John Coe 00:00:09  Hi, I'm John Coe and welcome to icons of DC Area Real Estate. A one on one interview show featuring the backgrounds, career trajectories and insights of the top luminaries in the Washington, DC area real estate market. The purpose of the show was to explore their journeys, how they got started, the pivotal moments that shaped their careers, and the lessons they've learned along the way. We also dive into their current work, industry trends, and some fascinating behind the scenes stories that bring unique perspective to our industry. Commercial real estate. Before we dive into today's conversation, I'd like to share some exciting news. The icons of DC Area Real Estate podcast is now part of the iconic journey and CRA, a nonprofit dedicated to supporting professionals at every stage of their real estate careers. With our new website ww w yj c r e.org, we're expanding opportunities for everyone in the industry. If you're a student or new to the industry, I encourage you to join the iconic journey and see our community an exclusive space for learning, mentorship, and networking.

John Coe 00:01:31  If you're an early to mid-career professional navigating career transitions. Our Career Coaching curriculum provides structured guidance to help you move forward with confidence. If you're an experienced professional looking to give back to the industry, I invite you to consider sponsoring or donating to the Iconic Journey and CRA nonprofit to help foster the next generation of commercial real estate leaders. And for everyone, the best way to stay connected is to subscribe to this podcast, whether directly or on Apple or Spotify, so you don't miss an episode. The podcast has been delivering twice monthly episodes since August 2019, and I'm thrilled to continue these conversations under the nonprofit umbrella, expanding our reach and impact. To learn more about our community, career, coaching or sponsorship opportunities, please visit our new website. Dot YJ crosswalk. Thank you for being part of this journey. And now let's get started with today's guest. Welcome to another episode of icons of DC Area Real Estate. I'm so pleased to introduce my guests for today's show. Who is Jesse Barter, who is the principal of Charger Ventures, a firm that she started in 2018.

John Coe 00:03:03  Jesse is a third generation Montgomery County resident, and she has deep roots in the DC area and a rich background in real estate that spans over 15 years. After earning her degree from Georgetown and gaining valuable experience at firms like Bear Stearns, Avalon Bay, and Mill Creek, Jesse launched Charger Ventures to focus on multifamily and acquisitions in secondary and tertiary markets. In this episode, Jesse shares her unique approach to real estate, emphasizing the importance of off market deals and rigorous asset management. She discusses her commitment to creating a brand that resonates with residents and fosters a sense of community, as well as her innovative strategies for navigating the current multifamily investment landscape. Listeners can also gain insights into Jesse's entrepreneurial journey, or thoughts on evolving market dynamics and our vision for the future of Charger Ventures. Additionally, she reflects on the importance of mentorship, collaboration, and maintaining a strong company culture. She also started Spark Communities as well as an asset branded asset management firm. So join us as we explore Jesse's inspiring story and the lessons she's learned along the way in the competitive world of our industry.

John Coe 00:04:28  So, Jesse Barter, welcome to icons of DC area Real Estate. Thank you for joining me today.

Jessie Barter 00:04:34  Thank you for having me.

John Coe 00:04:36  So I'm I've already had the introduction that I produce on the podcast. So I just wanted to get a high level view of what you started. Charger ventures, your current firm, what's your current role and focus with that company.

Jessie Barter 00:04:53  Sure. So with charger I am point on production, which we consider both deal flow as well as equity partnerships.

John Coe 00:05:02  Okay. So I mean what do you spend your day doing right now.

Jessie Barter 00:05:06  Typically sourcing deals and equity okay.

John Coe 00:05:10  And I assume that too when you have that need. Yes I assume yes.

Jessie Barter 00:05:15  When we have the first two then we go after the third. Yes. Right.

John Coe 00:05:19  Then you also have a separate operating company we'll get into. But I assume you have some oversight there as well. Right. Yes.

Jessie Barter 00:05:25  Yes, I, I love asset management and I find it hard to extract from that completely. But I have a very strong partner who is in charge of performance, Lindsay Pompano.

Jessie Barter 00:05:37  So that is her purview.

John Coe 00:05:40  That's great. So quickly, what differentiates differentiates your approach in a very competitive market?

Jessie Barter 00:05:49  I think that our strength probably lie in. We preliminarily pretty much only source off market. So a function of the relationships that we've developed over time. And we don't always hope to get better than market pricing, but it's more just that we hope to get control. And that's a function of our being a smaller shop with, you know, lesser resources. It just feels a better way to use our resources to make sure we have control. And then sometimes we get better pricing, which is which is also nice. And then I think we also have a core competency in rigorous asset management. So we just really, really have no threshold for materiality in terms of what is significant. Everything is significant when we're operating in our properties, we want to be optimizing them operationally. From a finance perspective, however, we're putting debt on the asset or managing the debt in place. So it's just a real we just have a really we go into looking at every deal with eyes wide open all the time.

John Coe 00:06:55  Yeah, I'm going to be interested to learn as we dig further into your off market strategy and how you get into that and how you develop your relationships, because you do have a long career prior to starting its ventures. So I assume that network is broad, such that you've been able to dive into places where other people haven't. So I want to learn more about that. We can. So before we do that, though, I would like to get into your origin story, if I could, a little bit. So tell me about your origins. I understand you grew up in the DC area.

Jessie Barter 00:07:30  Yes. Third generation Montgomery County resident and went to high school in Georgetown and college in Georgetown also. So my family is local as well. Came from a family of doctors That were determined that I not go into medicine. So my brother and I both went into real estate.

John Coe 00:07:53  So why not? Why didn't why were they encouraging you not to go into medicine?

Jessie Barter 00:07:58  Just. I don't even know the full reasons for that, to be honest.

Jessie Barter 00:08:02  Oh, really? Yeah. I mean, I think they just felt the industry had changed over the last several. It's funny, my.

John Coe 00:08:09  Last podcast guest had the same response. Blake, his father's a neurosurgeon and he.

Jessie Barter 00:08:16  Said his father's friends with my father. Yeah. Oh, really? Yes.

John Coe 00:08:20  That's interesting because he said that he started looking at it. He said, but he said, you don't want it. His father said, don't do that. You know, it's too long. It takes too much time. So. So what disciplines did you learn from your parents? You know, I mean, they were both. You said your mother's also a doctor as well?

Jessie Barter 00:08:40  No, she was a teacher.

John Coe 00:08:42  Teacher. Okay. All right. So what did you learn from them that kind of made you want to go the direction you did? Just out of.

Jessie Barter 00:08:50  Curiosity, I think the skills that I gained from my parents, from my father was probably adaptability. So he was a surgeon and also received his MBA during his career.

Jessie Barter 00:09:02  And yes, and also has been a prolific expert witness, so in various class action lawsuits in the medical field. So he has a bit of a jack of all trades. And I think I learned from him how to, you know, for lack of a better word, bob and weave in different circumstances. You know, it's definitely driven by curiosity and the desire to learn, I think, which I share. But I also got to see him maneuver in different ways.

John Coe 00:09:31  So very few doctors have an MBA. So tell me that story a little bit.

Jessie Barter 00:09:35  I'm curious. Well, my father was at Georgetown University, and I believe one of the benefits of that was that you could receive, you could go to school. So he decided he would get an executive MBA. Maybe it was just an excuse to spy on me while I was also at school. I'm not sure you wouldn't hear.

John Coe 00:09:52  It the same. He was in school at the same time you were?

Jessie Barter 00:09:55  Yes.

John Coe 00:09:57  That's interesting.

Jessie Barter 00:09:58  Yes.

Jessie Barter 00:09:59  So I, I actually, I think he just had a really strong desire to learn business fundamentals and to figure out if there were opportunities between medicine and business.

John Coe 00:10:10  Did he think about being in hospital administration at one point? I mean, was that part? No.

Jessie Barter 00:10:15  No, I mean, I think it was more he was he did work as an expert with medical device companies, some medical device startup companies, and, you know, working with, you know, just cutting edge technologies. So I think that he learned how.

John Coe 00:10:31  To invest in them. Then potentially by doing that.

Jessie Barter 00:10:33  Yes. I think it helped him bridge the two.

John Coe 00:10:36  Interesting, interesting. And then your mom Tight.

Jessie Barter 00:10:40  Yeah. So my mom was a teacher, but she. She did not teach after she had my me or my brother. But I think from her I learned mostly like a very, like, very strong sense for details. And she's probably what we owe our lack of materiality to because everything is material when it comes to numbers with her.

Jessie Barter 00:11:00  So a very strong, just like a sense of rigor when analyzing different circumstances across the board.

John Coe 00:11:10  Did she have a strong personality as you do as far as being a woman. Yeah. No. Okay. That's great.

Jessie Barter 00:11:18  Yes.

John Coe 00:11:21  That's great. So. So then you went. You went to Georgetown University. And so what experiences did you have there? Did you play sports there at Georgetown or.

Jessie Barter 00:11:29  I was no, that's actually a source of great humor. So I lived with five varsity captains my senior year and I was a complete non athlete. Really? Yes. But we are all great friends and and I just, I played tennis you know in high school but I didn't progress beyond that. So I just yeah I enjoyed going for long walks. That was the extent of my athletic prowess in college, but interesting. My friends were nice enough to befriend the walker of the group, if you will.

John Coe 00:12:03  Well, I heard on another podcast your nickname is the source of the name of your company, so talk about your nickname and how you got that.

Jessie Barter 00:12:10  Yes, I actually I'm not really sure who coined it, but Charger was my nickname and it started in college. and I think it kind of just exemplified kind of just like my go to attitude, in, you know, in whatever application or setting that I was in, it was just kind of a that was the best way to put it just. And did you lead.

