Bob Eidson
Bob Eidson spent his time as a mortgage and debt servicing executive for Bank of America in Southern California looking for warts: assets that didn’t look good but that could be had for a bargain and if they performed would aid his company’s bottom line.
It’s a philosophy he’s brought back to his hometown as he and his business partner, Matt Hovekamp, have started Emerge Properties and Emerge Contracting, looking for undervalued properties on the north side of Lexington.
“Value add is our core hypothesis,” Eidson said. “We think there will be a consistent opportunity to buy undervalued properties, do a value add and then sell at market, effectively moving the market of that asset by improving it. There will be no asset that we buy that we don’t have to do something to.”
Eidson points to others who have been working on bringing up rundown properties on the north side of town, such as Brokenfork Design, Griffin VanMeter and Chad Needham.
“We’re not all of the same exact mind,” he said. “People might put us all into a category and label us, but we each have individual business plans, and we all live on different streets. I think we all think about microclimates … When a lot of people think about the north side, they think about it as a homogenous thing, but it’s not.”
Eidson said other parts of town are seen as different neighborhoods, while the north side seems to be clumped together.
“Chevy Chase is very different than Woodland, and that’s very different than the Maxwell corridor,” he said, and he’s banking on the thought that with work and time, the north side will be viewed much the same.
“What Matt and I do, we’re not looking to take over trophy properties,” he said. “It makes for a challenging underwriting criteria, because you’re always trying to value the warts. That’s a direct reflection in the investments in debt we used to make. We used to buy scratch-and-dent, underperforming debt, and that’s where the value was,” he said, while knowing “fallen angels aren’t always sexy.”
Emerge’s property portfolio includes three properties on Third Street between the Lyric Theater and Midland Avenue, a lot on West Fourth by the entrance to the new BCTC campus, a four-plex on Wilson Street, five lots on Smith Street and a 12-unit apartment complex in Georgetown. To help along the way as Emerge builds its portfolio, Eidson has leveraged some of his out-of-state banking contacts for investments in Lexington.
“Having left banking, I had some former colleagues that wanted to be a part of what I did,” he said.
And in order to build up their investment, he knows he’ll have to make some choice decisions.
“The gamble is in the estimation of the wart, not in the property itself,” he said.
What about Bob?
Age: 33
Title: Director, Emerge Properties and Emerge Contracting; founder, The Bourbon Review
Hometown: Lexington
Education: MBA from UCLA, economics major at the University of Kentucky
Previously: Senior vice president, Default Services, Bank of America; sergeant, U.S. Army