Latest / Bloomberg Intelligence / Honeywell to Sell Productivity Business in $1.4 Billion Deal

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Honeywell to Sell Productivity Business in $1.4 Billion Deal · Bloomberg Intelligence

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  Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
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  Speaker 1: Bloomberg Intelligence podcast. Catch us live weekdays at ten am.
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  Speaker 2: Honeywell to sell productivity business in a one point four
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  Speaker 2: billion dollar deal. To break that down, Forest landa baker
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  Speaker 2: from Bloomberg News, joins us here, and I talked to
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  Speaker 2: us about Honeywell here because I'm looking at this Dock's
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  Speaker 2: off just a couple, you know, about a buck and
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  Speaker 2: a half here today, but it's up nineteen percent year
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  Speaker 2: to date. What's Honeywell doing with this transaction.
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  Speaker 3: Honeywell has been four years now trying to you know,
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  Speaker 3: reshape its portfolio. They've never met a spinoff. They don't like.
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  Speaker 3: They're spinning off their aerospace division. They've already spun off
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  Speaker 3: their chemicals unit. That's a whole separate company called Solstice.
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  Speaker 3: So they love doing deals. They also, you know, do
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  Speaker 3: acquire things, but in this one, it's been a long
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  Speaker 3: simmering situation. They announced last July that they were exploring
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  Speaker 3: options for this unit along with another unit that they
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  Speaker 3: haven't sold yet, and we had been tracking this one
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  Speaker 3: for months. We thought private equity would come in, but
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  Speaker 3: ultimately Brady Corporation, another public company based in Milwaukee, is
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  Speaker 3: souping in for this and it's going to make it
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  Speaker 3: a much larger company.
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  Speaker 4: And it's not just Honeywell either. Three M has looked
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  Speaker 4: into selling assets too. What is it about these big
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  Speaker 4: industrials that at one point like to be big, like to.
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  Speaker 5: Be diversified, are now in love with the idea.
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  Speaker 4: Of slimming down, realigning their portfolios, divesting assets.
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  Speaker 5: What happened in the thinking.
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  Speaker 3: We're seeing it across industries, not just in the industrial space.
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  Speaker 3: For whatever reason, every few years, diversification becomes popular with
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  Speaker 3: investors and we see ge buying NBC and those types
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  Speaker 3: of things to look back at history. And then eventually
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  Speaker 3: we get into spin offs which are now investor friendly
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  Speaker 3: and it doesn't take much to you know, boost your
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  Speaker 3: stock if you say you're going to sell units or
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  Speaker 3: spin off into public companies. Some public companies are now
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  Speaker 3: have turned into a dozen companies. It's quite amazing to watch.
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  Speaker 2: So it looks like I'm just going to at the
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  Speaker 2: PGeo function on the Bloomberg terminal. Honeywells down the kind
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  Speaker 2: of four lines of business airspace technologies, building automation, industrial automization,
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  Speaker 2: and energy and sustainability. Are they comfortable with their portfolio
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  Speaker 2: generally speaking now or do you think we'll get more
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  Speaker 2: deals here?
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  Speaker 3: I wouldn't rule them out for doing more M and
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  Speaker 3: A to actually, you know, as they reshape their portfolio,
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  Speaker 3: think what makes sense. We've definitely seen industrial companies get
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  Speaker 3: more into software. I know software has kind of fallen
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  Speaker 3: out of favor right now, but there's definitely these sort
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  Speaker 3: of big hardware software products that are might be hard
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  Speaker 3: to disintermediate with AI. So that's where to look. They've
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  Speaker 3: also invested in quantum Computing Quantineum, a company that Honeywell owns.
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  Speaker 3: They've been trying to take that one public. That's another
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  Speaker 3: one to watch, but we'll see under their CEO, Vimol Kapor,
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  Speaker 3: they've definitely been making a lot of moves to just
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  Speaker 3: reimagine what Honeywell is.
