Elizabeth Bell from Hamilton Lane on why the real estate reset is a buying opportunity

Elizabeth Bell is Co-Head of Real Estate at Hamilton Lane, where she helps run a $114B real estate program and invests $2.5–3B a year across funds, secondaries, and co-investments.

She has spent about 20 years in real estate private equity, much of it on the GP side before moving to the allocator's seat.

Katie and Elizabeth talk about why institutional investors see today's reset as a chance to buy, the sectors leading and lagging the recovery, and where she sees opportunity, from data centers to necessity-based retail. They also get into the "re-emerging manager" and the discipline it takes to back one.

Her test for a re-up after a hard cycle: not whether everything went right, but how the manager behaved when it didn't.

About Our Guest:

Elizabeth Bell is a Managing Director and Co-Head of Real Estate on the Real Assets team at Hamilton Lane, where she leads due diligence across primary, secondary, and co-investment opportunities in real estate and sits on the Real Asset Investment Committee. Hamilton Lane's real estate program spans roughly $114B, deploying $2.5–3B a year across funds, secondaries, co-investments, and joint ventures.

She has spent about 20 years in real estate private equity. Before joining Hamilton Lane in 2022, she was a Managing Director at Jaguar Growth Partners, leading Latin American real estate private equity investments. Earlier roles included Investment Manager on Aberdeen Asset Management's Property Multi-Manager team, Vice President at Equity International investing in emerging-markets real estate companies, Associate at JER Partners, and investment banking analyst at Deutsche Bank.

Elizabeth holds an MBA from the Wharton School at the University of Pennsylvania and an A.B. from Princeton University.

About The Re-Up:

The Re-Up is a podcast about the business of raising and allocating capital in private markets — and how that work can be done better. In private markets, a re-up is the decision to recommit to a manager's next fund: the ultimate signal of trust. Each episode is a candid conversation with the LPs, GPs, and advisors who have built exceptional track records — the conversations that usually happen over dinner after the conference, not the ones on stage. Hosted by Katie Fasken, founder of August Advisors, a Toronto-based placement firm connecting exceptional private investment managers with institutional capital.

Transcript

Katie Fasken 0:03

The Re-up is a podcast about the business of raising and allocating capital in private markets. In private markets, a Re-up is the decision to recommit to a manager's next fund. The ultimate signal of trust. I'm Katie Fasken, founder of August Advisors, and this show is built around that conversation. The managers, allocators, and ideas worth coming back to. After one of the hardest stretches for commercial real estate in decades, is now actually the time to buy. My guest today thinks it might be, and she allocates across the market at a scale that makes her view worth hearing. Elizabeth Bell is co-head of real estate at Hamilton Lane, where she helps oversee a real estate program of around $114 billion and deploys $2.5 to $3 billion a year across funds, secondaries, co-investments, and joint ventures. She has spent about 20 years in real estate private equity, much of it on the GP side, investing in emerging markets before moving to the allocator seat at Hamilton Lane. We talk about why her institutional clients see this reset as an opening rather than a warning, the sector almost everyone wrote off that quietly led the market last year, and where she's finding opportunity now, from data centers to senior housing to necessity-based retail. We get into what it takes for a new manager to earn a commitment, the idea of the re-emerging manager, and why the psychology makes them so hard to back, and what she looks for before show reap, which after a downturn comes down less to whether everything went right and more to how a manager behaved when it didn't. Here's my conversation with Liz Bell. Hi, Lynn. Thank you so much for joining me today on the Reap. I'm really excited to have this discussion with you. And maybe to start, let's hand it over to you and hear a little bit about your background and what led you to leading real estate at Hamilton Lane.

