Peter Mork, founder of Capital Partners returns to the Industrial Insights Podcast. Justin and Peter discuss Capital Partners’ second fund and how they entered the Milwaukee market. Peter shares strategies for acquisitions, underwriting and how to scale.

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Highlights

• Recap of last podcast appearance – 0:30
• What’s new with Capital Partners – 1:16
• Milwaukee vs Minneapolis – 3:45
• Capital Partners second fund – 10:00
• Strategies for acquisitions – 13:00
• Underwriting – 16:00
• Collaborating with other firms – 21:00
• How Capital Partners operate – 23:20
• Off market deals – 27:00
• How to scale – 30:00

Episode Resources

Connect with Peter Mork

• https://www.capitalpartnersmn.com/
• peter@capitalpartnersmn.com

Connect with Justin Smith

• https://smithcre.com/
• https://www.lee-associates.com/
• jbsmith@leeirvine.com
• https://www.linkedin.com/in/justinbsmith

Justin Smith: I’d like to welcome Peter Mork of Capital Partners to the Industrial Insights Podcast. For those who don’t know Peter, you were a guest last year and it was great to get to know you a little bit and understand where your focus has been. And so we talked about you getting started buying multi-tenant industrial and some of your brokerage roots and beginnings and how you took your brokerage expertise to launch into the investment side of the business. And so if you fast forward now you’re 8, 9, and 10 million square feet of industrial into the twin cities in Minnesota. And then you’re maybe a year into launching into Milwaukee with the new fund in another focus. So I was hoping you could give me some background of where we’re at and what you’re interested in in this next new fund. A little bit more about.

Peter Mork: Great Justin, once again, thanks for having me on the show. Glad to be a part of it and love to talk about Capital Partners. Capital Partners currently owns and manages 10.2 million square feet in the twin cities; it’s made up of about a hundred buildings. We’ve got about 450 tenants and we’re 98% occupied. With all that good news, Capital Partners decided last year to start up Capital Partners Development. Capital Partners Development since then has acquired four land sites and we’re going through the entitlement process right now. We hope to start going vertical this year and we have the ability to build about two and a half million square feet if everything comes together. So we’re hoping the wonderful market of industrial real estate stays strong so we can get these buildings built and leased

Justin Smith:  I’m sure it’s interesting going from buying existing to build new product. But there’s not a single industrial broker you’ll find that feels like we have too many buildings or like it’s too easy to be built. Supply has been such a tough problem. How do we get municipalities to value industrial as big as the economy does and to welcome it or to reduce maybe some of the red tape. We all applaud you for helping bring more supply into the market.

Peter Mork: Yes. Then the third thing Capital Partners is doing is we launched a joint venture into Milwaukee. Just recently, we seeded it with $50 million of equity, which gives us the capacity to grow to $150-$200 million in properties. So we’re very excited about that. We have been doing it about six months now and we’ve already purchased three off-market properties and have a fourth under contract. So that’s really exciting and it’s exciting to see the process is kicking off. We’re excited about Milwaukee and excited to get to know the brokerage community there to find more opportunity.

Justin Smith: Yeah, it ‘s great to have two prong approach, right. Then once you’re in the market, everybody knows you and likes you and trusts you. So often buildings can be covered land plays. Where is it an investor play or is it a developer play? And you kind of got to think which one is it? So for you, you can look at all of those deals and then you can decide what’s the best play here. Maybe have some flexibilities there. I do some national tenant rep work. I do some national investment sales work. So every area has its own dynamic and it has its own written and unwritten rules and accustomed. So I’m curious as you go into Milwaukee, what have you noticed to be different or what’s the same, or kind of what’s the dynamic there and how does it compare?

