In this week’s episode, Barry and Ernest discuss the recent volatility in the market, the illusion of safety in private real estate investments and their feature conversation is about CoStar.
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Podcast Transcription
Barry Schwartz
Hello and welcome to the Long Term Investing podcast with Baskin Wealth Management. I’m Barry Schwartz, Chief Investment Officer. Baskin Wealth Management is an independently owned investment management firm with almost $2 billion in assets under management, providing customized wealth management solutions and services to families and foundations. In this podcast, we ignore all the noise and have conversations that make sense about the things that matter in today’s markets. It’s what we talk about with each other here in the office, and we want to share those conversations with you. Please stay tuned for our legal disclaimer at the end of the episode.
Welcome everybody to the podcast joined today by Ernest Wong. We have a lot of interesting things to talk about, Ernest. In our last episode, we talked about what to do when a stock doesn’t work. Maybe this episode will talk about what to do when the stock market doesn’t work. Just for a minute, you know, it’s not always going to go up every day, every week, every month, as we know. And you know, it’s different strokes for different folks. Of course, those that are long term buyers that have cash coming in, that are younger clients that are going to invest long term, they should welcome market pullback, as Warren Buffett says, although it’s easier said than done when you see your portfolio or your stocks going down to have the willpower to say, you know what, the macro stuff will come and go but the opportunities of buying the stock when it’s been sold off is too good to be true. Right, so Ernest your thoughts on market pullbacks and you know what to do during them.
Ernest Wong
There’s a well-known chart that you like to send around every once in a while, that basically plots out the S&P 500 over 50 or 100 years or something like that.
Barry Schwartz
That’s right.
Ernest Wong
And it points out all the things that you could have been worried about, and as you know, the S&P 500 historically has just basically gone up in a straight line with some lumps.
Barry Schwartz
It’s done like 9% compound over a very long period of time. Of course, not every single year.
Ernest Wong
And clearly over the last 100 years, there’s been a lot of things that you could have worried about, like the world wars, like the Cold War, more recently there was you know like a global pandemic, great financial crisis. And yeah, there were times when the market was down but historically, the stock market tends to go up.
Barry Schwartz
I think what a long term investor really needs to have to stick with it is confidence. And where do you get this confidence from when all the headlines are lousy, your portfolio is down. Everybody’s talking about recession, inflation and nothing’s working. You get the confidence by not looking at those stock prices as benchmarks or score cards and telling you if you’re smart or dumb, you get it by reviewing the companies that you own and that’s where you should be spending your time, right?
Ernest Wong
And it’s a strange thing like one of the things that I always say is, imagine if you were getting bids for your house every day and like you’re watching your own net worth go up and down by like, you know, $100,000 every week or every month, like you’d go crazy, right? But no one thinks about it that way because you know that your house is worth what it is.
Barry Schwartz
Well, you and I are both business owners. We’re both part owners of shares of Baskin Wealth Management and we’re going to have the patience. I think it’s true what Warren Buffett says – you become a better investor by owning shares in a business, by actually being a business owner. Ernest, if you have shares, I would buy those shares off of you if I offered them 50% less than you paid for it, I would buy them today. Would you sell them to me?
Ernest Wong
No.
Barry Schwartz
Right. So then why do people react like that when the stock market sells off stocks? 10%, 20% 30%, 40% for no reason?
Ernest Wong
I think this is somewhat relevant to the alternatives discussion that we’re going to talk about a little bit later.
Barry Schwartz
We are, I mean, there is something psychological about moving stock prices. So my words of confidence to our clients is and those that follow the type of investing that we follow, which is long term investing in good companies, understand what you own take a few minutes and review the companies that you own.
Don’t look at the stock price like they always say when you’re researching a stock. Never look at the stock price first. Understand the company, understand the dynamics, and if you liked it when the stock was up 10% and now it’s down 10%. The stock price isn’t telling you anything, it’s just telling you how much it’s up or down.
Ernest Wong
It’s telling you, it’s telling you what somebody’s willing to pay today.
