Jay Rollins, left, and Tucker Manion have launched Canopy Real Estate Partners, a new business. (Photos courtesy of Jay Rollins and Tucker Manion)
Tucker Manion is taking his real estate business to the big leagues.
“When I started CentrePoint (Properties) at 26, I was the new kid on the block,” Manion said. “I’m no longer the young guy here.”
The 42-year-old Colorado native recently launched a new business, Canopy Real Estate Partners, with fellow industry veterans Jay Rollins and Maren Steinberg. CentrePoint will remain the same but will double as the new fundraising office for Canopy.
“CentrePoint is the local Denver sponsor. That’s not going to change. What is going to change is that we run the operations of all of Canopy. Someday, does this all merge into one umbrella and one name? Possibly, and that’s probably what the goal is,” Manion said.
For most of its 17-year history, CentrePoint has been a syndicator — every transaction done separately with its own unique group of investors. But that money is less liquid, and the deals aren’t able to be scaled. The money and the real returns, Manion said, are in raising real estate funds from a group of investors who write a check for multiple deals.
That money can be used at the fund manager’s discretion.
“The holy grail of real estate is having discretionary capital, but you just don’t get it overnight,” Manion said.
The businessman started CentrePoint’s Fund I in late 2023, which is also technically Canopy’s first fund too. Canopy’s business model is to find other CentrePoints in different markets and help them turn from syndicators to fundraisers, with Canopy providing the majority of the equity to start.
Fund I has raised between $60 million and $80 million, with a goal to reach $100 million. It will be buying real estate with that money through early next year. The first purchase was a retail center in the southwest Colorado town of Pagosa Springs. The deals are mostly sourced in Colorado, with some in Arizona. Perhaps the most notable fund acquisition was the $25.5 million purchase of the Edgewater Public Market food hall in late December.
“We feel like the path of growth is on the west side of Denver,” Manion said. “There’s a lot of money going there.”
CentrePoint’s fund acquisitions include the Edgewater Public Market food hall. (BusinessDen file)
Deals fall into three categories: neighborhood retail, small-bay industrial properties and multifamily assets.
The game plan is to find deals where the real estate is performing well but its financing is on shaky ground. Many investors paid a premium for real estate in the wake of the pandemic when interest rates were virtually nil, taking out short-term loans to make the purchase. Now those loans are coming due and interest rates have skyrocketed, so owners often need to put money in to refinance or sell at a steep discount.
“In ’24, that’s why we had such a slow transaction year. Not only us, but the nation, because we were all trying to figure out how to kick the can [down the road]. … The lenders are reluctant to kick the can anymore, so what this is creating is the ‘forced sale’ environment,” Manion said.
Canopy will capitalize on this market.
“The second part of our strategy is, OK, this is what we want to buy, … but how do we find them?” said Jay Rollins, Manion’s partner in the new business.
“The people that will find these assets are local operators. I’m not going to fly into Dallas and pretend like I know more than the guys in Dallas,” he added.
But these local operators are syndicators. To really win, they’ll need to start real estate funds. Rollins’ roughly 35 years of real estate experience will help make that happen.
He got his feet wet in the 1990s, buying distressed assets through his own firm, Eastern Realty Co. Later, he started Denver-based JCR Capital, managing $1 billion in assets and later selling to investment giant Walker & Dunlop in 2018.
He met Manion in 2016, when Rollins provided some financing on one of his projects. The two became fast friends, playing rounds of golf at the Lakewood Country Club.
Now 64, he doesn’t have the time left in his career to start a new business on his own, so he fast-tracked his way back into the institutional real estate game by working with Manion. His motivation, he said, is twofold: to counter the large “mediocre” funds that focus more on fees than returns, and to help raise a new generation of investors.
“These funds get to $2, $3 billion and they don’t care about their returns anymore. That’s the dirty secret. … This business is getting bigger and bigger and getting more mediocre,” Rollins said.
“I’m kind of like the guy who goes to high school football games on Friday nights,” he added. “I don’t know anyone on the team. I’m just watching the team, I’m watching for talent. Is there anyone on the field that might be able to play DI ball?”
Canopy has already started working on its second fund, which will be between $250 million and $500 million. Rollins, who still spends his summers in Denver, has no qualms about how successful it’ll be. He said he’s completed 629 investments in his career and only two of them lost money.
“I’d say we hit a lot of doubles. We don’t try and hit home runs.”