John Coe 00:12:31  Any lead, any clubs or any kind of organizations while you're in school?

Jessie Barter 00:12:36  We had an informal club of girlfriends that I was the president of. Yes, but very informal. All right.

John Coe 00:12:43  I figured there had to be something there.

Jessie Barter 00:12:45  Yes. Yes. It gave.

John Coe 00:12:48  You that?

Jessie Barter 00:12:48  Yes.

John Coe 00:12:49  So it sensed that? Yeah. Okay. So that's interesting. So then I finished up at Georgetown. And then what did you think you wanted to do?

Jessie Barter 00:12:58  Well, I was after eight years in Georgetown, I was dead set on not being in D.C. anymore. That was for sure. So moved. Yeah, but I also graduated during the dotcom bust, so hiring was a little pressure under pressure.

Jessie Barter 00:13:12  So ultimately, I accepted a nannying job in Shelter Island in Long Island so that I could nanny and then also interview in the city because I was all I knew I wanted to be on Wall Street, whatever that looked like. So I was able to basically spend a summer in Shelter Island and ultimately, through networking with Georgetown alumni, was able to get a job at Bear Stearns in equity research. That was an interesting experience interviewing because I was also on the same, basically on the same days when I would go into the city to interview. I ultimately ended up with two offers, one from Ralph Lauren, which I had also achieved through, I think, networking through Georgetown alums and then Bear Stearns. So very different paths. Yes. And my parents were like, well, you have an accounting and a finance degree. And you we look forward to you being independent. So you get to choose. And so that was a, you know, lovely. What was the.

John Coe 00:14:09  Ralph Lauren opportunity?

Jessie Barter 00:14:11  I don't even remember what it was to be honest.

Jessie Barter 00:14:13  I don't know I mean, I, I just think I was excited about the discount that I would have been able to get, to be honest. And and that was so the compensation packages reflected that and they were a bit different as well. Yeah. So ultimately I, I joined Bear Stearns and you know, it was an equity research role, but liaising between the trading floor and research. So not directly in a sector, but it was a great experience and I got to New York.

John Coe 00:14:44  Did you have any sense of what the fate of Bear Stearns was going to be at the time you were there or not? No.

Jessie Barter 00:14:52  Not in the cheap seats, no.

John Coe 00:14:55  Yeah. Pretty amazing what happened there.

Jessie Barter 00:14:59  Yes. Yeah.

John Coe 00:15:00  So you were trading?

Jessie Barter 00:15:02  We were not. I was in research. So we we basically were assisting behind the scenes and helping the traders that we were partnered with, basically just to make sure they were aware of like breaking news and, and doing.

John Coe 00:15:18  Stock research, basically.

Jessie Barter 00:15:20  Yes.

John Coe 00:15:20  Okay. Companies and financial statements a little bit.

Jessie Barter 00:15:24  Yeah.

John Coe 00:15:25  Okay. And did that turn you on or.

Jessie Barter 00:15:28  Or I mean, it was super interesting. Like things that I took away I think were probably nothing direct, like nothing immediately from that experience per se, in my daily life now, except for we work pretty long hours. I had to be at my desk at 6 a.m. every day ahead of the market opening. And then so, I mean, it was a great way to get disciplined as a 22 year old pretty quickly. And also, we we sent out a lot of emails, like a lot, which I'm still known for, and there was a great attention. Like you had to be very sure you were putting accurate, very accurate information. So I think it just taught me to like, always try to proofread and make sure what and I'm I've gotten lax at that now I feel like. But at the time, you know, you were basically transmitting very, very timely information to the traders that would then immediately be trading on that information.

Jessie Barter 00:16:25  So you had to make sure it was accurate. Those were probably.

John Coe 00:16:29  Wish you wish you had I back then right?

Jessie Barter 00:16:31  Yes. Yeah. Exactly. Yeah definitely.

John Coe 00:16:36  That would have helped a lot. Yes.

Jessie Barter 00:16:40  So those were probably my two best like life lessons. That and I just I can't eat I broke so many pairs of heels walking around New York City and running around New York City. That was like I just was just going through black heels like a pair every two weeks. It felt like. So it was it was a really fun experience.

John Coe 00:16:59  And so you're there sick at your desk at 6 a.m. and then you'd have to what, you there until 10:00 at night. Somebody it wasn't.

Jessie Barter 00:17:07  It was more like we were a lucky because we were more tied to the market hours. We had a reprieve. Yeah. And I think, you know, I.

John Coe 00:17:15  Know some of the investment banking.

Jessie Barter 00:17:16  People were I was gonna say, I think they were on a little bit of a they were on a later schedule.

Jessie Barter 00:17:20  Yes. That's nuts for sure. So how long were.

John Coe 00:17:23  You with bear?

Jessie Barter 00:17:24  I was with bear ultimately. Just for two years. After probably the first year, I realized that I, you know, I didn't think I would be in that role for a long time. I knew I wanted to get another degree, so I became pretty focused on applying to business schools and figuring out, you know, what, that might look like.

John Coe 00:17:43  You went to Darden. So what was what drove that decision?

Jessie Barter 00:17:46  My family, my parents and then my brother, all were, you know, had been or were at UVA at the time. So I was able to be overlapped with my brother when he was in undergrad, actually. So that was lovely. And obviously UVA and Charlottesville were quite a bit different than New York City. So I think I, I think I was ready for a change in terms of setting. And I just had we had a I had a couple of friends who had been to Darden and, and said really nice things.

Jessie Barter 00:18:13  It offers a case study, case, method, style, which is a little different. And I mean, I visited and applied to several schools, but ultimately that felt like a great choice.

John Coe 00:18:23  I've interviewed a lot of people that went there, you know. So. Good. Good program.

Jessie Barter 00:18:28  Yes. Yep. So I was young to go to business school, but I also knew that I wanted to have a family. And that's not that's a little I think the women that attend, business school and get their MBAs sometimes do skew a little younger and have a few, like, perhaps less working experience just because of, you know, the timelines sometimes that we have in mind.

John Coe 00:18:54  So what what what was your focus at Darden?

Jessie Barter 00:18:57  It's a general it's just a general business degree. I was able to at the time. They had two real estate classes, which I took in my second year. So not as heavy a real estate focus as some of the other schools. 

John Coe 00:19:09  Is that when you caught the real estate bug?

Jessie Barter 00:19:11  A little bit, a little bit, yes, yes, I just my brother had gone into business. We had many family friends that were in real estate that had been trying to lure me into it. And coming from, you know, several of our friends of our family that were in Washington, D.C., that where obviously real estate's prolific. So I think I finally kind of listened. I heard them out.

John Coe 00:19:36  So after Darden then what. Talk about.

Jessie Barter 00:19:39  That. Yes. So then I joined I was lucky to get a job at a private equity fund in Dallas, that factory partners that focuses that focus at the time on the four main food groups. So was able to get, you know, jump in and work on deals immediately is like a.

John Coe 00:19:56  You moved to Dallas.

Jessie Barter 00:19:57  Moved to Dallas. Yes.

John Coe 00:19:59  That's a big.

Jessie Barter 00:19:59  Change. Yes. Yes. But it was a great exposure. It was a great experience. I mean like the founders are wonderful people.

Jessie Barter 00:20:06  I'm still in touch with them and very grateful for the experience. Of course I really didn't, you know with two classes of real estate under my belt, I didn't have too much immediate skill to know. So it was really a learning ground for me, if you will, and I was able to get good exposure across the food groups. And just in terms of working on some new developments as well as acquisitions.

John Coe 00:20:28  So there's a private equity firm. So you just traditional acquisitions, is that what you were doing or.

Jessie Barter 00:20:33  And and investments in development.

John Coe 00:20:35  Okay. All right. So mostly joint venture partners that you were investing with. Yes. Okay. So you were looking at JV structures and all that. Okay.

Jessie Barter 00:20:46  I was pretty much just trying to figure out how to build it models at that point. So yeah, I wasn't deep in the JV docs then. I was just trying to figure out how to get all the math to work.

John Coe 00:20:56  And excel at that point.

Jessie Barter 00:20:58  Yeah, yeah. Okay.

Jessie Barter 00:21:00  Yeah. But in that experience, I did I did realize that I was gravitating towards multi among the, the, the food groups and did really enjoy the pace of the acquisitions.

John Coe 00:21:12  So why multi for you.

Jessie Barter 00:21:14  I think I just liked the diversified nature of it. So it's just you know I was a little nervous about office and industrial. If you had a big tenant roll off or, you know, you had exposure to me, it just seemed easier that you would get heads on beds if you needed it. Well, at.

John Coe 00:21:32  That time, multi-family just exploded and becoming the number one product. And out there about the time you're you were there probably. So I'm guessing because of the emergence of Fannie and Freddie being in the lending market. And I saw it firsthand in the early 90s when I interviewed Tom Bozzuto. He said, we were the I was the orphan stepchild that's multifamily, because all the focus was on office, you know, retail and industrial, he said. Right. You know, multifamily.

John Coe 00:22:08  We were like. And then suddenly it just took off. And it was basically because of finance. The capital markets changed in the 90s and CBGB's and all that. And then because of the Fannie and Freddie. The stability took in. And that's what I think changed the market. I don't know what your perspective of that is, but that's the way I look at it.