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  Speaker 5: And what about Brady? Is Brady looking to get bigger?
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  Speaker 4: I mean, it's buying this business from Honeywell, but can
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  Speaker 4: we expect more deal making from Brady?
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  Speaker 3: They'll definitely get bigger. Before this deal, they had about
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  Speaker 3: a three point nine billion dollar market cap and they're
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  Speaker 3: paying one point four billion dollar cash. So this is
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  Speaker 3: by far the largest deal ever for Brady, a Midwest
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  Speaker 3: company founded in nineteen fourteen. They make some of these
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  Speaker 3: products already, so this will help them maybe corner the
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  Speaker 3: market in this sort of industrial barcode logistics scanning type stuff.
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  Speaker 5: Stay with us. More from Bloomberg Intelligence coming up after this.
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  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
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  Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
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• 4:08
  Speaker 4: Speaking of AI, when every industry is navigating rapid change
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  Speaker 4: driven by this technology, one company is focused on helping
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  Speaker 4: them unlock better performance through data collaboration.
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  Speaker 5: So I want to bring in now Scott Howe. He's
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  Speaker 5: CEO of.
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  Speaker 4: Live Ramp, and Scott, before we get into exactly how
• 4:23
  Speaker 4: your company does what it does, just explain what live
• 4:26
  Speaker 4: Ramp does, what's the mission behind Live Ramp, what problems
• 4:29
  Speaker 4: are you trying to solve?
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  Speaker 6: Sure, you just talked about how fuel stocks are up
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  Speaker 6: today and data is the fuel for the future in
• 4:37
  Speaker 6: a technology world. What live ramp does is it makes
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  Speaker 6: data safe and easy for companies to use. We manage
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  Speaker 6: their integrations, their security, their permissions, and their accessible their
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  Speaker 6: acceptable uses through our data collaboration platform.
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  Speaker 2: So to what extent are retailers brands embrace AI because
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  Speaker 2: it feels like these are super super early innings here,
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  Speaker 2: and I think companies buy and large across all industry types.
• 5:07
  Speaker 2: They're trying to figure out what this thing is. Is
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  Speaker 2: it friend or foe? What are you finding?
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  Speaker 6: Yeah, well, I'll tell you retailers are going to follow consumers,
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  Speaker 6: and consumers are embracing AI. Search is being replaced by
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  Speaker 6: AI in terms of discovery and if you've done any
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  Speaker 6: kind of AI driven commerce where you're looking for products,
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  Speaker 6: you know it's just a transformational experience. So companies have
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  Speaker 6: to move, they have to stay current, and so for
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  Speaker 6: the next five years, AI is going to be probably
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  Speaker 6: the only thing retailers are talking about.
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  Speaker 4: So when you talk to brands right now, how AI
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  Speaker 4: ready are they? How do you assess their level of readiness?
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  Speaker 6: Well, I'd say it's early stages that said, we don't
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  Speaker 6: work with a company that isn't collecting information, creating a
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  Speaker 6: value exchange for consumers, and doing things with that information
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  Speaker 6: to give their customers a better experience, items that they
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  Speaker 6: might like, different value propositions, access to unique content. And
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  Speaker 6: so they're getting increasingly sophisticated about how to have the
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  Speaker 6: conversation with consumers. And every company in the world is
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  Speaker 6: looking at who the winners have been in the stock
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  Speaker 6: market for the last twenty thirty years, and the winners
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  Speaker 6: have been companies that are really sophisticated with data. And
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  Speaker 6: so if you want to be a winner in the
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  Speaker 6: stock market, you have to be more sophisticated. So I
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  Speaker 6: think consumers and the market forces, both of those things
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  Speaker 6: are driving adoption.
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  Speaker 5: What is data collaboration.
