Want to Break into Commercial Real Estate?

Posted: July 5, 2017 by Paul Cohen, Regional Director with contributions from Eli Randel


WANT TO BREAK INTO COMMERCIAL REAL ESTATE?

HERE’S SOME ADVICE

It must be that time of year. We’ve had three calls from acquaintances asking what’s the best way for their child, who just obtained their degree in Greek Mythology (or some other similar study), to get into Commercial Real Estate (“CRE”). Perhaps it’s a sign of “market heat” and CRE’s continued visibility as an industry, but there is no shortage of interested applicants for commercial real estate opportunities. It’s a competitive landscape, so what can applicants do to more effectively break in?

My first suggestion to future graduates who think they want a career in CRE is: “Don’t get a degree in Greek Mythology,” but hindsight is 20-20 and interestingly, when you go through the BIOs of successful CRE professionals, you’ll find a diverse list of backgrounds which is one of the many things we like about the industry (9 Reasons We Love CRE). Anyway, who am I to judge? I got a degree in Aerospace Engineering. I used to tell clients it was the perfect major for selling warehouses by the airport.

Here is some more advice for “young Sammy” who wants to break into the world of CRE:

Nothing is easy. If you want to become a part of the CRE industry because you think it’s an easy way to get rich or because you think you’ll impress people with your fancy business card – don’t waste your time. In CRE you will work hard. You will face rejection. You will not get rich in your 20s (most likely) and if in a sales role, you may go extended periods of time without income. If you aren’t tough, find another field. Throw out your get rich quick books. Most of the authors got rich selling their books to you, not in the field they profess to be masters in.

It’s all relative. Most CRE brokers don’t get hired from a wanted ad. It’s generally a function of who you know and often that person is a relative or is a friend with a relative willing to help. If your approach is only to submit resumes online, you will have fewer options. Maybe you don’t know the person personally but, if you can get an introduction to a top professional at a national firm; it will open doors. LinkedIn is a good way to figure out who you know and who knows who. If you’re not connected to anyone in CRE then start with me: Paul Cohen.

Clean up your act. Your resume should be clear and concise and visually appealing. I personally believe in keeping a resume to one page – even for seasoned professionals. If longer, it should be for good reason. CLEAN UP your resume. It should look like it was created after 1997 not just in content, but in visual quality (I’m talking to you Times New Roman users). Take more than one copy to an interview. Customize your resume for different opportunities. Your resume is often your first impression. Make a good one.

Prepare for the interview. Research the company you are meeting with and write down some thoughtful questions. We recently had an applicant who confessed he knew nothing about CREXi and asked if there was somewhere he could get more information: “Have you looked online?” was our response. Sadly the answer was “no.” You will also be asked to introduce yourself. If you just read your resume as your introduction, you will lose your audience who will read along with you and will finish while you’re still talking. Prepare a customized “elevator” pitch that will tell your story: Where are you from? What drives you? WHY SHOULD THEY HIRE YOU? (hint: it’s probably not because of one course you took, your 3.1 GPA, or an internship you did at your uncle’s company). If you are doing significantly more talking than the other person, you might lose them. Ask questions. And last: READ BOOKS. I often hear applicants get asked: “what was the last book you read?” If you have a good answer or it’s a book they also read, you just connected. Don’t have any answer? That loud noise is dead air. Read these two recent posts for book suggestions:  Book Suggestions 1 and Book Suggestions 2.

Start with the best. The best firms usually have the best employee development. Research the best firms and brokers in your market. This will help you assess the variety of firms and will also be helpful in finding the best personal fit. One firm might be more entrepreneurial than others for the person who seeks a “jack-of-all-trades” role. Some are more specialized and structured. Fit is crucial. If you are an introverted analytical type who gets an offer for an extroverted cold-calling position it could be a waste of your time and theirs. Some people are talented enough to learn and master skill sets, but if it goes against your basic wiring, it is less likely to be sustainable.

Give good phone. Here’s the reality, to get in the door and to land that first job (or to get started in any sales career) you must be able to make calls – even if it’s only for a probationary period. There are several books and recordings: Cold Calling Techniques by Shiffman is a good start. There is a generation of people who grew up without widespread use of the telephone. Get comfortable using one or the generation that did grow up with phones, will have a hard time connecting with you.

Get skills. If you want to join an investment sales team then proficiency in Argus will give you a head start. The more you know, the more value you’ll be to the team. Excel masters – like pivot tables and macros – are valuable (Pryor). Being a social media guru can open doors. If you can help your broker trend on LinkedIn they might make you a partner. This is a unique skill set a young professional can bring to the table. Did you get a sales associate license before needing one? Are you LEED certified? Have you taken a CCIM 101? Show that you want the opportunity and are committed to a career in CRE.