Peter Mork: Certainly, on the similarities with Milwaukee versus Minneapolis. Milwaukee, we consider a lookalike market, it’s close by. It looks a lot like the twin cities industrial market. It’s a little smaller, but it has the same sort of labor force, same work ethic, it’s got low vacancy and historically they haven’t done a lot of spec construction that has gone rampant. So they’ve been conservative on their construction, conservative on vacancy. They haven’t in Milwaukee. Milwaukee is like Minneapolis five years ago. Milwaukee today is still made up of an ownership structure, that’s a number of disjointed local owners and developers that control the market. They’re focused more on occupancy and they’re not really pushing rents which we find in Minneapolis. And that’s quite frankly, the difference. Minneapolis has been institutionalized where we’ve got the whereabouts of Link and Blackstone in our market that three and a half years ago, Capital Partners was the largest industrial holder of commercial real estate. Blackstone came in and now there are 20 million square feet in Minneapolis. Blackstone isn’t worried about a vacancy. They’re focused on NOI growth. So they’ve done a tremendous job in pushing NOI growth and pushing annual rent escalations of five to 8%. You’re not seeing that in Milwaukee. It’s certainly a dynamic there that we, hopefully we can bring to Milwaukee when we acquire massive real estate, we hope we can push rents and somewhat institutionalize it with the Midwest touch.

Justin Smith: Yeah, you can bring the practices, but still be more local on your approach. It’s so wild to see some of the big institutions pushing rents and the. Like we are already all stretching our imagination as we are in uncharted waters of, how much demand is there. And it seems like there’s just an overwhelming demand. And so trying to figure out what’s the appropriate response to that. It’s sure having all of these institutions in the market, they sure have been very bullish about that. And seeing now that’s just the way that it is. .It sure is wild. We don’t think of rents and annual escalations as purely in the inflation department. Inflation, we think of like the money supply and you see how that’s flowing through businesses. You are on the equity side, raising money, you’re on the debt side because you’re financing your deals. One would think higher interest rates would pump the brakes and one would think that there’s still so much demand that cap rates can still go down. So are they going up? Are they going down? What do we foresee? And so what are you seeing in the debt and equity markets and kind of, how are you dealing with that?

Peter Mork: Yeah. Thanks Justin. The debt market concerns me, certainly short-term interest rates. They’re talking about them increasing, three to four times yet this year, which certainly, will have an effect on potentially long-term interest rates and raising the cost to acquire real estate. What concerns me more, this is kind of a thesis I have on the synthetic cap rate reduction is not really driven by peer cap rate. It’s driven by two abnormalities in the market. One being the ultra low debt we can get to buy a building. Now, when you can go get 2% money, that’s pretty attractive and you can pay up when you can get that type of money. And second of all, there’s so much equity chasing industrial today. Pre-pandemic, institutional equity looked at all the asset classes, they looked at apartments, they looked at hotels, they looked at retail, they looked at offices and they looked at land. Post pandemic, no one’s buying offices, if any great magnitude or retail or hotels. So you have all this money funneling in to buy industrial or multifamily. That’s the only two places that really institutional money is looking today. So you have that coupled with low interest rates is driving down cap rates artificially, I would argue. And so the real true cap rate, once that opens up for the equity markets, they can go do risk adjusted returns and other asset classes. And the interest rates increase to a level that’s more normalized. You’re going to see cap rates for industrial real estate go up and that is going to be regardless of a change in NOI. The building is just going to be worthless because there’s not as much pressure to buy industrial and cap rates and interest rates have moderated up. So I worry about that happening. I worry about equity finding other opportunities and then short term debt going up if it’s going to affect us.

Justin Smith: You’re not trying to get us all out of industrial, are you Peter?

Peter Mork: I would like that. I’d just like to take it all.

Justin Smith: No doubt. It is interesting. You had brought it up last time and it was a point I hadn’t weighed too much cause I’m so focused on industrial. The risk adjusted returns and other asset classes. And just thinking through, at some point in time office would be more and not just per a demand standpoint, but just what it returns. And when you think of it like the return back to the office and people starting to travel again. You got to imagine that the spicket goes into the other asset classes more so but if you’ve enjoyed your run industrial, do you stay in there? And that’s maybe the big question we don’t know the answer to.

