Speaker 1: You're listening to Bloomberg Business Week with Carol Masser and
Speaker 1: Jason Kelly on Bloomberg Radio. This is one of these
Speaker 1: conversations we've been we've been looking forward to Carrolly. You're
Speaker 1: so eager well and right up in the camera. I
Speaker 1: know I'm up right up in the camera. Well, he's
Speaker 1: a favorite of ours. And you know, we were reminded
Speaker 1: that the last time he was in our studio was
Speaker 1: back at Bloomberg headquarters. It was the last in studio
Speaker 1: interview that we did. I keep saying it was Friday.
Speaker 1: It was Friday the March, if you will. It was
Speaker 1: a very thoughtful conversation about kind of how our world
Speaker 1: was being impacted because of the virus. Little did we know.
Speaker 1: You're so right, Jason Ken Swig is back with us.
Speaker 1: He is president of Swig Equities, and he's on the
Speaker 1: phone from Bridge Hampton. And from what I understand, you
Speaker 1: drove in a little bit so you could get better
Speaker 1: sell service. So Kent, thank you so much, um for
Speaker 1: doing that. Tell us about your world and how you're
Speaker 1: doing well. It's a pleasure to be back. And uh,
Speaker 1: my world is I think, like everybody else is a
Speaker 1: bit it seems more like a science fiction movie than
Speaker 1: it does a reality I'm listening to the radio and
Speaker 1: saying talking Bloomberg Radio says, Oh, the world, the United
Speaker 1: States economy is about to try to open again. I mean,
Speaker 1: I can't believe those kind of words are coming out
Speaker 1: of us. So I'm the same as everybody else. You know,
Speaker 1: I'm sipping sheltering in place and and uh, waiting for
Speaker 1: the world to reopen. And so what's your read on that, Kent,
Speaker 1: Because you know you have interest all over the country
Speaker 1: east coast, west coast, places in between. You're talking to
Speaker 1: people all the time. I mean, what's your read on
Speaker 1: this kind of checkerboard that we seem to have in
Speaker 1: terms of plans and aspirations to get this all going again. Well,
Speaker 1: the first thing I think we want to do is
Speaker 1: to make sure that everybody is healthy and safe, right,
Speaker 1: and the way to do that is through testing, similar
Speaker 1: to what we talked about last time I was with you.
Speaker 1: And so the critical component is is to try to
Speaker 1: get as many tests of our population as possible. Uh.
Speaker 1: And once we know and have knowledge, then we can
Speaker 1: start to begin to go back into the productive work schedules. Um.
Speaker 1: Albeit differently, but we need to find information first. Yeah.
Speaker 1: You know. One of the things Kent that Jason and
Speaker 1: I've talked a lot about, um because of a Bloomberg story,
Speaker 1: but it's been in kind of our psyche. Uh, if
Speaker 1: you will is fear versus greed. Um. There's so much
Speaker 1: fear talking to Henry Cornell about uh. And I think
Speaker 1: actually the chairman was it of Jet Blue, you know
Speaker 1: about people are afraid to come back to work. Um,
Speaker 1: and so you will ultimately initially ask people to come
Speaker 1: back to work, and until they know it's safe and secure,
Speaker 1: it's not going to happen. Um. And then at the
Speaker 1: same time, there's incredible pressure for companies to kind of
Speaker 1: get back to it. Uh, in order to survive. Well,
Speaker 1: let's put it, if you are a greedy person or
Speaker 1: a greedy company, um, then you're going to do things
Speaker 1: that would be productive for you in business. And being
Speaker 1: productive in business means that you have to have people
Speaker 1: by your product. You have to have people working for you,
Speaker 1: and that all means having people. Would we just lose Kent, think, okay,
Speaker 1: we just lost Kent for a minute. We're gonna try
Speaker 1: and get him back. But um, you know it's interesting
Speaker 1: to hear Kent talk about the real estate world. I
Speaker 1: was just looking at his story earlier, Carol, our friend
Speaker 1: Tom Barrick, we've talked to him before you about a