Follow Up. Once you’ve interviewed, be sure to follow up. I have colleagues who won’t even consider hiring the best candidate they ever met if there is no professional follow up. For many of us who are conducting an interview, we are testing your ability to interact with a potential client. If you don’t follow up with the person who would hire you, will you follow up with the client who may someday potentially hire us?

Good luck and happy hunting!


Paul Cohen

Paul Cohen, CREXi Convenient TechnologyPaul Cohen is a Regional Director with CREXi based in the firm’s Miami office and focused on business development in the southeast. Prior to joining CREXi, Cohen was a Managing Director specializing in investment sales and equity raises at Cohen Financial, a national debt and equity advisor. Prior to Cohen Financial, Paul owned and operated his own independent real estate firm following a 12-year tenure at CBRE where Cohen was a Senior Vice President and led the Private Client Group in Miami-Dade County with a specialty in office and industrial investment sales.  Email Paul

New to Commercial Real Estate?

Posted: June 29, 2017 by Paul Cohen, Regional Director


New to Commercial Real Estate?

Read these 10 books and accelerate your career

It started in the 1990’s and is becoming more and more pervasive.  I’m talking about the new wave of brokers and their shocking lack of reading.

I noticed it first when junior brokers in my firm would start using basic phrases that every salesperson from the pre-nineties era, who had studied the likes of Tom Hopkins, Zig Ziglar and Jim Rohn, would never say. Like “You wouldn’t want to make an offer on this property, would you?” I’d cringe and then take them aside, thrusting a copy of Tom Hopkins “How to Master the Art of Selling” into their hands. Months later it was clear they hadn’t read it. I once wrote on the second chapter of “See You at the Top” by Zig Ziglar, “When you read this, come and see me and I’ll give you $100.” They never asked for the money but did tell me they enjoyed the book.

I have given this some thought over the years. Why do these gen-Xrs think they can just wing it? I’ve watched these brokers “grow up” in the business and they make money based upon sheer determination, smiles and their ability to instinctively connect with some clients. However, because they don’t know why they do what they do, they sometimes don’t get the business and have no idea why. Generally, they blame the client, the market or a competitor but the fact is, it’s them. I explain that sales in commercial real estate is a skill that needs to be honed and practiced. Just willing something to happen doesn’t make it so. Learning to build rapport, ask questions, growing a business over time are fundamentals that seem to be missing from the “instant gratification” generation. Don’t get me wrong, I love the optimism and over confidence but a little nuance goes a along way.

If you don’t like to read, you can download an audio book as I like to do. Check out our blog debating the reading vs listening to books. Without further ado here are the ten books I recommend every aspiring commercial real estate broker should read:

    1. How to Win Friends and Influence People, Dale Carnegie. Warren Buffet took the course and said it was the best thing he could have done for himself when he started out.

    1. The Richest Man in Babylon, George Clason. Time tested principals for gaining wealth.

    1. Think and Grow Rich, Napoleon Hill. Time tested wisdom from a man who studied the likes of Andrew Carnegie.

    1. How to Master the Art of Selling and Listing Real Estate, Tom Hopkins. It’s a little dated but you’ll learn some good basic techniques.

    1. The Secrets of Closing the Sale, Zig Ziglar. In my opinion, this is best as an audio book.  Zig’s enthusiasm will get you pumped.

    1. The Psychology of Selling, Brian Tracy. More sales stuff. You’ve got to absorb this stuff as Brian Tracy breaks down the mind game.

    1. Seven Habits of Highly effective People, Steven Covey.  Probably the best overview of how you set yourself up to be successful in life

    1. Influence, Robert Caldini. Important if you want to understand why people decide to buy.

    1. Spin Selling, Neil Rackham. It seems that every major sales organization rebrands the principals of this book for their own purposes. Get the original.

  1. Success Through A Positive Mental Attitude, Napoleon Hill & W. Clement Stone. This was quoted in the Ray Kroc movie (Founder). As the words were recited it reminded me of when I started in the business. This stuff stays with you.

“Hey new broker. Yes I am talking to you.”

I know you think that because you are well liked and you work hard, you don’t need to read these books. Trust me, I’ve worked with hundreds of brokers over the years, and they all make money. However, the ones that learned these principals make much more.  Even if you make just 10% more each year, that’s almost a million dollars over a career. (That’s a Brian Tracy thing. You’ll see.) Now this is just the start, there are hundreds of books you should read. Some haven’t even been written yet. I personally recommend biographies – Sam Zell has a new one out now. Enjoy!

What book do you recommend for new brokers? Send me your recommendations.