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  Speaker 6: Yeah, it's a great question, and because what companies have
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  Speaker 6: realized is they can't go it alone. It's really hard
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  Speaker 6: to out Amazon Amazon. Amazon has so much information. But
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  Speaker 6: when a company like Nike gets together with its retailers,
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  Speaker 6: or a company like Disney gets together with its advertisers,
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  Speaker 6: and they start to collaborate on the data that they have,
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  Speaker 6: they can actually out Amazon, Amazon, out Google, Google and
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  Speaker 6: create really interesting insights that drive better value to their customers.
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  Speaker 4: That all sounds great, but how do they I guess,
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  Speaker 4: maintain control, ensure privacy and really have a handle over
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  Speaker 4: governance over their own data because they're collaborating with other
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  Speaker 4: partners and they're sharing this information.
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  Speaker 6: Yeah, so two words, live ramp. That's why we exist.
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  Speaker 6: Rather than a big company having to go secure, if
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  Speaker 6: not thousands eventually of one off business development agreements governing
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  Speaker 6: how data can be utilized. Instead, they can just use
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  Speaker 6: live ramp. We manage all those things for them. Any
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  Speaker 6: participant can set their permissions and their acceptable use so
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  Speaker 6: that they know that their partners are respecting their data.
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  Speaker 6: And ultimately, we think there's a big role for consumers
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  Speaker 6: to play in this long long term as well. AI
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  Speaker 6: means that the power of data eventually swings to consumers.
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  Speaker 6: And as a consumer, I would want my data to
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  Speaker 6: be portable and I'd want it to be very transparent.
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  Speaker 6: If I go surf on, say I watch programming on Netflix,
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  Speaker 6: shouldn't I be able to download my viewing history and
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  Speaker 6: use it next time I'm on Prime to get similar
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  Speaker 6: recommendations of shows that might matter to me.
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  Speaker 2: How are I know we're early in scott How are
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  Speaker 2: consumers using AI and just kind of their shopping behavior
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  Speaker 2: and now and maybe how do you think that's going
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  Speaker 2: to evolve?
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  Speaker 6: Yeah, it is early, but I would say, you know,
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  Speaker 6: particularly amongst the younger generation folks that are you know,
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  Speaker 6: up to age thirty, it is absolutely essential because you're
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  Speaker 6: using it to help you do the research on what
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  Speaker 6: products that you might want to buy, gather testimonials, and increasingly, say,
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  Speaker 6: like through Google AI Shopping, you can actually consummate a
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  Speaker 6: purchase within the AI browser that you're using.
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  Speaker 4: I can understand brands and consumer brands in particular, really
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  Speaker 4: embracing this. How are you seeing this show up among
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  Speaker 4: companies and industries that are also consumer facing but maybe
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  Speaker 4: have not had to go out and chase consumers in
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  Speaker 4: quite the same way healthcare companies for instance.
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  Speaker 6: Yeah, you know, it's interesting. Probably the product this moment
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  Speaker 6: I've had in one of our town halls is we
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  Speaker 6: had a company called Truth Social, that's the settlement of
• 10:05
  Speaker 6: Big Tobacco come in and speak to our folks a
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  Speaker 6: few years ago, and they talked about how they're using technology,
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  Speaker 6: how they're using data, how they're using live ramp, and
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  Speaker 6: the punchline was it's saving lives, and they shared how
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  Speaker 6: many lives they think that they've shared, they've saved by
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  Speaker 6: applying data, helping to market to young people about the
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  Speaker 6: dangers of tobacco and drugs. So I think, you know,
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  Speaker 6: data has such an important role to play in perhaps
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  Speaker 6: industries we don't even think about. Because wherever we can
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  Speaker 6: bring information to bear to make a better decision, whether
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  Speaker 6: it be for a business or for a consumer, shouldn't
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  Speaker 6: we want to do that, of course, but always within
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  Speaker 6: the control of those that are being affected by that decision.
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  Speaker 2: More from Bloomberg Intelligence coming up after this.
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  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
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  Speaker 1: you get your podcasts, or watch us live on YouTube.
