The FORT Podcast: Stephen Bailey and Dustin Volz of JLL Industrial Capital Markets
Stephen is a Managing Director in the Dallas office of JLL Capital Markets, Americas. He joined JLL as part of the HFF acquisition and specializes in industrial investment advisory. In this capacity, he represents and advises clients in the sale and acquisition, or development of industrial assets, primarily in Dallas/Fort Worth and throughout the Southwestern United States.
Dustin is a Managing Director in the Dallas office of JLL Capital Markets, Americas. With more than ten years of real estate investment experience, he leads the South Central industrial investment advisory team. In three years at JLL, his team has closed over $2.1 billion in industrial transactions within Texas alone and over the course of his career, Dustin has closed over $3 billion in commercial transactions, working with a number of institutional, corporate and private-client owners.
On this episode, Stephen, Dustin & Chris discuss the Texas Industrial market. They dive into all the capital coming into the state, how JLL has helped them become so successful, increasing land prices, DFW vs. Houston, labor issues, and more. Enjoy!
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(01:53) – How did you each get into this business?
(04:27) – When did you two get partnered up?
(05:36) – How would you describe what you do and what markets you cover?
(07:36) – What does JLL bring to the table and what do they allow you to do?
(12:22) – What’s a job where you’ll work on the equity side?
(15:50) – How is Texas performing in your eyes compared to the rest of the country?
(19:49) – How much capital is trying to get into Texas Industrial?
(21:34) – Is there a percentage of new development that is spec vs. a tenant in tow?
(22:54) – The Forward Value Metric
(24:32) – Are TI Packages starting to go up?
(26:23) – What are the types of tenants leasing the industrial buildings?
(27:59) – What’s going on in the market as it relates to capital gains going up?
(29:13) – How have you been able to meet so many people & build client relationships?
(32:12) – Are the majority of people buying working for companies that pursue market-only deals?
(34:50) – What do a dream seller and dream buyer look like?
(35:47) – What’s the process of working with you from the decision to sell all the way to closing?
(39:33) – IRR’s
(40:47) – What’s the dispersion in underwriting vacancy in a market this crazy in Class B and Class A?
(43:14) – Why would Amazon ever leave a building?
(45:52) – Are smaller tenants much more location-dependent in Class B?
(47:10) – What does the market for land prices look like?
(48:54) – How do people with tons of money to spend get into the Texas Industrial Market?
(52:51) – On seller/buyer calls, are there any great questions for sellers to ask on vetting a buyer?
(54:07) – At what threshold are tenants not represented by brokers in the market?
(55:08) – What are you expecting to see in the next 12-18 months?
(55:57) – Are tenants struggling to find labor for warehouses?
(55:46) – Debt Pricing and Cost of Capital
(58:46) – DFW vs. Houston Market
(1:00:16) – What makes DFW such a big hub?
(1:01:37) – What happens if interest rates go up?
(1:02:42) – If you were getting in the industry today, what’s the playbook to be successful?
(1:05:19) – What’s most exciting to you in industrial over the next decade?
Episode Summary
Stephen Bailey, known for his strategic acumen, and Dustin Volz, with his profound knowledge of the real estate landscape, contribute to a dialogue replete with significant takeaways for individuals and businesses navigating the real estate sector.
Commencing the conversation, the emphasis is squarely placed on the essentiality of personal interactions in the business world. Bailey and Volz underscore the irreplaceable value of direct communication, advocating for in-person meetings or phone conversations over impersonal emails. This personal approach is pinpointed as a crucial catalyst for unearthing and seizing lucrative opportunities in the real estate arena, fostering robust relationships and collaborations that fuel sustained business growth and expansion.
Progressing further, the dialogue delves into the foundational elements vital for individuals embarking on their real estate journey. Bailey and Volz highlight the indispensable trio of knowledge, experience, and exposure as the cornerstones for enhancing competence and efficiency in the real estate industry. The conversation offers a roadmap for individuals, guiding them towards the acquisition and consolidation of these vital elements, ensuring they are adeptly equipped with the essential tools and insights for navigating the multifaceted real estate landscape with confidence and strategic finesse.
Navigating the intricate avenues of the real estate sector, the discussion explores the diverse challenges and hurdles that professionals may encounter. Bailey and Volz provide a beacon of guidance, offering pragmatic solutions and strategies for overcoming these obstacles. Their insights illuminate the path towards effective problem resolution, ensuring individuals are fortified with the resilience and strategic insights necessary to navigate the complexities and challenges of the real estate world, ensuring sustained success and progress.
In the realm of technology, the dialogue transitions to explore the transformative impact of technological advancements on the real estate sector. The conversation delves into the integration of cutting-edge technological solutions within the industry, highlighting their role in augmenting efficiency, productivity, and strategic decision-making processes. Bailey and Volz’s insights stand as a testament to the importance of embracing technological innovation, ensuring businesses and professionals are at the forefront of the technological revolution, enhancing their competitive edge in the dynamic real estate market.
Shifting the lens to the global perspective, the discussion broadens to encompass the international real estate landscape. Bailey and Volz offer a panoramic view of the diverse global real estate markets, providing invaluable insights into the multifaceted market dynamics, trends, and patterns shaping the international real estate sector. Their global perspective equips listeners with a comprehensive understanding of the worldwide real estate landscape, ensuring they are well-prepared to navigate the international markets with strategic acumen and global insights.
Diving into the investment dimension, the conversation explores the intricate facets of real estate investment. Bailey and Volz illuminate the path towards informed and strategic investment decision-making, offering guidance and advice on optimizing real estate investments. Their insights underscore the importance of comprehensive market analysis, risk assessment, and strategic planning in ensuring profitable and successful real estate investment ventures.
As the discussion unfurls, the conversation focuses on the emerging trends and predictions shaping the future of the real estate sector. The dialogue offers a meticulous exploration of the evolving real estate landscape, ensuring listeners are abreast of the latest market trends, shifts, and evolutions. This exploration fortifies individuals and businesses with the knowledge and insights necessary to stay ahead of the curve, ensuring they are well-positioned to capitalize on emerging opportunities in the real estate market.
The FORT is produced by Straight Up Podcasts