Most real estate investment firms operate with large teams of financial analysts to guide daily decision-making. But very few prioritize economic research. That's why my role as Chief Economist at Middleburg, a leading real estate investment, development, and construction firm, is so unique.

Since this position is a bit of an anomaly in the industry, it is worth explaining what I do, how it's done, why it matters for institutional real estate investing, and how it gives Middleburg a distinct competitive advantage.

My responsibilities are centered on three core functions: macroeconomic surveillance, resource targeting, and visibility. Together, they provide a framework for navigating market cycles and identifying superior investment opportunities.

Macro Surveillance: The Competitive Edge in Timing

Many firms in our industry operate on a simple principle: they develop or acquire when capital is available and contract when it is not. This often leads to reactive decisions that can jeopardize investor returns. At Middleburg, our scale—2,700 rental housing units currently under construction—and 21-year track record ensure consistent access to capital. The critical decision is not if we can act, but how and when we should deploy resources across our key activities—development, acquisition, indirect investment, and asset disposition—throughout the market cycle.

My role is to support our CEO and CIO by providing expert analysis that informs these strategic timing decisions. This involves:

• Estimating the risk of a macroeconomic recession.

• Evaluating likely changes in interest rates.

• Monitoring shifts in wages or material costs that may impact our construction projects.

• Forecasting changes in rental-housing cap rates both nationwide and across individual markets.

To achieve this, I developed a sophisticated macroeconomy model that leverages monthly data for 12 key variables stretching back to the 1960s. Five times each month, I update this model, running 38 versions in a process that requires significant computing power. This rigorous, data-driven approach allows us to challenge consensus views with confidence. For example, in late 2021, a few prominent economists began forecasting a recession, and by mid-2022, that view had become a broad consensus. My model indicated otherwise, a conclusion I shared internally and publicly. It was not until mid-2023 that the consensus acknowledged its error.

This is not an academic exercise. Middleburg was able to profit from our macro surveillance at the expense of other real estate companies that followed the consensus. In 2021, our analysis showed the rental housing market was approaching a peak. Acting on this insight, we sold nearly all our held multifamily communities, locking in strong returns for our investors and replenishing capital for our next strategic move. This is the power of moving against the herd, guided by data instead of sentiment.

Resource Targeting: The Competitive Edge in Location

Location, location, location. It’s true for homebuyers, and it’s true for us as a real estate developer.

Middleburg is active in nine states—Maryland, Virginia, North Carolina, South Carolina, Georgia, Florida, Tennessee, Alabama, Texas, and Washington, D.C.—and we are analytically prepared for expansion into other dynamic markets. This vast territory contains millions of land parcels. Rather than waiting for brokers to bring us listed sites, we proactively identify and pursue off-market opportunities.

Success at this scale requires "narrowing the funnel"—focusing our efforts on locations where we are most likely to find suitable sites that can become thriving new communities. We begin with massive datasets, including:

• Demographic data, such as population by age group, household size, and number of working adults, for 123 markets and 452 counties. We use these data, along with our own forecasts for changes in key multipliers such as the headship rate and the rentership rate, to forecast demand for rental housing in each area.

• Rental housing market conditions, including units under construction and permits for new developments, for 841 submarkets. This equips us to forecast the supply side of the market and identify any potential supply-demand imbalances.

• Job proximity and other key information for nearly 59,000 Census Block Groups.

• Locations and descriptive data on tens of thousands of existing rental housing communities.

• Locations of thousands of what we call “preferred retailers"—grocery stores, restaurants, fitness centers, and the like—near which we know our prospective tenants would like to live.

What truly sets our expert analysis apart is our use of observed rents and descriptive information from millions of publicly sourced rental units. This microdata feeds a sophisticated, nonlinear machine-learning model that estimates what residents would pay for our units in any given location. This allows us to assess the viability of a development in each of the 59,000 Census Block Groups before we ever begin a site search.

Our automated, data-driven process enables us to shrink the land acquisition funnel significantly. We focus our team’s efforts on small, targeted areas within carefully selected markets, armed with reliable rent estimates from the outset. This efficiency minimizes wasted effort and maximizes the use of our most valuable resource: our people.

Visibility: Demonstrating Clarity Over Narrative

Many developers rely on compelling stories to attract investors—tales of outclassing the competition or achieving impossibly high rents. With every firm telling the same story, it becomes difficult to stand out. Part of my job is to ensure Middleburg is recognized for its substance, not just its narrative. The best way to achieve this is by making our analysis transparent and accessible.

This occurs in public forums, such as interviews on CNBC or Bloomberg Surveillance, where I discuss the macroeconomic environment. It also happens on LinkedIn, where I publish a weekly real estate market report and offer commentary on new data releases.

Internally, our analyses are built for transparency. The 21 steps of our demand and supply growth forecasts are detailed in an online dashboard, allowing for direct market comparisons.

When we do longer-format analyses, we publish the results on our website. For example, earlier I mentioned that we forecast changes in key demand drivers such as the headship rate and rentership rate: I've published detailed descriptions of our research into both. Our claim that household formation drives demand is not a hollow statement; it is backed by detailed forecasts of the underlying drivers—such as the age structure of the population and employment opportunities—in each market.

Another prime example of how our analysis sets us apart is our leadership in the build-to-rent (BTR) sector. We committed to this space after detailed research showed that renters typically build more wealth than buyers—because they can invest the down payment in high-return assets, such as stocks. Instead, buyers must put a significant portion of their wealth into a low-return asset. We published this detailed financial comparison, discussing it in interviews and podcasts to highlight our empirical capabilities.

The Role of the Chief Economist: Ensuring Long-Term Success

In a competitive landscape, the disciplined application of macroeconomic surveillance, resource targeting, and transparent visibility is what differentiates our real estate investment firm. It is how we provide a demonstrable edge for our partners in institutional real estate investing and deliver results that speak for themselves. We're serious about having empirical analysis capabilities that no other real estate company we've seen seems to have matched. It’s why being the Chief Economist for a real estate developer is both so rare and so rewarding.