Jessie Barter 00:22:30  Yeah. I mean, I didn't have the I didn't have the experiences before jumping into it, but I think it was just it was also the most relatable asset class. And I just I felt like I had it, you know, at least been in, you know, an apartment right before and could relate to to what we were trying to invest in.

John Coe 00:22:49  So then you joined Avalon Bay and I'm guessing you stayed. You moved back from Dallas to the to this area to do that exact right? Yes.

Jessie Barter 00:22:58  Yeah. Yes. And that was a great opportunity. I was able to work in acquisitions and disjoined in 08I think.

Jessie Barter 00:23:06  So just just as things were changing. Yes, it was a little slower in the beginning but but had great.

John Coe 00:23:14  That's a stable company to be with at that time.

Jessie Barter 00:23:16  Yes. And it was, it had I mean, it had a wonderful training program and was able to learn a lot. I think my first acquisition I worked on was actually out in Seattle, but primarily was focused on the Mid-Atlantic, in the northeast.

John Coe 00:23:31  So was that a big change going from private equity into a public REIT for you, as far as the way they looked at things and how they analyze them.

Jessie Barter 00:23:39  Parts of it were. But actually, at that time Avalon had a fund, a sidecar fund. So I believe I came at the tail end of the investment for the first fund in the beginning of the investing, just.

John Coe 00:23:53  Before they went public for the.

Jessie Barter 00:23:55  Second fund. No, it was while they were public. Yeah.

John Coe 00:23:57  Interesting.

Jessie Barter 00:23:59  so in that regards, it was kind of I was going from one fund initiative from another or to another.

Jessie Barter 00:24:04  But we also were doing dispositions, you know, depending on capital market needs or, you know, needs in order to fund development. So there was parts of it were similar and obviously parts of it were very different.

John Coe 00:24:20  So you just deepen your experience there more or less. Yeah. Got it. Really.

Jessie Barter 00:24:25  Yeah. Got a lot more reps and.

John Coe 00:24:28  Sure.

Jessie Barter 00:24:29  Was able to learn from a blue chip company. So that was yeah great training ground.

John Coe 00:24:34  So then it shifted over to Mill Creek. So what drove that change out of curiosity?

Jessie Barter 00:24:39  Yes. Well, I had had a great experience at Avalon and I thought, you know, at that point when I was leaving Avalon, we were no longer deploying for the fund. So it was more balance sheet investing and debt was we weren't doing individual debt. So I just like I felt like I needed to shore up my my skills for capitalizing deals. And at Mill Creek, they were working with a variety of different partners to deploy capital. And so it was I was able to learn about, you know, more structures, more ways to scaffold deals together different ways to capitalize them.

Jessie Barter 00:25:15  So it was like it was I just feel like I needed that. I remember feeling like I just I needed to shore that part of my toolkit up.

John Coe 00:25:24  And backtracking a moment to Avalon. Curious if you had experience with Lili Dunn?

Jessie Barter 00:25:29  Yes, yes. She ran the group for much of the time that I was there.

John Coe 00:25:34  So you reported to her okay.

Jessie Barter 00:25:36  Yes, actually. And my I reported to Pat and idk. And then Lili ran the group of the bigger I think all of investments I should say. Yeah.

John Coe 00:25:45  You stay in touch with her. Yeah. Yeah she's on my list. Hopefully I'll get her.

Jessie Barter 00:25:52  Absolutely. Yes.

John Coe 00:25:54  Oh she's special. Yes. She her mentor and mine are the same. So that's how we got to meet each other. Oh I love that. Yeah. But I'm actually one of my guests rattles out you know mutual mentors. Oh, okay. Anyway Wonderful. Yeah. So then you went with another podcast guest of mine, our friend Sean Caldwell. Yes.

John Coe 00:26:18  You worked with Sean?

Jessie Barter 00:26:19  Yes, but I was. Sean was running the development. Right. And so I was in.

John Coe 00:26:25  You're on the acquisition on the acquisition side?

Jessie Barter 00:26:27  Yes. Although we had the great pleasure of working together on an Acquisition developement, which was a wonderful experience, an asset in Columbia Pike, that 1970s high rise with an existing parking structure that offered density. So we worked together very closely on kind of a more unusual project. But that was that was really cool. Crossover.

John Coe 00:26:48  So yeah, I mean you go back from a public company then to the private equity type side, which is what they do. It's so that's a little bit of a different mindset. But what's interesting is that the, the the genes are the same. Yeah. Because they're both come from the Trammell Crow Yes, yes. In the company. Well, and.

Jessie Barter 00:27:10  In fact, the private equity fund that I'd been with, Thackery Partners also came out of.

John Coe 00:27:14  CRO. Oh, okay. I didn't realize that.

Jessie Barter 00:27:16  Experienced. Yeah. Predecessors in different, you know, different varieties.

John Coe 00:27:21  That's interesting. So did you. So let's talk about that for a moment. Was there a common theme among all those three firms. And and what did you learn from that common theme. If there was one.

Jessie Barter 00:27:36  I would say like it's a great question. I would say that I'd have to I honestly would have to think about that more. But I feel like integrity was a large part of all three of those firms, for sure, and kind of being good. Obviously being a good partner with whoever, you know, if you have an equity partner, that was always incredibly important. And then I think also just being like a fair business person, you know, with whoever your counterpart is on the other side of whatever your transaction is. I don't know if that's. I guess I've never been at a non macro predecessor company, so I don't know what if other I don't know if other places don't have those same ethos, but I would say that would be a common thread among the three.

John Coe 00:28:24  I think of. Partnership is the key word for that, because that's really how Trammell himself basically built his company. So when you think back, there's a book written by about him, it talks about that. And then I've met so many people that worked with him directly. and so it's interesting to hear that the whole philosophy and how they look at things. Right. So yeah, yeah.

Jessie Barter 00:28:50  Definitely a special respect for partners.

John Coe 00:28:52  And so on that theme, did you with regard to your own company, that you take some of those learning lessons with, you know, the things that you just mentioned and other thing. You know, we.

Jessie Barter 00:29:05  Treat everyone horribly. What are you talking about? yeah. No, I think I think that, like, a very. I mean, for the new company. Absolutely. Like, I would, I would definitely. I feel the same authenticity and the same. I feel like I placed a very strong measure of importance on the partnerships that we have and want to do right by our partners and be very transparent at all times.

Jessie Barter 00:29:30  So I, I definitely think that's part of that same ethos for the new company. I think also, there's just a deep respect for the residents that choose to live at our assets during points in their lives. So I think that also underscores how part of how we operate, because I think when I step back and I realized I wanted to do something more entrepreneurially, I had to figure out, you know, the essence of what that meant was I just doing it to do transactions or was I, you know, I kind of had to figure out in my own head, you know what? That really looked like that. I think it had, like, a deeper level. And I think we, we think of ourselves as pretty strong corporate stewards.

John Coe 00:30:16  So before we get into your company, talk about your decision making with regard to that decision, I mean, what led you to that to make that call and why then and not earlier? Why couldn't you have done it right after Avalon Bay, as opposed to, you know, waiting to your Millcreek and had that experience?

Jessie Barter 00:30:36  A couple of things.

Jessie Barter 00:30:37  I think the Millcreek experience was really an important one to help the tool set that I was mentioning. So I felt like I just had more confidence at that point, too. I had been working with an executive coach.

John Coe 00:30:50  interesting. Yes.

Jessie Barter 00:30:51  So my dear friend Vivian Garcia Tuna, and also a high school classmate of mine from from Georgetown and Visitation. And so I worked with her, probably for I was working with her probably for a year or two years. And in the process kind of was reconnecting with myself and figuring out what really got me excited and what I was really passionate about. And through the process, I realized, you know, I was so lucky to be doing what I love to do, which is acquisitions. So I had figured out, like functionally, what I really enjoyed. I just had to figure out in what environment I thought I could be doing it, you know, most successfully by, by virtue of being like, most happy. And so once I started going down that path and thinking about how I could do, you know, the role more independently, that's kind of how the idea started.

Jessie Barter 00:31:44  And then ultimately, you know, I was bouncing around business plan ideas and trying to figure out how to replicate all the resources that you have at a, at a company like Mill Creek or at Avalon Bay. That's obviously daunting, You know, if you're just going to go out on your own. And I and I am generally pretty risk averse. So I just there was a lot of thought that went into all of this before deciding to leave and and start charger. Also, I had a small daughter at the time who has a pretty strong personality, and she was two and she just she had no like no concept for like social norms or anything, and she just really did whatever, you know, she felt passionately she should do. And so that was a little it was, it was interesting to see her and to see, you know, that she was quite liberated in this, in her little bubble that she was existing in without norms. And so I thought, you know, okay, well, let me try.

Jessie Barter 00:32:46  I feel like I have to try and just see what happens. The idea had grown so big in my head at that point that you kind of just I just couldn't resist it anymore.

John Coe 00:32:57  So when you bought your first deal where you're still employed or did you had you resigned at that point? I had.

Jessie Barter 00:33:01  I resigned.

John Coe 00:33:02  Yeah. You already had. Oh yeah. Okay. Okay. So how long. What was the interim period before you closed on your first deal. And I mean.

Jessie Barter 00:33:11  Miraculously I had resigned in the summer and pretty immediately after resigning the deal happened to hit the market. And it was a market, a deal. But by that point I knew who my equity partner like I had forged an agreement with, with a family office. We, we had forged a partnership that we knew we wanted a good.

John Coe 00:33:31  Start, run.

Jessie Barter 00:33:32  At opportunities together and kind of figure out what the rest of the cycle, you know, however long it would be, what we wanted to see together, what we could do in that period.

