Ed Lerum:

Maybe there's two things. One is just find something that really drives you that you just naturally find interesting. The other thing I'd say about commercial real estate is I find it so appealing because I think there are so many aspects to commercial real estate where people of a great variety of skill sets and interests can find a spot to be very successful. I think it really is a great sector. It's a sector with just tons of opportunities. And so if you have a sense that you might be interested in it, I would highly encourage you or anyone to really look into that further. Think about it a lot more because there is just great depth and breadth to commercial real estate.

Nancy Lashine:

Hello and thanks for tuning into Real Estate Capital. I'm your host, Nancy Lashine of Park Madison Partners. Park Madison is a capital solutions and advisory firm serving the global institutional real estate business. We sit at the intersection of real estate managers and their capital partners. In bringing these two groups together we speak to a broad range of thought leaders about recent trends in real estate investing, capital markets, operations and technology. And on this show we try to bring some of those insights and conversations directly to you. My guest on this episode is Ed Lerum, head of Global Logistics Real Estate at Norges Bank Investment Management or NBIM. NBIM is the asset management unit of Norway's Central Bank and is responsible for managing the assets of Norway's Government Pension Fund, which was established in the 1990s to invest Norway's surplus oil and gas revenue. With over $1.3 trillion in assets it ranks as one of the largest sovereign wealth funds in the world, owning approximately 1.5% of the global stock market.

Ed has been with NBIM for seven years and leads transactions and asset management oversight for NBIM's $12 billion logistics real estate holdings, which spans across Europe in the U.S. We jump right in with Ed's story about growing up in Chicago and how he pivoted from an early career in accounting to his first real estate job. Ed, fantastic to have you on the show. Thank you so much for joining us. I'm really excited for our conversation.

Ed Lerum:

Yeah, thank you for having me and excited to be here as well.

Nancy Lashine:

Great. Well, let's start with you. Tell us a little bit about you, where you grew up and how you started on your career path.

Ed Lerum:

I grew up in the Chicago area and went to school in the Midwest as well, and then actually then began my career also in the Chicago area, not in real estate. What's interesting as I reflect on my career path from where when I was first thinking about what are things I'd like to do compared to where I am now, the things that I spent a lot of time thinking about is that when I was younger, I was often guided towards trying to find something to do for a career that I enjoy. Do something you like, you'll be happier, you'll be more successful.

Nancy Lashine:

That's always good advice, right?

Ed Lerum:

Yeah, and the tricky part is though is it's easier said than done. Whether it was in high school or college, the idea of what do I want to do or what's going to be motivating, interesting to me was sort of hard to figure out.

Nancy Lashine:

It's really hard. I'm totally with you. I've always been so envious of people who say, "From the time I was a little girl or a little boy, I wanted to be a..." Fill in the blank. Because I had no clue either. And you really don't know what all the careers are out there unless you're following the path of somebody in your family or someone that you know. So how did you end up getting your first real estate job?

Ed Lerum:

Just to build on that point of, a lot of times it's hard for you to have visibility into your various options because generally it's sort of people who are close to you, you can see what they're doing, but that doesn't give you the full scope. And so both my parents were and are lawyers, and so that was sort of my vision into the workspace. And the reason I didn't go down that path is sort of trying to pursue this idea of do something that interests you. And so for me, I was interested by numbers, and so that meant doing something in business with numbers. I went to the University of Notre Dame, and when I was in college, the various schools of business were selling themselves, and to me at least the accounting school did a great job and so hence accounting, numbers. I liked numbers, and so I majored in accounting, got a master's in accounting, and then went into the public auditing profession at Ernst & Young in Chicago.

And it was even in sort of as I'm kind of coming to the end of my education in accounting and I was starting to realize that this wasn't striking me, I'm not getting that sense or that feeling like this is really driving me or this has got my full attention from an interest level perspective, but I couldn't understand why. I couldn't figure that out. So anyways, I get into Ernst & Young and look all my time at Ernst & Young, I was there for four years. A lot of great fundamentals and building blocks were established from my time there.

