Starwood CEO on Business Strategy, AI, Data Centers

Summary

Barry Sternlicht, Chairman and CEO of Starwood Capital Group, discusses the company's expansion into AI data centers globally, including deals in Europe, Asia, and Australia. He also talks about taking private the Asian real estate manager ESR, European real estate opportunities, and his cautious view on US blue states. The conversation covers macroeconomics, interest rates, and the disparity in the US economy.

• Starwood has been investing in data centers for five years, with significant presence in Dallas, Europe, and Asia.
• The company led the privatization of ESR, Asia's largest real estate asset manager, to gain exposure to fast-growing Asian markets.
• Starwood is active in European real estate, including a Swedish homebuilder and industrial assets in Northern Italy.
• Sternlicht prefers investing in markets where property yields exceed the cost of debt, which happened faster in Europe than in the US.
• He is waiting for Federal Reserve rate cuts to become more active in US real estate.
• Sternlicht is wary of investing in US blue states due to high taxes and is favoring Sunbelt states like Texas and Florida.
• He notes a growing wealth disparity in the US that could impact consumption and politics.