Judd Stensrud founded Lumen Global after over 15 years working in Real Estate Private Equity and then in the Asset Management Division of Jones Lang LaSalle and ultimately as the head of a large real estate consulting division of Ernst & Young. Those years of experience taught him that owners of commercial real estate often don’t capture the full potential energy savings of their properties for a number of reasons. First and foremost, most owners don’t realize the potential energy savings available to them. That is why the purpose of Lumen Global is to “empower owners of commercial real estate to make intelligent decision with regard to energy efficiency”. The second reason owners of commercial real often don’t capture their full energy saving potential is because interests between property managers and ownership are not always aligned. Property managers, rightly so, focus on the day to day operations and focus on staying within budget. Owners may look at a project with a longer time horizon or strategic vision and realize that investment now, which dropped savings immediately to the bottom line, will pay off even more upon exit of a property. Lumen Global not only identifies the available energy savings, but then helps to bridge the gap between ownership and property management to get it done.
In the late early 2000’s I spent half a decade living and working in Costa Rica at a real estate private equity firm. While there, I honed my real estate management skills. My Undergraduate degree from Duke University had taught me the basics of economics and my MBA from the University of Chicago had tough me the hard finance skills that I needed to value and understand real estate. However, it was not until I got to Costa Rica and was placed in charge of operating a vast portfolio of income producing real estate that I began to truly grasp how much costs were important. I had previously worked in global real estate valuation roles (starting in Hong Kong in the 1990’s and ending my corporate career as head of a real estate valuation division at Ernst & Young) and I had even spent time working at the major investment banks underwriting deals. These roles in “corporate America” showed me how companies and real estate were valued, but it was my hands-on experience in Costa Rica that taught me to really operate real estate. The portfolio I managed consisted of hotels, retail, multifamily, farm, airports, bars, restaurants, casinos and various other assets.
After all, I learned, that as an operator of real estate that if I really pressed on expenses, and I mean really took every opportunity I could to eliminate every extraneous cost in the portfolio, I could create value where other firms were missing out. From 2012 to 2017, I was in what I call high volume consulting roles at Jones Lang LaSalle and then running a division at EY. In these positions, I was able to see literally hundreds of different businesses and real estate owners and advise them on how to maximize value at their portfolio. I had the opportunity to help renegotiate a half billion dollar loan with The Bank of China, to be the lead asset manager for The Plaza Hotel in New York, to lead a process wherein Bill Gates and the Four Seasons followed my analysis and agreed to invest over $300 mm in a project that was my brainchild. During these diverse consulting projects, I learned that the reasons firms miss out on this value creation varies. At some, it is simply that they have bad management. At others, their managers were good, but their incentives were not aligned with the outcome of profit maximization. At still others, the owners had not given their managers the tools necessary to maximize profit. One thing that I see over and over is that managers are held to a strict budget and therefor do everything they can to keep costs down year over year. However, this leads them to miss out on making investments that save money over the long term. Add to this the fact that a manager of real estate can not possibly stay up to date on every cost saving measure available and you had a basic lack of information on how to cut every cost available.
All of these above experiences brought me to found Lumen Global with the purpose of “empowering owners of commercial real estate to make intelligent decision with regard to energy efficiency”. Many people ask me how in the world I ended up helping owners of commercial real estate with energy efficiency after having consulted on much larger and more diverse deals. The answer is simple. In all my years managing and consulting for owners of real estate, I never once saw a consistently better return on investment (usually measured in IRR) that what Lumen Global can offer. The words I hear most are, “This is a no-brainer”. And it is.
Most of our deals have IRR’s 50% and often over 100%, real quantifiable environmental impact, and a simple process. These are the things that have led me to consult on over 300 energy efficiency initiatives and why I am focusing Lumen Global on continuing to help owners of commercial real estate.
I hope you will chose to work with my team.