But what I realized during that time there, I was constantly reflecting on why isn't this the thing that really interests me or motivate me? And what I realized is by my third year there, I was helping with creating the schedule for the team for the following year, and I realized that I found a great deal of interest in making a schedule for the following year. And what I figured out is I liked it so much because it was forward-looking. And so I started putting together this idea of auditing there's a lot of backward looking, it's a lot of analysis. I like analysis, a lot of numbers, I like numbers, but it's backward looking. And I was finding that looking backwards just wasn't striking a chord with me. But when I did the schedule for the team and I got to look forward, the idea of thinking about what's going to happen next really piqued my interest.

Nancy Lashine:

Wow, good for you. That's an incredible insight just to kind of stop and say, "Why is this fun and that's less fun?"

Ed Lerum:

Yeah, right. But I'll tell you, I've always, during that time in school, in my early years of my career, I was constantly reflecting on it because I couldn't understand why I wasn't getting sort of, I just felt like my interest level could be higher. So anyways, I started at that point, from that point on thinking, okay, I need to do something that's forward-looking. And so when I got to the point where I was thinking about making a move outside of Ernst & Young, my goal or requirement was something that was forward-looking. I didn't have an industry in mind. I didn't have a specific responsibility in mind. To me it was numbers and forward-looking. Those were my goal posts. So the timing just was very fortunate. At that time, Blackstone had bought a logistics portfolio from Prologis and was creating their very first ever sort of formal logistics operating platform. And the name of that was IndCor, and it was based out of Chicago.

And the person who was CEO, his name's Tim Bowden was looking, he wasn't in charge of the hiring for this part of the business, but my understanding was part of his guidance to hire folks from the public accounting firms to join their FP&A group, so where we do budgeting and forecasting and financial analysis. And so they ended up hiring me and someone else from Deloitte. And so that was true to form in that the people who were hired to come onto that group were from these public accounting firms. And the thinking was these folks have sort of the best practices, they have a lot of good fundamentals. The real estate can be taught. Just very, very fortunate.

Nancy Lashine:

But you were looking, which was obviously key, and it's very unusual to be able to jump from a financial planning and analysis job to an investment role. And that probably was another leap in your career trajectory.

Ed Lerum:

It was, and that happened probably about a year into my time IndCor I'd taken first it was really getting to understand the real estate and really enjoying even just the whole budgeting and forecasting and the various analyses we were taking on. I was finding myself finding that a lot more interesting. But then you start learning about other roles and responsibilities in real estate. And so yeah, I had expressed an interest in getting into an investment role and built a good rapport with the leadership team IndCor. And maybe a little over a year into my time there, I was sort of offered that opportunity. And you're right, that was another leap. And from my perspective, after that leap, sort of the rest is history, and now I've had just a great deal of experience in transactions and investment management since then.

Nancy Lashine:

It's a great story that you make your own luck in so many ways. And so it sounds like you had a real vision for what you wanted for yourself and you figured it out. We'll talk more about industrial in a few minutes, but let's start for people who are listening to talk a little bit about Norges Bank Investment Management because it's such an unusual entity. I mean, it's a wonderful mission, which is to safeguard and build the financial wealth of Norwegians for future generations. I mean, what's so clearly when Norway found these enormous oil reserves, this fund was started, it's an investment management business with something like 1.2 trillion. If those numbers are still accurate, $1.2 trillion, it's maybe the largest single owner in the world's stock markets owning about 1.5% of all the shares in the world's listed companies. That's incredible. Roughly 70% equities, 27.5% fixed income, 2.5% real assets. And so we'll talk about the tail on that wagging the dog in a moment. But tell us first in your own words, a little bit about the mission and the purpose of the fund.

Ed Lerum:

So just talking about that aspect of the fund building wealth for future generations. I love it. Just circling back and then I'll talk about the fund and its mission and purpose. When you talk about being in work that's motivating and fulfilling, part of that is doing something you really enjoy doing. But another part of it is actually working for an organization or a group whose sort of broader mission is something that you align with as well. And so in this case, that idea of building wealth for future generations really resonates with me and is something that I am actively aware of pretty often. So I really like that. So yeah, to talk about the purpose and mission here is as Norway realized the revenue potential of its natural resources, it very smartly created a fund to responsibly manage that. And what does that mean by responsible management? In broad terms, it means ensuring stability for the Norwegian economy in the current and future, and then responsibly managing and growing that wealth for future generations.

And so I think it's sort of easier to understand the building of the wealth and managing this wealth for future generations so it's here for a long time. But when it comes to the stability, the stability, it can help in two ways probably among others, but in real simple terms, by not flooding an economy with a great deal of money, you're protecting against inflation, which is obviously a very prevalent issue right now. But the other way is this, in times of crisis, the fund then can serve as a place that can help the Norwegian economy. And so where it really helps is that it supplements a small portion of the Norwegian governed budget annually, exactly how much that varies from year to year. But the main point here is it's meant to be a small portion, a fraction, a helpful fraction, but still a fraction of the overall budget.

And the other idea here is that whatever funds are used from the Sovereign Wealth Fund, ideally it's coming from returns that have been generated and ideally not from inflows into the fund from the natural resources. And the idea there is if you can achieve that, then you should perpetually have a fund fund that's there generating returns year in and year out, and only the returns are being used to help the Norwegian economy. It's very smart, and from my perspective, it's been very successful.

Nancy Lashine:

Well, from all perspectives, I mean, I was thinking about what other countries have been so successful in harnessing their natural resources for the good of their citizens. The other end of the spectrum, you think about Venezuela, which squandered its fund over a period of time, and it's a very, very strong example.

Ed Lerum:

And maybe just to also give a sense, one last thing to say about giving context to this idea that we're really trying to grow the fund and not spend it is, so you mentioned it's roughly $1.2 trillion was the value of the fund as of the end of 2022. And approximately only 32% of that was actually from inflows into the fund. So the remaining portion was from returns and also some currency exchange effects. So the point here is that less than half of the fund is actually from inflows, the current value of the fund.

Nancy Lashine:

The power of compounding.

Ed Lerum:

Right, yeah.

Nancy Lashine:

It's a lesson that nobody could learn too early. I wish I had learned it earlier my career. So what's the goal of the real estate portfolio for Norges Investment Management?

Ed Lerum:

It's to diversify and achieve excess returns. The way we think about that from the excess returns perspective is every real estate investment is funded from fixed income and equity investments. And so essentially those are our stake in a portion of fixed income and a portion of our equity investments is used to fund our real estate. And what we're trying to achieve with our real estate investments is return above what we would expect that combination of equity and fixed income investments to achieve. And so there is this diversifying effect, but also there is this excess return effect and that excess return effect is closely tracked. It is something we're always aware of when we talk about the return of the fund year in and year out.

Nancy Lashine:

And when you think about that excess return, are you thinking about it over some period of time?

Ed Lerum:

Yes, and so it's a great point. When we're making these real estate investments, we are thinking about it, these are long-term decisions. So the excess return is viewed on, call it like a 10-year timeframe as just a point of reference.

Nancy Lashine:

And you invest only outside Norway, if I understand correctly. So how do you come up with your global construction?

Ed Lerum:

Yeah, roughly, this is not intentional, but roughly for the countries where we are investing in, it roughly reflects the size of the various economies. It's not exact at all, but it's sort of in the ballpark. But also we like to think that because we have this global scope, it helps us be thoughtful and mindful across the globe in our view, you can at times pick up trends happening in one location that are very likely to occur at another, and we try to be mindful of that, and we try to have that help us in informing our strategy and investment decisions going forward.

Nancy Lashine:

And how do you think about currency risk, if at all?

Ed Lerum:

And so on that front, we're currency neutral. And what I mean by that is going back to this idea when we're talking about how we judge our returns, the fixed income and equity investments we sell to fund our real estate is coming from fixed income and equity investments in the currency that is the same as the real estate investment we're making.