Barry Schwartz
Exactly. Yes. Exactly what someone is willing to pay today. And guess what? The stock market is an exchange and you can tell that person where they can go if you don’t like the price they offer, or you can come up with more cash and buy some more shares. And so I view investing for our clients as a win-win. Because I know, and we know that buying and owning a collection of good companies and holding them for long term absolutely works and so I see it as a win-win. When the stocks go up, we win because we’re making money. And when the stocks go down, we get to buy more of the great businesses at a discount. And so it’s a win-win, pullbacks great times. And you know final word is you know our clients are having quite a good year this year. Many of our stocks are doing exceptionally well. And many of those stocks that are doing exceptionally well we’re doing exceptionally horrible last year or at the beginning of the year, the narratives about and we talked about it many times on the podcast. Adobe and Amazon and Netflix and Google all are going to get disrupted, their businesses are no good anymore. Oh, they’re making deals because and it’s exposing how bad those companies are. Now, many of those companies are up a dramatic amount this year because they’re good businesses. So don’t let the stock sale start a sales slip by you because you’re worried that the stock will go lower.
Ernest Wong
Right, for Adobe, for example, the stock is down like 50% from its top and then doubled again.
Barry Schwartz
Yeah
Ernest Wong
None of their financial metrics were that volatile. Their revenues, their profits, their user base like these were they were actually quite stable throughout this time. So I think that that gives you confidence that it is really just market volatility.
Barry Schwartz
We always say it it’s very hard to lose money over the long term. Owning a company where the fundamentals are improving. Maybe in the short term you overpaid. Maybe in the short term some macro stuff happens. That is very unsettling. Like the world we are in today. That’s going to happen all the time. But if the fundamentals are improving, we’re not selling the stock. So Ernest, let’s move on. We want to talk today about real estate and we have a feature company that we want to discuss that is classified as real estate. But we’re going to change people’s opinion about that. So Ernest, let’s get started.
Ernest Wong
So this goes back to the same discussion we were just talking about, do you own good businesses or not?
Barry Schwartz
Yeah.
Ernest Wong
I think a lot of clients often make a mistake or well, a lot of industry observers like the distinction, not our clients.
Barry Schwartz
Our clients are the smartest people.
Ernest Wong
They make a distinction between so-called alternatives and traditional asset classes like stocks and bonds that we own.
Barry Schwartz
So Ernest, for those that may not know, please explain what alternatives are. Obviously, everybody knows what a stock is, what a bond is, what cash or GIC is but what is an alternative?
Ernest Wong
An alternate alternative is used to describe anything that’s not traditional. Anything that’s not like a stock or a bond so it includes things like private REITs, private equity, venture capital, direct lending. There’s no shortage of things that belong here. I think the way to categorize them is that they don’t have a direct a public price.
Barry Schwartz
A daily market price, or a quotation on an exchange or being able to buy it through the bond exchanges.
Ernest Wong
That’s right. And I think this is a false distinction between because at the end of the day, what matters is the performance of the underlying asset that you own.
Barry Schwartz
Yes.
Ernest Wong
Doesn’t reveal whether Costco was a public or a private company. Like, I’d still want to own shares in it because it’s a fantastic business. And this is especially true in real estate. I think a lot of real estate funds out there, like they say, oh, we’re a private REIT and so we have less volatility than other things that exist.
Barry Schwartz
They have no volatility because there’s no public quotation for their securities.
Ernest Wong
Which if you really think about it, an apartment building is the same. It’s going to perform the same, whether it was owned by you or me, or a private read or a public REIT. Right?
Barry Schwartz
Yeah. I mean, you and I probably are not very good property managers, but we get the point.
Ernest Wong
It doesn’t really matter who is running the apartment building ultimately, what you’re going to earn on it is whether rents are going up, whether the vacancy is there.
Barry Schwartz
Yeah, location, the attractiveness of the of the product.
Ernest Wong
And these things are all true whether it’s owned in a private REIT or a public REIT or if we own the whole building.
Barry Schwartz
Yeah.
Ernest Wong
I think the tricky thing about real estate is that it’s quite a bit more illiquid than public equities.
Barry Schwartz
For sure.
Ernest Wong
It’s not like a stock. You can’t, to the point about my house.
Barry Schwartz
You can’t sell it in a second on Monday to Friday from 930 to 4 p.m.. Although when the real estate market was hot in Toronto, maybe you could have. But you’re absolutely right, you can’t just sell your real estate in two seconds and then oh I want to buy it back two seconds later. It doesn’t work that way.
Ernest Wong
And because real estate is illiquid, there’s a lot more subjectivity in how you can report the performance. Here at Baskin everything that we own is public. There’s a price for it and you can go and sell the entire portfolio today.
Barry Schwartz
You may not like the price you’re going to get, but you can sell it and turn it into cash in same day.
Ernest Wong
At the price that we say it’s worth.
Barry Schwartz
Yeah.