Elizabeth Bell 2:05

Great. Well, great to see you, Katie. I am very excited to be here. And this is a fantastic podcast. So thanks for inviting me. So I'm co-head of real estate in Hamilton Lane. We manage 114 billion AUM, AUS across real estate. We invest about two and a half to three billion a year across primary funds, secondaries, co-invest, joint ventures. So we're pretty active and get a wide view of the market. In terms of career, so I've been at Hamilton Lane for four years. And looking back, I guess I've been in real estate private equity for the past 20 years, which seems a lot longer than when I look back on it. I think what's interesting perspectives I had is that I've been pretty fortunate to have spent a lot of my time across a whole host of different investment roles that have really spanned the risk spectrum. So for a majority of my career, I was on the GP side investing primarily at the platform level with a focus on emerging markets. So that's probably one end of the risk spectrum. Today, you are mostly focused on investing in developed markets and at the asset level. And so, you know, different part of the risk spectrum, but good to have that overall perspective.

Katie Fasken 3:20

Awesome. And then specific to Hamilton Lane, giving your the co-head, like where are you focused? Or do you have general geographic coverage within your current position today?

Elizabeth Bell 3:32

So I sit in our headquarters outside of Philadelphia. We've got a team in the US that mostly covers the US. We have a team in London that focuses on Europe and a little bit of Asia. I would say my day job, 90% of what I'm doing is looking at the US today. And a lot of our clients are domestic U.S. So there's no currency factors they have to think about. They very much are bullish on investing where in the US today, where the cycle is too.

Katie Fasken 4:00

Speaking of the cycle, it is currently June 2026. We are several years into what has been one of the most challenging commercial real estate environments in decades. How would you describe your own sentiment? And then what are you hearing from clients just on the opportunity set today and kind of how you think about risk in the market?

Elizabeth Bell 4:25

Yeah, great question. Just to put the disclaimer out there, our clients span global investors across pensions, endowments. We've got sovereigns, family offices, retail investors. So it's kind of hard as I look across the board to paint with a broad brush what sentiment is. Since then, we've seen a modest increase, but it's been about two to three percent this recovery. So it isn't leading to this sharp V-shape recovery as we've seen in prior cycles. When we talk to our partners and clients, they actually view that as a positive for investing new capital. See that it means investors can deploy at this current reset valuation for several quarters ahead, and that they don't have the time the market rebound precisely, which I think is a positive. The interesting part is the challenge for them isn't necessarily convincing, you know, for us and their real estate teams. They understand where we are. They are bullish on the market. The problem is convincing their ICs or boards who are looking at the data over the past four years, performances down in real estate, and they're the ones who are looking on a relative basis. They're comparing private equity, venture, infra, and those have all outperformed. And so there is some hesitancy at we see at that level to increase the real estate allocations. But I think, you know, as we keep seeing a little bit more positive performance, that will thaw. On the flip side, talking about kind of that private wealth channel or retail capital, that's also retreated from the sector during this most recent downturn. We've all seen that. But when you talk to those investors, their biggest complaint isn't necessarily the performance. It's really this promise of liquidity that didn't transpire the way they want it. And we hear this from these investors and advisors all the time now that they want a better liquidity mousetrap. And so if you think about it, it makes sense. The existing options that are out there for them, think single manager, buy and hold, long-term strategy, that might not be the best setup to consistently satisfy their liquidity needs. So we're working with a lot of our clients on that side to come up with some new structures that can be a better match, especially from the duration perspective. And I think if we can achieve that, the retail capital will start to flow back to real estate pretty quickly.

Katie Fasken 7:11

Super interesting. So a couple of things that maybe to start, I would like to kind of lean in on retail a little bit. And that eliquidity, was that a factor of them investing in closed-end real estate funds and recognizing that maybe wasn't appropriate for them? Or was that them investing in open-end funds only to realize in a tough market, open-end funds tend not to stay open? There's kind of huge redemption cues, or is it a little bit of both?

Elizabeth Bell 7:40

I think it's more the latter. When we talk to our retail private wealth clients, it's hard for them to access closed-end funds. And so the alternative to get private real estate is these semi-liquid structures. I'm not going to name names, but think non-traded REITs or interval funds. And the nature of the retail investor is they don't want the long-term lockup. And so these funds have to offer some level of liquidity, but either the descriptions weren't clear or the investors weren't as sophisticated to really understand what that meant, in that when things get tough and markets experience challenges, the managers can gate the liquidity. And so I think it was expectations were not being met. I think now both sides understand the issue better. However, we just think the structure today, the existing options aren't the best mousetrap. And so we're trying to come up with something that we think can just be a better fit for our investors.