Nancy Lashine:

Okay. So let's talk about real estate. You run the logistics property strategy, but just to make sure we don't skip over, what other property types does Norges Investment Management invested?

Ed Lerum:

Yeah, so maybe the first thing to say is our real estate strategy is what we call a combined strategy. And what I mean by that is we think about a real estate strategy from both the real estate investments we make on the unlisted side, but also on the listed side. And so when we think about our sector exposures, I mean we can talk about it from two perspectives. It's one, what is it on the unlisted side alone, but also what is our sector exposure when you combine the listed and unlisted investments? And so the sectors that we invest in runs from residential, to office, to life science to retail and logistics, or call it your primary sectors of interest.

Nancy Lashine:

The main food groups. What percentage of the total real estate portfolio today is in logistics, do you know?

Ed Lerum:

Yeah, and so I'll speak both combined and unlisted, but unlisted, it's roughly 34%. And then on a combined basis, it's roughly 16%. So most of our investment is on the unlisted side.

Nancy Lashine:

34% is wonderfully high. So talk to us about your long-term objectives. Do you set a specific numeric return objective, or how do you benchmark?

Ed Lerum:

There is no firm numeric objective. Again, it comes down to comparing to the funding return. And so from geography to geography specifically, whether it's logistics or actually other sectors, the target's always moving. And what I mean by that is throughout the year, the expectation for equities return or fixed income return can change, and so therefore the funding return expectation also can change. And then depending on the geography, it changes as well because the simple way to think about that is the interest rate from geography can be quite different. And so that has an impact on how we think about each location.

Nancy Lashine:

So let's take 2023 as an example. How are you deciding where to make new commitments this year? How are you thinking about return expectations in North America versus Europe versus Asia, for example?

Ed Lerum:

One way to say this is they're certainly higher now than they were last year, particularly both for the US and Europe. And this comes right through, there's essentially a place I can go look any day and see what the funding return expectation is. And again, what I see is what I expect when I'm sort of clicking into that area and understanding what the current situation is. But right, it's higher now for sure, as we think about what should be the return expectation for real estate. That's... Call it a case-by-case basis. But I would say at this very moment, the threshold is higher than normal. So I'm saying higher in kind of two kinds of ways here. One, I'm saying the return is higher, but I would say also just your confidence level in whatever return is being provided also needs to be higher at the moment.

Nancy Lashine:

Which is really hard because it's such an uncertain time. So it makes it harder and harder to make commitments.

Ed Lerum:

What I'm saying right now is sort of speaking to what's happening in the market. There's just not a lot of transactions right now in the market. I will say this, despite there being a current lack of transactions, I would say I'm as busy as I've ever been. We are very active in understanding opportunities, and this is across all sectors, all geographies tight now. We are very active in making sure we're trying to understand as best as we can, what the opportunities are, because there's right now just a lot of fragmentation from market to market and from what we see quoted as values versus what we're seeing as the actual price points in the market in time, I'd like to think that we'll eventually start finding some pretty actionable opportunities.

Nancy Lashine:

So in your portfolio, your global portfolio, where are rents rising still and where are they falling anywhere? Let's just talk about rents.

Ed Lerum:

Yeah, rents are rising everywhere. This is a great opportunity to talk about the logistics market maybe as well, at least some aspects. 2022, it was a really interesting year because it saw in the second half of it in particular value depreciation. And for us, that was across all markets. And so it's yield driven, just the yields are rising, which makes a lot of sense that the yields are rising, right? What's very difficult to get a good grip on is what's the appropriate level of those yields and trying to even forecast when they'll settle. What's the right point for settling? And for me, what really drives this home is when we look at our Q4 valuations, the yield levels are on a relative basis. So if I compare various markets within Europe or the UK to continental Europe or various markets within the US, the yield levels are just... Or the relativity of the yields in these various markets is just very out of balance relative to historical precedence. What I mean is our very strongest market is, give an example, is the same yield as one of our weakest markets in the US.

