Arie van Gemeren, CFA | The Timeless Investor

Ex-Goldman | $150M+ multifamily | Building the next empire through cycles, history & contrarian real estate

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Everybody out here is saying Portland is dead.

And we just acquired a 109-year-old apartment building in the core.

Here's why.

The Imperial Arms. Built 1917. 54 units. Cell tower on the roof.

Classic brick building from the era when they built things to last — and it shows. Plus, prior ownership took great care of the property.

New boiler. New roof. New windows. Upgraded electrical panels. The heavy CapEx is done. Our thesis right now is buy right and cash flow. And take advantage of a significant pricing dislocation in this property type.

1️⃣ We're going in at north of a 7% capitalization rate on the 'actual' T-12.

2️⃣ Purchase price per square foot is less than half of the replacement value.

3️⃣ 98% occupancy upon purchase. Cash flow day 1.

Now — why Portland? Isn't everyone fleeing?

That's exactly the narrative. And narratives like that are often where opportunity hides.

Here's some data:

Portland's new construction pipeline has collapsed. Permits are at multi-decade lows. The supply that crushed rents in 2022 and 2023 is not being replaced.

Meanwhile, the city is 90,000 housing units short of meeting projected demand.
We don't really buy narratives that you hear on X - we prefer math.

This is a principle I keep coming back to: the best time to acquire real assets is when the headlines are the ugliest, and the competition has gone home.

Every era of history repeats this lesson. Over and over.

Washington bought land during the Revolutionary War. Smart operators bought San Francisco in the 1990s. Distressed assets in Detroit got picked up for pennies before the city came back.

Fear clears the field. We like a clear field.

Imperial Arms is vintage, supply-constrained, fully renovated, and cash flowing in a market that institutional capital has abandoned. That's the setup we look for.

Patient capital. Operations first.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

@realEstateTrent Congratulations!! 🙏🙏

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Those who do not learn from history are doomed to repeat its mistakes.

We have ample evidence at this point (across 1000+ years of recorded history) to say this is definitely true.

And what applies to generals and politicians applies equally to investors.

Learn from the mistakes and successes of those who came before.

Human nature hasn't changed in 10,000 years.

Neither have our mistakes.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Every bad deal is still paying you something, if you do the work to collect it.

The loss itself is tuition. What you paid for is the specific assumption that didn't hold: the rent growth you underwrote without stress-testing, the exit cap you accepted because the broker's model said so, the occupancy floor that looked conservative until it wasn't. That's the lesson. It's sitting right there in the deal file.

Investors who walk away from a loss without filing that lesson into their underwriting have paid full price for a course they never finished. The deal cost them capital and returned nothing, not even knowledge. That's the only outcome in this business that's genuinely unrecoverable.

Survival is an act of construction. You build it in before you own anything, by embedding what previous deals, yours and other people's, actually taught you about which assumptions fail and how. Conrad Hilton's best deals weren't won by resilience or by bouncing back. They were won because he understood, from hard experience, exactly which line items on a distressed hotel balance sheet were understated and by how much.

The loss doesn't disqualify you. Refusing to learn from it does.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Real estate investors - what do you fear more, rising inflation or a worsening economy?

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Did a real estate fundraising call on Friday. Investor was excited, wanted to put capital into our new deal.

I spent the entire call discussing all the myriad ways they could lose all of their money.

They still chose to invest.

But they might not have. And you know what? That is A-OK by me.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

The German hyperinflation wiped out savers and bondholders. But the industrialists who borrowed in marks to buy real assets — factories, land, equipment — repaid their debts in worthless paper and kept the assets free and clear. Hugo Stinnes built an empire this way. In every monetary catastrophe, the debtor who owns hard assets doesn't just survive. He inherits.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