Peter Mork: Right, exactly.

Justin Smith: What was your experience in raising the new fund? How did that all go down?

Peter Mork: It was great for Milwaukee. We started out by putting a book together and we’re going to go out and tap our high net worth investors that follow us. We have a couple of family offices that follow us. And we did that to an extent, we met with a couple family offices. We met some investors. We told them the story, everyone seem interested. And then we have one of our joint venture partners in town that we do work with and we told them about Milwaukee and they were intrigued about Milwaukee. One day, one of the senior partners flew into Minneapolis and we had breakfast and we talked about a lot of things and we talked about Milwaukee. They were intrigued about our thoughts on the market and how we can go try to acquire one-off industrial buildings. I acquire a portfolio, manage it, hold it for a period of time, push rents, and then exit on a portfolio sale to another institutional owner. So thankfully we had a joint venture partner that just stepped up. They threw in a majority of the money. Capital Partners through in certainly equity but on a minority amount. And we took the hundreds of books for the Milwaukee fund and threw them in the garbage.

Justin Smith: You said, now we’re fueled up and ready to go. Let’s get to work.

Peter Mork: We’re fueled up, ready to go. The good and the bad is, the clock is ticking. So we’ve got 24 months, maybe 30 months to deploy the capital. So we are active in Milwaukee. We’re flying there every other week, looking at opportunities, working with the brokers, telling them who Capital Partners is, what our reputation is. We’re brokers, we know the market, we know how brokers want to get a deal done. We know they want to get paid, they don’t want to get a commission ectomy, if you will. The ninth hour, it’s not something we’re about. So it’s working, people are listening to us and we’re finding opportunities which are fantastic.

Justin Smith: How many origins are there? That’s huge. I have to imagine that gets everybody to understand we you get it. You understand some of the struggles that it takes to bring everybody to the table and make a deal happen. Like I said, when I kind of started Capital Partners, it was interesting because I was a broker at CB Richard Ellis. I’m not sure if I mentioned this in your last show or not, but as a broker CB Richard Ellis we’re putting the deals together. We’re bringing the opportunities to the landlord or the developer filling their buildings and then bringing them a buyer and telling them how this all works and showing them the metrics of it all. And we’ve got the knowledge and the landowners making all the money or the developers making all the money and we’re the first to get our commissions cut. So that was why said one day, I want to be that guy. I want to be that guy, the building owner and so that’s why we started buying commercial real estate almost 20 years ago.

I had written a book on the tenant rep side of the business and it was so fun to connect with a bunch of the big users and then add my experience to it, to give the other users like a manual. Here’s how you go out and these buildings. This is how you deal with landlords. I started the second one all about investing. So for anyone doing investment sales acquisitions, you got the leasing, you got the disposition at least from a brokerage perspective. Maybe you could touch on a couple of strategies or tactics in the acquisitions game, because I know it’s tough to get out there and find deals and then if you have to compete or if you don’t, or if you really rely on unsolicited offers, or if you’re in like the managed bids and bidding in the first round and the second round and trying to figure out your approaches. What are a couple of strategies that you’ve found are helpful.

Peter Mork: For sure. First and foremost, it’s a people business. Commercial real estate is a people business and you want to get to know the other side, whether that’s the broker or the landowner selling the building or whoever. That’s important to understand really what their hot buttons are. Do they want a lot of earnest money? Do they want to close next year or this year? Do they got 1031 money? A couple of things we do is we do a lot of due diligence upfront. We have a great relationship with our roofing company, a great relationship with our asphalt company and our landscaping company. Usually we’re buying one to two to sometimes a portfolio building. We’ll send those guys out as soon as the OM comes out. So we have all of our due diligence done upfront, and that gives us the ability to put an offer in with some assurances to the seller that we’ve done our due diligence. We’re not going to back trade you after we’ve been awarded the contract. And then again, it’s also important to have a reputation that doesn’t proceed you with of doing those such a things, because once that happens especially in the Minneapolis market or I’m sure the Milwaukee market you’re dead in the water. So you need a stellar reputation. You gotta have all your equity lined up. You can’t tie a building up and then can’t close because you don’t have your equity.