• 11:20
  Speaker 4: Oil prices have reverse Friday's declines. They're marching higher, with
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  Speaker 4: Brent now up about five point seven percent, WTI gaining
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  Speaker 4: more than six percent, just below eighty nine dollars a
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  Speaker 4: barrel here in the US. Mike mcloan is our senior
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  Speaker 4: commodity strategist joining us from Miami. So, Mike, I'm trying
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  Speaker 4: to understand these latest headlines from President Trump saying that
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  Speaker 4: he is not going to open up the straight of
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  Speaker 4: Horror moves, even though around desperately wants him to do so.
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  Speaker 4: That presupposes that the US is the one that's blocking
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  Speaker 4: the straight of horor moves and iron is not playing
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  Speaker 4: a role. But I want to get from you a
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  Speaker 4: sense of what is actually moving oil price is right
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  Speaker 4: now these days.
• 12:02
  Speaker 5: Is it an opening of the street of Hormuz?
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  Speaker 7: It definitely is scarlett.
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  Speaker 8: I think the market's getting past that a little bit
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  Speaker 8: and realizing it's a bit of a battle of bulls.
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  Speaker 7: It'll figure it out. It'll be opening up. Question how
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  Speaker 7: you do it.
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  Speaker 8: I think the idea way mister Trump bought it was
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  Speaker 8: wanted was to repress the offensive abilities of Iran to
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  Speaker 8: close this strait, which they still have.
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  Speaker 7: But from a crueil standpoint, the rest of the world
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  Speaker 7: is breaking and breaking hard.
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  Speaker 8: Pretty severe demand destruction, and US so far is okay.
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  Speaker 8: Now right now, WTI is around eighty nine dollars a barrel.
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  Speaker 8: I think that high at one twenty is as during
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  Speaker 8: as that peak in twenty twenty at one point thirty was,
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  Speaker 8: and now it's probably stuck between eighty and one hundred
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  Speaker 8: dollars a barrel.
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  Speaker 7: And there's one key thing I reiterated today.
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  Speaker 8: Wanted to point out is if prices don't go down,
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  Speaker 8: that surplus of supply versus demand in the US and Canada,
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  Speaker 8: which is running around eight million barrels a day, it's
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  Speaker 8: going to go to ten million barrels a day by
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  Speaker 8: twenty twenty eight. So I look at this as this
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  Speaker 8: is a mark. It's a bear market that's bounced months,
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  Speaker 8: much more likely to go down. And the key thing
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  Speaker 8: that might make it go down to that level by
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  Speaker 8: the end of the year is the stock market dropping
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  Speaker 8: a bit.
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  Speaker 2: So, Mike is when you talk to people, you know,
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  Speaker 2: traders that the trade this comodity here, the oil and gas,
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  Speaker 2: they are they factoring in supply coming from other parts
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  Speaker 2: of the world coming into the marketplace, or maybe even
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  Speaker 2: Saladi crewed or Amidi screwed finding other ways to get
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  Speaker 2: out to the marketplace.
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  Speaker 8: Yeah, so people keep using that narrative twenty percent of
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  Speaker 8: world supply from the golf. It's really probably dropping closer
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  Speaker 8: to ten percent now as Saudi Arabia has found ways
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  Speaker 8: to get its pipelines through the red scene out other ways,
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  Speaker 8: and they're finding other ways. We'll get it The key
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  Speaker 8: theme I think is people remember what happened in twenty
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  Speaker 8: twenty two when Krudel popped at one thirty, and the
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  Speaker 8: thing that led us back down was natural gas, and
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  Speaker 8: that's done the same thing again this year.
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  Speaker 7: It was up one hundred percent and now it's down
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  Speaker 7: almost twenty percent on the air.