John Coe 00:33:42  So other than the. Yeah. Other than the coach, then that had to have been a huge impetus to have that relationship right up front, I imagine.

Jessie Barter 00:33:53  Yes. And that was very important to me and we had been speaking for some time, obviously, like, you know, not concretely, but just idea sharing and things like that. And so over that period of time, I was able to see that they were deploying a lot of, you know, a lot of capital and that they were quite active, which which was important for me.

John Coe 00:34:12  So when you met with them the first time, did you have a business plan that you put in front of them, or did they say, Jesse, we want to invest with you, bring a deal and we'll talk it through. Is that kind of how it went? I mean.

Jessie Barter 00:34:25  I literally just met them just like a normal, like a normal networking conversation with literally no idea. One of my mentors had put us in touch together, and I really had no idea what we were going to be visiting about.

Jessie Barter 00:34:38  And within, I think a couple of months, they had sent me a term sheet to do the venture, and it took me two years to think about it. Wow. Because I was so out of that headspace.

John Coe 00:34:48  Two years, two years.

Jessie Barter 00:34:50  Hahaha. Yeah. So wow, I wasn't I wasn't I was not focused on that. I didn't when I met them originally. That wasn't my idea at all.

John Coe 00:34:59  So you were at Mill Creek at the time?

Jessie Barter 00:35:01  Yeah, I was I was a little creek. Yeah. Fine deals that was trying to help grow that platform. And it wasn't on my mind at all. It was just random. It was very random. And then I thought, this is so odd. Well, like, what? What am I supposed to do with this term sheet?

John Coe 00:35:15  I don't even know what stimulated them to do that. Just out of curiosity, did you ever look back and think that through as to why or not? It was something about you that said, I think she could do it.

Jessie Barter 00:35:26  I mean, I guess, yeah, no.

John Coe 00:35:29  I don't I.

Jessie Barter 00:35:30  Don't know the answer because I really had no personal track. I mean, I had no personal track record.

John Coe 00:35:34  I know, that's why I asked because that is unusual.

Jessie Barter 00:35:37  Yeah. I mean.

John Coe 00:35:38  I know you're asking. They're not asking you. Right. So that's a little different.

Jessie Barter 00:35:42  I know that the the mentor, my mentor who introduced us, Grace Hooper, to which I owe a lot for the introduction, Apparently clearly very grateful for she had had a prior venture with. Oh, and it had gone very well. So. Okay, that was I'm sure I was riding on the coattails of those successes as well.

John Coe 00:36:04  That's interesting. You still have that relationship with that family office. Yes. Oh that's great. Yes. That's great. So they've been a backbone for you. Absolutely. Basically. That's that's nice.

Jessie Barter 00:36:17  Yes. They have been a partner on most of our deals.

John Coe 00:36:19  Yes. That's great. Great. So your first deal was in Lexington Park Maryland which is down near the river base.

John Coe 00:36:29  Yes. So I've been down there once actually camped there. Okay. Watch the Blue Angels there. Oh that's kind of it was cool actually. Yeah. Long time ago. But it's an interesting market is dominated by the military there. Pretty much. Yes. So is that what 80% of your occupancy there is your military typically?

Jessie Barter 00:36:54  I don't think. I think it's probably more like direct military after Brac has been reduced. So it is it's a lot of contractors, defense contractors.

John Coe 00:37:03  Okay.

Jessie Barter 00:37:03  I think you direct military maybe like less than 10%, but contractors probably 30%, 40%. And then just other, you know, other members of the community.

John Coe 00:37:15  So how'd that deal come to you?

Jessie Barter 00:37:17  Well, it was marketed. Oh, you.

John Coe 00:37:19  Said it was a broker.

Jessie Barter 00:37:19  I mean, it was it was marketed. And I guess, you know, late summer of 2018 and it was priced, which is so unusual. It came out with a price which is not common now. No. Right. It was in retrospect, it was priced at 250 basis points over.

Jessie Barter 00:37:36  Yeah. Which is incredibly deep, positive leverage in retrospect.

John Coe 00:37:40  That's a fall off the log deal.

Jessie Barter 00:37:43  Is it? I don't think at the time it didn't. It seemed more, I think maybe more normal. I mean, there was definitely some premium baked in given the location being more.

John Coe 00:37:53  What was your cash on cash return when you when you did your numbers on it, then.

Jessie Barter 00:37:57  I mean it fit the box. Double digit definitely high single.

John Coe 00:38:02  Yeah yeah. Wow. But so your your private equity guys you're like whoa okay here we go. Let's see this one.

Jessie Barter 00:38:12  Yeah. So and it was though it was not the I mean it was it was just everything all had to come together at once to get the deal done. So it came with all the things you would expect going through a JV for the first time with a new partner and, you know, showing them how we like, how we run a diligence and just making sure everyone's on the same page. So it was not it was not the easiest.

John Coe 00:38:34  This wasn't your first rodeo.

Jessie Barter 00:38:36  But it was our first rodeo together. Yes.

John Coe 00:38:39  Yeah, I get it. But they knew your background. My God, you'd been doing it for 15 years. Probably or more.

Jessie Barter 00:38:45  Yeah, so I think. But I wanted to show them, you know, we were strong and that we could do a good job. So it was not without stress, but we got it done. Well, I'm.

John Coe 00:38:54  Sure every deal is stressed. Yes. Of course.

Jessie Barter 00:39:01  So let's pass it.

John Coe 00:39:03  Yeah, let's let's shift now to your company and team dynamics a little bit. How do you define the firm's investment philosophy and approach?

Jessie Barter 00:39:13  Generally, I mean, because this family has been our major investor, we are together looking for higher yielding assets. And that has pretty much been the thesis. So whereas others have a box that includes vintage and location parameters and tactical strategies, we enjoy being agnostic on all three of those which which is which was very liberating. I mean, it's it's wonderful where you can kind of just float and gravitate to where the where you see inefficiencies in pricing.

Jessie Barter 00:39:45  And that has meant that sometimes we've bought merch and build deals brand new, like newer construction, and other times we've bought much older assets. By and large, the portfolio is in secondary and tertiary locations. The average vintage is roughly 1988 but spans from 1950s to 2019 now. So a pretty broad range of vintage and like high level, I would say the constants across the assets generally is some level of physical improvement, usually in the interiors, probably like $10,000 a door. And also, like I've mentioned before, operational rigor. So those are the two, you know, those have been the two major themes. But you know, we've been focused on buying existing acquisitions that are stabilized. So we haven't we've been very.

John Coe 00:40:36  Near haven't had major at least.

Jessie Barter 00:40:37  UPS. No. Yeah. No sales, no forward purchases, no lease ups. So it's been it's been like a you know it's been tight in terms of that focus.

John Coe 00:40:48  It's interesting because I think back at your prior firms to where you are.

John Coe 00:40:53  I mean Millcreek was a mix of development and acquisitions value add to some extent, maybe took a little bit more risk on leasing and things like that up front. But they wanted higher quality assets, I think, than what you're talking about. More of the Class-A stuff as well as Avalon is definitely class A, so you're talking or trophy. So you're you're at the top of the market there on asset quality. But so you're looking at a different asset quality. And a different geography. Yeah.

Jessie Barter 00:41:24  Well when we were at Avalon we were doing acquisitions of older assets for their mostly for the a brand called Avalon Eves. And so we had like I would say we had generally we had bounced around a bit on vintage probably 1970s was the oldest that we'd looked at, although there may have been 1 or 2 even older. So when we were deploying capital to the fund, I could see that it was a varied life. I would say that the caliber of the locations were always very high, even if they may have been older on vintage.

Jessie Barter 00:41:55  Right.

John Coe 00:41:55  Whereas, yeah, I mean, you're not doing tertiary markets with that.

Jessie Barter 00:41:58  Exactly. Yes. That was those were the constants.

John Coe 00:42:01  Right. And they you know, because of scale, they probably varied more on the age than they did on the location.

Jessie Barter 00:42:09  Absolutely.

John Coe 00:42:10  As far as building their portfolio.

Jessie Barter 00:42:12  Exactly, yes.

John Coe 00:42:14  So you're you're looking more at geography, their diversification as well as age and quality asset. But that's right. You know, you're not going to do see assets and you're not doing affordable housing. Sounds like. So you're focused on market rate housing and secondary and tertiary markets primarily.

Jessie Barter 00:42:34  Yes that's right. But you know we do tend to gravitate towards obviously like rent to income ratios and incomes in the areas are important to us. So when we go into pockets, they generally we we are wanting them to have like generally higher levels of income. And when we're buying older assets, that provides for somewhat naturally occurring affordable housing. When you look at the Ami percentage. So in fact our portfolio now sizes to 75% Ami.

Jessie Barter 00:43:01  So it is kind of de facto workforce housing. Interesting more or less by virtue of the vintage. Yeah.

John Coe 00:43:08  But you're in exurban markets primarily if you're in the urban area of any sort, like Lexington Park, for instance. I call that exurban. Yes, as is Waldorf. I think you're in a Waldorf as well. That's an exurban market. and it's not like you're inside the Beltway or something, right? I doubt you're ever going to look there unless prices get really attractive. Although FCP did it when Prince George's County was, you know, a little different market. And they were doing it there, but because they and they got value there. But it's kind of hard to do it in Northern Virginia.

Jessie Barter 00:43:44  We pretty much need to get yield by moving a little bit further out. Definitely.

John Coe 00:43:48  Charlottesville is an example I guess.