Paul Cohen

Paul Cohen, CREXi Convenient TechnologyPaul Cohen is a Regional Director with CREXi based in the firm’s Miami office and focused on business development in the southeast. Prior to joining CREXi, Cohen was a Managing Director specializing in investment sales and equity raises at Cohen Financial, a national debt and equity advisor. Prior to Cohen Financial, Paul owned and operated his own independent real estate firm following a 12-year tenure at CBRE where Cohen was a Senior Vice President and led the Private Client Group in Miami-Dade County with a specialty in office and industrial investment sales.  Email Paul

 

Profile of a Legend – Stephen Ross – The Empire Builder

Posted: April 14, 2017 by Eli Randel, Director of Business Development


PROFILE OF A LEGEND – STEPHEN ROSS – THE EMPIRE BUILDER

Stephen Ross, with an estimated net worth of approximately $8B, is one of the wealthiest real estate developers in the world. Additionally, Ross is a generous philanthropist and team owner of the Miami Dolphins. How did the Detroit native build his NYC and beyond empire?

 

Stephen Ross was born in 1940 in Detroit, Michigan. In high-school Ross relocated to Miami-Beach before eventually attending the University of Florida. Ross would relocate closer to his childhood home by transferring to the University of Michigan and following graduation would obtain his JD from Wayne St. School of Law. With a loan from his uncle Max Fisher – who Ross would call “the important role model and inspiration for me in my life” – Ross would get his LLM in Tax Law at NYU in 1966.

 

Ross began his career as a tax attorney at Coopers and Lybrand in Detroit before moving back to New York City to accept a job in the real estate department at Laird Inc. Ross would then work for Bear Stearns before leaving with a $10,000 loan from his mom to employ his tax knowledge and construct federally subsidized affordable housing with a syndicate of investors. The venture was successful and would propel Ross to take his earnings and experience and develop more traditional deals on his own. His new projects would have an emphasis on high-quality architecture and engineering and were the basis for which the Related Companies was founded in 1972 under Ross’s control.

 

The Related Companies has grown into a global diversified real estate developer and investor which employs approximately 2,000 people. Among other projects, Related is currently developing Hudson Yards on 28 acres on the West-Side of Manhattan which will eventually deliver 12.7MM SF of space. At $15B, the project is the largest private real estate development in America. In Florida, where Ross also has a residence, he and his long-time business partner Jorge Perez have helped shape the Miami and Ft. Lauderdale skylines delivering thousands of condo and rental apartments. Ross is also majority owner of the Miami Dolphins and their stadium which has propelled him into a more national spotlight. Stephen Ross is also a generous philanthropist with donations to the University of Michigan of approximately $300MM in addition to several other worthy causes. 

 

Through familial support, education, knowledge gained from previous jobs, hard-work, natural smarts, and likely some good old-fashioned luck, Ross built a real estate empire which has helped shape the NYC skyline and beyond.

 


Sell Properties Like Stephen Gostkowski

Posted: April 12, 2017 by Paul Cohen, Regional Director


SELL PROPERTIES LIKE STEPHEN GOSTKOWSKI

CREXi BlogI know what you’re thinking. Have I lost my mind? Why is the kicker for the New England Patriots selling real estate? Did he just get fired by Belichick and get picked up by the local Remax affiliate on the waiver wire? Not even close. Stephen Gostkowski is still alive and kicking (punt intended (that was intended too)) and getting ready for another 87.1% season.

 

One challenge with sellers is they want to believe the broker who forecasts the highest price not the broker who tells them the most realistic outcome. It’s all too easy to start a bidding war with other brokers and before you know it you have just landed a listing for 20% above your original valuation.

 

As a former broker, I liked to use the field goal analogy when speaking with sellers about their properties. I would put the price that even the most conservative investor would pay at the 1 yd line – about the equivalent of an extra point – and the highest price imaginable at the 45 yd. line (meaning a 62 yard field goal which has an approximate success rate of say 10%) and explain to the seller that the higher the price, the lower the success probability, but also explain that I was the best field goal kicker in town.

 

CREXi BlogIn fact, commercial real estate has different values depending upon who’s buying it. Take a suburban office property for example. To an investor, it will have a value based upon a cap rate range. An owner/occupier may be willing to pay slightly more if they view it as their office and have different economics, emotions, and maybe even different financing. A developer may value the property even higher if there are potential zoning changes and increased time to get said rezoning.

 

Selling to an investor at a market or slightly above market cap rate is like an extra point. Most brokers should be able to kick that. Only a bad snap or hold will stop you making a sale.

 

Selling at a premium cap rate or to an owner-user is a little tougher and requires wider reach. Most competent brokers can get the equivalent of a 25 yard field goal utilizing their broker and investor network but you need to have a more targeted approach if you want to hit from further out.  The success rate dramatically drops off unless you have Gostkowski accuracy.

 

Getting maximum pricing relies not only on accuracy but range. Only the top brokers have this.

 

A top Broker has deep relationships in the market, knows how to approach investors, owner users, and developers to structure a deal that makes sense and then strike at the right moment. They will use the best tools to help them reach the right buyer and then run a tight process to get the deal closed.  Many of them have made CREXi part of their team for it’s ability to enhance their range and accuracy!

