How Cadre is ‘democratizing access’ for investing in real estate

Cadre CEO Ryan Williams joined Yahoo Finance Live to break down how Cadre is trying to change commerical real estate and how the lingering effects of the remote work migration have impacted the industry.

Video Transcript

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SIBILE MARCELLUS: Welcome to "A Time for Change." I'm Sibile Marcellus, here with Kristin Myers and Alexis Christoforous. After almost a year and a half at home, corporate America is slowly returning to the office. In New York, Goldman Sachs workers have been back at their desks for a couple of weeks now. And Twitter is opening its doors to employees in New York and San Francisco at reduced capacity starting next week.

KRISTIN MYERS: But the lights are still off at countless offices around the country. And it's unclear when or even if office buildings will ever be as full as they were before the pandemic, which of course, calls into question the future of corporate real estate.

ALEXIS CHRISTOFOROUS: And here to discuss that and more is Ryan Williams. He is CEO and co-founder of Cadre. It is a fintech company aimed at disrupting the world of real estate. Ryan, thanks so much for being with us. And, you know, historically, the commercial real estate industry has not really been a playground for individual investors. And I know you set out to change that with your platform Cadre. For those who are not familiar, just tell us a little bit about your company and how you're letting individual investors have a stab at the real estate market and investing in it along with the big guys.

RYAN WILLIAMS: Absolutely. Yeah, real estate and specifically commercial real estate is one of the most important asset classes to own to build long-term wealth. But the average individual has no way to access commercial real estate efficiently or with any form of liquidity. And I previously worked at Blackstone, one of the largest real estate private equity firms in the world. And I saw how lucrative commercial real estate could be.

But I also saw how it was concentrated in the hands of a relative few and low number of people. And so I wanted to change that. I wanted to open up access. I wanted to remove barriers. I wanted individuals to be able to access institutional real estate the same way that large institutions that have dominated the space have done. And to date, we've been successful in scaling our platform and allowing thousands of individuals to invest in high quality commercial real estate portfolios, leveraging technology.

SIBILE MARCELLUS: Ryan, at Cadre, you typically require a minimum investment of $50,000 per transaction. Now how does that match up with your company's mission to open up investing to everyone?

RYAN WILLIAMS: Absolutely. Well, it's a journey. And we're starting right now at the top of the investing ecosystem, so to speak. And the reason we're starting at the top of the investing ecosystem is so we can build brand equity, trust, credibility with our core platform and our core offerings. But ultimately, the aspiration and vision has always been to democratize access. And this is really step one in that journey.

ALEXIS CHRISTOFOROUS: Talk to us a little bit about how the pandemic has altered the commercial real estate space. I know that you're actually talking to us from your office. You say you've actually been back in the office for weeks now. But as you know, that is not the case for many people. And in fact, many people are saying the face of commercial real estate has really changed forever. What's your take on that?

RYAN WILLIAMS: Yeah, our take is that there for sure there will be changes to commercial real estate going forward. We can't ignore what's happened over the past year or so. But the way we think about the changes that are happening is that these are changes that were going to be happening regardless. For instance, you are seeing the acceleration in the industrial space, given all the trends going on with migration to e-commerce versus traditional offline retail. You are seeing a lot of folks who are actually relocating to the suburbs, even pre-pandemic. And the pandemic amplified and accelerated many of these trends and these changes.

But we still think that there are compelling opportunities to invest in commercial real estate. We think there are sectors and asset classes that will outperform others. We like multifamily residential and growth markets around the country. We like investing in life sciences office transactions, which has seen a ton of tailwinds coming out of COVID.

So like any other industry, there will be winners, there will be losers. We try to focus on the asset classes and geographies that we think will outperform. We've actually seen some of the strongest performance across our existing portfolio over the past few months, as folks have returned to work in certain cases and, in other cases, have renewed leases, given all of the pressures going on in the residential real estate world.

SIBILE MARCELLUS: And speaking of winners and losers, I've been covering the growing divide between employers and workers over remote work. How do you think long-term remote work is going to impact commercial real estate?

RYAN WILLIAMS: Yeah, I think that remote work has been quite a change. I think that pre-pandemic, there was a lot of views that folks always needed to be in the office in order to collaborate effectively and produce. We've seen that that's not quite the case. We've seen that you can be flexible, that you can be adaptable. We've seen that employees sometimes need work time at home away from other folks.

And so I think going forward, what you'll see is a greater flexibility rather, more openness to providing employees with the option to have one or multiple days remote. People I still think believe-- and we've seen it at our company-- that working in person is irreplaceable.

