Bobby led Canyon's initiatives to partner with Magic Johnson and Andre Agassi in developing urban neighborhoods and charter schools. Bobby was trained by Mike Milken at Drexel and graduated from Wharton School of Business.
Bobby explained that there are four ways to create wealth:
- Value investing
Bobby said that your first million dollars is the hardest to make, and wealth doesn't make happiness.
He said there are four types of happiness:
- Power (to change the world, have positive impact on people's lives)
The investment criteria they used were the 6 D's:
- Density of population: 300,000 per 3 miles
- Demand (for housing, retail)
- Developer: real estate is a relationship business, so it matters who you know and work with
- (De)Leadership: getting the Mayor's support is critical
- Do good
Bobby considers a fair return on capital to be 10% unlevered (levered up to 18%); after incentives, they return 12% net to investors.
It was neat to hear a person so successful in real estate and for-profit investing find ways to make money while investing in projects that served a drastic need in the community even though they were unpopular. It was also fun to hear the stories of how he convinced Johnson and Agassi to get on board.