Jessie Barter 00:43:50  Exactly. Yes. Yeah. So but in terms of our approach, I mean, currently we're really focused on remaining climate resilient. So we current our current portfolio hugs the eastern side of the Appalachians from Virginia to Massachusetts with our pocket in in the more southern Maryland area.

Jessie Barter 00:44:12  So we want to continue to not experience wind or water events. That's important to us. We've been lucky to be with carriers that have not experienced large losses. So our average insurance per unit right now is 450 a door. It was 350 a door last year. So that's enjoyable to not, you know, to be able to sleep at night and hopefully worry about fewer climate events.

John Coe 00:44:36  And you wouldn't have thought that western North Carolina was going to suffer a climate event.

Jessie Barter 00:44:43  Yes.

John Coe 00:44:44  Yes.

Jessie Barter 00:44:45  It's it's hard to underwrite everywhere these days. I mean.

John Coe 00:44:49  Asheville would have thought, right?

Jessie Barter 00:44:51  I know so bad.

John Coe 00:44:53  Is that a market you looked at or.

Jessie Barter 00:44:55  We would love to we would love to buy in Asheville. We've looked there.

John Coe 00:44:59  But I'm sure now it's a bargain.

Jessie Barter 00:45:02  I don't know, I haven't circled back, to be honest. Yeah, yeah. But some of those, you know, we are in in when you look back at what we have now, there is a theme, a loose theme going through of college towns where we enjoy EDS and usually meds and sometimes some fed, if it's like a county seat with government presence.

Jessie Barter 00:45:21  So we we've been able to we've been enjoying those experiences in the markets where we are. They tend to have rents that don't where there's there tends to be very little new supply because the rents, you know, the new construction costs can't be borne by the existing rents. So the pockets were in tend to be relatively stable. And we find we're able to get pricing power, kind of like within those systems, if you will. So that's that's a loose theme as well.

John Coe 00:45:51  Interesting. So what's been the most challenging part of building Charger Ventures?

Jessie Barter 00:45:58  Probably the last two years. I mean, hitting this pocket, hitting this bubble in the capital markets and figuring out how to continue to grow amidst this capital markets.

John Coe 00:46:11  So it's slowed down your acquisition. Yeah.

Jessie Barter 00:46:13  It has. Yeah. And what about asset management.

John Coe 00:46:18  It's that stayed pretty solid through that period of time.

Jessie Barter 00:46:21  I think it has Covid in the Covid of course at the time was an operational like highly concerning for obvious reasons and all trying to figure out how to operate in this new dynamic.

Jessie Barter 00:46:33  But in retrospect, I mean, especially given all the surplus, I mean, in the rent bubble that came from it, that was kind of a boon, actually.

John Coe 00:46:44  And the most rewarding.

Jessie Barter 00:46:46  I mean, I get to do what I love every day, so that's pretty good. And the winds that we've had are very, you know, fulfilling as well.

John Coe 00:46:56  Perhaps finding your equity partner too was a big one.

Jessie Barter 00:46:59  Absolutely.

John Coe 00:47:00  Yeah. Yes. Yeah. That would have helped.

Jessie Barter 00:47:04  Yeah.

John Coe 00:47:06  So what differentiates you in this current landscape? You already mentioned a couple things, but get into a little more depth on that. If you can say with regard to your compare, you know, the off market strategy and some of the things that you've been able to kind of engineer. Yeah. Since you've had this entrepreneurial thing.

Jessie Barter 00:47:26  I mean, I would say. We were really lucky or whatever the right words are to use off fixed rate debt coming through the cycle. So it's we have dry powder in terms of resources and capacity because we really aren't dealing with any problem children from a debt side right now.

Jessie Barter 00:47:47  So I think I think.

John Coe 00:47:49  No recourse on any of your notes I assume. Right. Yeah.

Jessie Barter 00:47:53  And no floating rate exposure. So that's been I think we just I think I think we're just pretty disciplined in how we look at our acquisitions. We look at them all the exact same way and we use the same market research. We use the same approach. We haven't we didn't we don't really flex in terms of the underwriting, which to some may seem very conservative and has probably played into the fact that we haven't been able to grow as fast as we would like, but it meant that we didn't buy anything in 22, like at all, for instance. And so hopefully those hopefully just the fact that we're just going to keep doing what we're doing, basically because it seems to have kept us out of trouble so far, and help has helped steer us towards opportunities that have been successful. So part of that is, I mean, the off market is really just a matter of how to manage resources.

Jessie Barter 00:48:43  I think it was very it's disheartening. It was very disheartening when people were having multiple best and final rounds, when the market was hyper liquid and we would lose by a couple of dollars and we'd already invested all that time and, you know, dollies, questionnaires. So the off market, I think was just a kind of a realization that we needed to be more efficient with our time, frankly. And then in terms of the rigor of the underwriting, we just, for better or worse, or probably we just we just don't really deviate from it. High level.

John Coe 00:49:16  So you won't you won't go into an auction situation at all. You just say, this is it. That's the lid. We're done.

Jessie Barter 00:49:23  Yes.

John Coe 00:49:24  Yeah.

Jessie Barter 00:49:25  Yeah. Okay. Yeah. So I don't know if I'm lazy by not doing that or not, but especially because some of the options, the auctions have been fairly depressed in the last year. So I could I could argue that that was the wrong approach over the last year, but that's what you don't.

John Coe 00:49:39  Wall Street analysts are saying you got to close deals, you know. Right. So you have a private equity partner that's friendly, willing, patient long term perspective. The big asset. Yeah that's a huge asset.

Jessie Barter 00:49:58  Exactly I.

John Coe 00:49:59  Mean for anybody in your shoes.

Jessie Barter 00:50:01  Their cost of.

John Coe 00:50:02  Capital as it gets.

Jessie Barter 00:50:03  Their cost of capital is irritatingly high. So there is nothing maybe is ever perfectly.

John Coe 00:50:09  Perfect, right. I'm going to share a personal experience now about irritatingly high cost of capital.

Jessie Barter 00:50:14  Okay.

John Coe 00:50:16  My second job was with Koch Industries. Koch in Wichita, Kansas, the second largest privately held company. Guess what their internal rate return hurdle was for deals. And if you know what their business is, they're in the oil and gas business and and agriculture land. So just take a take a gander what that was. Try 40%

Jessie Barter 00:50:42  Are you serious?

John Coe 00:50:44  I'm serious. 40.

Jessie Barter 00:50:46  40.

John Coe 00:50:47  40. But this was 1980. So interest rates were a little different in 1980 of course. Right. But even so today it's probably still 30 some.

Jessie Barter 00:51:00  Wow.

John Coe 00:51:01  Yeah. Because they you know, they'll throw 100 holes in the ground and expect 1 or 2 to hit. So it's that it's that mentality. Yeah. They're wildcatters I mean that's what that's the roots of the company. And then of course they're much broader now and bigger and do a lot of different things and have huge tiers difference of of investment strategies. But that was the mindset for what we were doing at the time. So it was hard, right?

Jessie Barter 00:51:35  Yeah.

John Coe 00:51:38  Yeah. So it appears only early on in your venture, and I guess it was a couple of years in according to your timeline, you decided to start an operating company. So talk about the evolution of that thought process and that that come from your experience with Avalon Bay. And.

Jessie Barter 00:51:55  Sure. So we didn't start an operating company, but we did start a brand. So we rolled out a brand.

John Coe 00:51:59  Oh, I see the Spark.

Jessie Barter 00:52:01  Living brand in the fall of 2020.

John Coe 00:52:03  Where did that idea come from?

Jessie Barter 00:52:04  It definitely came from my experiences at Mill Creek and Avalon Bay.

Jessie Barter 00:52:07  You know, so I think I was just cut from that cloth that it made sense to have a brand so that it would standardize collateral, standardize, you know, when you were acquiring a new asset, it was, you know, exactly what to order and it just made it. You weren't reinventing the wheel. So there was a there was an efficiency play there for sure. I think while those companies probably enjoyed sharing traffic among their branded assets, we don't. That was less important or less relevant for us. I don't think we're sharing traffic between our disparate locations, but it was also important for us to to develop, I felt, and deliver a consumer facing brand. So it was important to me to separate charger from the experience that our residents were having. So keeping them separate, I think, is something that continues to be important to me. And I wanted to have a differentiated apartment community brand that told more of a story. So the mission of Spark Living is to improve the lives of those that pass through our doors, which includes all of our stakeholders, whether it's investor partners, property management team members and partners.

Jessie Barter 00:53:19  Obviously the residents or the broader community in which our assets are located, and we intend to spark joy, equity, efficiency and trust, all in the hopes of sparking greatness. So those are kind of the tenants in the mission that that guide a lot of what we do. We developed a training manual, but we don't actually manage the asset. So we use different property management partners to help live the brand out from a white label perspective.

John Coe 00:53:52  So two thoughts came to mind with that name. One is you like the electrical theme? Yeah. And the second is you're probably a Marie Kondo fan as well.

Jessie Barter 00:54:05  I do like that. Yes.

John Coe 00:54:09  Spark. Joy.

Jessie Barter 00:54:10  I know it's you. Okay. Yes.

John Coe 00:54:13  All right.

Jessie Barter 00:54:13  I think we rolled out around the same time, but I would have to check that.

John Coe 00:54:19  That's interesting. So you were operating for about four years at that point when you started this brand. So what what why why did it take so long?

Jessie Barter 00:54:28  It was it was about two years.

Jessie Barter 00:54:29  So two.