Nancy Lashine:

Oh, really?

Ed Lerum:

Yes. And this is on the valuations. This is not saying reality, this is not saying, if we were to go buy something today, and what's causing this is the appraiser that's appraising one market in the US is not the appraiser in another market in the US. They might be the same organization, but nonetheless it's different appraisers. And the other thing they're working with here is just a lack of evidence. And so maybe one market has just more evidence than the other, and so that evidence is negative. And so there's just more reason, more comfort in kind of making that leap towards the negative versus another market where maybe there's not as much action at the moment, and therefore it's just harder to just be purely speculative to really move the yields up as much as likely they'll end up being. So to me, that is a really important point of reference because what that says is just everything's out of balance.

And if everything's out balance, you know that means eventually things need to get back into balance. And so there's still some sort of sifting out that needs to happen here. And so that's in the US, but the exact same thing is happening in Europe. We have some of our very best European markets that have historically been your lowest yielding markets, are roughly now the same yield as other European markets that have a long history of having higher yields. And so the same thing's happening there. And then the UK has gotten all kinds of publicity. And our UK yields are relative, whether it's relative to the US, whether it's relative to Europe, our UK yields are just extraordinarily high right now. Being 100 to 120 basis points higher in yield in the UK versus other places in Europe, there is no precedent for that.

Nancy Lashine:

In those markets, presumably they have strong fundamentals, strong tenant demand, low supply, so it would be attractive to keep buying if you could buy at those rates. Can you find those transactions today?

Ed Lerum:

There's some. In general, they're at, call it investment value levels that I consider one-off transactions. And then on the other hand, because of the volatility right now in the market, we're not yet looking to make a meaningful transaction of significant size. And really no one is at the moment, or no one has.

Nancy Lashine:

Just out of interest, Ed, what is your average transaction size if it's a meaningful transaction?

Ed Lerum:

So in the logistics, specifically for logistics, I mean our largest one was $6 billion. It was a portfolio, a national portfolio in the US in 2015. And then we've made a number of other, call it a handful of transactions over the years between Europe and US that are above a billion. And then outside of that, actually a great deal from a frequency perspective, call it just a transaction count perspective. A lot of our transactions otherwise are, call it your one-off, two-off type of transactions. And we think there's just a great advantage in both of those parts of the capital market. We think there's a lot of advantages in the larger deals, and we think there's a great deal of advantages in these smaller deals. And that has primarily been the basis for our buildup of our portfolio and also our refinement. We've also sold, particularly when you buy these larger portfolios, there's some portion where we are... It doesn't fit our strategy, and it's a small portion. A small fraction of the overall portfolio, but some portion doesn't. And so over time, we sell them as best we can.

Nancy Lashine:

Are you using leverage in these transactions?

Ed Lerum:

We are not. We unlevered, we are unlevered in our logistics. Our overall real estate strategy allows for some leverage. On an individual transaction we can put on meaningful leverage. But from an overall perspective, we do want to stay at a pretty low leveraged state when we take in our entire unlisted real estate portfolio.

Nancy Lashine:

Which is certainly makes sense given the overall strategy of the fund. You have an unusual approach for many large pension plans or sovereigns in that you invest in logistics with just one manager. Can you talk a little bit about why you do it that way and whether you think that might ever change going forward?

Ed Lerum:

So our one partner is Prologis, and what I would say there is when we started that relationship, we started first in Europe and then we roughly a year later created another venture with Prologis in the US. And I would say what's driven to this point, us investing solely with them is success. I mean, they've been a great partner. We consider them a... There's a lot of alignment from the perspective that we view them as best in class. They're a global operator, they have a global scope. And so do we, and so there's just a lot that works very well with that relationship. And so we've been able to fulfill our mandate with them. It really is a great relationship. We think they do a great job and they've been a great partner for us.

