Newsfeed: Kyle Bass Acquires Texas Land As Boom Times Could ‘Last At Least A Decade’

By Tyler Durden via ZeroHedge

Hedge fund manager Kyle Bass’ private equity firm is placing big bets on land. Bass is buying tens of thousands of acres of Texas dirt which appears out of the norm for the hedge manager, considering he has wagered complex macro trades in financial markets for over two decades.

Maybe Bass is getting down to the basics: Land is one of the most important assets. His thesis about purchasing largely undeveloped Texas land is partially based on demographics in the state during Covid, which led to a population jump after that.

“We’re on the front end of a population migration that will last for at least a decade or more,” Bass told Bloomberg.

“People from the Northeast, people from the West Coast — they are going to constantly move to Texas, Tennessee, and Florida,” he said. 

Conservation Equity Management, an investment firm created by Bass last year, has acquired 37,000 acres of Texas ranch land.

“I’m taking all of my expertise developed over decades of analyzing global macro situations and geopolitical situations and developing a thesis on Texas land as an asset class,” Bass said.

Purchasing large swaths of land has been all the craze among ultra-wealthy and elites while average folks gamble their savings on worthless ‘meme stocks.’ We noted not too long ago that billionaire Bill Gates continues to buy massive amounts of farmland in the Midwest (now America’s largest farmland owner).

Gates isn’t alone. Other billionaires, including Amazon’s Jeff Bezos, have recently increased farmland holdings.

Back to Bass, who is concentrating on Texas land, said there are 142 million acres of privately owned ranches. The median price per acre was about $4,286 as of 2Q22, up 123% in the last decade, according to the Texas Real Estate Research Center at Texas A&M University.

Also supporting the boom are large companies shifting headquarters and/or operations to the state.

Elon Musk famously abandoned California for Texas last year and moved Tesla headquarters to Austin. Hewlett Packard Enterprise has shifted its headquarters to Houston, and Caterpillar plans to relocate to Dallas.

According to Decide Consulting, over 125 tech companies have announced plans to move to Texas since 4Q20 (here’s the most comprehensive list of tech companies relocating to Texas).

With the massive inflow of not just people but also businesses, Bass feels the pensions, endowments, and other institutions will deploy capital in the state as the boom is just getting underway.

Bass also said the state’s industrial expansion would be a boon for companies that can satisfy corporate ESG mandates.

Besides complex macro trades and now Texas land, Bass also took a position in nickel when he bought a million dollars worth of US nickels in 2011.

 


More From The Real Estate Guys

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.


Subscribe

Broadcasting since 1997 with over 600 episodes on iTunes!

real estate podcast on itunesSubscribe on Androidyoutube_subscribe_button__2014__by_just_browsiing-d7qkda4

 

 


Love the show?  Tell the world!  When you promote the show, you help us attract more great guests for your listening pleasure!

Facebook
Twitter
LinkedIn
Email

Be the first to know when new content arrives!

Explore The Archives

Archives
Metal Ask Change
Gold $1632.94 $6.05
Silver $18.5 $0.02
Platinum $864.53 $-0.51
Palladium $2119.5 $24.21
Gold to Silver 88.27 to 1
Gold to Platinum 1.89 to 1
Gold to Palladium 0.77 to 1

The Real Estate Guys™ Guests and Contributors Have Been Featured On: