What Could Be Next for Goldenrod in North Texas

Nebraska-based Goldenrod Companies is looking for continued growth as the firm gets underway with two of the most prominent mixed-use developments in Fort Worth.

Article by Spencer Brewer, Dallas Business Journal

The commercial real estate development and investment firm is behind The Van Zandt and The Mullet, a playfully named mixed-use development located in the Cultural District.

Former NFL player Zach Wiegert formed Goldenrod in 2005 to oversee his own portfolio of assets. In 2017, the firm launched its first fund and has launched several funds since then. The company is kicking off its fourth fund in April.

The company, which has about $4 billion in assets under management, targets primary and secondary markets in the central U.S. In any given fund, the firm is looking for 60% acquisition and 40% ground up development.

Of the ground-up development, Goldenrod targets medical, office, multifamily and industrial.

“You have people that are elephant hunters and home run hitters,” said Brandon Schubert, head of Acquisitions at Goldenrod Companies. “You have other groups that just hit a bunch of singles and make really good returns. Because our funds are about $200 million in size and that equates to about 12 to 15 deals, I tell people I’m really looking for a stand-up triple.”

The company aims to place between $5 million and $25 million in equity in its deals. Goldenrod will go after larger deals, north of $100 million, but its sweet spot is typically between $25 million and $50 million per deal.

“It’s not really complicated,” he said. “We’re not creating anything new that nobody else has ever done. It’s more about finding the right 15 opportunities per fund, where we can maximize the return potential.”

Schubert spoke with the Dallas Business Journal about the company and its strategy for this market.

Tell me a little bit about how you operate.

We’re pretty risk averse. We’ll put 40% equity in all of our deals and really stress them at the deal level and also the fund level. How does this deal stand on its own? How does it impact the portfolio?

How long do you typically hold assets?

We generally underwrite as if we’re on a five-year hold, but our funds are unique in that they have an evergreen provision which allows us to hold some of our core assets long term.

Tell me about your investors.

Our investors are typically comprised of family offices and super high-net-worth individuals.

The Mullet is located near the Crescent-Fort Worth. How did that dynamic factor into your decision making?

We’re very much subscribed to the belief that a rising tide lifts all boats and it’s better for the neighborhood. We’re not trying to build a competing product where we’re both vying for the same tenant.

We definitely want to follow in the way that they’ve already started and add a couple quality projects to that side of the Cultural District.