Peter Mork: I always say that if you have a good real estate opportunity, it’s got good fundamentals. It has a good cash flow, you’re going to find the equity. You’re going to find the investors that want to invest in it. You’re going to find the debt. These banks are dying to lend money, especially the good, what I say down the fairway real estate and that’s what we look to purchase.

Justin Smith: It’s so interesting trying to get to the front of the line or to try and find an opportunity where there is no line. Right. That’s what we all hope for. So it is sure interesting trying to figure out how to make an angle of that. We won’t ask for all of your secrets.

Peter Mork: Okay, good.

Justin Smith: But underwriting is an interesting one. You gotta be aggressive, right. You’ve got to think of how can we push rents and how can we add value to the building and then dealing with the value add, oftentimes come sort of some form of construction or capex project. We’re long lead times on air conditioning units, on docks and we’re short on labor. How are you dealing with underwriting and construction and dealing with that and trying to come up with realistic and winnable assumptions?

Peter Mork: Yeah, that’s a good point and a lot of times when these investment opportunities are fully marketed, you’ve got these OMs put together, offering memorandums and then they’ll have what they have in their Argus runs for renewal rates, commissions, bumps, et cetera. And the nice thing is we’re so close to the market and we have so much real estate in the market. We really know real time data. We know really what the rates are, we have the comps. We are the comps and we have a relationship construction guy. So we can have a fair conversation with the other side and say “listen you know what, it’s really not 12 in six building 12 for office six for warehouse, it’s really a tenant and five.” And here’s why, here are the comps and here are these buildings that demonstrate. So again, knowledge is power. Whenever we get a vacancy, I’ve seen this throughout the history of my 33 years in commercial real estate. There are a lot of these landlords, well, not white box or clean up the vacancy. They’ll take the risk, they don’t want to put the money in and it’s certainly a risk putting the money in because you don’t know how the space is going to be repurposed. We’ve found time and time again, it’s worth it. It’s worth it to go rip off the ceiling, spray the deck, polish the floors, rip out the offices, even maybe get rid of the restrooms if they’re in the wrong location of the building. Because a lot of these tenants’ prospects just don’t maybe have the foresight to understand, to look around the walls and say how this really could look. But when they come into a nice clean box, they can envision it. It’s like selling your home vacant or full of all your stuff. So that’s super important to us. We do that in most, every vacancy. And then another thing we do, and I’ve always thought they’re worthwhile is having these broker parties, pay them a hundred dollars that come to the warehouse. We have lunch catered in, lunches only cost $12 to $14 a guy. We get 30 to 50 brokers. They come in, we do a walkthrough of the space, we tour them around the space, sit down and have lunch. Everyone gets a chance to catch up with each other. We give a little speech about the vacancy, talk about the rates and talk about any incentives we have. The broker leaves and goes yeah, I remember that space. A month later when they’re touring around, they go, I remember that space over the midway that we’re at a broker open and let’s pop in there. So it goes a long way. I think the brokers appreciate it too, they get out of the office, get out of their house now. They get a hundred dollars in their pocket and a free lunch and they collaborate with other brokers. Another thing I’ve found with Milwaukee versus the twin cities, is the collaboration aspect of it. Milwaukee, these brokers don’t collaborate like we do in Minneapolis. And that’s kind of sad to see at the end of the day, because I remember this mindset when I went out years ago to brokers, people have the, in the latest comps, they want to kind of control them so they can use that knowledge and not everyone else has that knowledge.

