February 14, 2014

Four on Friday: Bob Godard of Compass Real Estate

The founder and CEO of Atlanta-based Compass Real Estate, Bob Godard has serious experience in the commercial real estate arena, having completed transactions totaling more than $400 million in value over the course of his career.

In today’s Four on Friday, we talk with Godard about his firm and its current foci, what compelled him to found it more than 10 years ago and his idea of total relaxation.

Many thanks to Bob for his time.

Bob godardHS: Give us an overview of Compass Real Estate.

Godard:Compass Real Estate is a private company that provides co-investment capital for real estate investment and development companies across all property types in major markets throughout the United States. We recently broke escrow for our third private-equity fund, which is focused on providing sponsor equity for large-scale properties led by top-tier operating companies. During our first decade in business, we served as the operating partner for all of our investments. This foundation allows us to understand what sponsors need and want in a capital partner.

In order to invest successfully in institutional-quality commercial real estate without paying a premium for properties because we have a boutique company, we recognized that we had to either join a larger company or figure out a way to partner with them. This led us to adapt, over the past few years, from being a small company relegated to smaller properties into being a capital partner for some of the best operating companies in the country. Now we are able to partner with the companies that used to be our most formidable competitors. We also are able to invest in a diversified portfolio of some of the biggest and best properties in the country — assets that had been beyond our reach in the past.

HS: What are the property types and geographic areas that Compass is currently most interested in investing in, and how has that changed in recent years?

Godard: We are focused on office, retail and mixed-use properties in major markets throughout the Sun Belt and in a few other key markets elsewhere in the country. We are particularly interested in urban infill development and repositioning opportunities in vibrant cities with high-wage employment growth and technology innovation.

We look for cities with a young population of entrepreneurs with great educations, fresh ideas and access to capital. We like places with great urban design, vibrant living and working environments, diverse and interesting cultural and entertainment venues, and plentiful free outdoor recreational opportunities.

We also like markets appealing to institutional real estate investors so we are not limited if and when we would like to exit our investments.

Based on these and other factors, we are currently looking at opportunities in markets including Atlanta, Nashville, Charlotte, Raleigh, Austin and Denver. We are cautious about suburban multifamily, older (pre-1990) industrial, existing power centers, fortress malls and other commoditized properties, because we do not think we will be able to achieve our investment objectives with these property types.

HS: What led you to decide to found Compass back in January 2003?

Godard: Prior to starting Compass, I had the pleasure of working with some of the smartest real estate entrepreneurs in our region. They taught me the business of institutional real estate investment and development and remain good friends today.

I had a genetic predisposition to start my own business at a young age, following in the footsteps of virtually every man in my extended family for the past several generations. I was blessed to have a solid foundation and the support of friends and family, which allowed me to launch this business. There was a period during the market correction when I questioned the wisdom of my decision, but we survived the downturn and have bounced back with both a stronger company and a smarter approach to the business.

HS: What is your idea of perfect relaxation?

Godard: I enjoy spending time with my family in the outdoors, particularly in places with exceptional natural beauty and/or great man-made design. Perfect relaxation would be a trip with my wife and daughters to a cool town in the mountains with no schedules, no cell phones and no worries back home.

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