Ernest Wong
That’s not true for, and maybe this is a controversial point, but I don’t think that’s true for a private real estate fund today. If you look at the investor decks that I get sent a lot of these, they come to my desk and they say, oh, can you help us distribute our product? The performance is like it’s like a straight line up, like it never goes down. It’s like the best thing in the world, right? Like ten, 12% a year. Never lose money, It’s like it’s one of the greatest things in the world.
Barry Schwartz
Yeah.
Ernest Wong
But do you actually think that if you go and sell the entire portfolio of apartment buildings today, you’re going to get exactly what they said it’s worth?
Barry Schwartz
Not if you’re looking to liquidate it very quickly.
Ernest Wong
No and that’s especially true in today’s market when commercial real estate transaction volume is at a historic low. So what I’m trying to say is these funds are providing you with an illusion of liquidity. They’re not worth what they say they’re worth, and they’re actually much more risky than the way they market themselves to be.
Barry Schwartz
And how do they explain Ernest, so in the last year or so, with rising interest rates, we’ve seen the prices of many publicly traded REITS in every type of industry whether it’s multifamily, apartment buildings, storage, industrial office, the investors don’t want to own them. And the prices of many of them have fallen 10%, 20%, 30%, 40% share prices and how does one explain when we get an investor deck from a private company looking to pitch this product to our clients through us, that they say their values are up year after year after year.
Ernest Wong
And that’s what you’re seeing in the US, where there’s been a number of large private real estate funds that have halted redemptions. Even if now if you thought that they’re not lying about their asset valuations.
Barry Schwartz
And maybe the publicly traded share. Asset values are still worth what they’re worth. It’s just the stock prices have been decimated.
Ernest Wong
So even if you felt that the private REIT valuations were reasonable. There is no reason why you should be buying them over the public. Remember, like real estate is the same thing. The apartment buildings are the same. There’s no management that’s running an apartment building better than any other company. So there’s no there’s no reason why you should be buying privates over public today.
Barry Schwartz
Absolutely no reason.
Ernest Wong
And to maybe put one example to it, we own a small position in a REIT called granite REIT. Granite owns a bunch of industrial warehouses all over the world basically.
Barry Schartz
Yeah and they’re 99% occupied. They have fabulous assets with great long term leases, and they’ve been raising prices, rent prices for all their clients recently so companies making more money. But go ahead. You started Granite.
Ernest Wong
Granite shares today are trading at about a 20% discount to reported NAV. Why would you invest in a private industrial REIT at 100% of asset value when you can buy granite at a 20% discount, and probably with better leverage?
Barry Schwartz
And if you screwed up, you could always sell the Granite shares when the markets open.
Ernest Wong
Exactly. So that’s my thought on private REITs today. We’ll see what happens.
Barry Schwartz
So I’ve never we’ve never been a big fan here, Earnest of alternatives. Prior to even you joining I’ve written many blogs about it about mortgage funds and alternative assets. We pride ourselves on the liquidity of the stock market. Obviously, not everybody is well suited to own stocks and bonds because the volatility, the daily price volatility. But as you made the point crystal clear, the asset is the asset and what someone is telling you what it’s worth, you know, in a short period of time can be nonsense as Jews call it bubkes. So let’s, you know, let’s focus on assets. And that’s what we do here as long term investors. You know, obviously we’d love and everybody would love their portfolio to go up every single day and only own the best stocks and never lose money. But you know, that’s not going to play out in the short term. You know, the way we manage money for our clients is we have separately manage accounts for the most part and clients see every position that they own. And, you know, our minds are going to go right to the names that in our portfolio that are down since I owned it or hasn’t worked in, you know, the past couple of years, obviously. Please listen to our last podcast. But as I just said before, at the beginning of the podcast last year, we had a lot of stocks that were horrible and now they’re the best names, so don’t sell something. Don’t be quick to judge the, the value of that company based on the recent quotation, it doesn’t tell you a whole lot. And so earnest we focus and we want to partner with people that think long term, that zig when others zag. That, as Wayne Gretzky says, “go to where the puck is going to be”. Not, you know, these are the truisms in investing, especially if you’re going to be a long term investor, because we have no idea what’s going to work in the short term. If we did, I wouldn’t be doing this podcast. But we think we know exactly what works over the long term, and it’s partnering with great people running great businesses who think long term. And that’s our feature discussion for today about a company called CoStar. Ernest Wong
CoStar is not really a household name, but what you need to know about them is that they power the entire commercial real estate industry. The main product that they have is an online portal thing where they provide analytics and tools for the entire commercial real estate industry. Things like vacancy rates like market comps, what tenants are in the buildings with the neighborhood demographics are like.