Peter Mork: But at the end of the day, if you share that information, if you collaborate and everyone participates everyone benefits. I’ve been having some conversations with some brokers in Milwaukee about that and we started a thing in the twin cities called an active user list. So the active user list is a great tool. 15 years ago, we got kind of the 20 most active brokers in the market, all different shops. We invited them to our office, CB Richard Ellis office, and we always switch offices and we sit down over lunch. Everyone has to bring at least three prospects to the meeting and a prospect is someone looking for space in the market. And we limited it to 20,000 square feet and above. So you bring a prospect, everyone shares the prospect. We put this spreadsheet together that lists the prospect’s name or it can be anonymous, the square footage they’re looking for, what market they’re looking for Northwest, Southwest, Southeast, clear height, docks drive-ins whatever, and then a miscellaneous column. And then also list the broker representing them so it’s not just, I’m not giving you this stuff I’m representing. Justin is representing this group here you go. So you put the spreadsheet together and then you would do that once a month for nine months. You know what’s out in the market. Capital Partners decided to go into development just based on this spreadsheet, because we knew in Minneapolis last year, there were 13 million square feet of active prospects in the market and we were only built in 4.5 million square feet of new construction of which 50% was already pre-leased. We got a frequency rate of 3% of which that product that’s vacant is half of it’s obsolete. So why not build? It’s a race to go vertical, but why not build? That collaboration is beneficial to guys like us, the landlords, the brokers, et cetera. I’m going to push that agenda in Milwaukee. We’ll see how far I get.

Justin Smith: Yeah, I love it. It’s so funny where a lot of the people you collaborate with are not in your firm. Not that they cannot also be there but like you just find all the players in your space. And a great example of something that was very similar, I was representing an e-commerce company that was looking to service the west. West coast is 2, 3, 4x, a lot of the next markets. And so we ended up in Arizona and Phoenix and there was a 3 million square feet of requirements chasing one and a half million of vertical projects. And what it caused us to do is to recognize that and take the Christmas holiday when everyone goes home and we had an incredibly motivated client that said, let’s do everything we can to pick our building and tours before the Christmas break and let’s hustle through the Christmas break because we recognize. There’s so many more requirements that are out there in the pipeline, because we’ve been able to quantify what the pipeline is. It caused us to make it just after new years with an agreed to deal where everyone else was just getting back and was just starting to hit the market. It’s not like we were looking to double time during Christmas, but we need to do whatever we can to land the plane. And this is a strategy where knowing the pipeline can cause us to know how urgent we need to be going after the market and product and because of it we won. We got what we wanted, the ideal outcome, and then all those buildings are now leased and there’s a dry spell of what’s being delivered. And so it was interesting that yeah, your strategy I think is spot on and they were from different firms. Yeah. So it was totally possible, it transcends the boundaries of just having people that are in the know, in that part of the market to just be aware of what’s going on. For sure, I think it only helps all parties and there’s no one that gets hurt by that sharing of information.

Peter Mork: No, exactly and you know one could argue life’s too short. I mean, everyone chases hard for a deal and if you don’t get awarded it, that’s okay. You’re still buddies. You lose out. You still go out and have breakfast or a beer after work and get over it, move on to the next deal.

Justin Smith: Tell me about operations, we third-party everything, we have some resources in house or how do you deal with the pros and cons of doing that? How do you want to operate?

Peter Mork: Great question, we’ve got nine people total at Capital Partners. Two of us are managing partners, myself and my partner, Jason Simic. We’ve got three property managers, three full-time property managers and a CFO and an office manager and another assistant, a financial lady. So we run pretty lean and we still handle our renewals in house because we believe no one is closer to our tenants than us. So we still do that and we still see value in that and not third-party that out. But we do, third-party out vacancies and I’m a big believer in that you third-party out to the best in class of brokers, the vacancies in that sub-market and that’s worked well because that also keeps us in the pipeline of deals. Other than that we’re full scale management. We handle in-house accounting. We obviously outsource all the property maintenance and we don’t just use one group, we use CBRE and Colliers and a couple others. So we do that as well. And then landscaping, we outsource. And other than that, it’s pretty streamlined. Industrial real estate isn’t that difficult to manage. Keep doing the simple things right, making sure it looks good. We focus on making sure our properties look fantastic. Taking care of our tenants needs so our tenants can focus on what they’re doing is running their business and that’s the whole goal. It’s worked well.