Katie Fasken 8:42

Got it. And then earlier in your last response, you just talked about valuations 2024, 2025, down about 20% from 2022 peaks. Not surprising, but a pretty significant stat. In aggregate, you'd said the real estate markets up about 2 or 3% since then. Would love to dive in. That's obviously not all asset classes. Just a little bit of commentary on what's, you know, the haves and have nots in terms of asset classes today.

Elizabeth Bell 9:12

Yeah, the most obvious office is well below that 17 net downturn. And we're seeing a little bit of rebound there, but we're very cautious still. I think the interesting sector is retail right now. So much so that, you know, during the past decade, retail obviously was not in favor. People avoided regional malls, rightfully so. But now, as we see the rebound, especially Odyssey, which is the open ed core fund index in the US, a really good proxy for the overall market, the highest performing sector driving returns in 2025 was retail. And so a lot of, you know, we were in favor of multifamily and industrial. And if you had the right sector allocations leading up to the downturn, i.e. heavy multifamily industrial, underweight retail and office, you outperformed. But now we're seeing there's a little bit of a drag in that if you didn't have retail, you might be underperforming this one year return. So we're definitely looking to allocate more to retail today as a result of that.

Katie Fasken 10:19

Awesome. Would love to spend a bit of time on that. Obviously, not all retail is the same. If you could elaborate on within retail areas where you see opportunity and not, and certainly I've spent the vast majority of my career working in retail. It's an asset class that I've loved, you've seen perform through all cycles. The sentiment I get from LPs today is like, oh, now we've missed the opportunity, which I certainly don't believe. But I would love to hear from your perspective why today, despite the positive sentiment, is still a buying opportunity. And then within retail, which segments are attractive or not?

Elizabeth Bell 10:57

I still think it's a great buying opportunity. Capital has flowed back to the sector. However, I think there's still opportunity on the ground to find good quality assets and attractive yields. The segment we like to play in right now is more necessity-based retail, so grocery anchored shopping centers or non-grocery anchored strip centers. What we like about that segment was generally speaking, even during the pandemic, occupancy held up pretty well. These are stores that were deemed essential and stayed open. And especially, you know, you've got your grocer who the grocers are performing very well today, the ones we target, right? And then you get your return from the inlines. And what's so interesting is that, you know, a lot of these centers, especially the non-grocer anchored ones, owned by unnatural real estate owners, mom and pops, not the most sophisticated investors. And there's an opportunity to buy these centers and get real rent growth because they haven't been managing the rent role the way an institutional investor or a strong operator would. So even if yields compressed slightly, we see the NOI growth opportunity there is very strong. And the supply side has been muted for 10 years now. So there's very little supply coming online. The tenants that remain in retail are strong. They've understood how to withstand the challenges they've faced. So we're pretty bullish on the sector in that kind of necessity-based segment.

Katie Fasken 12:30

Awesome. And to complement that sort of bullish sentiment, are you seeing significant opportunities? I mean, certainly retail was the bell of the ball, kind of pre-retail apocalypse. And you just saw the number of managers decrease in that segment. Are you seeing emerging managers trying to get back into the segment, more sort of generalist funds, leaning in on retail? Or is it some of the legacy groups who are now really shining?

Elizabeth Bell 13:01

I think that with the phenomenon I just mentioned in terms of the performance of the Odyssey being driven by retail, we're going to see a lot more diversified groups expand from the two favored sectors, multifamily industrial and include retail now. I'm not sure that that is the best way to access the sector. Retail by far is the most complex of the real estate sectors. You have a host of tenants, you've got restrictions. It's a difficult sector, and you really need to know what you're doing. So when we go back in, we want to work with the specialist operators who have understood the sector, have been in this sector. There's been a few that I'm amazed have continued to raise capital even during the retail apocalypse, as you mentioned. And I think those are the ones who are particularly well positioned in today's market. They've stayed in touch with the tenants. They really know what they're doing, versus some diversified groups who were kind of looking to play the sector now, but one have been out of it. So they're the junior teams really have looking at it for the first time. And two, they just don't have that expertise on the ground. Got it. Super helpful.

