John Paulson’s Looking Towards Real Estate

I suspect that you can either make a great deal of money following the lead of recently successful investors or lose a lot of money by doing so. For those of you who subscribe to the first part of that sentence, you might want to take notice of the recent investments undertaken by John Paulson.

For any not familiar with Mr. Paulson and his hedge fund Paulson & Co., he is the fellow who recognized the mortgage emperor wore no clothes and so shorted mortgages big time. The rest is history, he made billions.

Now he appears to be accumulating commercial real estate assets. His most recent play is to pop $100 million into CB Richard Ellis, a very large but also very troubled commercial real estate firm. He also happens to be in the money raising stage of a new fund that is set up to pursue commercial mortgage opportunities.

Paulson doesn’t appear to be buying yet so much as he seems to be positioning himself to snap up deals. Paulson has also been buying gold by accumulating miners. So gold and real estate assets, what kind of outlook for the future would that imply? If you guessed inflation, go to the head of the class.

Like I said, Paulson may either lead you to the Promised Land or bust your portfolio if you go all in with him. Might not be bad as a hedge, though.

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About Tom Lindmark 401 Articles

I’m not sure that credentials mean much when it comes to writing about things but people seem to want to see them, so briefly here are mine. I have an undergraduate degree in economics from an undistinguished Midwestern university and masters in international business from an equally undistinguished Southwestern University. I spent a number of years working for large banks lending to lots of different industries. For the past few years, I’ve been engaged in real estate finance – primarily for commercial projects. Like a lot of other finance guys, I’m looking for a job at this point in time.

Given all of that, I suggest that you take what I write with the appropriate grain of salt. I try and figure out what’s behind the news but suspect that I’m often delusional. Nevertheless, I keep throwing things out there and occasionally it sticks. I do read the comments that readers leave and to the extent I can reply to them. I also reply to all emails so feel free to contact me if you want to discuss something at more length. Oh, I also have a very thick skin, so if you disagree feel free to say so.

Enjoy what I write and let me know when I’m off base – I probably won’t agree with you but don’t be shy.

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