Talk with David Neithercut '82, retired CEO of Equity Residential

David Neithercut ‘82, retired equity residential ceo

David Neithercut ‘82, retired equity residential ceo

On Monday morning, retired Equity Residential CEO David Neithercut ‘82 spoke about his career and offered advice to current CBS students and recent alumni.  David began his career selling books for Prentice Hall after graduating from St. Lawrence University. While he quickly realized the job was not for the long term, David said that the sales experience paid dividend later. 

After graduating from Columbia, David joined the real estate department at Continental International Bank in Chicago.  At the time, Continental International was one of the largest real estate lenders in the country, and David was drawn to the wide range of experience that the position offered—he lent directly, worked on syndications and looked at all asset types—and it was in this role that he began working with Sam Zell and Equity Group.

As the real estate recession deepened in the early 1990s and traditional sources of financing dried up, David joined Equity Group to help refinance its portfolio.  This process culminated in a series of IPOs in 1993 and ultimately saw David transition to being Equity Residential’s CFO in February 1995.  David became EQR’s CEO in 2005, a position which he held until his retirement in September 2018.  During his time at EQR, the business grew from an $800MM enterprise owning 22,000 apartments to one that owned 230,000 and was worth $45B at its peak. 

Looking back on his experience, David highlighted Sam Zell’s foresight and focus on cultural as keys to EQR’s success.  He also credited EQR’s board with pushing him to grow as a leader so that he could ultimately become a successful CEO.  A weeklong session at the Center for Creative Leadership was particularly formative for emphasizing that strengths could become weaknesses as he rose in the organization and that a CEO has to make sure to keep his or her headlights up—if you have to dig too deep into a particular area of the business, you probably have the wrong person in the role.

Written By: John Millet ‘21

 

Virtual Coffee Chat with James Schmid 05’, Chief Investment Officer & Managing Partner of Anchor Health Properties

James Schmid 05’, chief investment officer & managing partner of anchor health properties

James Schmid 05’, chief investment officer & managing partner of anchor health properties

Virtual Coffee Chat Summary: James Schmid

On June 10, 2020, the Paul Milstein Center for Real Estate and the CBS Real Estate Association kicked off the first virtual alumni coffee chat of the summer. James Schmid ‘05, who is the Chief Investment Officer and Managing Partner of Anchor Health Properties, took some time in the morning to discuss Anchor Health Properties, talk about his career, and answer questions from current and recent CBS students.

Anchor Health Properties was founded in 1985 and has been focused exclusively on the acquisition, development, and management of medical facilities. The company has closed on $1.3B in acquisitions, developed over 3.0MSF, and managed 5.3MSF.

James is responsible for Anchor’s acquisition efforts, capital markets activities, investor relations, and sourcing of new development and property management opportunities. Prior to joining Anchor, James held significant roles at CNL Financial Group, HCP, and UBS.

Highlights:

James came to business school as a career switcher. He did his summer internship in commercial lending and realized he wanted to join the principal investing side. He started at UBS as a generalist in real estate.

On why he decided to focus on medical office buildings: James liked the demographics and where the growth appeared to be going – the need for healthcare services. Understanding the net operating businesses intrigued him as well.

Anchor had collections of 95% in the month of May and just under 90% in April.

Medical office buildings have high renewal rates (~85-90%).

The healthcare real estate industry is quite fragmented. It is a very relationship-driven sector. A lot of your competitors are your friends.

Culture is very important to James and Ben (Managing Partner). They have set up an employee ownership model within their business. The infrastructure of the company is very important.

James doesn’t see telehealth overtaking the physical interaction of healthcare; however, Anchor has been building telehealth systems within their properties as they believe it will play a role going forward.

Parking is an operational issue for all properties. Sometimes parking is the biggest issue with a potential investment. Anchor has been working on making their properties rideshare friendly.

Life science is a very tenant-centric sector. They require high TI costs.

Anchor raised its first fund ($50M) in 2016. Will probably do a second fund of $100M to $150M. In 5 years, would like to have a discretionary fund. James believes there is such a thing as over-raising funds.

Never thought of himself as an entrepreneur, but really enjoys it. Loves the creative license and being his own boss.

Work hard to make a name for yourself and get trained in an organization that trains a lot, and be creative. Don’t be afraid to take an entrepreneurship opportunity if it presents itself.
— James Schmid

Written By: Andrew Kim ‘21