John Coe 00:54:30  Years.

Jessie Barter 00:54:30  Oh, okay. So we I think we probably had to rebrand 3 or 4 assets. Okay. But otherwise everything else immediately came in as a spark asset.

John Coe 00:54:40  Did you hire somebody. I mean is that the time when you brought in your partner binder.

Jessie Barter 00:54:45  We brought I mean we brought in a creative consultant. Oh you did build the brand. Yes.

John Coe 00:54:52  What's your partner on board at that point they were.

Jessie Barter 00:54:54  They were supportive and.

John Coe 00:54:56  No I'm talking about your personal partner within your company.

Jessie Barter 00:54:59  Oh, within the company. Well, Lindsay, who runs asset management, started with charge from the beginning.

John Coe 00:55:05  Oh, from the beginning. Oh, okay.

Jessie Barter 00:55:07  All right. And and she and I had been at Avalon together as well. Right. I think that concept was also Although familiar, but I will give our equity partners credit that they also got behind it and there was obviously capital investment and time investment involved. But I think we also were trying to make the case that if we if we offered a, you know, healthy and sticky consumer story, that it could help drive retention higher, which in turn would reduce marketing dollars, turnover dollars and potentially payroll.

Jessie Barter 00:55:36  So, I mean, there was a there was a business thesis that went along with the brand rollout as well.

John Coe 00:55:44  So I assume that you hire different property managers in different markets. Is that correct? Yes. Yeah. Okay. And so you basically when you interview with them and hire them, say, okay, well this is our brand standards and this is how we do it and fall in line.

Jessie Barter 00:56:00  Basically we asked yeah, we want to make sure they're open to that idea.

John Coe 00:56:05  Yeah I assume so. Interesting. That's cool.

Jessie Barter 00:56:09  Yeah I mean it's been it's it's like we in fact, this year we are reexamining the brand. It's five years old. And one of our initiatives this year is to reexamine the, like strength of the brand, the health of the brand, and to see how everyone feels about the brand, from our residents to our team members. So we are just now in this quarter, throughout the course of the year, we'll be going through an exercise to measure the strength of the brand, to determine where we need to improve the strength of it, and then how to enact that going forward.

Jessie Barter 00:56:41  And then we'll retest again this time next year to see if you brought the.

John Coe 00:56:45  Property managers together to have a kind of a thesis idea, or at least get their ideas on on that what you just said.

Jessie Barter 00:56:55  Yeah, we have a survey out right now across all the all the members of every team to try to gauge and.

John Coe 00:57:01  Benchmark you physically. Have you ever physically got them all together in one place or not?

Jessie Barter 00:57:06  Virtually. Virtually. We do that once or twice a year, But we also have, like compensation structures scaffolded to help drive the strength of the brand. So where we feel there are really important metrics to the brand to drive operational greatness. We also have compensation structures quarterly and annually that are overlays on top of whatever the existing management companies already do, because we want to reward team members that are living the values that we think are really important. And then we want to celebrate the teams that collectively are working towards those metrics. So we call those the spark, our Spark Living Awards.

John Coe 00:57:49  So if you're a resident there at one of those, one of your properties, why would you feel differently than you would at an Avalon Bay property or at a mill Creek property or another asset? What what do you offer that they may not offer? The sort of curiosity?

Jessie Barter 00:58:04  Well, those are also wonderful brands. Of course, those are all those are wonderful companies that offer wonderful brands, I should say. I think we are just I would like to think that it's in. I mean, it all comes down to our team members that our residents are interfacing with. So it's all about how bought in they are to our brand. But for each of the values, we have protocols lined out in order to how how that would be executed on the ground. So it's everything from our what you may see as a resident or a prospect would be that our team members all have the same dress code, which is on purpose, a bit informal. So it's jeans and a white shirt, and you may notice that our office team members wear pink socks and that they have name tags that say, you know what? Like this value sparks.

Jessie Barter 00:58:47  Like, what gets me excited is this value. That value gets me excited with our logo, which is meant to be a conversation starter. And then in the if you're calling the office, you'll we have a different, you know, somewhat differentiate like it's it's a beautiful day at spark XYZ. We have scripts that are written out for various circumstances that hopefully are somewhat differentiated. And then, you know, I mean, we really have to give credit to our managers because they're the ones on the ground every day living the brand with the residents and the prospects. But in terms of sparking trust, you know, it's really important to us that when we when our management, when our maintenance team say they're going to do something, that they do it right the first time, sparking efficiency. We've been exploring and we are currently using like a variety of technologies that make everything more efficient for our team members and for our residents. Spark equity. You know, we are we do annual unconscious bias training. We have specific words that we would prefer to be using that are like, that are just more thoughtful, I would say.

Jessie Barter 00:59:51  Our floor plans are all verbs. They're action words. So that was an intentional choice. So I would say there's just a lot a lot of intentionality that has gone behind, you know, the collateral and the the verbiage that we use just in general operating conditions.

John Coe 01:00:06  Is this through consultants or your own ideas?

Jessie Barter 01:00:09  I mean, I definitely the consultant we worked with was awesome and really helped to develop some of the original ideas. So I would say collaboration for sure.

John Coe 01:00:17  That's great. I looked at the websites of both Charger Ventures and Spark. Notice no cross reference to each platform, nor any bios of you or your colleagues. Curious if this is on purpose and why?

Jessie Barter 01:00:33  I think it was intentional. We definitely do want to keep the brand different. The brands are different and they serve different audiences, so that's intentionally having no crossover. The Charger Ventures brand is, you know, I mean, charger will go for the jugular to get the best return for our messages. That doesn't resonate as well with our products for obvious reasons.

Jessie Barter 01:00:56  That is the essence of why they had to be separate in terms of the Bios. I mean, I just on the charger website? We can't have a map with our spark assets for the reason I just mentioned, and I also think it served us well. We were under contract on an asset in 2021 that unfortunately entered into some litigation and resulted in actually some protests that I thought it was really beneficial at that time that there was no crossover between Charger and Spark. So, you know, our residents weren't impacted at all by the noise.

John Coe 01:01:28  I figured there was a reason, because you're both prior employers have everything under one platform. Typically, offset may be a property asset website for each one. But you look at Avalonbay and everything's under one roof there. That's right. And I assume from a public standpoint they have to do that probably.

Jessie Barter 01:01:52  Yeah. So but I was just.

John Coe 01:01:55  Wondering what, what the origin of that thought process was. And I think you've explained it well. Thank you. Sure.

John Coe 01:02:01  That's good. So what strategies do you employ for foster collaboration and innovation in your team?

Jessie Barter 01:02:09  I would say that we have a strong focus on getting lots of inclusive viewpoints. So that's something that's important to us. And we want to make sure we just we're always soliciting new ideas. So whether that's on the Charger team or within the Spark portfolio, we are always encouraging our team members on the ground to tell us what can be done better, faster, more efficiently. Whatever the case is, we compensate actually for that because we really want to encourage idea sharing, and if it can be shared across the portfolio, then that's like an even, you know, bigger bonus if you will, because and it's I mean, there's been many examples where one manager comes up with an idea and then it's almost immediately expanded throughout the portfolio. So I'd like to think that we're pretty nimble. We like to think that we are also we're very open to vetting new technologies where we think they make sense, testing them and then rolling them out, you know, on the bigger platform.

Jessie Barter 01:03:06  So I think it's just a it's like just a constant curiosity for what we can do better. And seeing, you know, the best, the best impact, the biggest impact that new ideas can have. So definitely an appreciation we like I don't know, I think we just know we all have blind spots and that having other people see them can only make us better.

John Coe 01:03:29  Well, at this point, I don't think you've done a joint venture with another operator that I'm aware of, except someone who I know quite well who's on my board, and I've known her for 20 years. And I understand that you've brought my friend Lauren Jezienicki. And as a partner on one of your transactions, talk about that deal a little bit and.

Jessie Barter 01:03:54  Sure, why.

John Coe 01:03:55  That happened.

Jessie Barter 01:03:55  We actually, we are a joint venture partner with another operating company. Oh, you are another deal. But, that's been it's a little bit of a different the way we structured that was a little different. But yeah, we are super excited to have be working with Lauren on one of our assets, an asset in Massachusetts that we acquired in 2019.

Jessie Barter 01:04:13  It's one building on 17 acres. So since I first visited the asset in 2019, every time I go, it occurs to me that there's way too much land and additional density there. And what can we do about it? So this year we we've really started to invest in over the like over the last couple of years, we've just been setting aside, you know, funds to make sure that we can pursue what the potential could be. And so how did.

John Coe 01:04:39  You find Lauren or.

Jessie Barter 01:04:41  Lauren and I just I think we we've known it. I, we well, her husband and I went to college together. Oh. Okay. Yeah. And then when she lived in DC and was with Bozzuto, you know, we knew of each other and or met each other then, but definitely by the time she was up in Boston and I was doing deals in Boston, we had connected them as well. So for this, for this project and this initiative, it became clear we needed a local operating, a local development partner to help us, you know, figure out what we could do.

Jessie Barter 01:05:10  And so so this.

John Coe 01:05:10  Was your first development deal.

Jessie Barter 01:05:12  Basically, this would be our first development deal. Yes. This would be an active. So so that's exciting. We would we would welcome other collaborations. But this one is a has been an exciting first one is your partner.

John Coe 01:05:26  How are you. Are you going to recapitalize the existing property, or are you going to separate the parcels and do a fresh financing for that? Just out of.