Barry Schwartz
Who signs up for that information?
Ernest Wong
Commercial real estate agents. So when Baskin signs a lease we will contact our commercial real estate agent and say we’re looking for XYZ place to fit 25 people. This is what we’re looking to do. And then basically what the agent will do is they’ll log on to CoStar. And we’ll say, okay, this is this place looks suitable and recommend it to you.
Barry Scwartz?
Can you get that information anywhere else?
Ernest Wong
No, CoStar spends $300 million a year to collect this information.
Barry Schwartz
Ernest, that already sounds like a fabulous business, but we’ll keep that away from the regulators so we don’t want to bring attention to the monopoly that business has.
Ernest Wong
It’s a terrific business. They raise prices every year. Agents can’t do anything about it because they have all the data. And what happened was that CoStar looked at their business and said, look, we’re already generating all this data like we should be making more money off of it. So they went and they entered into public marketplaces.
Barry Schwartz
Public marketplace so most people know a marketplace like eBay, right, where you can buy and sell knickknacks, whatever. Or like a Expedia or a Booking.com where you log in and you can see what hotels you want to book and see, reviews, that kind of thing so that’s what a marketplace is.
Ernest Wong
So they went in they bought apartments.com which is the largest rent site rental apartments rental site in the US today.
Barry Schwartz
So it’s in every single state in the US pretty much.
Ernest Wong
Basically if you’re looking for a place to rent, like you’re probably going to go to apartments.com.
Barry Schwartz
Yeah, it’s pretty easy name to remember too.
Ernest Wong
And then they also went and bought a company called LoopNet which is basically the same thing, but for office buildings and industrial space,
Barry Schwartz
I bet not too many people are looking to buy office buildings now.
Ernest Wong
No, so if again, Baskin was looking for a space, we’d most likely we would go on Loop.net today.
Barry Schwartz
Oh, so it’s for rentals.
Ernest Wong
Exactly, leasing. Largely for leasing. Not for the buy and sell transaction.
Barry Schwartz
So they’ve got apartments, they’ve got LoopNet. There are other marketplaces too, right?
Ernest Wong
They do a bunch of other stuff they have, they have a big lease marketplace business, there’s a business called Biz Buy Sell which is a small business marketplace, but they own STR, which is a large database of hotels so but those are the key businesses that they have.
Barry Schwartz
I think they also have a marketplace for distressed buildings if those are looking to sell, buy and sell as well. So how do they make money on those marketplaces?
Ernest Wong
They sell ads to the agent.
Barry Schwartz
To the agent. Okay.
Ernest Wong
So what happens is if there is an office building, they have a vacant floor. The agent will say, okay, I’ll go and buy an add on LoopNet and like, I don’t know, Baskin or whoever is looking for an office space can see it on loop net and contact the agent.
Barry Schwartz
And it’s all the tricks like if you want to get at the top of the page or a special highlight or more pictures, you got to pay more money. So everybody seems everybody can understand that, how that marketplace works.
Ernest Wong
And CoStar has been extremely aggressive in how they built out these two businesses or all of their businesses, and is a tremendously profitable business today. I think that we bought shares a few years ago after they fell.
Barry Schwartz
Yeah.
Ernest Wong
I think there is a bit of a misconception around the business in that they are highly tied to commercial real estate prices. I think this is not true. And you’re especially seeing that today as costar shares have fallen.
Barry Schwartz
Whole market is really unless you’re The Magnificent Seven. The whole market has been kind of tough this year.
Ernest Wong
It’s been impacted with the rest of the commercial real estate industry. So companies like Colliers or Jones, Lang or Brookfield, Brookfield and those kinds of companies. I think what’s not understood about CoStar is that they actually benefit from periods of distress in the commercial real estate industry and the strip, and they benefit from a few ways. Number one is that, if your apartment building is full, like 100% occupancy, you don’t need to advertise it. You already have all the tenants that you need.
Barry Schwartz
Yeah, you’ll probably just when they when you do have a vacancy, you probably just put a sign up in front of your apartment building because you don’t need to spend any money and there won’t be any issues.
Ernest Wong
It’s when you can’t fill your building that you need to go out and spend on apartments. Yeah, and that’s actually what happened in 2021 when rents were going through the roof and there weren’t enough apartments around Apartments.com was impacted like they had a tough year because nobody needed to advertise.
Barry Schwartz
And no one was moving during Covid anyways people were worried, right? So there was no real estate transactions during that time of rental. There was a lot of home transactions, but rental was very, very slow.
