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Stockdale Capital Partners Diversifies Beyond Distressed Retail

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  //stocks-investing.news-articles.net/content/202 .. rtners-diversifies-beyond-distressed-retail.html
  Published in Stocks and Investing on Wednesday, January 7th 2026 at 8:08 GMT by Commercial Observer

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Stockdale Capital Partners' Dan Michaels Plots a Post-Pandemic Comeback, Expanding Beyond Retail Distress

Dan Michaels, founder and CEO of Stockdale Capital Partners, is positioning his firm for significant growth in the post-pandemic commercial real estate landscape, moving beyond its established expertise in distressed retail and diversifying into industrial, multifamily, and even hospitality. A recent profile in Commercial Observer details Michaels’ strategic shift, driven by a belief that the opportunities created by the pandemic’s disruptions are far from exhausted and that his firm’s nimble, hands-on approach is well-suited to capitalize on them.

Stockdale, known for acquiring and revitalizing struggling retail assets, initially thrived during the early stages of the pandemic. While many investors shied away from brick-and-mortar retail, Michaels saw opportunity in assets undervalued due to perceived permanent closures. He focused on properties in strong, demographically-rich areas, believing that while the retail landscape was changing, prime locations would recover. This strategy proved successful, particularly in California and the Southwest, with Stockdale acquiring over $1 billion in retail assets during the height of the downturn.

However, Michaels isn't content to remain solely a retail specialist. The Commercial Observer article highlights a deliberate strategy to broaden Stockdale’s portfolio. This diversification is being fueled by a combination of factors: a desire to reduce concentration risk, the increasing difficulty of finding truly distressed retail deals, and the emergence of attractive opportunities in other sectors.

A key focus of this expansion is the industrial sector. Stockdale has begun actively pursuing last-mile logistics facilities, capitalizing on the continued growth of e-commerce and the need for faster delivery times. They're targeting properties in densely populated areas, particularly those with value-add potential. This mirrors a wider trend in CRE, with industrial remaining a relatively stable and high-demand sector despite broader economic uncertainties.

Multifamily is another target, though Stockdale isn’t pursuing large-scale developments. Instead, the firm is focusing on "niche" multifamily opportunities – smaller, value-add projects in well-located areas. Michaels emphasizes the importance of finding properties where they can improve the tenant experience and create a more appealing living environment. This focus on quality and tenant satisfaction is a consistent theme across Stockdale's approach.

Perhaps the most surprising aspect of Stockdale’s diversification is its foray into hospitality. The firm recently acquired the Kimpton Everly Hotel in Hollywood, a move that seemingly contrasts with its previous focus on distressed assets. Michaels explained that this acquisition aligns with his core investment principles: identifying underperforming assets with strong underlying fundamentals and potential for repositioning. The Kimpton Everly, while struggling during the pandemic, is located in a prime entertainment district and offers opportunities for operational improvements and enhanced amenities.

Stockdale’s approach isn't about simply buying assets; it's about actively managing and improving them. Michaels is known for a hands-on leadership style, personally involved in the day-to-day operations of the firm and its properties. He stresses the importance of a strong on-the-ground team that can quickly identify and address challenges. This is particularly crucial in the retail space, where adapting to changing consumer preferences and tenant needs is critical.

The article details Stockdale's current portfolio, highlighting several key projects. Beyond the Kimpton Everly, they’re developing a mixed-use project in Scottsdale, Arizona, demonstrating their ability to move beyond solely retail redevelopments. They also continue to invest in retail, recently announcing plans to redevelop a shopping center in Las Vegas.

Michaels believes that the coming months will present further opportunities for investors who are willing to be flexible and take calculated risks. He anticipates continued volatility in the market and expects to see more distressed assets come to market as loans mature and refinancing becomes more difficult. However, he also believes that the long-term fundamentals of the U.S. economy remain strong, and that well-located, well-managed properties will continue to perform well.

Stockdale’s financing strategy is also noteworthy. The firm relies heavily on private equity and debt financing, allowing them to move quickly on deals without being hampered by the slower processes of institutional investors. They’ve established strong relationships with a network of lenders and investors who share their vision for value creation.

In conclusion, Dan Michaels and Stockdale Capital Partners are evolving beyond their initial success in distressed retail to become a more diversified commercial real estate player. By leveraging their operational expertise, focusing on value-add opportunities, and maintaining a nimble approach, they aim to navigate the complexities of the post-pandemic market and deliver strong returns for their investors. The shift represents a bet on a future where active management, strategic diversification, and a willingness to take on challenges are key to success in commercial real estate.