Justin Smith: You eventually become a seller, right? You got to sell assets on occasion and Minnesota and with every bite, you at some point in time or a seller. So, how do you figure out when and how and what that looks like for you?

Peter Mork: Well, I don’t like selling.

Peter Mork: I remember us talking about this for a little bit.

Peter Mork: It’s inevitable and we are in the process and have last year sold sub one off properties we own. And first what we do, if it’s possible we form a tick. We put them into a tick type structure. So when we do sell, we can exchange them and not pay the capital gains tax. And we’ve been fortunate to do that. First of all, we’ll tick a property if we can, and then wait a calendar year before we sell it. So when we do sell it, we usually get a broker opinion of value from the investment sales guys. We’ve got great investment sales brokers in the twin cities. What we found quite frankly, is that before we put it on the market, we found someone that came to us with 1031 money, usually 1031 money, or someone found out that we’re selling a building. They say “hey, I really want to own that.” Sometimes we’ll recap it and stay in it and manage it other times we won’t. But if that does occur and we get a broker opinion of value, we still pay the broker a fair amount, make sure they’re happy with the compensation for doing that work because I hate to put people through that and then not use their services.

Justin Smith: Totally, it’s so tough to know when you can respond to an unsolicited offer or when you’ve decided you want to sell. And everyone says, what can I do to preempt the dog and pony show and the bidding process. You may end up with an exchange buyer anyways so can you start with one or you know how much can you expect to yield in this bidding process? I have now been in it long enough to know, we’re lucky if there even is a bidding process, right. Where that’s not all markets you have that. I’ll cite points in time in the cycle. So we’re at that point in the cycle where you can have a big spread by having like 10 bidders and two rounds or three rounds, or I’ve even heard of some institutional capital markets teams that had like seven rounds and two sets of interviews. You don’t want it to be so tough for the buyers that they just are apathetic. So I feel like that’s a challenge to figure out how much to exercise the buyer pool to make sure you’ve done a good job being a seller.

Peter Mork: I think a lot of markets are experiencing this. It’s the Blackstone, the Link effect in these markets where they’re usually the best buyer. They are usually willing to pay the most and it doesn’t even hit the market. If it’s a good portfolio of properties, call up the link first and talk to them about it. And we’ve seen it in this market and I’m sure the investment sales brokers aren’t excited to have that be known, but it’s a fact. I’ll read about some portfolio sales that didn’t hit the market and I’m like, what’s going on here guys and they called Blackstone direct. So hopefully that will temper because that just loses the appetite for all of us to dig our heels in and chase a deal when we know that could be the eventual outcome. But I’ve seen recently a number of 1031 buyers come in and pay ridiculous pricing for real estate that I know isn’t worth that. And they just focused on blinders on not wanting to pay the capital gains tax. They want to buy the real estate to offset that. Whatever their performa is, they’re not going to meet it based on the price they’re willing to pay in this market. So I’m a little worried about that. I see that. It’s good if you’re a seller but there’s no logic behind some of these sales

Justin Smith: Maybe some California money. I liken it sometimes to they go from playing offense to defense and if they can just park it there that all means lower expectations for return. But you’re right. When you do that, then you close the other side of the yield potential. That means you wouldn’t pay that, but for them they feel like, Hey, maybe that was an educated decision or maybe they don’t know as much as they could know, or as much as you might know about it.