Ernest Wong
So that’s and that’s especially true in their loop net business, their commercial business. Because if you have an empty floor on your office building and there’s a lot of that today.
Barry Schwart
Oh yes.
Ernest Wong
Like the need for you to go out and advertise and find tenants on a place like Loop Net is going to be much higher than it was in good times.
Barry Schwartz
Thats right and if you can’t rent it out on Loop.Net, maybe you, the building owner says, damn, maybe I should just sell the building on TenX because it’s I’m never going to be able to rent this out.
Ernest Wong
Yes. And that leads to the last point, which is that CoStar owns a company called TenX, which is a bit of an auction. It’s a platform that allows companies or distressed real estate to transact as the flood of commercial distress commercial real estate goes on the market over the next few years due to rising interest rates and the weak office work from home and all those things. All of a large chunk of this is going to end up flowing through TenX.
Barry Schwartz
For sure. So you can already see the future earnest, because the work from home is probably a real thing for foreseeable future. And you’re going to see companies just give up on their office space and they’ll be buyers for to convert it to other things, whether they convert it to multifamily, where they knock it down and build a high rise condo. You can see, you know, similar to like what happened after the great financial crisis. There were tons of private equity buyers of distressed houses, and they made out like bandits. Because we’re not building any more land. As the saying goes, go ahead.
Ernest Wong
So CoStar is actually a countercyclical company. They’re going to benefit from the current distress in real estate.
Barry Schwartz
Well, so that’s a very fair comment now. And Ernest, CoStar has been investing heavily in a new marketplace. And we’re pretty excited about it so maybe spend a few minutes talking about its strategy there.
Ernest Wong
So one of the things that we like to look for in companies is companies that invest heavily in their businesses. And I think oftentimes these kinds of companies can appear very expensive because the investments that they’re making at depressed earnings but can lead to a much greater outcome in the future, right? There’s no better example of that than CoStar, in my opinion.
Barry Schwartz
Yeah, because unlike, let’s say, a physical a company that’s running factories or something, if it wants to invest heavily in its business, it’s going to build factories that might not necessarily show up on the income statement Ernest, and may show up more on the balance sheet. But if CoStar not buying things, they’re investing in technology and people not, really physical stuff. So those things are investments, really depressed earnings in the short term.
Ernest Wong
That’s right and Costar, the main thing that’s been depressing earnings for Costar in the last year or so has been their investment in homes. They’ve successfully created marketplace or invested in marketplaces for apartments. They’ve successfully done it for commercial real estate and now they’re after the big price, which is residential housing.
Barry Schwartz
Yeah. And Canadians will know the marketplace. Realtor.com. Right? That’s where a lot of people will go when they want to look at houses, they’ll look at it on that marketplace.
Ernest Wong
Yes and so they went and acquired homes and this is a as everybody knows, this is a gigantic market opportunity and they are investing very heavily into this.
Barry Schwartz
Just to remind everybody that there’s no bigger market in the world than residential real estate. It is the largest market in the world. It’s what brought down the world in 2008-2009. But the US housing market is unbelievable and this is the opportunity there. If you get it right it is huge.
Ernest Wong
Now, there has been a little bit of skepticism in the markets that CoStar is going to succeed in this residential investment.
Barry Schwartz
Well there’s marketplaces that already exist so what’s the secret sauce? What’s the special thing that CoStar is going to bring to homes to get the eyeballs and the agents over to its platform?
Ernest Wong
There’s a few things. Number one is that, as we’ve seen with the rest of their business, they already know how to build marketplaces successfully. Number two is that they have money and marketing expertise. Now just to go through a little bit of background, when CoStar bought apartments in 2014, it was not the leading site. There were a lot of apartment rental sites out there.
Barry Schwartz
Very interesting.
Ernest Wong
What CoStar did was they bought apartments and then they tried to buy their next competitor. And the competitor said, no, we’re not selling to you. So what CoStar did was they went out and said, okay, we’re going to spend some insane amount of money on marketing, because the way these sites work is that you usually don’t type apartments in your browser. No, what you do is you search apartments for rent in New York and then on Google, and then you click on the first link that you see. And so CoStar blanketed the web with marketing spend. Totally dominated their competitors, who are mostly small companies who don’t have the financial capability to keep up with CoStar.
Barry Schwartz
And Starz has a $30 billion market cap. Ernest. This is not a joke company.