And as our focus is going forward, we really want to ensure that all the partners that we work with are being respectful of tenants, are being flexible and open to accommodating tenants, and again, really reinventing and reimagining the future of work, which I think, again, is a good thing and something that those who are willing to be innovative on the cutting edge and focus on their customer and tenant base will succeed.

ALEXIS CHRISTOFOROUS: Brian, I want to take a minute and talk about your personal journey. Because I know you've been pretty vocal about having sort of two roles, if you will, being one person as CEO and founder of your company, Cadre, and then outside of the office, being a young Black man. Why do you think there is that divide? And how are you managing sort of those two dual personalities, if you will?

RYAN WILLIAMS: Sure. Yeah, so look, I've always focused on being the best possible CEO and leader for my company. I had not spent a lot of time, focus, or energy classifying myself or identifying myself before being the best possible CEO and founder I can be. What I've learned, though, over the past year is that it is important for me and the position that I'm in to use my voice to share my experience and my background, the fact that I don't come from money the fact, that I come from a working class background, the fact that I've never had access to the kind of opportunities that my platform has been built to open up.

And so I've learned that, as I was taught growing up, to whom much is given, much is required, that I have an obligation to help pay forward whatever I can. And part of that starts with me using my voice to personalize some of the pain and the frustration others have seen that might actually seem foreign to them. And so that's what I've tried to do over the past year. And more important than that, more important than statements or words or commitments, we've taken action at Cadre.

We launched a new product, the direct access fund recently, that now allows a wider range of individuals to access real estate. We've opened up our platform to be more intentional about partnering with Black and Brown operating partners, developers, and sponsors. And we think that we're showing that you can do well and do good and that many of these opportunities, many of these partners who have been overlooked, have compelling business plans and strategies that will also yield strong returns and results for investors.

So I've, again, tried to, first and foremost, personalize my story to help others see what is possible when the playing field is level, and then also show what's possible when you actually put actions behind those statements and words. And we're setting the stage and setting the tone at Cadre. And we hope others will emulate much of what we've been able to do to date.

SIBILE MARCELLUS: And Ryan, as a young man in your 20s, you struggled to secure your first loan from a bank. So, how did you overcome that and decide, you know what? I'm going to be a CEO and deal with commercial real estate specifically.

RYAN WILLIAMS: Definitely. Well, you know, I was really fortunate and, frankly, blessed to be able to received a loan from a bank called Citizens Trust Bank, a Black-owned bank based out of Atlanta, Georgia-- it was founded in the early '20s-- When I was turned down by many other banks. And what I was told is that I was a risky borrower, despite having pretty significant backers behind myself and my partners.

And had it not been for Citizens Trust Bank, a community oriented and focused institution, I might not be where I am today. And so I never forgot that that institution took a chance on me, invested in me when others wouldn't, that that institution saw something different in me. And we were willing to rethink maybe some of the conventional criteria. And at Cadre, we want to pay that forward for every individual or institution who's been underserved, who hasn't had access to opportunities. We don't think that you should have to be exceptional to have a good, prosperous life.

And that's really what we're looking to do at Cadre, is to change that paradigm to give everybody the opportunity to own their future. And it starts with the kinds of personal reminders that I've had growing up, when others believed in me, when others invested in me, when others went above and beyond to give me a shot. And that's all I was looking for. And now, at Cadre, we want to do that for so many others around the country and around the world.

ALEXIS CHRISTOFOROUS: Speaking of people who gave you a shot and helped you along the way, last week, we dedicated our show to the importance of mentorship. And I'm curious, Ryan, if you've had mentors along the way? And how have they shaped your career path?

RYAN WILLIAMS: Yes, I have had many, many mentors. And I never pretend like I'm a solely a self-made man. I know that I've missed a lot of mistakes I otherwise might have made based off the guidance I've received from a handful of individuals. You know, I think back to my days in college, getting phone calls and messages from Ray McGuire, who recently ran for mayor in New York City, was head of banking at Citi for a while, and having him help show me what's possible. I saw that someone who looked like me could ascend to the kind of heights that he has.

I think about mentors in the venture capital world that have been there for me through thick and thin, folks like Ken Chenault at General Catalyst, former CEO of American Express, folks like Joel Cutler of General Catalyst, Jeff Jordan at Andreessen Horowitz. So the short answer is I've had countless mentors. I've always tried to be respectful and ensure I'm adding value to those conversations and dialogues as well. And I think what we've done at Cadre is really brought those two worlds together, the finance world, the technology world, under one umbrella. And we're trying to, again, democratize access so more people can have great opportunities.

ALEXIS CHRISTOFOROUS: Ryan Williams, great story. We continue to wish you success. Come back, won't you? Thanks so much.

RYAN WILLIAMS: I will. Thank--