 

Are you the Gostkowski in your market?  How do you drive pricing and help get that extra point or three?


Paul Cohen

Paul Cohen, CREXi Convenient TechnologyPaul Cohen is a Regional Director with CREXi based in the firm’s Miami office and focused on business development in the southeast. Prior to joining CREXi, Cohen was a Managing Director specializing in investment sales and equity raises at Cohen Financial, a national debt and equity advisor. Prior to Cohen Financial, Paul owned and operated his own independent real estate firm following a 12-year tenure at CBRE where Cohen was a Senior Vice President and led the Private Client Group in Miami-Dade County with a specialty in office and industrial investment sales.  Email Paul

Profile of a CRE Marketing Executive – DJ Sandler

Posted: March 14, 2017 by Doug Shankman – Regional Director, West Coast CREXi


PROFILE OF A CRE MARKETING EXECUTIVE – DJ SANDLER, VICE PRESIDENT OF MARKETING, JLL

DJ Sandler joined commercial real estate powerhouse JLL in 2015 after a very successful four-year tenure at Raytheon Company as the Deputy Director of Communications (#117 on the Fortune 500 in 2016). Now as Vice President of Marketing for the West Coast at JLL, the Seattle native has brought his data-driven, multi-channel marketing approach to another Fortune 500 company (#436 in 2016). Based in Downtown LA, I had the opportunity to catch-up with my old friend and colleague and learn more about him, JLL, and his views on the commercial real estate market and more.

 

DS: In the constantly changing brokerage landscape, JLL has stayed relatively consistent and focused on their core business. What do you see changing – if anything – during the next chapter of your storied company?

DJS: In my opinion, the next chapter at JLL will be defined by the digital and data revolution. Real estate has been slower than most sectors to feel the full transformational effects of digitalization – think of banking, retailing, and travel and how they’ve been dramatically altered by smartphones and online businesses. You really don’t have to look farther than CREXi to see all of the potential. The real digital opportunities for real estate are still to come. JLL is investing significant time and money with the goal of becoming the clear digital leader in real estate services.

 

DS: What role do you see tech playing in the commercial real estate landscape over the next ten years?

DJS: In ten years, I don’t think tech will be playing a role in the CRE landscape, it will be the landscape. Even in a built environment such as ours, we cannot ignore the trends and changing needs of B2B. After all, B2B is still driven by the people that make up those businesses. As a result, businesses will demand the same benefits from technology as the consumer: convenience, accountability, expertise, end-to-end solutions and transparency – any time of the day, all at their fingertips.

 

DS: You came to JLL following a very successful career at Raytheon. What similarities have you found within the commercial real estate and defense contractor industries? What glaring differences?

DJS: Both industries are driven by a core set of big players, which means sometimes you go up against them head-to-head on a pursuit and sometimes you might end up partnering on a deal. Reputation and integrity matter because you never know who you might be on the phone with a week from now.

 

DS: You have a data-driven approach to your craft. What piece of data or information about how marketing materials are disseminated and received do you think would surprise most people?

DJS: Data driven marketing is all about business development and revenue producing solutions. Many marketing organizations broadly circulate material, cross their fingers and wait to see who comes back – almost like throwing spaghetti at the wall to see what sticks. That strategy is expensive, unpredictable and hard to prove value. Through data-driven marketing, I know who my prospects are. This allows my team to develop targeted, relevant and engaging materials for a core set of decision makers. When marketing plays a role in converting prospects into customers it’s incredibly rewarding and allows us to justify our extended value in an organization.

 

DS: Without the blinders of a deep background in Commercial Real Estate, what inefficiencies do you see in the industry that sometimes surprise you?

DJS: Perhaps there’s a trend in my responses here, however I was surprised at the dependence on traditional quarterly reporting, which is valuable but is also less forward looking. With the incredible amount of data currently available, I’d like to see a shift towards more real-time reporting. What’s the narrative today? How can we help our customers make good decisions based on the latest market information right now? The speed of economy is increasing and our customers will eventually demand us to keep pace.

 

DS: Most of our early interviews have been with east-coasters so your west coast markets have been underrepresented. What is your favorite food city?

DJS: If you’re a foodie, pick a weekend and book a flight to Portland, Oregon. Hit the food carts for lunch, Pearl District for dinner, and the microbreweries in between.

 

DS: What piece of advice do you carry with you (or first that comes to mind)?

DJS: I try to spend the majority of my day looking forward; it’s helped me and my team focus on the art of progress instead of trying to perfect the past.

 

DS: If money was of no concern and you were proficient at any skill you chose, what career would you have chosen if you could start over and do anything?

DJS: I’ve never parted with my childhood rock and mineral collection and often think I could have been a famous Geologist, if there is such a thing.