Nancy Lashine:

Don't mess with success. Or as my mother always used to say to me, "Nothing succeeds like success." So let's talk a little bit about how you invest in logistics through the different property types. Do you invest just in the large warehouses? Do you focus on cold storage? Are you looking at all at industrial outdoor storage? Would you consider a manufacturing building? Talk about the different types of industrial and which ones are most appealing to you.

Ed Lerum:

Yeah, so I view, call it dry warehouses as a strategy. Well, first of all, I'll say this, dry warehouses, cold storage, industrial outdoor storage, manufacturing, all these things are on the supply chain. And so from that perspective, in my mind, they all are logistics to an extent. I see each of them as having a different profile though, and maybe just to quickly get right to the cold... And the other thing I'd say here is we haven't invested or created a strategy at this point for either cold storage or industrial storage or manufacturing. And so the holdings we have currently are what I would just characterize under a dry warehouse logistics strategy. And I'll get to sort of the large warehouse versus other kinds of dry warehouses in a second. But on the cold storage front, the way I see that one is not necessarily do you have a building that it has some cooling components because you can in a dry warehouse, you can put a box within a box and it can therefore all of a sudden have cooling components as well.

I view the cold storage as being operated by a proper cold storage logistics operator. And so that can be one of two things. The owner of the cold storage building can also be the operator, or you can be leasing the cold storage building to a proper cold storage logistics operator. And I think in those cases, that's sort of the proper cold storage sector. And then industrial outdoor storage, I see that as well as its own strategy. We certainly have some land plots that serve as an outdoor storage, but in general, these are being picked up. These are adjacent to our proper warehouses. And so it's not truly a strategy focused on this. And then manufacturing, that's something that I don't... We don't think about much, but I certainly view that as different as well.

I going back to the dry warehouses, our strategy has been, call it consumption oriented or consumer focused. And so when you think about the supply chain, you can think about it from the beginning origins of the products that need to go through the supply chain all the way to the end consumer. And so we try to be as close to the end consumer as possible. And sometimes that might mean that we own a million square foot warehouse in northern New Jersey. And so you might see, hey, that's a really big warehouse that's sort of this larger national distribution center. But on the other hand, it's right in a very infill supply restricted area, and there is likely a number of tenants who would use that much space to serve only New York. And so from that perspective, again, we're near the end of the consumption, as close as we're getting to the consumer on this supply chain.

And generally that's our strategy is the closer we can get. In our mind I think... Or in my mind, there's kind of two things you get there. One, you get, I think the demand is more durable. People can always change how they're shipping their Things across the supply chain, whether it comes in on a ship, whether it's made in XYZ locations, how it gets to the end consumer, that path can change. But consumers, population centers, they're a lot stickier. And so if you can be owning assets that are more tied to that aspect of the supply chain, the demand in my mind's more durable.

And then the other thing is just there's better possibility for rent growth, and that's twofold. One is there's the supply aspect to it, but also the urgency within the supply chain is really heightened at the consumer end of it. And so from my perspective, that urgency still has a lot of runway to go as e-commerce matures even further. It's matured, it's already come a long way, but there's still in my mind, more to come. And so in our perspective, that's the strategy that we have a lot of conviction in.

Nancy Lashine:

Wow, that makes a lot of sense. It's really well said. When you think about these buildings that you're buying, how important is technology sophistication and has that changed much in the last few years?

Ed Lerum:

Yeah, the technology that the tenants are using is certainly growing and is something that we're mindful of, and its ability to impact warehouse demand in the future. But when it comes to the actual, call it warehouse and our investment in it, where I really think technology is emerging is sort of on the energy consumption side of things. And so the thing that I think immediately come to mind is solar and how to maximize the solar energy that you can produce and provide. But the other thing that's I think really interesting is the amount of energy that our tenants are going to need in the future. And so that starts with thinking about how more and more vehicles are going to become electric vehicles. But it also goes to, again, back to this, the tenant operations and their growing development of technology and the energy needed to run that technology and just run the operations overall. And so I think for us, a big focus right now is sort of trying to understand what's the best path forward from a solar production standpoint and what are the energy needs of our tenants in the future.

Nancy Lashine:

Yeah. I know your CEO, Nicolai Tangen talks a lot about responsible investment, which I'm sure permeates the entire portfolio. We talk about it broadly in the industry as ESG. Are there ways that influences what you buy or how you manage your investments?

Ed Lerum:

Yeah, there is an ESG consideration with every investment we make. And that goes across the whole spectrum of those considerations. Maybe the best way to put it is every investment goes through a checklist that's beyond, you call it just what's our return and what's our risk profile here? And that checklist is very thorough. And so every investment goes through that, call it process. And we have ESG specialists within our organization who are involved in those considerations.

Nancy Lashine:

Are there physical districts that you won't buy in because of flood risk or hurricane risk?

Ed Lerum:

We talk about that quite a bit. On the logistics side specifically, we have yet to run into a specific location where we're either saying we need to sell because of flood risk or we can't buy there because of it. And I'll say, actually, our understanding of flood risk is evolving. And so we're now talking about flood risks in the different kinds of ways that flooding can happen. And so there's different kinds of ways sort of have different risks of frequency and also how permanent that event can be. And that's more of a recent conversation we're having.

Nancy Lashine:

Yeah, I'll be really interested to see where you evolve in that conversation. We have actually seen investors, some of the larger investors who literally have drawn maps that they've redlined certain markets. Well, this has been amazing. Thank you for the conversation. I'd love to end with a couple of quick rapid fire questions to you. Who has been the most important influence on your career?

Ed Lerum:

I've been very fortunate from basically the moment I got into real estate that pretty much all of my, call it bosses or managers have been just excellent influences. And so I can run through the gamut of, I mentioned Tim Bowden at the beginning. He was the CEO of IndCor, even though I was multiple levels from him when I joined IndCor, he's been someone I actually still keep in touch with to this day. He was very influential when I was at IndCor and beyond that. Paul Loosmann, who was the CIO at IndCor, was someone I worked more closely with and is someone else I keep in touch with regularly now and has been just a great mentor for me. Going to actually NBIM, the folks at NBIM are truly remarkable, and I feel very fortunate. It starts with Petter Falck who's since moved on from NBIM, but now it's Per Loken and Mie Holstad are both just excellent influences. I feel fortunate for the folks who have been sort of leaders for me.

Nancy Lashine:

Yeah, you are fortunate. And then one last question. What advice would you give to young people who are looking to start a career who know they want to get into real estate?

Ed Lerum:

I'm going to say the same thing that I said was so difficult. Maybe there's two things. One is just find something that really drives you that you just naturally find interesting. The other thing I'd say about commercial real estate is I find it so appealing because I think there are so many aspects to commercial real estate where people of a great variety of skill sets and interests can find a spot to be very successful. I think it really is a great sector. It's a sector with just tons of opportunities. And so if you have a sense that you might be interested in it, I would highly encourage you or anyone to really look into that further. Think about it a lot more because there is just great depth and breadth to commercial real estate.

Nancy Lashine:

Truer words were never spoken. Thank you, Ed. Really enjoyed our conversation today, and you have an incredible perspective, having started out in public accounting, worked for a private equity firm, and now for one of the largest sovereigns on the planet and with a global perspective in the most successful real estate property type out there. So very much appreciate your taking the time to share your thoughts with all of us today.

Ed Lerum:

Thank you very much, Nancy. I greatly appreciate it.

Nancy Lashine:

I hope you enjoyed this episode of Real Estate Capital. Before you go, I have a quick favor to ask. We put a lot of thought and effort into this show and making sure we bring you insights from real estate leaders that you don't normally find in the mainstream media. So if you're enjoying the show, please remember to follow it on your favorite podcasting app so you never miss an episode. We'd also love for you to share it with others or give us a review on Apple Podcasts so others can find us. Thanks again for tuning in. For more information about our firm, please visit our website at Parkmadisonpartners.com.