When most people open their freezer, they probably find a frozen lasagna, some green beans, a pepperoni pizza and a pint of Ben & Jerry’s Chunky Monkey. At Bonaventure, our freezer sometimes includes an apartment site. Not literally, of course, but in these days of uncertainty we take some projects that we think are in a great location, on a great site with long-term potential and put them in the freezer. We’ll thaw them out when market conditions change.

That’s what freezers are for: being prepared when you can’t necessarily get to the store. At Bonaventure, we’re prepared for every market contingency. We think in decades, not months or years. At the same time, we’re nimble enough to respond when things change.

We’re extremely rational with the way we deploy capital. The process of development is a very long cycle. From the moment you lay eyes on a piece of land to the moment you can put a shovel in the ground to the time when the building is complete and full of residents can be four or five years.

Let’s pause right there. Think back four or five years – nothing much has happened since 2019, right? If you think about what people thought the future held in 2019 versus what actually happened, it would be hard to write a script as crazy as what we’ve seen. It would be a science fiction movie. But it’s also our reality. While the past few years have been extraordinary, expectations and reality are always at least somewhat different over a four or five-year period.

Here’s how we handle these cycles: We pick great sites. We conservatively finance them with long-term fixed-rate HUD loans that provide stability to help us navigate changing market conditions. Now, with rising construction costs, rising interest rates and the total cost of capital, the investment merits don’t always look as strong for every project.

Some properties are still above the “go or no-go” line. Others have fallen below that line, so we’ve chosen to let go of that opportunity and look somewhere else. We’re keeping the sites in places that merit a 20-year bet.

We’re continuing to identify sites in suburban locations around primary and secondary cities where we believe the future will look like the past – before hyper rent growth, hyper migration activity and hyper cost increases.

When the new equilibrium arrives generally and in specific submarkets, we’ll use the techniques that work for us such as contracts with long closing periods or joint ventures with landowners. We have the strength and ability to wait to deliver a building that meets the needs of our customers as well as providing an adequate return on capital for our investors.