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  Speaker 8: It's already done what I think Krudel is going to do,
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  Speaker 8: and it's I've seen what's really happening in a global
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  Speaker 8: basis that pricemaker status has switched from the Gulf to
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  Speaker 8: the western hemishere led by the US from Canada, Venezuela
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  Speaker 8: all the way down to Argentina. And that's the key
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  Speaker 8: theme that's been pressuring prices forever, and that I think
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  Speaker 8: is what's accelerating. I think people also realizing if natural
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  Speaker 8: gas is a guy and corn guide peeking, corn pinking
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  Speaker 8: and soybean pinking, this is a I think, just a
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  Speaker 8: dump that it's very think, just right, a pomp that's
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  Speaker 8: ready to dump again. And it's all these things predicated
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  Speaker 8: on that wealth effect continuing in the US.
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  Speaker 4: Okay, So there's US not gas futures, which you highlighted,
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  Speaker 4: and then there's European gas futures which have not fallen
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  Speaker 4: in quite the same way because they do depend on
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  Speaker 4: the straight of horror moves. How is that looking at
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  Speaker 4: How does that compare to what we saw in twenty
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  Speaker 4: twenty two Scarlet.
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  Speaker 8: It's not nearly as high, but it's the demand destruction
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  Speaker 8: I'm worried about. Typically these kind of things, as you've
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  Speaker 8: seen and not know as it psychological makes people cut off.
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  Speaker 7: Their consumer spy, but it's actual physical.
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  Speaker 8: Now prices are pumped up so much, particularly in gas,
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  Speaker 8: soil and diesel in view in this country diesel, but
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  Speaker 8: in the rest of the world most nobling as maybe
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  Speaker 8: not so much China, so much in Europe that you
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  Speaker 8: can't help but not cut your capital budgeting decisions, certainly
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  Speaker 8: from a personal consumer standpoint.
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  Speaker 7: And that's the stuff that's not really coming out yet.
• 15:21
  Speaker 8: It's one key thing that on Along pointed out in
• 15:23
  Speaker 8: our morning meeting our chief economists is you're not seeing
• 15:26
  Speaker 8: that top twenty percentile of wag journers.
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  Speaker 7: Yet because the stock market's still doing well. That's why, unfortunately,
• 15:30
  Speaker 7: is a commodity guy.
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  Speaker 8: I look at the stock markets everything now, most nobly
• 15:34
  Speaker 8: from things like industrial metals and even Crudel could push
• 15:36
  Speaker 8: things lower.
• 15:37
  Speaker 5: Stay with us. More from Bloomberg Intelligence coming up after this.
• 15:44
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
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  Speaker 1: weekdays at ten am Eastern on Applecarplay and Android Auto
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• 15:57
  Speaker 4: I want to bring in Uma Moriarty s your investment
• 16:00
  Speaker 4: strategists over at Center Square and Oma. When you look
• 16:04
  Speaker 4: at something like long term yields remaining stuck in a
• 16:07
  Speaker 4: range and concerns about inflation, what does that mean for
• 16:11
  Speaker 4: your space for real estate?
• 16:13
  Speaker 9: Great to be here, and that's a great question to
• 16:16
  Speaker 9: start this conversation with. I think we've been talking about
• 16:19
  Speaker 9: the ten year treasury yield long term rates being in
• 16:22
  Speaker 9: this four to four and a half percent range for
• 16:24
  Speaker 9: several years now, and that's really because of the underlying
• 16:28
  Speaker 9: components of that. Right. So when I think about the
• 16:29
  Speaker 9: ten year treasury yield, I'm really decomposing not into three
• 16:33
  Speaker 9: kind of main categories, one being nominal growth, one be inflation,
• 16:37
  Speaker 9: and then one being the term premium. And I think
• 16:40
  Speaker 9: from an inflation perspective, obviously we have a little bit
• 16:42
  Speaker 9: of a shock here, but there have been other things
• 16:44
  Speaker 9: that are structurally driving inflation a little bit higher. Think
• 16:48
  Speaker 9: about what's happening from a deglobalization perspective. For a long time,
• 16:52
  Speaker 9: the US was really importing deflation as a lot of
• 16:56
  Speaker 9: manufacturing was happening elsewhere. But as we start to think
• 16:58
  Speaker 9: about more nearshore on shoring, this deglobalization phenomenon, that's going
• 17:03
  Speaker 9: to be driving interest rates a little bit higher. AI
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  Speaker 9: should be net deflationary, I think long term. But in
• 17:09
  Speaker 9: the meantime, we're spending a lot of capital building this out.
