Frank Marro wasn’t surprised when General Electric Capital sold its apartment portfolio to New York City–based investment firm Blackstone Group this past summer. As former managing director of multifamily equity for the Norwalk, Conn.–based company, Marro regularly mulled over moves to help the firm exit the business.
“We looked at doing that all the time, in terms of selling our portfolio,” Marro says. “It’s certainly consistent with what I understand to be their current investment philosophy.”
At GE, Marro ran a joint-venture group that invested equity in all sorts of commercial real estate assets across the United States. When the firm stopped doing new equity investments, he worked in asset management.
Before leaving GE, Marro planned on building the company’s first national multifamily equity fund to invest in multifamily assets and also pursue debt, with GE as sponsor. But the company decided against that business model, as well.
Now, as the market cycle begins to peak, Marro is seeking opportunities elsewhere. Although conventional multifamily is a great asset class, he says, it doesn’t yield the same returns it did in the past.
“I think it’s a question of timing,” he says. “From a returns standpoint, it’s a better time now to pursue things like senior housing.”
And with an aging population and the anticipation that Baby Boomers will need housing in the next 25 years, Marro is especially focused on this niche in his new position as president and CEO at Tiburon, Calif.–based Drever Capital Management (DCM), founded by contrarian investor Maxwell Drever, once the largest landlord in Houston.
DCM will also look at investments in the hospitality industry. But if there’s anything Marro learned from his time with GE, it’s how to think long term.
“Right now, the future—the very long future—is the need for senior housing.” MFE