On the contrary

In his book, “Letters to a Young Contrarian,” Christopher Hitchens pens advice to a fictional protégé, offering a series of dispatches on how to “live at an angle to the safety and mediocrity of consensus.”

Today, it appears increasingly difficult for private equity real estate firms to follow Hitchens' counsel. For an industry with a long streak of contrarian behavior, coming of age in one of the largest distressed real estate markets in history, it's a bit unfortunate. That's not to say such out-of-the-way opportunities don't exist; just that the amount of capital in today's markets is making them harder to find—and pushing high-yield real estate pros further and further afield.

China, for example, is an area of the world that is increasingly drawing the attention of opportunistic investors. Our special report on the country, which begins on p. 27, studies not just the optimism underlying the country's economic transformation, but also the distress inherent in China's burgeoning non-performing loan market—something that contrarian real estate investors are always keen to exploit. Though NPL investors have thus far been disappointed with deal flow and transparency, there are reasons to believe that the tide could be turning in their favor.

One organization that has not embraced the coming China revolution is Apollo Real Estate Advisors, a company that prefers to focus on its core markets of the US and Europe. That's not to say the firm is playing it safe—it has been investing in some of the less-traveled sub-markets of New York City, finding opportunities where others have not. Our profile of Apollo and its senior partner Lee Neibart begins on p. 22.

Speaking of New York, perhaps there's no greater example of contrarian behavior than punk rock, a genre that challenged the bloated and bombastic rock of the mid-1970s and produced bands like The Ramones and Television. A brief story on two hotbeds of the city's punk scene, now in their final hours, can be found on p. 4.

At times, it seems contrarianism is dead, but it's not. It's just getting much harder to find—and not just in the private equity real estate industry.

Enjoy the issue,

Paul Fruchbom