 

DS: What trend or fundamental do you think the market-herd is overlooking when analyzing the commercial real estate market?

DJS: In my experience, the ‘herd’ has embraced and successfully leveraged financial and real estate indicators very well. However, we partner with JLL Research very closely to study broader economic and industry sectors to identify up and coming trends in the market, specifically on the west coast. By doing so, we can get out front and meet the needs of both occupiers and investors in a new or developing vertical.

 


Lessons Learned Part IV – Networking, Honesty, and Teaming

Posted: March 8, 2017 by Paul Cohen, Regional Director

LESSONS LEARNED IV – BROKER ADVICE ON NETWORKING, HONESTY, AND TEAMING

And the advice keeps on coming.  This post we cover topics from the importance of networking, honesty, and teaming.  I look forward to receiving more advice.  Checkout the past three posts: 

Lessons Learned Part I – Ten Takeaways from 25 years in CRE 

Lessons Learned Part II – Broker Advice From Around the Country

Lessons Learned Part III – More Broker Advice From Around the Country


More CRE Lessons Learned - Carolyn Niemczyk
Carolyn Niemczyk, CFM
Keyes Commercial, Port St Lucie, FL

Be willing to go the extra mile:  The majority of my clients stay with me thru purchase after purchase and lease after lease. I can get the a/c fixed on a Sunday or a locksmith there Friday night to avoid any overtime charges. Maintain good relationships with all service providers.


More CRE Lessons Learned - Alan Bolduc Avison YoungAlan Bolduc CCIM, SIORSenior Vice President
Avison Young, Charleston, SC

Networking 101.  Find a group, association or organization where you will find the people you want to meet and get to know as possible clients or can refer you to potential clients… BUT, you need to be the only one in the room that does what you do!  And go often.  No one knows when you aren’t there, only when you are!


More CRE Lessons Learned - GG Galloway - CBCG.G. Galloway – Associate/Partner
Coldwell Banker Commercial Benchmark, Ormond Beach, FL

  1. Never be afraid to ask a dumb question…… it may save you or your client a lot of money.
  2. Being in the business for 30 years, one would think you have about heard everything there is too hear…. wrong…… stay actively involved in your trade associations as well as continuing your continued education.  Give back to your communities by being actively involved not just in your professional and trade associations but equally involved in community activities and nonprofits. Reach out and become mentors to others, and help and share some of the success, failures, pitfalls, and sidesteps that we ALL have enjoyed throughout ones career.
  3. Teaming is the way to go.  A team will accomplish so much more than an individual that thinks they have to have it all. There is no “I” in TEAM, a team has multiple fronts, hands, ears, and eyes. Best of all a Team can be at multiple locations at the same time as well as completing multiple tasks outside an office as well as multiple tasks within an office.
  4. Don’t bull shit your way out of a question that you don’t have the answer for…. We are professionals….. and when a question arises that you have no real answer for….. let the person know you don’t know; however, I will find out the answer to your question and report back to you with my findings.
  5. Live by the sunset rule….. if it was important enough for someone to call you today….. call that person back by sunset the day of  or at least before you leave your office if it is after sunset…even if you leave a message to an answering machine….. let ALL know your call is very important to and the success of my business……thank you for the consideration.
  6. Email, LinkedIn, Facebook, Twitter, texting……………. how about just an old fashioned hand written thank you note or card……… Thanks for your business or thanks for your time today.
  7. Business cards are not dinosaurs…. pass out two when you give one out…… one to the customer and ask them to give one to a friend or customer of theirs who may need your services.

More CRE Lessons Learned - Aaron LigonAaron Ligon – Managing Principal
LCRE Partners, Charlotte, NC

  • Be clear, and tell the truth.  Brokers often try to solve problems before presenting a difficult situation to a client.  Or in an effort to be helpful, they’ll obsess about how to present a situation or set of circumstances in the most positive way possible. Simply be clear, and tell the truth.  Do it quickly.  State the problem, outline the circumstances, and suggest solutions, or at least some potential action steps to navigate toward a solution. Most problems get worse when you delay discussion.
  • Simple is best.  In a world of deep analytics and tons of data, sometimes simple is best.  Delving into cap rates, levered yields, after-tax IRR’s, and complex waterfall structures can leave your head spinning.  When analyzing a potential acquisition for yourself or a client, don’t forget to also make the simplest possible analysis.  How does the purchase price of the asset compare to other trades on a cost per square foot basis? Is this purchase below or above the cost of reproduction?  Irrespective of a tenant/lease, what is the real rental rate for the property?  Is the underlying land likely to appreciate?  Answering those and other basic questions will often provide clarity around an otherwise complex transaction.
  • Be a value-add for your clients:  Adding value in the real estate service business requires one or more of three basic contributions: 1) Information, 2) Resources, and/or 3) Hard work.  The most successful real estate brokers and investors leverage all three.  If you don’t have financial resources to invest, you should be well-informed and working hard for your clients.  If you’re not offering intelligence, financial resources, or diligent work, you’re not adding value, and you won’t fool them for long.

