Episode summary
Robert Boucai & James Broyer – Tax-Efficient Multifamily Real Estate at Newbrook (EP.475)
Capital Allocators with Ted Seides
· · Hosts: Ted Seides · Guests: Robert Boucai, James Broyer
Summary
Robert Boucai and James Broyer argue that multifamily real estate is best used as a tax-efficient income engine when it is held long term, financed with fixed-rate debt, and bought only when the entry math offers positive leverage. Robert said his own after-tax returns from real estate outpaced liquid investments because depreciation shelter and income growth made the strategy superior on an after-tax basis. The guests framed their platform as a deliberate response to what they saw as misaligned incentives in much of real estate private equity, especially short hold periods and floating-rate financing.
The guests described a highly selective process that underwrites roughly 100 deals a month, focuses on landlord-friendly Midwest and Sun Belt markets, and targets submarkets with limited new supply, strong renewal growth, and room for rent growth rather than simply high population growth. They highlighted a Charlotte asset bought below replacement cost with eight years of fixed financing at about a 4% rate and a six cap, where rent growth has already run 13% in 16 months.
They also discussed execution details: deal-by-deal investing, conservative underwriting, significant upfront equity calls, and investor communications built around transparency and quarterly reporting. Key risks include higher rates, weaker population growth, falling replacement costs, and insurance costs, while a potential upside is synergy with public-equity research that can improve market underwriting and rate-lock timing.
Key takeaways
- The guests want multifamily to function as a synthetic fixed-income replacement with tax benefits, not just a levered appreciation trade.
- Robert said the strategy only works when the deal starts with positive leverage and fixed-rate debt, because that preserves cash-on-cash visibility over a long hold.
- The team underwrites about 100 deals a month but says only about five fit its narrow buy box for rent growth, supply constraints, and acceptable entry pricing.
- A suburban Charlotte acquisition showed the model in action: 96.5% occupancy, 13% rent growth in 16 months, and financing locked around 4% on a six-cap purchase.
- The guests see insurance, higher unemployment, and cheaper replacement costs as the main risks, and they underwrite conservatively to avoid deals that fail on those assumptions.
Notable quotes
“we really needed to create this ourselves and we couldn't invest more with other GPS because the other GPS don't have the things that we looking for”
“The only way to benefit from that is if you hold it for a long-term hold and you can only finance it with fixed rate debt if you're going to value that”
“We look for the areas in the markets where either it's you can't build because it's too difficult and challenging to build there or the rents don't justify it”
“What we focus on is low supply markets, and we've seen that that is outperforms these high population growth markets”
How the episode opens
When I started looking at my own returns of my investments in 2020, I'd invested in a bunch of real estate general partnerships over the last 10 15 years. My best after tax returns were coming from real estate because of the depreciation shelter and the growth in income. I was getting protractive returns on an after tax basis.
We came to the conclusion that we really needed to create this ourselves and we couldn't invest more with other GPS because the other GPS don't have the things that we looking for. We needed to reverse engineer the optimal solution for ourselves and find a partner to help us implement it. I'm Ted Sides and this is Capital Allocators.
My guests on today's show are Robert Bukai and James Bryer, co-founders of Newbrook Capital Properties, a multif family real estate investment platform built to generate optimal longduration tax efficient income. Robert is also founder of New Brook Capital Advisors, a hedge fund he launched 20 years ago that today manages a billion dollars across long, short, and long only strategies. He was born with sensory neural hearing loss and today serves on the board of the Hearing Health Foundation which is dedicated to preventing and finding cures for hearing loss.
Our conversation covers Robert's path from real estate to hedge fund investing and back to real estate. We discussed the real estate strategy he designed with James, including alignment, market and asset selection, property improvement, and supply demand drivers to create durable rental growth. We close with risks, synergies with New Brook's public equity business and plans to scale the real estate platform.
I hope you enjoy the show and if you do this week, why not reach out to that friend of yours? You know the one I'm talking about.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- tax-efficient multifamily real estate
- long-duration rental income
- hedge fund investing path
- supply-demand drivers
- scaling real estate platform
Companies and tickers mentioned
- Newbrook Capital Properties
- Newbrook Capital Advisors
- Hearing Health Foundation
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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Capital Allocators with Ted Seides, this episode and its artwork belong to Ted Seides – Allocator and Asset Management Expert. Octagon is not affiliated with the show; this page is an independent summary.