The oldest cliché in real estate is "location, location, location." But you can lose money on the best corner in town if you overpay, and make a fortune on a B-location bought at the right basis. Price is what protects you. A great location at a terrible basis is just a beautiful way to go broke.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Every financial blowup — 2008, the S&Ls, Silicon Valley Bank — has the same skeleton: borrowing short to own long. The asset was usually fine. The funding killed it. Leverage doesn't blow you up. Leverage that has to be refinanced at the worst possible moment does. Match your duration and you survive almost anything.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

History remembers the Medici as lenders. The real edge, though, was the bill of exchange — a way to move money across borders without physically shipping gold, dodging the Church's usury ban in the process. The fortune wasn't in the interest. It was in owning the rails. Same as today: the toll-takers beat the risk-takers.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

No one writes legends about a well-run 1980s garden apartment complex bought at a fair price and held for 20 years. But that boring asset, with patient leverage and steady rent growth, quietly outperforms most of the "brilliant" deals that blew up chasing yield. In real assets, durability beats genius. Time is the edge.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Gold has overtaken US Treasuries as the preferred reserve holding of central banks worldwide.

Big news, right?

But there's a nuance that's completely lost in the coverage: central banks actually bought less gold last year, not more.

It's the value of gold that's risen — not the appetite for it.

In fact, the ECB admits that at 2023 prices, Treasuries would still be on top, 26% to 16%. The crossing only happened because gold ran ~30%.

Always peer through the headline. This doesn't mean the dollar is doomed, or that anyone's falling back in love with Treasuries.

Gold got more valuable. That doesn't mean central banks are done with the dollar.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Jobs rebounded hard this week.

But is all well?

I still think not.

It boils down to four pillars:

1. Jobs growth beat expectations — but the bar was extraordinarily low to begin with. You don't or shouldn't get credit for clearing a bar that's been lowered.

2. The type of jobs created — hospitality, local government, healthcare — is not what a healthy, expanding economy produces. It's what an economy hunkering down produces.

3. A "blowout" jobs report, yet unemployment held flat. That's an artifact of how the data is gathered — the headline jobs number and the unemployment rate come from two different surveys, and the quieter one is flashing trouble. Canary in the coal mine?

4. Long-term unemployment is steadily, unhealthily rising. If you're out of work, it's taking longer and longer to find your way back in.

And of course — the government's notorious, wonderful ability to revise these rosy reports down after the fact.

Given the history here, all but certain.

This, much more, and a new deal we're actively raising for, in this week's Timeless Five (accredited investors).

So — is the jobs report a sign of an improving economy?

Or is there something rotten in the state of Denmark?

https://t.co/KnRVLKS1Ib

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

@adamstatonsmith Nobody knows. Not commenting enough probably

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

@adamstatonsmith Lots of angry and bitter people out there. YOU DO YOU BOSS.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

@MainStLender @adamstatonsmith True true

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

The 1980s savings and loan crisis maps almost perfectly onto multifamily debt between 2020 and 2023. Cheap capital flooded in. Underwriting standards collapsed. Asset prices detached from fundamentals. When rates moved, the math broke. The pattern was identical. The cycle, the euphoria, the moment when nobody wanted to ask hard questions about basis or exit math. As we've now passed this window, it's important to commit it to memory to guard yourself before the "next" time comes.

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

I need help with FB Marketplace for rentals.

I’m not sure I’ve ever dealt with a more frustrating organization than Facebook (or Meta).

Views and clicks are down 97%. Something seems to be algorithmically wrong, as I cannot find any other reason we'd have gone from 2000+ clicks per month to 40 in a week.

I got Meta Verified JUST to gain access to live support.

Absolutely zero support.

Has anybody out there dealt with this, or have any ideas??

They seemed to suggest that some internal policy change now requires posting from a FB Business Page, except that so far as I can tell you are prohibited from using FB Business on Marketplace.

And then when I returned to the live support, they told me my case was closed and I needed to "enter a new ticket".

[Arie van Gemeren, CFA | The Timeless Investor @TimelessArie]

Boethius wrote The Consolation of Philosophy in a prison cell awaiting execution — on the theme of Fortune's wheel. Everyone riding it up forgets it only turns one direction at the top.