PREA and Tom Davis

i attended the PREA annual plan sponsor conference in chicago this week. 850 attendees but the ratio of managers/others to pension funds was reported to be 10:1. an example of why this event has grown in size each year is evidenced in two people i met who are real estate operators from different parts of the U.S. who have either self-funded or have done small syndications over the years. in sarah palin speak, "how do i get some of that there pension fund money, katie?" is the reason. but it's not that easy. anyway, on a personal level, the timing couldn't have been better as i was able to hand out my new AVIVA Investors business cards and tell people about my new gig. also, as the press release about my new job hit the trade publications and websites as well, many people congratulated me on my 'next life.' it's great to see so many industry friends and acquaintances and it was a wonderful feeling to get so many people telling me how they felt that this was such a perfect use of who i know and what i know. i used up all my business cards!

here are some of the things i heard at the PREA conference:

1. liquidity is on the minds of almost all institutional investors.
2. funny how quickly open-end funds turned from having a queue to get in to a queue to get out.
3. some institutions are increasing their allocation to real estate to take advantage of dislocation or distress opportunities.
4. is there liquidity in other asset classes vs. real estate?

one keynote was delivered by frederic mishkin, an American economist and academic at the Columbia Business School. He was also a member of the Board of Governors of the Federal Reserve System from 2006 to 2008.

1. i'm as scared as i've ever been in my life about the economic situation.
2. sub-prime losses will be more than $1 trillion.
3. what caused this?
a. financial innovation
b. asset price bubble
c. deterioration of balance sheets of financial institutions
4. if you 'nail the S.O.B.'s on wall street you may do harm to the economy in general.
5. a "let's get those rich bastards" attitude will destroy the economy.
6. restoring confidence is everything in solving the financial crisis.
7. if we really screw this up, like the japanese did, it'll take 10 years to recover.
8. medicare needs trillions to fix it; $700BB? that's chump change.

some stuff from a one panel:
a. i don't see a commercial real estate depression like the early 1990's.
b. opportunistic investors will be compensated for separating the 'good' bonds and loans from the 'bad' ones.
c. the transfer of assets will be of biblical proportion.
d. going down to the lower levels of the capital structure you can buy at distressed prices where there is no distress.
e. it's likely that a whole number of hedge funds will close up by 12/31/08.

and another panel:
1. global recession is a reality.
2. the downturn will last 16 months.
3. we are going to see the opportunities of a generation.
4. i don't want to be the last man standing.
5. not only is the sky falling, it's gone lower than the earth's crust.
6. 16 of the 20 headlines in the wall street journal could have been the headline of your career.
7. panic is not necessarily wrong when it comes to making investing decisions.
8. we see great opportunity in distressed residential mortgages.
9. that we can talk about whether GE will survive is almost unfathomable.
10. this is a generational change in america.

while i was at the conference i got the news that tom davis had died. tom was the bass player in the most significant band i played in, called "everyone." tom was a professor of philosophy and religion at a college in new york state. he had fallen a few days earlier and cracked his head open. the doctors thought he would survive although never teach again. he died of a stroke without every regaining consciousness. the last time i saw tom was in the summer of 2001 when our band played a reunion gig to commemorate the most successful and crazy summer in our lives in 1971. tom was the gentlest soul i've ever known. he had a sweet voice but could also really rock, like when he sang steppenwolf's 'born to be wild.' we were all fairly innocent when we got together in 1968 but during those ensuing crazy days we all grew and experienced all the things that you would imagine a popular rock and roll band (albeit on a local level) might get the chance to see and do. i went on the website of tom's college, searching for something about him and found a place where students can rate and comment on their teachers. i offer a few of those comments about tom davis:

-Besides being helpful, kind, and understanding he MAKES you want to come to school.
-Tom Davis has inspired so many students to go deeper than they ever thought they would or could into philosophy and themselves; the comments he writes on your papers make it feel like a conversation he's having with you about your ideas; he's awesome, and for someone over 40, he's cute as ever! Ask to see the pics of him in his band when 20ish!
-He is the best professor you will ever encounter. He encouraged me to want to learn. He is dedicated to make sure that all of his students do well. He is an inspiration to me.
-An inspired and inspiring man. Zany, insightful, intelligent, interesting and benevolent. One of the best.
-he's just funny and smart and insane and entertaining and marvelous. he's somethin', that's for sure. :) he loves to jump down the rabbit holes. he doesn't ever make a student feel like their views are insignificant, he considers all points. at times i didn't know what he was talking about, but i never felt alienated.
-he seems like one of the few teachers that cares about teaching. Great guy.
-One of the most benign, charasmatic intellectuals I have ever met. He just happens to be the GREATEST professor I have ever had!!! I never learned so much as I did from him.
-he is great, very concerned with how every individual is doing within the class, he is also crazy and loved to dash around the room acting things out
-He is involved, unbiased, genuine-a phenomenal human being who should be providing seminars for teachers.
-Tom Davis is one of the greatest professors I have ever had and he's probably the nicest person you could possibly meet.

remember, these were written before tom died. i can only imagine what his current and former students are writing and saying about him now. what do people say about you? what will they say about you when you're in the next dimension? when you think about it, we all can be teachers. we can give something of ourselves to those starting out in the business and all along the way. you can 'teach your children' as graham nash of crosby, stills and nash sang. there is nothing more powerful than taking the time to help someone else be what they want to and can be. i never got the chance to take a class with tom and i never got to say goodbye to him but it's obvious that he was a very special teacher and a special person to those who came in contact with him in his 'life after everyone.' he's the first of our band to go and now we'll never play together again. it's like puggy, our lead guitarist wrote me, "it was good to just know tom was around." there'll be a memorial service for tom next saturday; i'll be there and have been asked to play a couple of songs that were close to tom's heart, "while my guitar gently weeps" and "imagine". but i'm also going to surprise his partner debbie with an old blues song which tom used to "knock out of the park" called 'sporting life blues' written by sonny terry:

I'm getting tired of runnin' around,
Think I will marry and settle down
This ole night life,
This ole Sportin' Life, it's killin' me

I got a letter from my home,
All of my friends, they're dead an'gone
It'll make you worry,
It'll make you wonder, 'bout days to come

My mother used to talk to me,
I was young and foolish, and could not see
Now, I have no mother,
My sisters and brothers, they don't care for me

Mama used to fall on her knees an' pray,
These are the words, mother, she used to say
She would say: "Wha-oh,
My son, please change your way"

Now, I'm goin' to change my way,
I'm growin' older each and every day
When I was young and foolish,
It was so easy, to go out and play

I was a gambler, and a cheater too,
Now, it's come my turn to lose
This ole Sportin' Life,
Got the best hand, what can I do?

There ain't but one thing that I done wrong,
I liv'd that ole Sportin' Life too long
Friends, it's no good, please believe me,
Please leave it alone

I'm getting tired of running round,
Think I will marry, and settle down
This ole night life,

This ole Sportin' Life, its killing me

here's a great version by j.j. cale and eric clapton [http://www.youtube.com/watch?v=Iebv1LZOInc&feature=related].

we lived the sportin' life together in that band. tom sang about it almost every night. now he's gone and all we can do is think about how the sportin' life affected us all. sometimes it's just a spot you race by in a fast moving train. but other times it's something that becomes a monkey on your back. there was not anyone that met tom davis that did not love him. we loved him. he was our brother. we miss knowing he's around. don't wait too long to see someone in your life who you miss. make plans right now. to wait may be too long.

part of growing up is dealing with reality and dealing with problems and learning how to solve them or let them solve themselves. the lessons we're learning as a society today (especially in america) are painful but keeping them in perspective, still not nearly as painful as those in the world who are dying from hunger or disease that can be prevented or in wars and skirmishes the underlying theme of which sometimes escapes reason. i don't know if we'll ever go back to when things were simpler but i for one am going to try to go forward by going back a little and appreciating the simple things in life; appreciating what i have rather than being jealous or unhappy over what i don't have. things can change in the blink of an eye. we never lose sight of that and let's live our lives accordingly.


Where will I be?

Oct. 6-8: London

Nov. 12-13: New York to moderate a panel on "Asset Transformation Case Studies) at the fourth annual PERE Forum (Private Equity Real Estate). NOTE: PERE is offering a 15% discount for "Friends of Steve". If you want to take advantage of it just use this code (PERENY_Bridge) when you go to register on their site (http://www.peimedia.com/Product.aspx?cID=5496&pID=174808&contType=1).