Ernest Wong
They basically drove all of their competitors to bankruptcy, and then they tried to acquire all of them. Yes, they succeeded in acquiring one of them but they tried to buy the other out of bankruptcy but the FTC said, nuh-uh.
Barry Schwartz
Well, it’s kind of kind of dirty trick, but something you like as a long term investor put the competitor out of business and get all the traffic.
Ernest Wong
And that’s how apartments became so dominant. They’re going to do something similar with Homes.com.
Barry Schwartz
They’re already doing it.
Ernest Wong
They already announced a $300 million marketing spend and they are like, if I was Zillow or any of the other.
Barry Schwartz
Who owns Realtor.com by the way?
Ernest Wong
News Corp I think. Okay. But they are replicating the strategy. They’re making Homes.com like a beautiful site.
Barry Schwartz
A lot of like when you Google “I want to buy 221 Springfield Road” in you know in Michigan there’s eight different websites that will pop up. There’s Zillow, there’s Redfin, there’s Homes. So it’s the guy who has the number one listing at the top is going to get your attention.
Ernest Wong
That’s right. And so they’ve built a beautiful site. You can go on it today and it looks great. And they have the money to invest in the marketing. What will probably happen is that their competitors again, cannot catch up with their marketing spending, and probably end up getting acquired by CoStar in the end.
Barry Schwartz
So it’s a similar playbook to apartments, and you need the eyeballs to get the agents, and then you need the agents to get the eyeballs. And so far, what we’ve read, it’s working out beautifully. I think they’re getting 100 million unique visitors a month from zero a year ago.
Ernest Wong
And they also own a little company called Home Snap, which is a portal that real estate agents use to help manage their leads. So they already have the agent relationships. It’s just about executing on this site.
Barry Schwartz
Very exciting.
Ernest Wong
That’s even before talking about the international growth, which is almost completely untapped, like in most places around the world, real estate is still a fairly. Which put this archaic process.
Barry Schwartz
I would think so, even in most of Europe, it’s just not the North American way.
Ernest Wong
And so just yesterday they bought a company called On the Market, which is a real estate portal in the UK, and they’re going to spend hundreds of millions of pounds there as well to try and be the market leader.
Barry Schwartz
Ernest, you have to imagine there’s at least 1 billion apartments, houses, you name it, in the world and is only gotten started in North America, pretty much. Its international plans have yet to really you know, they haven’t really gone into anything outside of North America. Is that correct?
Ernest Wong
No, they they’re just getting started.
Barry Schwartz
Just getting started. And the world’s a big place. North America was 350 million people just got six and a half plus billion more people to attack. So pretty interesting. And I think the maybe just a concluding thought on Costar is that.
Ernest Wong
I think a lot of people recognize it’s a great business, but say, oh, it trades at an expensive price.
Barry Schwartz
It is not cheap and we haven’t even touched on valuation, but yes.
Ernest Wong
I think it’s certainly not a deep value stock, but I think the valuation is much more reasonable if you consider the fact that they have $5 billion of cash today and the fact that, as we just discussed before, they’re investing heavily on their income statement for growth. And the business is growing really quickly.
Barry Schwartz
And the main business, the CoStar business of data, that’s not going anywhere, that is a cash cow that gives them the ammunition to reinvest in the business. So remember what we talked about when we want to own good companies, we want to own companies that generate a lot of free cash flow, that can reinvest that free cash flow at high rates. And continue to compound your money. Is CoStar a good example of that Ernest?
Ernest Wong
No better.
Barry Schwartz
Okay. Very good. So check out CoStar. It isn’t a real estate company. It’s in the real estate business. And the real estate business, like we talked about, is the world’s biggest business. And so this is a company that has a long, long runway of growth. And maybe next time we’ll talk, I think we’ll do a podcast about some of our favorite managers and owner operators, maybe talk a little bit more about the personalities, because we didn’t even touch on the Andy Florence, he’s also the founder, right?
Ernest Wong
Yes. He founded it in his in his college room. Yeah.
Barry Schwartz
Founder and still running the business and still youngish guy and big plans to continue to grow the business. So that’s all we have for you today. We’ll see you back here real soon.
Disclaimer
This podcast is for informational purposes only, and any forecasts on the economy, markets or individual securities should not be viewed as investment advice, a recommendation or an offer or solicitation to buy or sell any securities. Clients of Baskin Wealth Management and the speakers on this podcast may own shares of the company’s discussed information on this podcast is current as of the time of production and is subject to change. If you have any questions or would like to subscribe to these podcasts, visit our website at Baskin Wealth.