 

Paul Cohen

Paul Cohen, Regional DirectorPaul Cohen is a Regional Director with CREXi based in the firm’s Miami office and focused on business development in the southeast. Prior to joining CREXi, Cohen was a Managing Director specializing in investment sales and equity raises at Cohen Financial, a national debt and equity advisor. Prior to Cohen Financial, Paul owned and operated his own independent real estate firm following a 12-year tenure at CBRE where Cohen was a Senior Vice President and led the Private Client Group in Miami-Dade County with a specialty in office and industrial investment sales.  Email Paul

Profile of a Legend – The Gambler, Steve Wynn

Posted: March 3, 2017 by Eli Randel, Director of Business Development

 

PROFILE OF A LEGEND – THE GAMBLER, STEVE WYNN

 

“Money doesn’t make people happy. People make people happy.”

 

Steve Wynn has built an empire worth an estimated $2.6B with serendipity and entrepreneurial grit.

 

Born in New Haven, CT in 1942, Wynn would eventually graduate from University of Pennsylvania with plans to attend Yale Law. However, Steve’s father passed away before his UPenn graduation leaving him with $350,000 in gambling debt which forced him to take over and operate the family’s many Bingo Parlors mostly surrounding Wayson’s Corner, Maryland. Wynn would expand the business before moving his family to Las Vegas in 1967.

 

It was in Las Vegas that Wynn entered the casino business by buying a small stake in the Frontier Hotel and Casino with the profits he eventually made in the family business. By 1971, Wynn had managed to profit enough from the Frontier and several well-orchestrated land deals to gain a controlling interest in the Golden Nugget Las Vegas. Through a series of renovations, he would attract high-end clientele to the Golden Nugget and would increase his stake to become the majority owner by 1973. In 1977 Wynn opened the casino’s first hotel tower which would be followed later by several more hotels. Around that time, Steve built a lasting friendship with the Sinatra family before focusing east towards Atlantic City where he developed the Atlantic City Golden Nugget which he would later sell for $440MM.

 

Wynn would go on to build the Mirage, the Bellagio and several other well-known hotels and casinos before selling his company, Mirage Resorts, to MGM Grand for $6.6B in 2000. He would then form Wynn Resorts Limited which he would take public in 2002 becoming a billionaire two years later. Most of Wynn’s empire was built with his ex-wife, Elaine, who he would marry twice and who sat on the board of directors for 13 years. Today Wynn is remarried, an active art collector, and was also the inspiration for Andy Garcia’s character in Ocean’s Trilogy.

 

Wynn’s rise to prominence can be attributed to his smarts, honesty, big vision, guts, a strong support network, and of course some luck.

 

SOME SELECT STEVE WYNN QUOTES:

“Keep it simple. Tell the truth. People can smell the truth.”

“This office is smaller than the last one I had. I’m not trying to impress people. I want to be close to them.”

“Other people’s successes are good news – for them and for you. Good for you because they show you a way to go.”

“If I complain about a traffic jam, I have no one to blame but myself.”

“Change is not threatening.”

“I am a self-made brat.”

Forget Hillary, Where Did Your 30,000 Emails Go?

Posted: December 28, 2016 by Paul Cohen, Regional Director

FORGET HILLARY, WHERE DID YOUR 30,000 EMAILS GO?

I recently met a long-time broker-friend for lunch. In typical broker-friend style, he texted me five minutes before we were due to meet telling me he was finishing up a project and asked if I would come to his office first. I did. He was hunched over a workstation with who I assumed was his marketing assistant at the computer’s controls. As I approached, he greeted me with “BaBoom! 30,000 emails. Let’s get lunch.” Turns out that my broker buddy had just hired a new marketing whizz who had revamped his marketing platform. They both looked very excited.

“That’s great,” I told him, “So, what’s your delivery rate been?”

Blank stare.

“How many unique page views are you generating?”

Blank stare.

“OK,” I said now feeling a little like a bully “how many offers have you gotten?”

“We got one last week on the downtown development site!”

Turns out he wasn’t clear whether the offer came from his email campaign or a call off a sign, but 30,000 emails must have generated some of the deal activity he was experiencing. Right?

I explained to my friend and his whizz that technology was available that takes the guess work out of email campaigns. You can analyze exactly how many emails were delivered, viewed, resulted in downloaded OMs, and who performed these activities all on CREXi.com for free.

“Why are you paying a service without these capabilities over $200 a month when you can use CREXI for free?” I asked.