Speaker 1: year ago, I believe moderated panel that he had that
Speaker 1: he participated in milk and talking about real estate. You know,
Speaker 1: he told Eric Chatzker earlier today that the real estate
Speaker 1: market is in chaos. You've got laws waved on rent
Speaker 1: and debt, and I mean this is the lifeblood of
Speaker 1: this industry, you know, sort of the income and the
Speaker 1: ability to borrow. Yeah. Absolutely. And the thing is, you know,
Speaker 1: we are learning each day that goes by. If people
Speaker 1: aren't paying their rent, um, aren't paying um these you know,
Speaker 1: our mortgages, you know, then it starts to work its
Speaker 1: way through the system because then financial firms that are
Speaker 1: doing the lending are getting impact. Right, it starts to
Speaker 1: work its way through the system. So you're right, he said,
Speaker 1: we haven't had a crisis like this. We've never had
Speaker 1: one where we just have a government, um um taking
Speaker 1: a revenue. Is that right? We've never had one where
Speaker 1: we just have a government taking of revenue. Um. Let's
Speaker 1: go back to Kent. Swig president of SWIG Equities once
Speaker 1: again with us from Bridge Hampton. Hey, Ken, I'm glad
Speaker 1: you we were able to get you back. You were saying,
Speaker 1: you were talking about if you're a greedy person, and
Speaker 1: I'm assuming you know, um, you know you're gonna you're
Speaker 1: gonna maybe do things you shouldn't do. Well, I'm saying
Speaker 1: even agreed now, it has the same motivations and everybody
Speaker 1: else is that they want an economy to be back,
Speaker 1: They want people to buy their product, and they want
Speaker 1: their workers to be working. So there's some I have
Speaker 1: a more narrow focus, some have a little bit broader focus.
Speaker 1: But nonetheless it's the same goals in mind, so that
Speaker 1: it doesn't work. If we open up too soon and
Speaker 1: have to close back, that's going to do more damage.
Speaker 1: So I would say that greed doesn't play a role
Speaker 1: here as much as it is as as looking at
Speaker 1: a broad perspective and a proper perspective. So can in
Speaker 1: our little interregnum there we're when we're getting you back.
Speaker 1: I was reading our listeners some comments that Tom Barrick
Speaker 1: made a well known figure to you, I'm sure, uh,
Speaker 1: colleague there in the in the real estate industry and
Speaker 1: he was, you know, sort of weighing in as I
Speaker 1: would love for you to weigh in on sort of
Speaker 1: this notion of rent forbearance and you know, essentially landlords
Speaker 1: saying no, you know, just just get me when you
Speaker 1: can or differ or whatever that is. How is that
Speaker 1: working and what's the right mix and balance there in
Speaker 1: your estimation? Well, so let's take the government factor out
Speaker 1: for one moment and let's take a look at private enterprise. Um.
Speaker 1: So I'm a building owner on one of my companies, right, Um,
Speaker 1: my family has properties. I have properties, and you know,
Speaker 1: people laugh at me, my colleagues sometimes say, but basically
Speaker 1: I'm a tenant service provider. I am own owning. Buildings
Speaker 1: are meaningless. It's the people inside them that count. And
Speaker 1: those people are rent paying people. So if they can't
Speaker 1: pay rent, were nowhere. Um. At the same time, if
Speaker 1: these companies don't have money to pay rent and go
Speaker 1: out of business, then you're really nowhere. So unfortunately, you know,
Speaker 1: our debt service, our utilities are real estate taxes need
Speaker 1: to be paid and we get that from rent. But
Speaker 1: if if so, we have to have a balance here.
Speaker 1: So forgetting the government for a moment, we have to
Speaker 1: work with our tenants in some way, shape or form
Speaker 1: to make sure that they have viable companies because if
Speaker 1: they all go out, we're left with big, huge buildings
Speaker 1: that are empty and meaningless. Um. So you know, there
Speaker 1: is a balance there that we have to allow tenants
Speaker 1: to be able to get on their feet in some way.