Katie Fasken 14:11

Maybe before we switch gears, as we think about just different sectors and congestion, I would love to know your thoughts on alternative real estate. It's something that we hear about a lot. There's some haves and have nots, big kind of flows in and out over the last five to 10 years. But overall, there's a lot of interest. And I'm curious what your house view is on the alternative space.

Elizabeth Bell 14:34

Generally speaking, we're very bullish. However, I think you have to define we almost define it in three different buckets. You've got your digital alternatives, so data centers being the largest. We are very bullish on data centers. We allocate to the sector through our infra team and our real estate team. And I think there is definitely risk, but when you look at the supply-demand dynamic, vacancies are below 2% in the US. The big bottleneck is access to power. In some ways, it almost feels like unlimited demand is out there and that the supply is so constrained because of the power access. Now, all that being said, rules of real estate still apply. So when we look at the sector, we're not necessarily investing in the hyperscalers in the middle of nowhere. We still want to access as you know infill as possible around primary markets, where if something is obsolete in the future or if something changes, you're still on a quality landscape. That's one segment of alternatives we love. Then looking at the others, I almost think that there's, I call it the ascendant alternative sectors, which are senior housing, student housing, self-storage, medical office, where those sectors are being included in Odyssey one. So I think there's recognition that they are probably more advanced than some of your other niche alternative sectors. There's more liquidity there. I think there's been several cycles now where operators have been tested so you can really see who understands what they're doing, especially in the senior housing space, where the operational skill set is so important. But we like that segment. There's structural demand drivers supporting, you know, getting to seniors again. This is phenomenal. In the US, every day, 5,000 seniors turn 80. Yeah. And by 2030, I think 20% of the US population will be over the age of 65. So we're finally hitting that silver tsunami, and there are real housing needs for that cohort. And then the third bucket of alternatives are your niche alternatives. I think this is where we're mixed. This ranges anywhere from RV parks to marinas to industrial outdoor storage. These are typically much more fragmented sectors that typically warrant, you know, uh wider yields, which we like. Again, you kind of have to do an aggregation play here to deploy and scale, but there's opportunities and risks there. So I would say of the three, we're pretty bullish on the digital and ascendant sectors. And we'll look cautiously at the niche ones.

Katie Fasken 17:18

Silver tsunami is amazing, by the way. I've never heard that before. So despite what has been an extremely difficult and prolonged fundraising backdrop, you know, you mentioned Hamilton Lane continues to deploy really significant capital into real estate annually. I know vintage diversification is certainly key to your program. Let's talk a little bit about new GPs and what it takes for a new GP to get Hamilton Lane's attention.

