A friend of mine called me out today for not using my online presence -- both social media and this blog -- to share my views on the horrible tragedies that are taking place right now in the United States and the world. She is right. And it is certainly something that I have been thinking about. But as I mulled it over in my head, it just didn't feel right to glibly share a few social media posts and consider my contributions complete. For almost 7 years, this blog has been my public voice and this blog is where I figured it should show up when I was ready.
My view is that there are really two tragedies taking place right now. The first started with the murder of George Floyd. It was truly awful, and it is symptomatic of some fundamental issues that remain in our society. I support the demonstrations that have ensued and I am pleased to see people and companies taking action. To give one example, Goldman Sachs today announced the creation of a $10 million fund for Racial Equity. If any of you know of any causes that should be supported or of any actions that you believe should be taken, I would encourage you to share them in the comment section below or to email them to me directly.
The second tragedy is the looting that has followed tragedy number one. Whoever is doing it, I think it is counterproductive and I think it serves to obscure the systemic problems that we know need to be addressed. I was reading through this Journal article today about the impact that looting is having on small black-owned businesses in Philadelphia -- a city that is near and dear to me. It makes me both sad and frustrated that these businesses are scrambling to post up "Black Owned" signs in their windows in an effort to be spared from the chaos.
The article goes on to quantify the number of US small businesses in mostly black areas that have enough cash on hand to survive 14 days or more. Very few do. In fact, almost none of them do. The number for mostly black areas is only about 5.3%. This is compared to 70.4% for mostly white areas and 97.9% for mostly Asian areas. This is a scary statistic that only amplifies the severity of tragedy number two. This looting is delivering a second blow to small businesses that were already reeling on the ground from COVID-19.
Tragedy number one and the push for racial equity and positive change is the focus here.
Update: Minor edits were done to this post in an attempt to clarify its original intent.
This past fall, Goldman Sachs published an important report about "making cities resilient to climate change." In it, they remind us that the scientific consensus is that the world has already warmed from the pre-industrial era (and will likely continue to do so) and that a great many of us live near water (and will likely be impacted going forward).
About 40% of the world's population lives within 100 kilometers of a coast, and about 10% of the world's population lives in a coastal settlement that is less than 10m above sea level. Above is a list of some of those cities, along with their average elevation in meters. The cities with single digit elevations include Bangkok, Miami, Alexandria, and Amsterdam.
Goldman's prediction is that this need for "urban adaption" could lead to one of the largest infrastructure build-outs in history. And that cities all around the world should already be thinking about how they will finance and equitably execute on greater resilience (assuming they aren't already).
Click here to download a full copy of the report. The diagrams showing the average change in global mean surface temperatures against the pre-industrial period are something you should all look at it. The 2015-2019 change is pictured above.
Charts: Goldman Sachs
On Monday, Slate Asset Management announced a minority investment from Goldman Sachs Asset Management's Petershill Program. This is great news, so here's a copy of the full press release that went out.
Toronto, August 19, 2019 – Slate Asset Management L.P. (Slate), a leading alternative asset management platform with a focus on real estate and real assets, today announced a passive, non-voting minority equity investment from Goldman Sachs Asset Management’s Petershill program, creating a strategic relationship with one of the world’s leading investment managers and positioning Slate for future success. The transaction will have no impact on the control or decision making of Slate. The day-to-day operations and management of Slate will remain unchanged.
The investment provides capital that Slate will use to enhance its platform and increase its GP investments in current and future businesses and investment vehicles, further strengthening the firm’s alignment with its clients and investing partners.
The investment accelerates Slate’s goal to build the leading independent alternative investment platform in real estate and real assets. As part of the transaction, Slate Founders Blair and Brady Welch have made a long-term commitment to the business.
To date Slate has completed over $11 billion of transactions across Canada, the U.S. and Europe, through multiple vehicles spanning co-investments with global institutional partners, private equity funds and publicly-traded Real Estate Investment Trusts.
“This investment in our platform is an endorsement of our people, our strategy and our future,” said Brady Welch, co-founder of Slate. “For our investors and our team, this is excellent news; our strategy and model remain the same, and we can now benefit from our new relationship with Goldman.”
Blair Welch, co-founder of Slate, added that: “Since we started Slate nearly 15 years ago, we have showed that we can build tremendous value by providing our investors with a unique perspective, focusing on the fundamentals of the assets we acquire and delivering hands-on management that is innovative and creative. With our new relationship with Goldman Sachs, Brady and I are enthusiastic about what all of us at Slate can accomplish together over the next decade and beyond.”
“Slate Asset Management is an incredibly innovative, dynamic real-estate focused alternative asset management platform,” said Robert Hamilton Kelly, Managing Director, Goldman Sachs Asset Management Petershill program. “We are big believers in the strategy, the team and the model. We are excited to partner with Slate as they work to capture the opportunities before them.”
About Slate Asset Management
Slate Asset Management L.P. is a leading real-estate focused alternative investment platform with over $6 billion in assets under management. Slate is a value-oriented manager and a significant sponsor of all of its private and publicly-traded investment vehicles, which are tailored to the unique goals and objectives of its investors. The firm's careful and selective investment approach creates long-term value with an emphasis on capital preservation and outsized returns. Slate is supported by exceptional people, flexible capital and a demonstrated ability to originate and execute on a wide range of compelling investment opportunities. Visit slateam.com to learn more.
About Goldman Sachs Asset Management’s (GSAM) Petershill Program
The Petershill program is managed by GSAM’s Alternative Investments & Manager Selection (AIMS) Group, which provides investors with investment and advisory solutions across leading private equity funds, hedge fund managers, real estate managers, public equity strategies and fixed income strategies. With investments in over 20 asset management firms, the Petershill program provides strategic capital to mid-sized asset management firms and has raised over $5 billion of commitments since inception. GSAM is one of the world’s leading investment managers with more than $1 trillion in assets under supervision globally as of June 30, 2019.
For more information:
Slate Asset Management
Katie Fasken
416-583-1785
Goldman Sachs
Patrick Scanlan
212-902-5400