Speaker 1: So one of the questions first people ask is you know,
Speaker 1: have you applied for any government grants? Have you have
Speaker 1: you received anything? Because you know then you know what
Speaker 1: kind of shape they're in and what they can do,
Speaker 1: and you have to work with them. Um. But it's
Speaker 1: going to be a difficult with April what's going on,
Speaker 1: and May it's probably going to be worse because the
Speaker 1: people you May is going to be the worst hold
Speaker 1: that thought. We're going to continue this conversation in just
Speaker 1: a minute. Ken Swig is with as president of Swig Equities,
Speaker 1: joining us on the phone. A lot more to talk
Speaker 1: about when it comes to real estate. Also want to
Speaker 1: talk to him a lot because about New York City,
Speaker 1: because it's a city he knows really, really well. And
Speaker 1: I do feel like no one would disagree with the
Speaker 1: idea that, at least in the short term, the city
Speaker 1: is going to be fundamentally changed, maybe more than the
Speaker 1: short term. So I want to pose that question to
Speaker 1: really right, but you know what life is like and
Speaker 1: we do come back. So we'll get his thoughts on
Speaker 1: that in just a moment. We're going to continue our
Speaker 1: conversation now with Kent Swig, president of Swig Equities, joining
Speaker 1: us on the phone from Long Island. So, Kent, uh,
Speaker 1: he spent a lot of time in New York City.
Speaker 1: That's where we last saw you, as we mentioned at
Speaker 1: the top of the conversation there in Midtown. How does
Speaker 1: New York change out of this? Well, one thing that
Speaker 1: New Yorkers are, if anything, is resilient. So we look
Speaker 1: back at the pandemic that existed in nineteen eighteen, you
Speaker 1: know where sixty million, sixty five million people passed away,
Speaker 1: I mean unbelievable amount. And then you look at what
Speaker 1: happened in America in nineteen twenties, right, you know, people
Speaker 1: were back, they were dancing, they were out. So this
Speaker 1: is a horrendous, terrible thing, no doubt. At the same time,
Speaker 1: we've got you know, much more better, much better science,
Speaker 1: much more technology, and I think that will end up
Speaker 1: with a vaccine of sorts at least um and and
Speaker 1: a way to stabilize ourselves. And people will be back
Speaker 1: and they will be going out, but it will take
Speaker 1: a moment. Unlike other situations we've been in where people,
Speaker 1: you know, the situation ended and then people started going
Speaker 1: back into the regular routines, this isn't going to have
Speaker 1: a you know, a five line that it ends. This
Speaker 1: is going to be a longer period of time where
Speaker 1: it's a slow comeback, but we will be back in
Speaker 1: New York is a very strong place and it's a
Speaker 1: capital city of the world. Um And, and it's a
Speaker 1: painful process, but we'll be better for it and will
Speaker 1: be better prepared for it. How will we be better
Speaker 1: for it, Well, one thing is this we if you
Speaker 1: look at the federal government, you know, the basic element
Speaker 1: of the federal government is to protect the life, liberty,
Speaker 1: and health and safety of Americans, right and we look
Speaker 1: at this with four branches of the military. I think, frankly,
Speaker 1: what has happened in this administration is that we failed
Speaker 1: to look at the fifth branch of our secure system,
Speaker 1: which is a CDC, the Center of Disease Control UM.
Speaker 1: The administration currently took the head person off of the
Speaker 1: National Security Council. We've cut back eight sixteen over the
Speaker 1: past two years, respectively, um from the CDC, and that's
Speaker 1: just can't happen. So where will we be better for
Speaker 1: it is that Americans will demand that the c d
Speaker 1: C and other organizations are a functioning major part of
Speaker 1: our civil defense and our national defense, and we will
Speaker 1: protect ourselves. You know, we're we're storing nuclear weapons, Lord forbid,
Speaker 1: we never want to use them. We need to store
Speaker 1: ventilators that we hopefully never will need. But that doesn't
Speaker 1: mean we don't have them. So we have. We've caught
Speaker 1: ourselves unprepared for something like this because we let we
Speaker 1: didn't we let it go, or we didn't think about it.
Speaker 1: And it's a major leg of our defense. And I
Speaker 1: think we will be better for the future generations because
Speaker 1: we will understand that and will take the necessary precautions
Speaker 1: to never let this happen again. Unprepared unpreparedness never happened again.
Speaker 1: Yea son, How does this change you as a business person?
Speaker 1: How does it change you as an investor? As someone
Speaker 1: who is you know you are ultimately, as you said
Speaker 1: earlier in the conversation, your your business is all about people,
Speaker 1: giving people places to be and to live and to work.