Elizabeth Bell 17:49

I think first, just echoing what you said, how difficult the past four years have been for real estate fundraising. I was talking to a friend recently and she described the current real estate fundraising market as the most acute challenge across all private markets by orders of magnitude. So if you're feeling this pain, it's real. You're not alone. However, this means it really is very competitive out there. And so to share some attributes we look for to help get attention for new managers. First, it's strategy. You know, that's obvious. We look for strategy in two ways of GP, you know, we're looking for GPs that are pursuing some strategy that's either new or differentiated. But we're also looking for GPs that might be pursuing a familiar strategy that we like and just have a proven capability of operational expertise and which leads to better performance. So some examples of groups like this we recently invested with. So kind of that first case study, we recently met a manager. They're pursuing a differentiated strategy within data centers. So I mentioned we like data centers. However, what caught our attention here is that they're not doing hyperscale developments, they're doing more infill co-location assets, and they're really looking to attract the tenants that have strict latency requirements. So think algorithmic traders. Ultimately, well, this will be drivingless cars, you know, operating rooms that can't miss a nanosecond on an operation. And so if you're relying on some technology or AI there, you do need to be closer to cities. So we hadn't really studied this space much before. When we did a deep analysis, we really gained conviction. And this was one of the few managers that was executing a space. So we are investing with them right now. I think another side of the coin is an example where we came across a very traditional industrial manager. They've had a series of funds already. And so what really drew our attention on this one was even though we already had significant industrial exposure, when we looked at this manager's track record, it stood out that they were head and shoulders above their peers, which had already been strong returns previously, and that these returns were very consistent. So, you know, this brings up the second attribute. I think. So when we dove in further, what we got to know the manager, we realized that they're not just good at investing and delivering the returns, but they're also good managers in terms of transparency, partner behavior, responsiveness. And so with all of this, we got conviction where we were overweight in the sector to still even take on a new name there. It's important track records can get our attention, but we're not just allocating solely based on that. These are 10-year partnerships, and we really have to trust our managers, understand how they'll act when challenges arise, how they'll communicate when things are going wrong, tell us the truth, and all of that matters. And then I think there's some other attributes that can help. So sometimes we see a fund or an opportunity and the situation is just too good to pass on. This could be for a fund. You've got seed assets that are doing extremely well. You can see that there's a path to a strong markup after we close. We like to see that. Maybe the fee loads are super attractive. And so those attributes get our attention. And then the fourth way to really get to know a group like us at Hamilton Lane is to show us co-invest. So what we love that angle is if we're doing a first-time meeting and you're seeking a, you know, discretionary, co-mingled blind pool commitment, that's tough. However, a first conversation can lead to I'll show you a deal. You can see how I act as a manager, how I underrate risk, how I produce my models, and you can get to meet more of the team. That is a fantastic way for us to diligence you, your firm, your fund, your strategy. And ultimately, a lot of times when We do a column best with the manager, that will lead to a commitment into their fund. So it's a host of things, but there's definitely ways to get the attention if you're trying to establish a new relationship.

Katie Fasken 22:11

You touched on this a little bit, but just given the pressure on managers today, what kind of concessions or structural changes are you seeing from GPs who are just eager to get a deal done? And then how do you kind of distinguish between attractive opportunities and then, you know, kind of situation that may just signal, I guess, distress coming from a GP or urgency, depending on what type of concessions they may or may not be offering.

Elizabeth Bell 22:41

Yeah, that's a great point. Maybe just talking about breaking down the concessions. So what we're seeing today is kind of threefold. We're seeing concessions on economics, on governance, and also the partnership construct. So with respect to economics, we are seeing some aggressive fee breaks. We're seeing step downs, founder share classes, and then kind of thoughtful structuring around carry. All of that goes directly to the LP's bottom line. So we love that. On the governance side, we're seeing more openness to spoke or enhanced reporting. We're seeing advisory committee rights get stronger, more transparency around conflicts, succession planning. So those are either concessions, but legal negotiations that are more LP favorable. So we're seeing those come into play, which helps. And then in terms of the partnerships, it's interesting. We're seeing some GPs there. You know, flexibility is key to if you can access capital, be as flexible as possible to do that. We're seeing some GPs go so far as to kind of almost pause their next co-mingle fundraise, given the environment, and instead focus on developing a new LP relationship through an SMA. And, you know, in some cases, they're giving up fees and discretion, but in return, you get a new partner with deep pockets and you can secure that capital quickly to execute. And as we mentioned, I think it's a great opportunity to deploy capital today. So if you can get it and put money in the ground, I think it'll be a great vintage. So those are the various concessions or you know, changes we're seeing. When is a manager desperate? I think this is this gets to the whole story, right? Yes, we're seeing some managers. There's a whole host of reasons as to why fee cuts can be tricky. I think it really comes to the story. I can't really, without naming names, kind of go into whether we think it's a good or bad story based on distress. The point I will say is that top quality managers are offering discounts. So a discount doesn't necessarily mean there's distress. We don't just, the other point I'd make is we don't just invest because it's a great discount.

Katie Fasken 24:57

Of course. Yeah. Okay. So a theme that I have been hearing about, given us coming out of the last cycle, is this concept around a re-emerging manager. So a manager that has historically been exceptional and they hit tough times and they are coming through the cycle with some hard-earned lessons, a refocused team, a refocused strategy. Are you seeing this? And how how do you evaluate those opportunities? And I think it's a question of balancing the emerging manager of someone who has no skeletons on their track record versus someone who has a lot, but they've really spent the time and energy to think through what their 2.0 or 3.0 in some instances is going to look like.

