Among the predictions – the Fed will raise rates; retailers need to have an omni-channel presence to survive; higher prices are changing how private equity firms do business and strategies for alternative investments, portfolio allocation and energy.
When faced with an unpredictable environment, it’s important to focus on the fundamentals for a successful investment strategy. That was the message investment managers and industry insiders shared with more than 250 attendees at the Commerce Street Investment Conference held on Oct. 19, 2017 at The George W. Bush Institute at Southern Methodist University in Dallas.
Dory Wiley, President and CEO at Commerce Street Holdings, welcomed a sold-out crowd to the Commerce Street Investment Conference, which has partnered with SMU for five years.
Reflecting on the state of the economy 30 years after Black Friday, Danielle DiMartino Booth, author of “Fed Up: An Insider’s Take on Why the Federal Reserve is Bad for America” said, “Thirty years later in the wake of one speculative boom and subsequent bust, I’m afraid to say that we have not learned nearly enough. It is not the creation of debt that makes a lasting impact on economic prosperity, rather its investment in the future that promises to retain its value for generations to come.”
A panel discussing real estate investment strategies offered positive retail predictions. Jeff Deweese, President of Lincoln Retail REIT Services at Lincoln Property Company, observed that investing in retail can be opportunistic as long as the fundamentals of the individual property are considered. Sam Gillespie, Senior Director of Invesco Real Estate, explained that successful retailers will have an omni-channel presence. Greg McGowan, Co-founder and Managing Principal of CoastOak Group, pointed to infill redevelopment in Dallas and other Texas markets as a niche play worth getting excited about in 2018.
A private equity panel, moderated by Bruce Ingram, Partner at Aon plc, included Adam Howarth, Managing Director, Co-Head of Private Equity at Partners Group, Suzanne Kriscunas, Managing Partner at the Riverside Company and W. Kelvin Walker, Managing Director at RLJ Equity Partners. All reported seeing valuations two or three multiple points higher than usual for small and mid-sized companies, a trend that it is pushing firms to sell sooner than expected.
Executive leaders from Commerce Street Holdings also shared their best investing ideas. Eugene Urcan, Managing Director at Commerce Street Capital, advised in investing in public funds that participate in the junior debt/high yield market; Carla Brooks, Managing Director at Commerce Street Investment Management, shared an opportunity to invest in nano and micro-cap financial institutions and George Kirchway, Managing Director at Commerce Street Investment Management, advised investing in industrial warehouses via a limited partnership or joint venture.
Giving the keynote address, John Phelan, Co-Managing Partner and Co-Founder of MSD Capital, L.P., provided insights into investing for family wealth offices.
Daniel Eagan, Director at Hirtle, Callaghan & Co., moderated a panel discussing asset allocation in today’s environment, which included Susan Baxter, Vice President of RBC Wealth Management, Cheryl Alston, Executive Director and CIO of Dallas Employees’ Retirement Fund and Scott Luttrell, Founder of the LCM Group. The panelists agreed that being clear on investment expectations and working with an engaged board are essential. Regarding hedge funds, Luttrell offered, “If we know when the market will stop going straight up and risk management is something that people will pay for, then you’ll see a reemergence of hedge funds.”
When asked if the Fed would raise interest rates, all of the panelists agreed that interest rates would rise. “From a banking view, the economy is strong enough,” Baxter noted.
Participants on a panel discussing energy, moderated by William Meyer, President of Midland-based Energy Related Properties, agreed that there has been a shift in energy companies to show more capital discipline. James Wicklund, Managing Director at Credit Suisse, explained that international and deep water drilling cannot come back to the U.S. until there are diminishing returns. David Miller, Managing Partner and Founder of EnCap Investments L.P., predicted the supply and demand for oil will start to rebalance over the course of the next few years. “The reason crude oil fell was because of too much supply,”Libby Toudouze, Portfolio Manager of Cushing Asset Management noted. “When we refocus on fundamentals, I think people will recognize that there is real value.”
Wrapping up the conference, John Sitilides, Principal at Trilogy Advisors, LLC, gave a discussion on global risk and geopolitical strategy.
About Commerce Street Holdings
Commerce Street Holdings, LLC, headquartered in Dallas, Texas, is a premier investment banking firm serving and investing in financial institutions across the United States since 2007. CSH is comprised of the following entities:
Commerce Street Capital, LLC, (Member FINRA/SIPC) is a broker-dealer whose services include: Mergers & Acquisitions, Recapitalizations, Private Placement of Debt & Equity, Regulatory Advisory, Valuations & Fairness Opinions, Community Bank Capital Markets Services, Small Business Investment Company Fund Raising, Corporate & Real Estate Finance, Due Diligence Services.
Commerce Street Investment Advisor, dba Commerce Street Investment Management, a wholly-owned subsidiary of Commerce Street Holdings LLC, a Texas limited liability company and is an SEC-registered Investment Adviser that provides asset management services for private equity and credit opportunity funds that invest in bank and financial institution related transactions.
This press release is for information purposes only and does not constitute a solicitation or offer by Commerce Street Investment Management to buy or sell any securities, futures, options, foreign exchange or other financial instrument or to provide any investment advice or service.