As the real estate market continues to grow, financial analysts are beginning to worry about the state of the economy. Some are beginning to murmur about 2008, the last great recession, when the real estate market crashed and took four years to recover. Investors and property owners are wondering how to prepare. Christian Gore makes an encouraging prediction based on data he analyzed with the help of an innovative artificial intelligence partner.
“We're going through a new cycle now, but we're prepared and we think we'll get through it,” Christian Gore said. “We're on the offensive and hopefully we can continue to scale and get through this.”
Gore's in-depth knowledge of the U.S. real estate market comes from 10 years working in private equity real estate at several firms before founding his own firm focused on a data-driven, research-focused approach to real estate investing.
“Our industry is at a crossroads where data is moving faster than ever before,” Christian explains. “It's a tipping point where everything is being disrupted. We're extremely technology-driven in everything we do.”
Gore advises real estate investment firms to do the same thing he did at G1 Capital Partners: replace outdated systems with new technology. Innovation leads to streamlined data. Gore's focus on finding new ways to collect and analyze financial data is part of a new era in the real estate industry.
“We're very technology-driven from the ground up in all of our internal processes and all of our external processes with our partners. We use data companies that are relatively new start-ups, and that's where our strength lies. Some of the data providers that we use are using machine learning and AI technologies that allow us in our world to look at a ton of investments and really identify where we want to spend our time.”
Gore suggests that access to such timely data will help the U.S. economy weather this slowdown much more quickly than it would have in the past: “I think the process is going to be much quicker because of the technology, the data flows, the information that's improved so much over the last 10 to 15 years.”
Gore believes that AI-powered analysis suggests that data will move much faster in 2024 than it did in 2008, so a recovery will only take 12 to 18 months, versus the four years it took then. Gore said his analysis of bank loans for real estate projects puts this forecast timeline also starting in November 2023.
“Distress is widespread. Banks are putting the issues off depending on their quotas and exposures. Many loans have been extended for another year so it will be interesting to see how the situation evolves by 2025.”
Christian Gore
G1 Capital Partners is currently focused primarily on the residential sector and industrial real estate, which Christian Gore calls the most solid products for the time being, but there are a number of weaknesses in real estate as a whole.
“Real estate is bifurcated by different products, with office real estate being the most challenged,” Gore explains, “next would probably be hospitality, and then as you go down the food chain you have the more niche real estate products.”
Gore initially founded G-1 Capital Partners to provide a channel for private capital to access institutional-grade real estate investments. Christian believes the company's people and culture are key factors in his and his partners' investment success. Gore seeks proprietary data and tools that enable his team and partners to make objective and rational investment decisions in complex environments.
“We strongly believe we can execute on behalf of our clients and deliver strong risk-adjusted returns,” Christian said. “We are fully aligned and invest in every opportunity with our investors.”
Gore has taken his prediction to its logical conclusion and is confident that the U.S. economy will begin to improve between this year and early 2025. “It's funny how the timing works out,” he says with a laugh.
He continued, again in serious terms: “We assume that nothing will happen on interest rates until after the election, and we don't see any significant changes until early 2025. That's our internal view. But given the complexity of global financial markets, nobody has a crystal ball.”
Confidence and authenticity are paramount in real estate investing, Gore noted, and the success of G1 Capital Partners and its investment partners is a testament to how well he is achieving this goal.
“At the end of the day, our world is about trust. Many people say, and I believe, that you invest in people, not products,” Gore said.
Christian Gore has found success with a data-driven investment approach that leverages AI and machine learning for data aggregation. The strategic use of this technology allows his firm to make informed decisions about where and why to invest.