“To free others of bestowed burdens so that they are free to move the world.”
Stan is a CFP with over 19 years of experience in financial services. He is also deeply experienced in matters that affect the Ultra-High-Net-Worth. He is an Alum of the Thayer Leader Development Program at WestPoint and a USC graduate in Electrical Engineering and Business Studies. Stan founded GENRICH in 2008 and evolved it into the Family Office it is today. Since 2008, GENRICH has operated as a Management Services Organization providing comprehensive wealth-keeping services to ultra-wealthy Principals. Its purpose is to future-proof the family treasury for the self-made.
Q1. Tell us your life journey. What motivated you to start the Genrich Family Office?
Everything I do revolves around one idea: “To free others of bestowed burdens so that they are free to move the world.” I formed Genrich to do just that. It just so happens that Genrich is a family office that does that for the Ultra High Net Worth.
Q2. What mistakes do family offices usually make?
Wealthy Principals often underestimate the impact of the not-so-obvious issues that affect their family and in turn, affect their wealth and status. A family office is an effective solution to handle those issues. However, mistakes that family offices typically make are in the design of the organization, the people involved, and the overall role it plays. The family office should be structured to offer an edge in wealth management, but often they are structured (unintentionally) in a commoditized fashion which simply adds complexity and cost.
Q3. What benefits do families get at Genrich as compared to others?
We keep the mentality of making our Principals money, not investing it. Thus we chose not to be an RIA. We manage the back-office/middle-office and oversee external professionals. With our growing community of Principals and family offices, the distinct value we offer is helping facilitate key connections for our Client-Principals where many business deals were consummated.
Q4. What asset classes in real estate are you going to allocate in? And in what asset classes are you planning to decrease your allocation in real estate?
We like housing, it’s a staple along with real estate secured debt. With that, we also like grocery-anchored retail. We also like operator-centric asset classes such as healthcare, ghost kitchens, and specific areas of hospitality which include senior housing. We currently don’t intend to be a net seller of real estate assets.
Q5. What is your outlook on the real estate market over the next decade?
We are very bullish on the real estate market over the next decade. We think that the pandemic has changed people’s habits which is creating a lot of opportunities in the real estate market. Specialized markets will do well.
Q6. What mistakes do managers make when raising capital from family offices?
Managers often group family offices in one large category and don’t take the time to understand the needs of the family office. Family offices are as diverse as the friends everyone keeps around them. Well-run family offices have different buckets of capital serving different purposes they allocate from. They have their own liquidity considerations, varying market outlooks, and different past experiences that shape their decisions.
Q7. How important is impact investing in real estate? (e.g. Funds like Home.LLC )
The range of importance of impact investing to family offices is 0% to 100%. It tends to be more important for the younger generations and less for the older generations. We currently work with a Principal that is in escrow to purchase a small town so that he can write his own rules and prove out a profitable healthcare governance model. We work with another Principal that distinctively keeps his for-profit activities separate from his philanthropic activities.
Q8. How do you allocate your own personal portfolio?
I have the benefit of being able to invest alongside our Principals, so my personal portfolio is very similar to theirs. Generally speaking, I have 10% in cash, 25% in public markets, 35% in real estate equity and debt, and 30% in private alternatives.
Q9. What can family offices do to preserve long term wealth? How can you help them with this?
Consider technical expertise in areas of estate planning, tax planning, and investing as a prerequisite. Focus instead on hyper-organization of your wealth, and more of the human resource role of getting the right people on and in the right seats on the bus. Much like the evaluation of managers when deciding on an investment, the success and failure of a family office in preserving long-term wealth reside in the execution of the family office, not the idea of one. We have been an outsourced family office execution team for multiple families since 2008 and can help guide families with best practices.
Q10. Which family office helped you understand this industry back in the day? Which mentor would you like to give a shoutout to?
Tiberius Family Office. We still work closely with them. Vic Chiang, the Founder, is an Advisory Board Member to Genrich.
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