Expert Interview: A View Into Investment Banking in Real Estate

Expert Interview: A View Into Investment Banking in Real Estate
john gilchrist, founder of atalyst
John Gilchrist, Founder of ATALYST

Many entities rely on investment banks to help them with their commercial real estate projects. Whether it’s about analyzing factors like risk, location and overall scope of projects—anything from new constructions to acquisitions, types of assets, and the potential for cash flow from real estate investments, institutions like these play a key role in the real estate industry.

We recently had the opportunity to chat with Mr. John S. Gilchrist, the Founder of ATALYST, a trusted real estate investment and mortgage banking firm. Mr. Gilchrist has more than 25 years of experience in banking, real estate and accounting, has worked for public and private multinational firms, and has also experienced success as an entrepreneur.

We had a chat about his insights into the industry from an investment point of view, covering the current situation, as well as future challenges in the business. Read on to find out more.

Q: Can you tell us about your background and what brought you to the Banking/Finance field?

I graduated with a degree in accounting and a master in taxation from USC. After graduating, I joined Arthur Anderson. I had some early exposure to real estate and technology public offerings and transaction activity. Spending time with the bankers on some of those early deals and seeing their influence and ability to help drive and shape those deals is what ultimately brought me to the banking/finance field.

Q: How would you describe the real estate market in the U.S. today from an investment point of view?

I have an overall positive view of the real estate market in the U.S. today. Real estate is a local business, so you have to understand the dynamics of each local market. Generally, I believe we are in a prolonged cycle driven by a strong economy. The expansion has created significant job growth that is driving real estate expansion.

In particular, I like housing. Markets like Austin, Houston, Reno and Las Vegas are seeing significant job creation plus migration from people leaving high cost states like California (with major cities such as: Los Angeles & San Francisco) and New York (with New York City). Single-family, for-rent housing is going to continue to grow as a category in all markets. Also, we are extremely bullish on senior housing, especially in the west and southwest, where penetration rates trail the east coast.

Q: What are some of the main challenges in this industry?

Many opportunities are expensive as a result of the low interest rate environment and competition, so finding the right deal with the right risk/return will continue to be a challenge. Development capital is getting harder to find. It actually works to our benefit because as capital gets harder to find, we see more opportunities from potential new clients.

Q: What approach do you have when working with clients?

Each scenario is very different, so there isn’t a single approach that works for all clients. We pride ourselves on understanding our client’s needs and the markets, giving thought to the best structure for the transaction, working with clients in a transparent way, and orchestrating a well-run process. We take an investment banking approach when executing real estate transactions and believe the devil is in the details.

Interested to participate in our Expert Interview series? Feel free to reach out to us at [email protected].

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