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Green Street Advisors, LLC is a global commercial real estate financial services firm headquartered in Newport Beach, California. Green Street provides commercial real estate research on both the publicly-traded and privately-held property markets in North America and Europe. The firm also offers advisory services and Real Estate Investment Trust (REIT) dedicated trading services (through Green Street Trading, a subsidiary) to institutions around the globe. Green Street has 148 employees (as of September, 2017) across three offices, including its Newport Beach headquarters, European office in London, England, and North American trading desk in Dallas, Texas. Green Street popularized the use of a net asset value (NAV) methodology for real estate valuation.

1985-1992: Birth of the modern REIT market
Green Street was founded in Newport Beach, CA, in 1985 by Mike Kirby, a recent University of Chicago Booth School of Business graduate, and Jon Fosheim Jr., an investment banker and son of former South Dakota Supreme Court Chief Justice Jon Fosheim, Sr.. The two met at Bear Stearns, where Kirby was an MBA intern and Fosheim was an investor. The company is named for a cafe located on Greene Street in New York City where Kirby and Fosheim decided to start the business. .

Green Street originally formed to provide research on junk real estate loans. While analyzing junk bonds, Kirby and Fosheim discovered contradictory financial analysis of REITs, a tax-advantaged security designed to hold real estate assets. REITs were more than 25 years old at that point but Kirby and Fosheim believed that the security was poorly understood and underutilized. This discovery led them to begin marketing their own REIT research.

When Green Street was founded in 1985, the REIT market capitalization was $7.7 billion. The firm's launch roughly coincided with other developments in the REIT market, including the debut of the first real estate-dedicated index fund in January of 1985 and the founding of REIT-dedicated asset manager Cohen & Steers in 1986. Until 1991, the REIT market was generally being used as a repository for mortgage debt, and Green Street's REIT analysis became a key resource. Within two years of its founding, Green Street counted major financial firms as clients, including Citi Group, Fidelity Investments, and First Pacific Advisors.

The 1991 initial public offering (IPO) of Kimco Realty marked the beginning of the modern REIT era. The Kimco IPO was followed by the 1992 IPO of Taubman Centers, the first REIT to utilize the Umbrella Partnership REIT (UPREIT) tax structure to defer capital gains tax on appreciated real estate assets (similar to a 1031 exchange structure). Together, these IPOs introduced equity REITs to the market, causing a structural conflict of interest for research firms that also provided sell side underwriting and investment services. Because Green Street provided only research products at that time, it became a prominent source of independent analysis.

1992-2007: REIT market boom
Kimco's IPO set off a boom of REIT IPOs, with 45 IPOs in 1993 and 43 in 1994, compared to just six in 1992. Green Street initially provided analysis on every REIT IPO, but as the pace of IPOs accelerated in 1993 and 1994, the firm's small team began providing IPO coverage only on large and influential deals. As the REIT market grew from a market cap of $13 Billion in 1991 to $139 billion in 1998, Green Street expanded the scope of its business and in 1998, increased its team to 12 analysts up from two analysts in 1991. In 1995, the firm opened Green Street Trading, a REIT-dedicated trading desk based in Dallas, Texas, as a vehicle for a volume-based business model for research distribution. In 1997, the firm created an advisory and consulting division providing real estate strategy, valuation, IPO advisory, and other services based on its REIT expertise. Nine years later, Green Street founded Green Street Investors, an affiliated REIT-focused investment fund that trades almost exclusively on Green Street's Buy, Hold, and Sell recommendations.

Over time, Green Street became known for its casual environment,which was a departure from the strict professional environment at most financial firms. During this time, Green Street added employees who would go on to become leaders of the firm, including John Lutzius in 1992, who became managing director of Green Street Europe in 2008; Craig Leupold in 1993, the firm's chief executive officer since 2016; and Jim Sullivan in 1994, president of the firm's Advisory and Consulting division since 2016.

In 2005, co-founder Jon Fosheim left Green Street to serve as CEO of Oak Hill REIT Management, LLC, a REIT-dedicated hedge fund.

