#82 Keith Breslauer - Managing Director & Senior Partner at Patron Capital
Jul 18, 2024
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In this engaging discussion, Keith Breslauer, Managing Director and Senior Partner at Patron Capital, dives into his illustrious journey from banking at Lehman Brothers to thriving in real estate investment. He shares insights on the importance of local partnerships and adapting to market challenges. Breslauer also explores his philanthropic efforts, focusing on veterans and domestic abuse initiatives. The conversation wraps up with his strategic vision for investing £500 million into Western European residential markets, highlighting a keen sense of opportunity in a demanding sector.
Keith Breslau's early entrepreneurial ventures in college highlighted the importance of financial independence and work ethic that shaped his career.
Transitioning from Lehman Brothers to founding Patron Capital, he emphasizes the need for local market understanding to drive successful investments.
Breslau's commitment to social responsibility is evident in his alignment of investment strategies with charitable initiatives that positively impact communities.
Deep dives
Keith Breslau's Early Influences and Entrepreneurial Journey
Keith Breslau shares that his upbringing in New Jersey, being exposed to his father's struggles as a real estate developer, instilled in him the importance of financial independence from a young age. Motivated by the need to support himself and wanting a better life than what his family had, he ventured into entrepreneurship during his college years. He tapped into the demand for customized software solutions for small businesses, leveraging his connections with graduate students to create a successful business that ultimately helped fund his education. This early experience not only cultivated his work ethic but also laid the groundwork for his future in both finance and real estate.
Transition from Investment Banking to Real Estate
Breslau explains his gradual transition from a secure job in investment banking to a focus on real estate investment. His tenure at Lehman Brothers afforded him the opportunity to deploy capital into distressed properties, giving him invaluable experience and insight into the real estate market. This led to an eventual decision to establish Patreon Capital, motivated by the desire to manage his own investment strategies rather than relying solely on a corporate structure. Breslau emphasized the importance of understanding local markets and managing investments based on insights gathered from personal experiences and the broader economic environment.
Fundraising Strategies and Early Successes
Breslau details the challenges and strategies involved in fundraising for the initial funds at Patreon. Early achievements, such as raising €110 million for Fund One, were bolstered by strong relationships with institutional investors, overcoming doubts about the viability of a new fund outside a large bank structure. Key transactions, including distressed asset purchases like Hotel Arts in Barcelona, showcased the fund's capability to identify and capitalize on undervalued assets. His clear strategy of aligning interests between local partners and investors played a significant role in achieving these early successes.
Navigating Market Downturns and Institutional Relationships
Breslau reflects on the pivotal learning experiences during financial crises, particularly during the global financial crisis and the challenges posed by COVID-19. The ability to maintain a conservative leverage approach and a focus on balance between risk and return allowed Patreon to weather the storm better than many competitors. Moreover, Breslau highlights the significance of fostering long-term relationships and open communication with limited partners, which has resulted in partners remaining loyal through different market cycles. This culture of transparency and mutual respect has been central to their business model and successes.
Commitment to Social Impact and Community Support
Breslau expresses his deep commitment to social responsibility, aligning his investment strategies with values that promote societal benefits. He actively participates in charitable initiatives that support veterans, educators, and domestic abuse survivors, emphasizing the profound impact these efforts have on communities. Through funds like the Women in Safe Homes Fund, he showcases how a business can maintain profitability while addressing critical social issues. Breslau's belief in the multiplier effect of positive contributions amplifies the influence that the real estate sector can have beyond financial returns.
Established in 1999, Patron Capital Partners has evolved into one of the leading opportunistic real estate managers in Europe.
To date, it has raised over €5.4bn Euros, and has undertaken more than 200 transactions across 106 investments in 17 countries. The Patron organisation includes a 64 person in-house team, with offices in the UK, Spain and Luxembourg.
Patron's strategy is to back local partners and management teams in growing their respective business, investing in property, corporate operating entities, credit related businesses and debt related instruments, whose value is primarily supported by property assets. Keith started his career at Lehman Brothers in New York, and is a graduate of NYU, and The University of Chicago Booth School of Business. I sat down with Keith to discuss a broad range of subjects which covered some of the following topics: * How he got into real estate
* Early career moves
* How & why he set up Patron
* Creating alignment between LP’s, Patron team & local operating partners
* Current market challenges & opportunities
* Raising €860m for Fund VII
* Impact of the election
* Has his definition of success changed
* Why he does so much charity work
Oh and one last question - who are the People, what Property, and in which Place Keith would invest should he have £500m of capital at his disposal. Catch the full episode, which is live on Spotify, Apple and Youtube NOW! The People Property Place Podcast 🎙️is powered by Rockbourne - the team recruit Leadership & Future Leadership hires for Real Estate Funds, Owners, Investors & Developers. #podcast #rockbourne #realestate #peoplepropertyplace