“Free is good but we don’t have time to learn a new mail program. Time is money, Pauly-boy,” was his reply. I logged into his CREXI account (of course, he had a CREXI account) and in three clicks created him an email marketing campaign. The campaign was customizable and directed buyers to his listing page where they could quickly execute his NDA, access his sleek offering memorandum, and open a due diligence vault with all the property information (he was still paying a firm $100/month just for a DD vault).

He was impressed. Then he noticed on his dashboard that each listing had a number of page views, Executed CA’s, Downloaded OM’s. He swore he had never seen that page before (He had because I had given him the demo). Then he looked at the Downtown Development site and clicked on the leads tab. The buyer who had submitted the offer had downloaded the OM over two weeks ago. I suggested that he should probably check his other listings. He agreed but after lunch and he was buying!

Paul Cohen

Paul Cohen, Regional Director

Paul Cohen is a Regional Director with CREXi based in the firm’s Miami office and focused on business development in the southeast. Prior to joining CREXi, Cohen was a Managing Director specializing in investment sales and equity raises at Cohen Financial, a national debt and equity advisor. Prior to Cohen Financial, Paul owned and operated his own independent real estate firm following a 12-year tenure at CBRE where Cohen was a Senior Vice President and led the Private Client Group in Miami-Dade County with a specialty in office and industrial investment sales.  

How Long Should It Take To Receive An OM?

Posted: December 21, 2016 by Paul Cohen, Regional Director

HOW LONG SHOULD IT TAKE TO RECEIVE AN OFFERING MEMORANDUM?

Back in 2002, I was at a conference for a select group of CBRE brokers who were invited to be part of a new division called the Private Client Group. It was an exciting time. Led by a maverick named Glen Esnard, we had one mandate: to design and build a platform within the CBRE network to work with the thousands of private real estate owners across the country. Previously, the company had a more institutional focus, but now recognized the opportunity to service a wider entrepreneurial client-base.

One of our first breakout sessions was led by a forward thinker named Jim Crupi; a consultant to many Fortune 500 companies and a former Army Ranger commander. I was pumped. His first question to us was: “how long should it take to get an offering memorandum?”.  I looked around the room, thought about how long it typically took; figured he was looking for a short answer and suggested one I thought was low but not crazy: “less than 24 hours.” Many of my colleagues could tell by his reaction that he was looking for a shorter time and offered their newly revised responses with the lowest being “one hour.” Of course, an hour was doable but in my experience, was not the norm. By the time a buyer gets a broker on the phone, the broker e-mails an NDA, the NDA is received, printed, executed, and then faxed (yes faxed) back, the executed NDA is then received by the broker and finally the offering memorandum is sent, at least a day if not several has usually elapsed. Crupi then challenged us to a group exercise. Our task was to pass a tennis ball around a circle of 20 people in the shortest time possible. Now we were a very competitive bunch so after three attempts we got it down to under 5 seconds. Crupi commended us but encouraged us to do it quicker. After some brainstorming, strong teamwork, and logistical coordination we finally touched the ball simultaneously. That was Crupi’s point: “Don’t accept the norm but challenge yourself to find new ways to do it better.” He invited us to do the same with Offering Memorandums. My mind was blown. What if we improve on and change the norm in other areas of the business?

Fast forward to 2016, I find myself with the same level of excitement as I did in the early days of the PCG: a member of a band of free thinkers with the goal of disrupting traditional norms. Providing tools to brokers to make them more effective with client reporting, email marketing, due diligence vaults, offer submission, and analytics. Oh, and you can download an OM instantaneously. Check out www.crexi.com and take the OM Challenge.

Paul Cohen – Guest Contributor

Paul Cohen, Regional DirectorPaul Cohen is a Regional Director with CREXi based in the firm’s Miami office and focused on business development in the southeast. Prior to joining CREXi, Cohen was a Managing Director specializing in investment sales and equity raises at Cohen Financial, a national debt and equity advisor. Prior to Cohen Financial, Paul owned and operated his own independent real estate firm following a 12-year tenure at CBRE where Cohen was a Senior Vice President and led the Private Client Group in Miami-Dade County with a specialty in office and industrial investment sales.

 

Data-Less 2017 Market Outlooks (Analysis Without Paralysis) Part 1

Posted: December 7, 2016 by Eli Randel with Guest Contributor Paul Cohen

DATA-LESS 2017 MARKET OUTLOOKS (ANALYSIS WITHOUT PARALYSIS) 

The computer can’t tell you the emotional story. It can give you the exact mathematical design, but what’s missing is the eyebrows. – Frank Zappa

As a tech company and a marketplace that has seen approximately 7,000 deals come through our doors since our inception in October 2015, we are data driven and pattern focused. However, for our market predictions we walked away from our computers to drive our neighborhoods, speak with our clients, visit stores to get a feel for the holiday retail pulse, and approach our forward-looking predictions instinctively to avoid analytical-paralysis or failures to read the stories between the lines. CRE data and surveys can often organize the “what” but sometimes fail to explain the “why” (or input). Our goal for our 2017 predictions was to focus on the “why” with the expectation that we (or anyone else) will not get the predictions perfect but that the value sometimes resides in the thought-journey and not solely the destination.