Peter Mork: I see a lot of asset preservation especially from joint venture partners that have come to this market that have got equity from out of the country. We had a group come and tour a portfolio that they ended up recapping. They didn’t speak English. I don’t know if they really know exactly what they’re staring at, but they bought it. And I think it was just part money. They just didn’t want to lose money. They wanted to get the sovereign wealth capital out of wherever they live and put it in a, in a more stable first world country. So we’re seeing that and that’s crazy. What’s that going to do to cap rates?

Justin Smith: I was going to ask you a little bit about, how do you scale what you already have but I think you hit the nail on the head one where you make the comps sometimes, or you have your own data set from your own internal buildings. And that’s one way that you can scale better because you already have access to that information. And with some of our institutional clients we’re using technology like VTS, for all of our prospect reports and all of our tenant reports and tenants in the market. It’s been super helpful. I don’t mind it as a broker, if anything, it’s easier than what we were doing before and it gives real time reporting and I feel like that’s a win-win for everybody. So I’m not sure if there’s any other things that you have in mind as you scale. How do you scale more? But I feel like leveraging what you have, being able to go into ground up, going into new cities, those all seem like you got a handle on that. Those are some ideas that you had already touched on.

Peter Mork: You gotta be careful, right. You know, everyone talks about let’s go to Florida, let’s go to Phoenix, there’s a lot of competition in those markets and I don’t know those markets. I know industrial real estate, but I don’t know industrial real estate in those other markets. I feel comfortable going in Milwaukee, going to Omaha, going to Madison, Wisconsin markets that are close to home and are similar and the people are similar and what we deal with is similar, I think, going in those other markets you can get hurt.

Justin Smith: Yeah, we have a new Omaha office as of last week. So happy to introduce you to some people.

Peter Mork: Yeah, we love Omaha.

Justin Smith: We’ll wrap up with the toughest question of all and that’s, you’re a family man, you’re busy, you’re successful. How do you manage your day and your time to be successful? You’ve got a million priorities and projects. How do you manage it? I struggle with it. I’m always trying to do better and it’s always tough when you’ve got so much on your plate. Some are curious how you do it.

Peter Mork: Well, first I’m fortunate that I’ve got a wonderful wife that helps out and I’ve got wonderful children, one in college and one in high school and they’re both very self-sufficient so that makes it easy. I got too focused on the dog when I got home at night to take him for a walk. It’s important to prioritize your day. You don’t try to get up early. I have a simple binder that I write down all my calls that I have to make it after I make the call I highlight them. So I know it made that call, but I use a highlighter not scratch it out. If I have to go back and use that number again. I think emails can be a curse at times because you get so many emails that are not worth looking at. Not worth taking the time to delete or relocate or what have you. So a lot of times I’ll just turn off my computer, make the calls, try to get the calls in early in the morning, get that out of the way, because those calls will certainly turn into more calls, more emails. And then just being efficient throughout the day I don’t really do a lot of lunches. We kind of have an understanding in the office when people come to meet in my office or my partner’s office, we don’t sit down, we have a table here that lifts up. We just kind of put our arms around it, talk about the issues and move on. You know we’re all here to enjoy each other’s company to work hard, but at the end of the day, to get out of here, to go home to our loved ones and do our hobbies or what may it be. And lastly, real estate isn’t an eight to five job, just five days a week. I work Saturdays usually, four hours and if I can put a couple of hours in on Sunday and of course everyone can bring their laptop home now and work from home. Not that you have to be working all the time, but you can be pretty efficient now with the cell phone and the laptop to get things done. So you don’t want it to run your life, you just have to make smart decisions and it’s worked out so far.

Justin Smith: I love it. It’s the internal challenge, but it comes back to a lot of the simple things and just prioritizing is so huge. It’s such a big one so that you get the things that move the needle done. Peter Mork, Capital Partners, thank you for joining me. I appreciate it. I appreciate you making your time available.

Peter Mork: Always good talking with you. Thank you.