From 1998 to 2006, the REIT industry market cap more than tripled from $139 billion peaking in August, 2007 at $438 billion. The expansion of the U.S. real estate market over this period has been retrospectively identified as related to the United States housing bubble. The resulting market collapse created a credit crisis that dragged down the greater real estate market, which was an important cause of the Great Recession.

2007-Present: Great Recession and recovery
From the industry's peak in August, 2007, commercial real estate fell 39% by March, 2009. During the crash and recovery of the real estate market, Green Street kept expanding the scope of its services. In 2008, the firm released a shopping mall database with detailed information and grades on more than 1,400 U.S. malls. Shortly after the industry hit the bottom, Green Street launched its Commercial Property Price Index (CPPI) to track commercial real estate values indexed to the August, 2007 peak. In 2012, Green Street expanded its formal coverage universe to more than 100 publicly traded REITs, covering 82 in North America and 26 in Europe.

In February, 2014, Green Street launched its Real Estate Analytics product suite, expandeding its coverage universe into private commercial real estate markets. The new product marked the firm's first formal expansion beyond publicly-traded REITs, although the firm had informally covered private commercial real estate as part of its REIT research efforts and advisory services. Also in 2014, private equity firm Golden Gate Capital purchased a majority stake in the firm for an undisclosed amount.

In July, 2016, Green Street expanded its private market coverage universe to the 50 largest private markets in the United States. By this time, the firm employed more than 120 analysts and associates across its four business lines.

REIT Research
Green Street's REIT analysts produce Buy, Hold, and Sell recommendations on a coverage universe of 128 publicly-traded REITS. Green Street formally covers REITs in 11 sectors in the United States, including apartment, industrial, mall, office, strip center, health care, lodging, self storage, net lease, data center, and single-family rental, and 13 sector-market combinations (e.g. London Office, or German Residential) in the European union. The firm's analysts cover dozens more informally. Green Street's US REIT research division is its oldest business line. In 2008 the firm opened its European office based in London, UK to cover the European real estate markets.

Real Estate Analytics
Green Street's Real Estate Analytics division was launched in 2013 as a complement to its REIT research business, expanding its analysis of private real estate markets. Green Street's Real Estate Analytics products cover eight sectors (apartment, industrial, mall, office, strip center, healthcare, lodging, and self storage) in the 50 largest markets in the United States, as well as macroeconomic real estate reports.

Advisory and Consulting
Green Street Advisory and Consulting is an affiliate advisory firm founded in 1997. The group has been active in REIT IPO advisory, but also consult on REIT strategy, conversions, valuation, mergers and acquisitions, and international business practices. Green Street's research and advisory divisions are located in the same building but are subject to a Chinese wall which prevents material non-public information from being shared between the affiliates.

Green Street Trading
Green Street Trading is a REIT-dedicated trading  subsidiary launched in 1995. Its trading services deal exclusively in listed REIT securities in both the United States and the European Union, and it operates the largest REIT-dedicated trading desk in the United States. Green Street Trading (US) is located in Dallas, Texas, and Green Street Trading (EU) is located in London.

Methodology
Green Street assigns Buy, Hold, and Sell recommendations and a variety of property-, portfolio-, and market-level scores based on calculations of the net asset value (NAV) of a security or market's underlying assets  relative to similar securities and assets. This technique is also employed by Green Street's advisory group in its valuation services.

Net asset value (NAV) is the value of an entity's assets minus the value of its liabilities, equivalent to equity value in standard accounting. NAV of securities is often divided by the number of shares outstanding as a representation of net asset value per share. As it applies to REITs and real estate holdings, NAV is an adjusted net asset value reflecting the current market values ("mark to market") of real estate properties held by an investment corporation. NAV calculations allow analysts to observe how public securities trade relative to their listed price; at a discount, a premium, or parity to listed value.

Relative value is the attractiveness measured in terms of risk, liquidity, and return of one instrument or maturity relative to another, or in the REIT market, of one REIT relative to another. Commercial real estate holdings are distributed over a wide range of disparate industries and so different property types are often hard to compare. For this reason, the commercial real estate industry is generally broken out by sector and market. Green Street's research follows that convention, using relative valuation to compare REITs within industries, assigning a Buy, Hold, and Sell recommendation based on each company's net asset value and the premium, discount, or parity to their price relative to its industry and market peers.