Elizabeth Bell 25:48

Yeah. I love this question. I first heard the term re-emerging manager from you a few weeks ago. And I think it's brilliant. And I am definitely using it today. And so thank you for sharing. I think this concept is really relevant in today's market for a whole host of reasons, which we don't have to get into right now. It could be a completely separate podcast, but it's definitely this concept of re-emerging is a reality. I've been chewing on the exact comparison you just said between kind of what's easier for a manager to be an emerging manager or a re-emerging manager. And as I've been chewing on this, I'm kind of going back to my like college psych 101 classes again, because I think there's some lessons we can learn there. Is it easier for LPs to underwrite the unknown? As we say, an emerging manager with a limited track record and data, or to underwrite a known but historically imperfect manager. I think this gets into availability bias and novelty effect a bit. So when we think about re-emerging managers, they have this recorded history. This means there's readily available information about their past flaws, failures, and this is front and center in our memories. And our brain will naturally build complex criteria to evaluate them and ask a ton of questions and we'll go deep. This makes repositioning for these emerging managers quite challenging. On the flip side, contrasting that to an emerging manager, they generally lack that history. There's fewer concrete data points to trigger that active skepticism. And so, in some ways, these emerging managers get a free pass in a way because our brains perceive them as blank slates. This is where I think LPs need to be very disciplined and not take the easy or lazy mental path. The reality is we know this, no manager's perfect. And just because we don't underwrite the specific issues the emerging manager will eventually face, and we know they will face them, it doesn't mean they're less risky. And you can see this, we see this whether it's a manager, even on the direct deal side, right? Like when I was investing in operating platforms, it would be so funny. We'd set spend months on a mid-stage company to invest in because there were so many things to uncover versus an early stage platform. It was a lot of need to believe, but the uncovering stage was a lot shorter, didn't mean that that was a better investment or less risk. So it's a super interesting point to think about.

Katie Fasken 28:22

And so from your perspective, some GPs may not have accepted that they are a re-emerging beganster and they likely have a bit of an uphill battle. What do you think a GP needs to do to kind of overcome that bias and that hurdle?

Elizabeth Bell 28:38

Yeah. I'm half joking with this, but I think if we were to put our heads together, we could come up with a 12-step program to re-emerge. And without a doubt, I think step one would be acceptance. And in some ways, this is the hardest, right? Like in case you're not aware or any listeners, real estate founders generally have big egos. And this concept of acceptance of saying, literally looking themselves in the mirror and saying, I am now a re-emerging manager, I'm not on top of the world like I used to be, is so humbling. And that is a building block that many managers won't be able to get past. So if you get past stage one and a manager can honestly say, here's where I am today, I'm willing to admit vulnerability. I'm going to own up to my past mistakes. Then I do think there is a real strong case for this re-emergence. Just sharing some ideas on the subject. So I don't think LPs are inherently against emerging managers. I think in some cases there's benefits, right? A difficult cycle, a down cycle, like we just went through, really creates that kind of reflection that makes a platform can make a platform stronger. You can improve your investment committee discipline, you can tighten your mandates, you know, really think about realistic return expectations and kind of can dissect your team and capabilities to understand where your edge is. If you are thinking of re-emerging, all these things can make your platform better. And I think the other aspect of is to not just do that, but to communicate it, right? So you do have to tell your LP's existing and prospects what you learned, how those lessons are changing, not just what you learned, but how they're going to change your behavior going forward, demonstrating that your strategy is now sharper. You it's more repeatable. All of that can be a very compelling story. So some of the most interesting managers we're looking at aren't the ones that are pretending like nothing happened. In fact, we will be walking away from those. It's the ones who kind of came through this cycle a little bit more humble, more focused. And ultimately we think that they have to prove it, but can be better, come out of this better in the long run. So there is hope for re-emerging managers.

