Evergreen The EconomyPhilosophy

The Blue Collar Hedge

When the economy tanks, people stop buying luxury cars. They do not stop fixing their toilets. Why trades-based tenants are the ultimate recession shield.

In 2008, financial analysts lost their jobs. In 2020, tech workers got laid off. But in both crises, the plumber still had a full schedule.

We build our portfolio around what we call "Non-Discretionary Services."

These are businesses that solve immediate, physical problems. If your roof leaks, you call a roofer. If your power goes out, you call an electrician. You don't wait for interest rates to drop. You don't wait for a bull market. You pay the bill because you have to.

The Tenant Roster

  • HVAC Contractors (Repair & Install)
  • Restoration Services (Fire/Water Damage)
  • Municipal Utilities (Water/Sewer)
  • Last-Mile Medical Supply

The Counter-Cyclical Nature

Often, these businesses actually grow during downturns. When homeowners can't afford to buy a new house, they renovate their old one. When a factory cancels a new expansion, they spend money maintaining their existing equipment.

This makes our rent roll incredibly sticky. A tech startup might vanish overnight. An HVAC company with 2,000 service contracts is an institution.

We aren't looking for "Unicorns." We are looking for "Workhorses."

Michael Holt
Michael Holt
Principal