• 17:13
  Speaker 9: We've now got geopolitical conflicts as well. They are expensive,
• 17:17
  Speaker 9: so we have a lot of things that are driving
• 17:19
  Speaker 9: up the deficit, for example, driving into that term premium
• 17:22
  Speaker 9: as well, and so all these things really compounding is
• 17:25
  Speaker 9: creating this ten year treasure yield, which is somewhat range found.
• 17:28
  Speaker 9: When we think about this from the real state perspective,
• 17:31
  Speaker 9: I think it really helps to underscore the fact that
• 17:33
  Speaker 9: we are in a new interest rate era right and
• 17:36
  Speaker 9: real estate really has to think about operating in this
• 17:39
  Speaker 9: new regime. For a long time, a lot of real
• 17:42
  Speaker 9: estate owners and operators were really hesitant to accept the
• 17:45
  Speaker 9: fact that we were structurally in a higher interest rate
• 17:48
  Speaker 9: phenomenon this period. Now that we've had kind of consistent
• 17:53
  Speaker 9: couple years of remaining in this range, I think you're
• 17:55
  Speaker 9: going to get a lot more acceptance from the broader marketplace,
• 17:58
  Speaker 9: which should also mean that transaction activities should start to
• 18:01
  Speaker 9: pick back up again because that bid ask spread is
• 18:05
  Speaker 9: narrowing as sellers are accepting the fact that interest rates
• 18:08
  Speaker 9: will be higher for longer.
• 18:09
  Speaker 2: Here, oom my, what sectors in the real estate business
• 18:12
  Speaker 2: are attractive to you guys these days?
• 18:15
  Speaker 9: You know, from the perspective of what we're doing here
• 18:17
  Speaker 9: at Center Square, we're focused on a couple specific areas
• 18:21
  Speaker 9: where we think that demand is really strong and also
• 18:24
  Speaker 9: a place where supply doesn't really exist, and so that
• 18:27
  Speaker 9: supply demand and balance as creating really strong fundamentals. One
• 18:31
  Speaker 9: of those areas happens to be what we call essential
• 18:33
  Speaker 9: service retail. These are unanchored neighborhood shopping centers where we
• 18:38
  Speaker 9: just have not seen you construction. And at the same time,
• 18:40
  Speaker 9: retailers have really evolved between the growth of e commerce
• 18:45
  Speaker 9: between what happened during COVID, you've now seen retailers really
• 18:50
  Speaker 9: come to embrace an omni channel retail strategy where that
• 18:54
  Speaker 9: physical ural state footprint for them is really critical to
• 18:58
  Speaker 9: drive brand recognition, to really drive loyalty for their customers,
• 19:02
  Speaker 9: and also deliver goods at the place where the customers
• 19:05
  Speaker 9: want at the right time. And so from that perspective,
• 19:08
  Speaker 9: we're really seeing retailed real estate getting a moment in
• 19:11
  Speaker 9: the sun. Here another great area from a supply demand
• 19:14
  Speaker 9: and balanced perspective, we see really a senior housing. A
• 19:17
  Speaker 9: lot of the senior housing space, especially within listed real
• 19:20
  Speaker 9: estate space, is really compelling today. The healthcare sector has
• 19:24
  Speaker 9: had a bit of a pullback in the last couple
• 19:25
  Speaker 9: of days, and so that's an interesting opportunity for investors.
• 19:28
  Speaker 9: Maybe add in a little bit there, and then it
• 19:31
  Speaker 9: would be we'remiss to not mention an area like data
• 19:33
  Speaker 9: centers within the real state space that's saying so much
• 19:36
  Speaker 9: demand that is somewhat insatiable as we continue to build
• 19:40
  Speaker 9: out not only AI, but really just the global digitalization
• 19:44
  Speaker 9: that we're seeing across companies across the board.