Katie Fasken 31:00

Super interesting. And you said not just do it, but communicate it. And I mean, I would argue it's a virtuous cycle where it's not just communicate it, but do it. Because you can get into a pitch and hear all these amazing things. And then the question is, is this re-emergence really substantiated in your team, your ethos, your investment committee, your strategy, et cetera? So it'll be it'll be neat to unwatch and really love that response. So thank you. Yeah.

Elizabeth Bell 31:27

And I think, sorry, just to that point, I think LPs, especially for re-emerging managers, will be doing you're underwriting like an emerging manager. The reference calls will be significantly more than they have, they even appreciate it went on in the past. And so that idea of saying it and doing it will unfold in these reference calls. And so there's checks on that, right?

Katie Fasken 31:51

Absolutely. You mentioned a little bit about real estate founders. Succession continues to be, we're talking about the silver tsunami to be an increasingly important topic across real estate. How do you think succession is done right today?

Elizabeth Bell 32:13

It's an interesting question. I was talking to an advisor who said, in some ways, with AI, right, the steps to do succession planning can be easily taken from Claude and you've got your steps, but the hard part is the execution and the nuance with personalities. And so, to your point, we've got groups that say they're doing succession planning and they take all the right steps, do this early so you can mentor the next generation, you're identifying. But if the founder isn't mentally ready to give up, sometimes it can all get derailed because, you know, follow the personalities and how this whole process is managed, either from a founder or senior executive who isn't going to actually give up the reins, who moves to chairman but is involved in the weeds every day. That's not real succession planning. Or it could be, but the execution isn't there. Or other groups we see where, okay, we're gonna do succession planning. They start to announce this, and then the competitive nature of the type A personalities in our business, there's the vying for that succession planning can get ugly too. And so it's a very, I think there's you know, right ways to do it, but the execution and the people aspect make it challenging.

Katie Fasken 33:30

Absolutely. Okay. Last question. I've loved our conversation today, but in line with the name of the podcast. The react. How do you get comfort in making a re-up?

Elizabeth Bell 33:47

Re-upping is it's usually less about, and especially in a time like this when we've gone through a down cycle, it's less about whether everything has gone perfect, and it's more about how the GP acted in some ways when it didn't go perfect. Now, there are exceptions of managers completely missing the mark, being way too aggressive on underwriting, and the returns are now awful. And hopefully we weren't with those managers to begin with, and we will definitely kick them out. But the group that we're considering the re-up, a big component of it is the softer aspect of partnership. We look at the market, very few managers have come through this period unscathed. And what we care about is if there's a market downturn, still, how were you underwriting? Were you disciplined? Were you transparent with your partners mutating the challenges? Were you transparent with your valuations? Were you early with your valuation marks of being honest with where you saw the market going and marking appropriately? And is there a consistency of this? A lot of times we'll see managers that keep their marks really high, getting close to their next fundraise. Or maybe they'll take one hit and say, see, we marked down, but you know, we're good now. There's consistency. So we can kind of see those immediate drops or upticks. In terms of just managers and re-upping, another point is how true to their strategy were they? Again, the underwriting discipline is almost a given. If you didn't have that, we're probably not having this conversation. Another point is are you nimble enough to adapt without drifting too far from your core competencies? I think that's a big one. If you're an industrial manager and your performance was softer, probably not terrible because industrial is a sector outperformed, but now you want to you see the shiny object of data centers, and now you think you can jump to there and save the day. That's probably not something we're looking for. Even if you succeed because the data center market is doing very well, those core competencies are, you know, probably not there. So we're cautious on that type of move. And we want to make sure that the managers really understand what worked and what didn't and how they've changed as a result. So for all of these, you learn a lot about our managers in kind of years three and four of a down cycle versus how much you learn from them in year one of an upcycle. So these are, like I said earlier, long-term partnerships. We're evaluating the behavior over time.

Katie Fasken 36:22

Awesome. Thank you so much for the time today. I've really enjoyed this discussion and I'm excited to share with the audience. Good. Well, thank you for having me. That's another episode of the Reapp. Subscribe wherever you get your podcast. And if there's someone in private markets you think we should be talking to, send us a note. I'm Katie Faskin. Thanks for listening, and we'll see you next episode.