All right, everyone. Hello and welcome. Thank you for joining us. As always. It’s wonderful to have you here. Without further ado, it is my pleasure to introduce to you Kyle Hyen. He’s the Managing Director of Equity Sales with Noyack Capital To our live viewers, please type any questions you may have into the live chat box in time permitting. We’ll take those at the end of his presentation. With that all said, Kyle, I’ll be right here if you need anything, but I’ll hand the mic on over to you if floor’s all yours.
Thank you so much, Charlie. Appreciate the collaboration. And hello everybody. Welcome to Money Show and Noyack Logistics Income reit. My name is Kyle Hayden. I’m a managing director of equity sales at NOYACK, and today we’re here to talk about mobility hubs. Very quick background on myself. I’ve been in the securities industry for about 10 years. Half of that spent with leading alternative investment firms, raising capital, predominantly in the private wealth community, so working alongside registered investment advisors, family offices, individual investors.
And one of my passions is breaking down the traditional barriers of the investment world. a quick story. When I was in middle school, I had just moved to Phoenix from Texas. some kids and some friends in my, neighboring AP class had started a stock market challenge game on the computer. I was talking to a few of them. The concept of the stock market and investments sounded interesting to me.
So I went to my teacher at the time and asked if we could do a similar project. Her response was, the stock market is too complicated. You wouldn’t understand re regardless of why she made that comment. I, I didn’t hear or talk to anyone about the stock market again until I was a junior in high school. And I had only heard and, and studied briefly alternative investments in college, wasn’t completely familiar with the asset class when I first entered the industry.
and that’s because alternatives in general weren’t as accessible or structured in a way that was feasible for the everyday investor. So now in large part thinks to groups like money show, other institutional operators like NOYACK. The accessibility education for folks like you and me, more specifically accredited investors, is much better than it was just even just a few years ago. So this is one of many reasons why I see so much alignment between, myself, my values, and what we’re doing here at NOYACK.
But before we dive in, to NLI Mobility Hub specifically, I’d like to show a quick video that our wonderful tech and marketing teams put together because I think it really sets the stage for, our conversation about mobility hubs today. So I’ll play that now. Hope you enjoy it with Parking Garages can be boring and underutilized buildings, but they are also big buildings in great locations, near large urban populations where thousands of deliveries are made every day.
In short, they have tons of potential. What if someone could transform them into a multipurpose facility utilized by several industries, all supporting local supply chains? Noyack Logistics Income REIT has a vision for repurposing parking garages to what we call mobility hubs, creating a logistics hub for neighborhoods and cities.
Mobility hubs are a reinvention of commercial space that transforms them to meet all our demands of fast growing e-commerce, and same day delivery. The many things our mobility hubs can do are serve as micro warehouses for products, as well as cold storage pods for organic produce efficiently charge Amazon’s fleet of EV delivery vans or for rental car companies, fulfillment centers with Amazon or Walmart lockers.
So you can pick up your online purchases more sustainably, and even a place to offer you self storage space to store your extra stuff. During the pandemic Mobility hubs also served as a safe space for mobile clinics, vaccination and testing sites, supply chain support, micro fulfillment and logistics all are possible to serve our communities and businesses with re-imagining an old garage into a future mobility hub. Call us at (631) 204-8173 to learn more about how you can invest in your future by profiting from mobility hubs.
Wonderful. So NOYACK is, formerly a family office now functioning as a multi-asset class investment vehicle with our first offering being Noyack Logistics income reit.
Our mission is to bring low volatility, high yield supply chain, real estate investment plays to accredited investors. So again, it’s accessibility, diversification, low volatility, and high yield. Little background on, on NOYACK, we have a 38 year track record, excuse me. 23% IRR across a variety of asset classes, and supply chain.
commercial real estate are multiple on of cash is 5.3, and we’ve generated 2.4 billion in commercial real estate value since inception. the man at the helm, CJ Fellini, our managing principal and CIO has over 38 years of acquisition, development and operational experience in commercial real estate. Also considered a leading expert in alternative real assets, including industrial structured parking, cold storage, logistics, and healthcare.
and with that NLI has assembled a leadership team from diverse professional backgrounds with the idea to disrupt the traditional logic logistics asset portfolio. Speaking of disruption, let’s talk about that for a moment. There have been various outside forces that have completely disrupted supply chains over the last few years, as we can probably all remember, we were at home tragically and needed delivery from Amazon five times a day.
How has that even made possible? Well, it’s through supply chain infrastructure and, and that includes intermodal warehouses, cold storage, last mile logistics, et cetera. Another example, remote work, working from home, complete game changer, especially during the pandemic. Many people were not driving at all, not driving to the office, which meant, vast parking structures or vast parking assets. were being underutilized.
Also, going back even further than the last few years, our economy has continued to see growing digitization, even with a somewhat maturation in its lifecycle. The growth of e-commerce continues to accelerate at a five x pace. The infrastructure needed to support that, especially cold storage and cold chain, is less than three x, meaning there’s a supply demand imbalance and it’s continuing. So the question we’re asking ourselves here at NOYACK is how, how do we bring productivity to this maturing category of e-commerce?
For us, that means bringing the supply chain to you and delivery of goods and services to your home faster. My underpinning theme here is that our infrastructure must change to meet the growing demand of these products and services. And our thesis is that logistics assets are undervalued relative to the secular demand of supply chain needs.
So taking a diversified approach within this strategy, what does that mean to us? So we have four main food groups here, and it’s basically any infrastructure that supports one, the delivery of a service. So for us, that includes healthcare, life sciences, r and d labs, and delivery of of goods. So last mile logistics or we at NOYACK are calling next mile logistics and cold storage, same day delivery and dry intermodal warehouse.
That’s our thesis, and we do it in a diversified way. I’m a soccer player, but I’m gonna use a baseball analogy here. We’re not swinging for the fences, but we’re striving for stability. We’re hitting singles and doubles on one side of the portfolio, and at the same time, we’re balancing that by hitting triples off of a batting t through our value add approach with mobility hubs. So the Mobility Hub, let’s talk about that.
The Mobility Hub is a concept that, that we pioneered. We’re the first and only group to do it. We’re doing it in partnership with SP Plus, which is the largest parking manager REIT in the world. Our partnership with them has yielded a variety of relationships from Amazon fleet charging, co co warehousing and cold storage, all the way to self storage and drone delivery. the parking assets that we’re targeting, as is, as is a case for many large parking structures are ripe for reinvention because they’re centrally located and have vast underutilized square footage.
Once these assets are repurposed, a mobility hub becomes a part flexible parking structure, part fulfillment center, and part fleet Management Depot for ride sharing services and last mile delivery. Oh, and by the way, they’re developed and operated right where the customers are, which is in the urban core and not so much the urban periphery.
And with that mobility hubs address several logistics issues that are unique to urban centers from easing of delivery congestion to creating short term flexible holding areas for ride share and delivery vehicles. I think it goes without saying they enable faster delivery of goods and services for customers. So for, for us, it’s all about value. Reinventing dead commercial space like parking garages into innovative mobility hubs that can create value in many ways.
And yes, they’re good for business generating new income, supporting the municipal tax base, but they also create intangible value above and beyond the ROI. When we repurpose existing structures, it reduces material waste, energy consumption, and supports the growing need for electric vehicle charging hubs and ride share programs. So that in a nutshell is the value add strategy of our diversified portfolio. And it’s very simple.
We’re enhancing the revenue and moving, these assets into a new category that trade at a lower cap rate than the standard parking structure. So let’s continue. We have a real life example that we can talk about here, and it’s our Columbus Mobility hub. it’s one of our seed assets in the NLI portfolio, one of the best locations in downtown Columbus. and it’s very large with 1200 spaces. The bones of the structure are fantastic. it was built in 1986, was well kept during that time.
there was an established basis of parking demand and revenue because the structure, served as the first parking option for commuters to downtown Columbus. the property, when we were, looking to acquire it, acquire, it was marketed as a structured parking asset. we however, felt that there was plenty of, of room to boost that property’s overall revenue by reclassifying it as a supply chain real estate asset. at the time, the seller had three properties up for sale collectively.
when we approached them, we only wanted the Columbus garage. and we at that time presented data to the seller, which ultimately convinced them that he, that they would receive, overall stronger profits. So they were to sell the assets individually. So we acquired the asset using an innovative deal structure, included a $36 million price tag along with the assumption, previous debt and a mezzanine note.
We held off on refinancing the property for three years. the senior lender’s Defe PO penalty had already, burned off by this point, but at this time, the nation was experiencing the pandemic and all business has ceased. However, one type of real estate asset class, performed better and, and, and, and saw, performed better, and, was seeing activity over other types of real estate, which was supply chain real estate.
