Black Salmon is a real estate investment and development firm that is focused on multifamily, industrial, hospitality and mixed-use opportunities in the United States. Pulse 2.0 interviewed Black Salmon managing director Stephen Evans to learn more.
Stephen Evans’ Background
Evans started working in the commercial real estate industry in 1986, the same year that the U.S. tax laws changed and directly impacted the value of real estate. And Evans said:
“This change led to the creation of the Resolution Trust Corporation, the Feds clearing house for distressed property. Despite the significant negative impact on the real estate market, it was an excellent opportunity for me to learn, gain experience and navigate a troubled market in the real estate brokerage business. Fortunately, I was able to survive and thrive during the 90’s, focusing on commercial leasing and investment sales.”
“During that time, I was approached by USAA Real Estate to lead and grow their South Florida office as Director of Real Estate Services. What I thought would be a three to five-year experience turned out to be a nearly 20-year career with arguably one of the most respected real estate investment managers in the industry. They had a global platform, allowing me to work with some of the largest and most sophisticated investors in the world. I am very grateful for the experience and knowledge I was able to attain and for the outstanding people I had the opportunity to work with during my time there.”
“After retiring from USAA Real Estate in 2018, I left San Antonio, Texas, to return home to Miami. Soon after returning, a close industry friend introduced me to the managing partners of Black Salmon Capital (Black Salmon). I am pleased that I am able to utilize my knowledge, experience, and industry connections to help grow Black Salmon and, most importantly, work with professionals whom I like and respect.”
Evolution Of Black Salmon’s Thesis
How has Black Salmon’s thesis evolved over time? Evans noted:
“Black Salmon has evolved over the years as its leadership has identified different investment opportunities. Today, the firm is focused on investment management and development. In regard to investment management, Black Salmon focuses on strategies where our investors have conviction and match our thesis. Currently, we are focused on two primary property sectors: housing and industrial/logistics. We strongly believe that the fundamentals for investment in these two property sectors have a significant long-term investment horizon and growth potential.”
“In regard to development, we have had a long-term strategy focused on South Florida. We have acquired multiple development sites where we intend to capitalize on the extraordinary opportunity in our own backyard. The southeastern U.S. has multiple demand drivers, including strong employment and population growth. No market in the U.S. has done better than South Florida, and we remain bullish on the investment possibilities in Miami as well as other parts of Florida.”
Challenges Faced
What are some of the challenges you face in building Black Salmon and has the current macroeconomic climate affected the firm? Evans acknowledged:
“The current economic environment and rising interest rates have significantly impacted the real estate market. Most, if not all, institutional and private real estate investors have been impacted by changes in the capital markets, shifts in space utilization, an economic slowdown, and other macroeconomic factors.”
“Changes to the real estate industry are inevitable, and navigating these changes will be crucial for Black Salmon and other investors alike. Our focus on housing and the industrial sectors are a large part of our future growth, and we believe it will help mitigate certain risks in our firm’s future.”
Favorite Memory
What has been Evans’ favorite memory working for Black Salmon so far? Evans shared:
“The highlight of my time at Black Salmon was the successful launch of our $500 million industrial fund and successful raise in South America. I was able to work with our leadership to create a strategy and investment thesis that would appeal to the market and investors alike.”
“Our unique strategy across industrial subsectors has been successful, and we anticipate having the entire allocation committed and/or invested by the end of 2023. We are already working on our next iteration, enabling us to continue our success with this strategy.”
Significant Milestones
What have been some of Black Salmon’s most significant milestones? Evans cited:
“We have had several milestones that have brought us to where we are now. The first and most significant milestone is the accumulation of significant land positions within Miami-Dade’s urban core.”
“Camilo Lopez and Jorge Escobar, Black Salmon’s managing partners and co-CEO’s, spearheaded this laborious strategy, and the firm is now realizing the incredible opportunity by planning and developing significant projects that will change the landscape of Miami as our city grows and matures as a premier global city.”
“In October 2021, we announced that one-third of the firm would be acquired by LarrainVial, one of Latin America’s leading financial services companies present in Chile, Colombia, Peru, U.S., and Panama. Founded in Chile, with more than 87 years of experience and 800 professionals, it offers its clients a service of excellence in financial advisory, intermediation, corporate finance, research, third-party product distribution, asset management, wealth management, and alternative assets. Our partnership with LarrainVial is mutually beneficial and an extraordinary opportunity for us to capitalize on real estate investments within the United States and grow our platform in the future.”
“In the first quarter of 2022, Black Salmon Capital, along with LarrainVial, launched our first commingled industrial fund. The fund strategy is to invest in three primary industrial subsectors: Distribution Warehouse, Cold Storage, and Industrial Service/Outdoor Storage. Our strategy has focused on industrial development in key industrial markets, port markets, and population centers. We are very pleased with our results thus far and are excited to be working on launching a successor fund in the very near future.”
Investment Success Stories
Upon asking Evans about some customer success stories, he replied:
“Yes, our investment in an industrial fund has been a success. Our industrial real estate fund strategy has a particular interest in investing in port markets. The Port of Savannah, the fourth busiest port in the nation, is one of the strongest industrial real estate port markets in the U.S. due to tremendous container traffic. Moreover, Georgia has made a massive investment in the port’s infrastructure in order to increase its capacity and fuel future growth, spending billions of dollars over the past several years. The Port of Savannah as well as other east coast ports have shown strong growth as shippers look for additional points of entry into the U.S. while west coast ports have been experiencing delays.”
“With our development partner, InLight Real Estate, we acquired a site just five miles from the Port of Savannah, an ideal location for a truck terminal. At the time of the land acquisition, we were confident that a user would be secured to occupy the property as there was a scarcity of quality industrial product near the port, and we knew there was a need for such. The Port of Savannah encourages this type of investment due to the port’s desire and need to have such facilities on the ground to service increased container volume. Ultimately, a single tenant was located for the facility, and the project reverted to a build-to-suit lease for a global logistics company on a long-term lease basis.”
AUM And Other Metrics
After asking Evans about assets under management, he revealed:
“Black Salmon has $2.1 billion in projects and assets under management.”
Differentiation From Other Firms
What differentiates Black Salmon from other firms? Evans affirmed:
“Black Salmon has considerable industry experience across investment management and development in U.S. markets. Our company culture aligns with our investors – to date, predominantly South American – which enables us to effectively communicate in a transparent manner. Our goal is to expand our investor appeal to the U.S., Europe, Asia, and Middle Eastern markets.”
“As industry veterans, Black Salmon has tremendous access to industry leaders, professionals, and real estate investment participants, which allows us to stay topical on real estate markets, key topics, and industry trends at the local and national levels.”
Future Firm Goals
What are some of Black Salmon’s future goals? Evans concluded:
“We enjoy the benefits of working in an entrepreneurial culture focused on measured growth with an institutional mindset. Black Salmon’s goal is to deliver strong risk-adjusted returns for our investors and seek unique investment opportunities that have strong fundamentals and growth opportunities. Not just growth for growth’s sake.”
“Given that, we are currently focused on the housing and industrial sectors. We intend to invest through acquisition and development in markets that demonstrate strong employment and population growth and/or may have unique characteristics that complement our investment thesis.”
