Berkadia CEO Says Bet on Property in Right-to-Work States

By Noah Buhayar and Oshrat Carmiel, Bloomberg

Hugh Frater, who leads a commercial mortgage venture backed by Warren Buffett’s Berkshire Hathaway Inc. (BRK/A), said apartments in states that have passed right-to-work laws may fare better than property in other regions.

Almost half of U.S. states, including North Carolina and Alabama in the Southeast, have enacted the legislation, which bans labor unions from collecting mandatory dues. A revival of U.S. manufacturing may be stronger in areas that have the restrictions, increasing demand for apartments, Frater said.

“I would tend to bet on right-to-work states in the southeast as compared to the old industrial hub,” the chief executive officer of Berkadia Commercial Mortgage LLC said in a phone interview this week. “It’s not a political statement.”

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