Industrial Outlook Paul Cohen – Southeast Regional Director

For many, industrial real estate is the most boring asset type. Buildings usually lack structural sophistication, are often “dirty”, reside in less traveled outskirts, and yields as of late are compressed to once unthinkable lows and lacking in the return premiums that used to often exist. Despite the lack of sex-appeal, it’s possible industrial real estate is currently the most stable asset type and poised for long-term prosperity.

During the last three or four-years land values have increased significantly in most major port and shipping markets and often the highest-and-best-use (or only use that will “pencil-out”) has been residential even in once industrial submarkets (Doral, FL for instance). Housing brings new residents and demographics which creates the need for warehousing particularly in our new economy where firms like Amazon and FedEx have made speed and logistics a priority and therefore need distribution proximity to population clusters. Rising land costs have done two things simultaneously: 1) because land doesn’t pencil-out well for industrial development there has been little new supply; 2) increased residential demographics has increased demand for industrial space.

A reason I particularly like Industrial real estate and find it a safe investment is it remains semi-immune to technological advances which may threaten other asset types. Modern technology advances and trends like automation, e-commerce, and telecommuting do not generally hurt industrial occupancy or demand but could actually fuel it. Whereas telecommuting trends can contribute to office space demands, and e-commerce has contributed to the decrease of brick-and-mortar retail demand, manufacturing and distribution continues to need distribution hubs across the country to quickly and efficiently produce and distribute products. And while automation has created less need for proximity to skilled workers and may change floor plans, the need to be near population clusters for quick distribution will limit major sprawl from cities.

Future segment potential impactors and risks include: oil prices – which are currently low and affect manufacturing and transportation costs, the political landscape and resulting impact on trade, new manufacturing technology, and the housing market. Politically, the incoming administration’s oft-discussed views on trade could result in decreased imports which could slow activity at port markets. However, penalties for companies moving overseas to exploit cheaper labor (known as “offshoring”) could keep companies and occupiers in the US and potentially increase domestic manufacturing and exporting. Additionally, a professed government plan for mass infrastructure investment will certainly require industrial storage and manufacturing to support those construction efforts. Next level technology like 3-D printers could eventually change how products are manufactured and delivered but I think we have time to see how that unfolds and impacts to industrial will initially be limited. Last, the housing market should be watched as a cooling in the housing market can affect the industrial market in two ways: 1) a decrease in residential development will likely decrease land and construction costs and open the door for industrial developers to deliver more supply; and 2) occupiers tied to the housing industry (like tile and furniture producers) will suffer if the housing market cools. In 2007 while leading the industrial investment sale team in Miami for CBRE, we saw occupiers struggle, vacancies increase, and rents soften.

Ultimately, while pricing has risen and yields have dropped as low as 4% for core product in top markets, I predict industrial real estate to be a very safe asset type with great fundamentals and macro-trends favoring its long-term health. Deal velocity or transaction volume, which is currently down about 25% from 2015, will remain below historical norms as some investors can’t stomach the compressed yields resulting from competition for deals and strong growth assumptions, but patient capital will continue to acquire assets and will benefit in the long-term when they do. While rents in some markets have reached once unimaginable highs and will someday soon flirt with $20/SF levels, lower transportation and labor costs resulting from cheap oil and automation have helped manufacturers offset increased occupancy costs. As land becomes more scarce and development of industrial space less practical, we think occupancies will stay high and rent growth will fuel long-term IRRs despite currently high asset values.

At www.CREXi.com we currently have 786 industrial properties (and growing rapidly) being offered by the best brokers in the business. We encourage you to visit and learn more or reach out to me anytime @ paul@crexi.com or 786.877.0544.

Recommended Reading:

LA Times – Warehouse Robots

USA Today – Offshoring

Eli Randel

Eli Randel is Director of Business Development based in CREXi’s Miami office. Eli spearheads CREXi’s growth and sales throughout the east coast as well as overseeing the national sales team. Prior to joining CREXi, Eli was director of dispositions for Blackstone’s Invitation Homes. Eli has also held management positions and production roles with Cohen Financial, Auction.com, LNR and CBRE where he began his career spending three years in Investment Sales before leaving to obtain his Master in Business Administration from the University of Florida.

Paul Cohen – Guest Contributor

Paul Cohen is the Southeast Regional Director of Business Development and is based in CREXi’s Miami office.   Paul is primarily focused on expanding CREXi’s footprint in the southeast markets. Prior to joining CREXi, Paul was a Managing Director at Cohen Financial, his privately held real estate firm that specialized in investment sales and equity raises, and previously held a Senior Vice President position at CBRE.