• 19:47
  Speaker 4: Yeah, that is a secular growth story on its own
• 19:49
  Speaker 4: that's kind of separate from everything else. What about residential
• 19:53
  Speaker 4: and here I'm really focused on multifamily because that's where
• 19:56
  Speaker 4: a lot of the institutional money has been that's.
• 19:59
  Speaker 9: A great question. The multifamily is an area where I
• 20:01
  Speaker 9: think there's a little bit of a mismatch from a
• 20:03
  Speaker 9: valuation perspective between the public markets versus the private markets.
• 20:07
  Speaker 9: If you take a big step back, really, what's happening
• 20:09
  Speaker 9: from a multi family perspective is that over the last
• 20:12
  Speaker 9: couple of years, we've had an enormous amount of supply
• 20:15
  Speaker 9: that has delivered into the marketplace, and we're still absorbing
• 20:19
  Speaker 9: that supply. But one of the things that really shifted
• 20:21
  Speaker 9: last year was that demand became a big question mark.
• 20:24
  Speaker 9: We've really shut off immigration as a demand driver for multifamily,
• 20:28
  Speaker 9: and we've also had a bit of a question mark
• 20:30
  Speaker 9: in terms of what's happening from a labor growth perspective,
• 20:33
  Speaker 9: both in terms of companies really trying to maintain their
• 20:37
  Speaker 9: margins as we see inflation picking back up again, but
• 20:41
  Speaker 9: also in terms of what AI means for the workforce.
• 20:43
  Speaker 7: Right.
• 20:44
  Speaker 9: So, I think from a labor market perspective, we've seen
• 20:47
  Speaker 9: this malaise, which also means that demand for new multi
• 20:50
  Speaker 9: family renters is a little bit low. You've heard a
• 20:53
  Speaker 9: lot about college grads having a hard time finding new jobs.
• 20:56
  Speaker 9: I mean they are graduating in the spray and coming
• 20:58
  Speaker 9: into the rental marketplace, and so there are a lot
• 21:01
  Speaker 9: of question marks from a demand perspective. Meantime, supply still
• 21:05
  Speaker 9: keeps coming right, and so the listed real estate market
• 21:08
  Speaker 9: has really discounted what's happening here from a fundamental perspective,
• 21:11
  Speaker 9: and so you're seeing the listed reads trading on a
• 21:14
  Speaker 9: pretty material discount to what you're seeing in the private marketplace.
• 21:17
  Speaker 9: And so if I'm thinking about deploying new capital today
• 21:19
  Speaker 9: and multifamily, I'm really doing that in the listed real
• 21:23
  Speaker 9: estate space if I'm deploying equity. But what's really interesting
• 21:26
  Speaker 9: in the private markets is that you are seeing a
• 21:28
  Speaker 9: lot of existing capital stacks for multifamily, for really great assets,
• 21:34
  Speaker 9: but that have a hiccup from an operational perspective because
• 21:37
  Speaker 9: of the supply demand mismatch that really just needs a
• 21:40
  Speaker 9: little bit of structured capital to get to the other side.
• 21:43
  Speaker 9: And so when we're thinking about deploying capital and multifamily
• 21:46
  Speaker 9: in the private markets, that's really through kind of a
• 21:48
  Speaker 9: structured equity pref equity space within the capital stack to
• 21:52
  Speaker 9: provide a little bit more risk protection for us and
• 21:56
  Speaker 9: the capital stacks there, and if we're looking at deploying equity,
• 22:00
  Speaker 9: really doing that through the listed rule state marketplace, where
• 22:03
  Speaker 9: we do see the reads are being discounted for the
• 22:06
  Speaker 9: supply demand mismatch. That's creating a bit of a hiccup
• 22:09
  Speaker 9: from an operational perspective for the sector right now.
• 22:11
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