Jessie Barter 01:05:33  Curiosity, yeah, it seems like the execution that we're most interested in right now would be not subdividing the property and perhaps pursuing a HUD execution. So we would refinance these.

John Coe 01:05:45  And 21 D4 for the whole thing is.

Jessie Barter 01:05:47  That I can't remember the right letters or numbers. But yes.

John Coe 01:05:51  I was a mortgage banker for 25 years.

Jessie Barter 01:05:54  So no, it would enable us not to have to subdivide, which would be great. We could ideally, we would pull out some equity from the first and use that as our co-investment or use that as our equity to develop the new the new assets.

Jessie Barter 01:06:09  So the existing asset is 112 units. The new development looks like it could be about 40 or 50 units, which I think is helpful to make the total deal size more institutional.

John Coe 01:06:20  That's cool. Yeah. So the multifamily investment market has evolved even since you started your firm due to the pandemic. And capital markets vagaries, as we've talked about earlier, have you interpreted the market strategically to address these challenges? How how have you?

Jessie Barter 01:06:40  Well, yeah, I definitely think the market changed since we started. I think what I felt most were two things. I mean, we are mostly secondary tertiary, and I felt a lot of investors move into those spaces chasing Covid growth. So that was one pressure we felt. But also the rise of indicators made our, you know, like the pockets where we focus more crowded for sure going forward. What we're feeling now in the market is kind of a retrenchment to primary markets of newer and newer vintage assets. So I do think that whereas there used to be no risk premiums for location or vintage, we're starting to definitely see that reemerge.

Jessie Barter 01:07:19  And hopefully there's less competition as as people, you know, either as indicators are challenged and tied up with, you know, perhaps prior investments. So between the two where we hope to we're kind of just doubling down on our original strategy.

John Coe 01:07:36  So in light of the increase in both interest rates and construction costs, how have you seen evaluations of your current assets holding up? Have you been able to keep high occupancies throughout?

Jessie Barter 01:07:48  Yeah. So I think that's kind of two questions. So the fundamentals have been very strong despite the market malaise otherwise and the capital markets. So fundamentals really I mean there'll be ebbs and flows. There was like a weird funk in the fall of 24 where household formation or demand kind of fell off before and around the election as the case was. I don't know if that was related or not, but we did feel pockets of weakness in the fundamentals as we tried to become very full ahead of winter. But heading into the spring now, most all of the assets have firmed up. So that's really important as we head into the big turn season and then on the like on the valuation side, I mean of course higher interest rates, you know, impact all assets the same way inversely with value.

Jessie Barter 01:08:37  But we've been you know, we're lucky to have all fixed rate debt that we haven't had to explore.

John Coe 01:08:45  I don't have to recap anything. We have it.

Jessie Barter 01:08:47  We did well last year. We did two refinances. Actually. We refinanced a 20 default. They were both fall 21 acquisitions. One we refinanced with new debt and we're able to pull 15% of the equity out. So that was a win. And it was we had acquired the asset with debt in place. And ultimately the new debt was a lower cost. So that was a win. And then the second refinance in late fall was a full cash out refi. And that had also been a fall 21 vintage. So those were both actually good success refinance stories. We're currently pulling a supplemental out on a 2020 vintage asset and will return equity entirely on that deal. So I mean, that rate doesn't feel great, but on a blended basis for a 2022 deal, the blended rate is attractive. So I would say, yeah, I mean it's kind of.

Jessie Barter 01:09:46  I guess we were lucky to peg some of those, you know, rates on down days or down or when the rates were a little lower, I should say so.

John Coe 01:09:56  So you mentioned this a little earlier, but I'm going to bring it up again. Affordable housing continues to be an important need in the urban markets because of where you invest and the markets where your rents may be lower than more urban markets. You think you are addressing this affordability issue with you for your tenants?

Jessie Barter 01:10:15  Well, we do focus on market rate housing and we do represent the needs of our investors. having said that, we are also, by virtue of where our rents sit, considered naturally occurring for the most part, we have also taken advantage of a couple of programs in locations where we are, where we've self obligated affordability. So we've actually said for a certain percentage of the units. We will make sure that we don't push the rents beyond a certain threshold. So I would say, you know, we try to be conscious of programs like that in different municipalities, and it's kind of a win win because the residents for the restricted units are protected.

Jessie Barter 01:11:00  And often there's another incentive, you know, tied to it for the performance of the asset. So it can. So we're always open to dynamics like that.

John Coe 01:11:12  That's great. As your strategy matures, what new opportunities do you see now on the horizon at this point?

Jessie Barter 01:11:19  I mean, I am definitely curious about more active opportunities like the one that we're working on with Lauren. We have another asset that we have just identified potentially additional density on as well that we're trying to explore there. And actually just this quarter last month worked really hard on an RFP. So another a potential new partnership with another development company for what would be a pretty good pipeline of new development going forward. So obviously we're not bringing the development expertise, but our potential partner is we're bringing other aspects that are important to the deal.

John Coe 01:11:54  So it's interesting that the economics now are starting to work for development, which is interesting.

Jessie Barter 01:12:00  We will see if it works. But yeah I'm hopeful. Okay. Yeah.

John Coe 01:12:08  So you're betting on rates coming down a little bit more on the floating side.

John Coe 01:12:11  Yeah.

Jessie Barter 01:12:11  The particular it's it's the structure will have to the structural will reflect market conditions. When we are able to sharpen our pencils and figure out if it if it really makes sense. I mean, if it's.

John Coe 01:12:25  Depending on scale, if it's a big enough deal, you can go sit down with a couple life companies that do fixed rate construction, permanent loans. So that program is out there. Yes, but those assets have to be Pretty pristine. And they also have to be in pretty, you know, urban markets typically not. You're not going to do it in, you know, Lexington, Kentucky, let's say someplace like that.

Jessie Barter 01:12:51  But so I would say just generally areas for growth, those would be ones that we would like to explore potentially. And then just I think we're just open to collaboration and to see what new, new growth avenues there. Cool.

John Coe 01:13:07  In the realm of capital markets and deal structuring, what innovative financing strategies of any have you implemented?

Jessie Barter 01:13:13  Generally, we are agency borrowers, so there's only so much creative, you know, innovation that can go into those structures, but where it makes sense.

Jessie Barter 01:13:22  We are happy to.

John Coe 01:13:24  Have you done any mezz or private preferred equity at all. No no okay okay. No no need for that.

Jessie Barter 01:13:30  Yeah I mean I think we've just been resistant to additional leverage. That's kind of one of our guide rails. We don't cross over to do that. But if you've done.

John Coe 01:13:42  Any secondary, should I say seller finance deals where you've gotten help from your seller? No, none of that. Okay. Yeah. Okay. Are there any specific partnerships or collaborations with financial institutions that you believe have been pivotal to your success, other than your backbone equity partner?

Jessie Barter 01:14:01  Yeah, I mean, I think backbone equity. And then the mother's milk of multifamily, which is the agencies. Okay. Yeah, those are the those are the two pillars.

John Coe 01:14:09  So really no other no other financial partners at this point?

Jessie Barter 01:14:13  Well, I mean, we have other equity partners who we are also very grateful for and look forward to growing relationships with. But. Oh good. Yeah. But on the, on the debt side.

John Coe 01:14:23  Just Fannie and Freddie. Yeah. Yeah.

Jessie Barter 01:14:25  And then I would say like what I was just talking about in terms of self obligating affordability, you know, so working with the counties where we're located of course. Sure. Just to and if they offer initiative tax.

John Coe 01:14:37  Incentives, maybe.

Jessie Barter 01:14:39  Yes. Or we've received a lot of green investment money.

John Coe 01:14:43  Are.

Jessie Barter 01:14:43  As well. Yeah. Interesting.

John Coe 01:14:46  That's helpful. As your portfolio grows, have you considered any aggregation strategies, such as a fund or strategic equity partnership? One off equity raises for acquisitions can be taxing, as you probably know now. But however, you do have that common theme of one larger see, you've got joint venture documents already set.

Jessie Barter 01:15:09  Right? Yeah. So executing with our existing partners is definitely important to us because we have the documents. But I think, you know, and and for assets for partners where we have multiple assets together, then we could explore exiting them together the next time. There's hyper liquidity, whenever that is.

John Coe 01:15:33  But as far as aggregation, there's really no thought for that at this point.

John Coe 01:15:37  You want to keep each each deal separately? Yes. Yeah. Well there's a way to structure it. You could where you could have it aggregate in some respects, but have the ability to plug and play with with the assets too. But yeah, it depends on the scale long term as to how big your company wants to get and what you want to do with it.

Jessie Barter 01:15:56  Yeah, I think for aggregation we would be we would be happy to do strategic initiatives with, you know, a couple or a couple partners with different strategies like that would make sense. But those would be more or less separate account initiatives.

John Coe 01:16:12  Yeah. Well, there's a couple of firms out there that do these corporate level financings that allow for lower cost of capital than you could typically get, and probably lower than what your partners are willing to offer you. So you could probably, as a company, do quite well with those kinds of operating opportunities. Yeah, just something.

Jessie Barter 01:16:34  We could also like look into the secondary market. We could roll some of the existing assets in with a potential new partner who could help us grow in the next phase.

Jessie Barter 01:16:42  So that's.

John Coe 01:16:42  Exactly.

Jessie Barter 01:16:43  You know, a strategy we've thought about. I just I'm not sure the valuations are where we would want them to be at the moment perhaps.