Thus, NOYACK’s repositioning, was prescient in that. Lenders were only financing supply chain real estate at that time. And the Columbus Mobility Hub received a top quality debt term, from a long-term life insurance lender for 31 million at a fixed attractive interest rate. so through this cutting edge acquisition structure, NOYACK made the necessary modifications to the asset to consider new types of tenancy, including cold storage, vehicle storage, EV charging stations, robotic delivery drones, and remotely controlled Walmart and, Amazon delivery lockers.
So by the end of just the fourth year, the Columbus Mobility hub was appraised for a 38% increase over the original acquisition price. So those operational enhancements, a categorial categorical makeover, if you will. the rising demand of parking in downtown Columbus, were all, contributors to, the appreciation, the appreciation of this asset.
Let’s talk about our investment cycle for a moment. How we do things here at NOYACK. To put it plainly, we’re not a back of the napkin team. We use data more than any commercial real estate fund entity that we’ve seen in the last 38 years. but here’s our cycle. So sourcing, we have a unique sourcing methodology, starting with our upbeat exchange program.
We have one of the deepest networks of private investors that own commercial real estate. Because of our 38 year history as a multifamily office, we know who owns the asset, why they’re having to sell it, and which family members are causing problems, for lack of a better word. and that serves as an opportunity for our up creek program to, to, to bring them into the fold, increase nav while being hypervigilant about the efficiency of our cash.
So we’re still raising money, and frankly, that’s one of the reasons we’re here today. But, we can also still put out letters of intent and deals every week through this upbeat exchange methodology, diligence. So, our diligence is what I was referring to earlier. We built two proprietary algorithms called property quotient and market quotient. What do they do? They allow us to prioritize the right markets so that we know we’re focused on the right place for growth. If we’re looking at 10 deals and can only do three across five asset classes, you have to answer the question effectively, which three deals?
Our algos help with that, redevelopment. that’s our whole value add strategy. We don’t just buy assets and sit on them for six years. We’re looking to enhance the property. The revenue, like I described with mobility hubs, disposition selling right, is always the goal. And, and we’ve been doing that effectively for over 30 years. Let’s talk about the Noyack advantage.
What, what do you get with noc? So what makes us different, stabilized portfolio. So, CJ and our management team have seeded this portfolio with 35 million in nav, almost a hundred million in total asset value. We do not believe in blind pools where you’re having to make a a bet on us doing our job. We want to show you what we’ve done. so skin in the game for decades, we, we’ve invested large sums of capital alongside our investors to prove that we have belief in our, Noyack process and strategy, network sourcing, we refer to this, means by a little bit.
we refer to this a little bit earlier, but, we know every developer that does these asset classes in the country. So we know the family offices that own these assets. We have enough REIT methodology where we’re making programmatic efforts to, to find these assets at attractive prices. And I just mentioned that, selling right is always the underlying goal.
Well, the other part of that corollary is, is buying right? as well. And then thematic focus, very important. again, we believe in diversification as a core principle of, of any investment strategy, but there has to be a through narrative. The thematic focus for us is supply chain. Any commercial real estate that supports the delivery of a service or good, that’s our thematic focus, and that’s what we’re moving on. Let’s talk about the key offering terms for a moment.
I’ll just highlight a few things quickly. 6% targeted annualized yield. Yes, we already have a portfolio that’s doing this now, it’s not a bet. And if you recall the four investors by Investors mantra in some of our earlier slides, well, when you look at the, the, the management fee and the structure, it, it, you earn and then we earn, to put it plainly, we don’t take fees upfront. We prove ourselves, align our risks with our investors.
We give ourselves and our investors that 15% IRR before we see a dollar in per, performance compensation. So once you, after, once you’ve achieved this, 15% IRR over the life cycle in the investment, that’s when we can start participating in, in the preferred comp. then we split 50 50, but, you’ve already earned 15%. And with that split, we hope to get you to to to high teens IRRs. accessibility, I think is extremely important as well.
Our minimum is not 500 K, it’s not 200 K, it’s only 20 k. And, and, and we want to be accessible to all accredited investors. And that’s why we, we, we made our minimums as as low as we did. And as you can see, we, we have one of the top 10 auditors and accountants on our, on our belt and, as well as a very reputable white shoe law firm, assisting and supporting us to close, to put it plainly, it’s alignment of investors, strong track record data-driven decisions.
That’s why you’ll win and invest with confidence with Noyack Logistics.