Speaker 1: How does it change the choices that you make in
Speaker 1: the short and the midterm. Well, the short term is
Speaker 1: the safety and health of our workers and and and
Speaker 1: trying to get our companies to be safe secure so
Speaker 1: we can continue to employ all the people that we do. UM,
Speaker 1: our businesses are going to change. We're in you know,
Speaker 1: both residential and commercial. The way we live and work
Speaker 1: is going to change. The way we work is going
Speaker 1: to change. Um. You know, if if buildings for cleaning
Speaker 1: once a week, apart me once a day, you know,
Speaker 1: their lobbies and elevators, etcetera, it's now going to be
Speaker 1: an hourly cleaning. It's not more. Um, there's gonna be
Speaker 1: a whole new way of looking at things. In in Manhattan,
Speaker 1: there was roughly three hundred square feet per person in
Speaker 1: an office building. Um. Today you know it brought down
Speaker 1: to about a hundred eighty square feet because we were
Speaker 1: able to have more open landscaping, packed people in more
Speaker 1: dense communities, etcetera. That's going to change back the other way. So. UM.
Speaker 1: The other thing is that people will find that possibly
Speaker 1: you know you've got you don't have to go to
Speaker 1: work five days a week. You can work two days
Speaker 1: from home. Maybe. Um, So there will be a different
Speaker 1: way of structuring our jaw market. It's gonna have a
Speaker 1: whole new view. Smaller kitchens in Manhattan may not be
Speaker 1: the idea anymore because people may need to have a
Speaker 1: larger kitchen and be able to want to cook and
Speaker 1: stay in. So I think it's going to have a
Speaker 1: lot of ramplications of the way we are. But our
Speaker 1: our ability to to go after life and live life
Speaker 1: and want all these great things, I don't think it's
Speaker 1: going to be diminished. I think it's going to be
Speaker 1: just refocused a little while. And so I do wonder
Speaker 1: you know this notion of especially from a residential perspective,
Speaker 1: Kent Weather and I say this sitting and talking to
Speaker 1: you in the suburbs, do we change the way we
Speaker 1: think about cities and suburbs. You know for sure we're
Speaker 1: going to be looking at that, of course. Um. But
Speaker 1: again I think that if look, we all went through
Speaker 1: nine eleven, which was a horrendous thing, and people were
Speaker 1: nervous about New York City and and and living here
Speaker 1: in this but what we relied on was our national
Speaker 1: government to take action and protect us. I think what
Speaker 1: the biggest problem right now is that our national government,
Speaker 1: in my opinion, sailed, and that failure is what makes
Speaker 1: people more nervous and more more susceptible to wanting for change.
Speaker 1: So that is going to be changed back because the
Speaker 1: population is not going to tolerate that kind of thing anymore,
Speaker 1: nor should they. And we're going to have in place mechanisms.
Speaker 1: I don't know all of them, but certainly we're gonna
Speaker 1: have in place mechanism new protocols of how we conduct
Speaker 1: ourselves and how we live, and and we're going to
Speaker 1: have back up, and we're going to have ways to
Speaker 1: be able to to to you know, Lord forbid another
Speaker 1: kind of virus. It's like this, ways to be able
Speaker 1: to to fight it um. And that's what hasn't happened.
Speaker 1: I think there were the Latin the fact that we
Speaker 1: were caught off guard and that we're not prepared and
Speaker 1: we weren't getting a steady, consistent message coming out of Washington,
Speaker 1: d C. That makes people reevaluate things, so I think
Speaker 1: they will. But all manly New Yorkers are it's a
Speaker 1: very exciting, wonderful place to be and I think it
Speaker 1: will continue to be that way. Well, we look forward
Speaker 1: to seeing you in person again a bookend of sorts.
Speaker 1: Nice to catch up with you in the interim, but
Speaker 1: next time in the Bloomberg Interactor Broker studio. We hope,
Speaker 1: or I don't knows, maybe over a drink would be better,
Speaker 1: exactly all right? Ken Swigg, president of SWIG Equities, on
Speaker 1: the phone from Long Island. Always appreciate his time and
Speaker 1: his thoughtful insight.