John Coe 01:16:50  So one of my other podcast guests, Daniel Klein, formed a partnership with a group called Almanac. And they invest in his company. Okay. Give him a basically an equity line of credit for him to go out and buy new assets with it, which is kind of a nice situation. Yeah. Right.

Jessie Barter 01:17:08  Yeah. That is it's.

John Coe 01:17:09  An interesting strategic partnership for them. And so it's a different structure than asset by asset. So it's a little more, you know, looking at all the way at the matrix through the company. Right. Basically. So it's something to think about until you have only acquired Until now, you've only acquired existing properties. I know we talked about this already, so we talked about Lauren and that. So we'll move on. Would you be looking for development opportunities in the future and that you've already answered that.

John Coe 01:17:44  So it sounds like you're going to but I would assume.

Jessie Barter 01:17:48  Yeah with partners.

John Coe 01:17:50  Going to be conservative with it. You're not going to be too ambitious.

Jessie Barter 01:17:54  Yes. I don't have the patience to do development. So it would require a partner that does.

John Coe 01:18:01  So how would you play on that? I mean, would you come in and say, okay, we'll be the spark at the end of the day for the asset management piece?

Jessie Barter 01:18:10  Yes.

John Coe 01:18:11  You guys do the, you know, the heavy lifting basically of the construction.

Jessie Barter 01:18:16  I mean it all depends on what, what the needs of the project are and what's important. But in the example for the RFP, we, we recently worked on, you know, it was important that we already had a local presence, The development partner did not. It was important that we would. They would develop the deal. We would asset manage it. we were able to lend our minority status, which was important for purposes of the RFP are okay.

John Coe 01:18:43  And then the equity you would be shouldering a big part of that.

John Coe 01:18:47  Then as far as the.

Jessie Barter 01:18:49  Yeah, I mean, I think we would be working in tandem to make sure we could get it capitalized.

John Coe 01:18:55  Got it. Okay. So reflecting on your career, what pivotal moments or decisions significantly impacted your professional development?

Jessie Barter 01:19:06  I think, you know, I would say the move from Avalon to Mill Creek was pretty. I mean, it was a wonderful place to work at Avalon, and it was hard to leave. But I was able to learn a, you know, some new skills that that turned out to be pretty important in order to ultimately launch charger. So that was a that was an important step for sure. And then I think, you know, most recently promoting my partner Lindsay to partner, status was, you know, a great acknowledgement of her contribution to the company so far and an investment in the future together. So those those have been good decisions.

John Coe 01:19:52  So you posted, a little bit about being, you know, a woman in the business. In our business, there aren't many.

John Coe 01:20:01  You and Lauren are pretty unusual, actually. Being independent ladies, doing your own operating companies. Talk about your commitment to the inclusive thought process as a generator for better returns.

Jessie Barter 01:20:16  Yeah. I mean, I think I touched on it a little earlier, but that's just that's just in our DNA. You know, we just think that having more ideas versus like a more of a. Yeah, we just think more ideas will help. Help us think through blind spots and identify opportunities to help provide better returns.

John Coe 01:20:36  What observation I'll make, based on what you've said, is that there might be more of a hospitality mindset to your thinking. Is that part of what you're thinking from, you know, being a hostess, being more of, you know, bringing people in? And that from that perspective, I'm seeing that more and more with with the multifamily business, much more so than ever was before. This whole feeling of being like more like a hotel. And the experience of greeting your guests, in essence treating them as guests as opposed to tenants, you know, it's kind of a little different a mindset.

John Coe 01:21:14  Is that part of what you're thinking is.

Jessie Barter 01:21:16  I mean I'm not sure if you know, it wasn't intentionally to come from a hospitality mindset per se, but I think like having a real like a human connection is something, you know, we want to be authentic in. We want all of our team members to be able to feel authentic in how they come to work every day, and so that they feel comfortable sharing their ideas. And we want them to connect authentically with our tenants as well.

John Coe 01:21:44  That's great. So as a leader, how do you balance the demands of running a firm with the personal and professional growth?

Jessie Barter 01:21:53  Well, when you love what you do, it doesn't feel demanding. It just feels like fun. No. I mean, there's part of it's true, but there are definitely there definitely requires balance. I enjoy hot yoga as a way to help ground myself and clear my mind. That's important. And I, you know, I have a commitment to self-care. So sleep and and exercise in order to have a daughter.

John Coe 01:22:21  Two. Right?

Jessie Barter 01:22:22  Yes. A daughter and a son. Yes.

John Coe 01:22:24  And a son as well. Okay. How old are your children?

Jessie Barter 01:22:27  11 and 12. So when I'm with them, I want to be able to be present with them. And that is sometimes a challenge, but something that I am focused on.

John Coe 01:22:39  So that they live with you? Yes.

Jessie Barter 01:22:43  They live with me most of the time. Yes. And so it's just that just typifies that I want to be present with them when we're together.

John Coe 01:22:54  That's great. So how do you measure success both for charger ventures and for yourself?

Jessie Barter 01:23:01  I think for myself, like I just want to feel fulfilled in what I'm doing and every day enjoying what I'm what I'm doing. So like I said, you know, buying acquisitions and and really driving value is something that I get a lot of satisfaction from recharger. I think that same concept, you know, relays that, you know, we just want to be doing right by our investor partners. And, and I think the passion kind of flows through.

Jessie Barter 01:23:32  I do think like our I would like to I think our brand kind of has a soul. So that's great. That's an important part of it. And we want to make sure that we feed the soul, which is part of what we're going to do this year. Focus on the brand. I have a renewed commitment to sparking joy. You know, we are very analytical and we do ask lots of questions, and we want to make sure that our team members are like that. We can all, you know, like keep in mind that, you know, like hopefully we're able to have some whimsy in, you know, amidst all the, the focus time. So we're going to be flexing on that value this year.

John Coe 01:24:12  Well, listening to what you've just said, now I know why you and Lauren are on the same page. That's that's almost exactly the way she said things. Almost exactly that, because I counseled her early on in her entrepreneurial days, and we talked a little bit about why she's doing what she did and very similar to what you're doing, which is great.

John Coe 01:24:36  So what advice would you give your 25 year old self?

Jessie Barter 01:24:41  That's a great question. I would think that would probably just say, you know, just reconnect with yourself probably more quickly. And if I had worked with that executive coach perhaps sooner, I would have been more connected. I mean, frankly, when I had when I did start working with Vivian, I was pretty disconnected with my own self. I was a young mother, and just with doing everything I thought was the right thing to do, but I wasn't. I kind of lost track of what I thought was important to myself to be doing.

John Coe 01:25:14  How did she talk you into doing what you you know that coaching or did you did you? Was it your decision to hire her?

Jessie Barter 01:25:21  Oh I yeah I know, I knew I had to work with someone. Like, I knew that I was not feeling perfectly fulfilled in all aspects. So I reached out and then she just did a great job of asking questions to try to peel back the onion and figure out what would be a better fit.

John Coe 01:25:40  One other podcast guest of mine went into depth about her coaching experience. To her name was Kathy Bonnafe. So you said, was it Combined Properties? Yeah, and it was quite an experience for her as well. Yeah. So it's probably a good thing to do for some people at the right place.

Jessie Barter 01:25:59  Yes.

John Coe 01:26:01  Can you share any mentors or role models you've influenced your approach to leadership in business?

Jessie Barter 01:26:09  I mean, I've been lucky to, you know, work with amazing mentors, and I would say the ones that just I could connect with offline, you know, whether it be on professional or personal issues where I could just ask, you know, like where I could feel comfortable, you know, explaining to them just whatever the circumstances were and where we could connect on like a deeper level and where I could solicit their feedback and, and counsel. So I think just, just, I mean, I've been lucky to have a lot of mentors that were willing to offer time like that. And it was I mean, it's been at various points in my life and my career and whether it be personal challenges or professional.

Jessie Barter 01:26:49  Yeah, just very lucky to be able to to have really some really great resources to help, kind of help me figure out what the right next step is.

John Coe 01:26:59  Do you have an advisory board?

Jessie Barter 01:27:01  We do not.

John Coe 01:27:03  Okay. My guess is that your equity partners are probably that more far apart. Yeah, I would imagine so, yes. Okay, so final question. If you could post a billboard on the Capitol Beltway for millions to see, what would it say?

Jessie Barter 01:27:24  Probably like start now. I don't know, just just do the thing I don't I'm not I'm I'm one to take action, I think. And maybe it's just coming into the new year, but I have a renewed sense of like just getting after it and not really waiting for things to happen. I feel like 24 was kind of, you know, like I, I kind of kept us in our lane and it was a little bit of round peg, square hole. And 25 is going to be a little messier, and it's going to be some coloring outside the lines of what, you know, our normal what I thought we should be doing.

Jessie Barter 01:28:04  But with that will come green shoots in an opportunity. So we're just going to do it.

John Coe 01:28:11  So what? You. What you just said sparks me to ask one more question. Even though I said it was my last one. You're one of the few, if not one of 1 or 2, that have come to me to ask to be on. I'm 99% of the time I asked people to join me. So I'm asking you why you came to me to be on the podcast. Just out of curiosity.

Jessie Barter 01:28:33  Well, I obviously have seen your podcast and seen the, you know, the great content that you're putting out with amazing leaders in real estate. So very, you know, in awe of what you've been doing, which is awesome. And I'd like to think that I might be able to offer some insights that were different.

John Coe 01:28:52  Which you've done, and I appreciate it very much. Thank you very much.

Jessie Barter 01:28:58  Thank you for the opportunity.

John Coe 01:28:59  I appreciate it very much.