December (date TBA): London to moderate a panel at a seminar hosted by Reuters Real Estate (http://www.reutersrealestate.com).

Feb. 19-20, 2009: Chapel Hill, NC to attend the Kenan-Flagler Center for Real Estate Development’s Annual Conference and Real Estate Challenge Case Competition.

Aviva Investors

i'm excited to tell you that i've joined Aviva Investors Multi-Manager Real Estate team as Head of Marketing for North America. yes, it's a long title but it helps me to remember what i was hired to do. actually, my responsibilities will probably include being an ambassador for all real estate products offered by AVIVA Investors. today is the official day of my announcement. and it's also the official day of the announcement of the launch of the AVIVA Investors brand which is the only sub-business of AVIVA plc, the worlds fifth largest insurance company. AVIVA Investors has been formed by combining AVIVA Capital Management and Morley Fund Management. we have offices in London, New York and Singapore. Aviva Investors is one of the world’s largest real estate managers with $50 billion in assets under management, and is one of the largest real estate multi-managers with more than $10 billion under management, invested into indirect real estate strategies. i’m very excited to have this opportunity.

i really don't know what i can add to everything being written and talked about regarding the state of financial affairs in the u.s. today. suffice it to say that others much smarter and closer to the situation than i have said that unless the government steps in further our entire economy could crumble. hopefully, the final solution will be one that takes everyone into consideration. but, once things do settle down, and i have a feeling that it will be sooner rather than later, we can move forward, albeit at a slower and more careful pace but perhaps 'the bottom' will have arrived and things can only go up from there. we all need to keep our fingers crossed because as a friend of mine used to say, “we’re in deep doo-doo” right now.

Pete Seger, the legendary folk singer who turned 89 this year has released a new album. I read this today in the paper and it resonated with me so I wanted to pass it along to you:
"I hope the next revolution (after the current information-based one) will take the form of a 'willingness to communicate revolution.' It will involve becoming more generous, having a better sense of humor and talking to people we disagree with. And that must happen if there is going to be a human race here in the next century,'

from time to time i have thought about 'where time goes?' i guess that while i keep a very positive attitude on life and am convinced that i am going to live well past 100, there are moments when i wonder how it is that time can be passing so fast. perhaps it happens when i think about 'what have i contributed to the world?' and whether i'm just going through life, working to make a living, from time to time taking holidays and experiencing different people, cultures and geographies and that is something that is very important to me; i also know that there are more people, places and things in the world than i will have time or means to visit. but that won't stop me from trying but not trying in the sense of putting pressure on myself but rather just continue to stretch myself when i have the opportunity to expand my horizons. but that again is something that i do for myself but i don know that the experience of meeting people on their own turf and communicating with them also means something to them as well; i know it because i have talked about it with them. and, i've always believed, that the key to bringing our world closer together, while cross border investment and business deals are one component, and cultural exchanges are another, in my humble opinion, there is no substitute for people meeting people, one on one and talking. in this way we learn that we are all human beings and that the differences represented by our language or our habits, holidays or traditions are not the true essence of who we are as human beings. maybe i'm just a wishful thinker but i continue to believe that we can bring more peace and understanding to the world by taking advantage of any opportunity we have to contribute to our world's future.

but at times like these, when it seems like in so many ways and places, the stress, strain, pain, hatred and confrontation serve to separate us as people, both within and outside our respective countries it makes it more and more difficult to think of anything or anyone other than ourselves, our families and our and their own well-being. i too am feeling some strain of what is going on in the economy and financial world in the U.S. and perhaps some of what i'm going through is due to my believing that things would always continue to get better and for many years, for me, they did. i do feel that things will continue to get better for me and that the lessons learned are not the kind that are as damaging as they are with other U.S. citizens and others around the world who have made investment decisions which have caused them to lose some of their net worth. but i guess what i'm coming around to is that i've been thinking lately of what does someones' real 'net worth' consist of. it is only measured in terms of dollars and assets owned? i'd like to believe not. there's a phrase i read many years ago in a book whose name i cannot remember: "things worth being vs. things worth having." there is a big difference.

sunday’s new york times magazine section had a special advertising section dedicated to new york lawyers. but it wasn't just any lawyers (at least i don't think it was) it was 'superlawyers.' now, i may be wrong, but i thought all lawyers were superlawyers or at least they see themselves as superlawyers. and, as having good self-esteem is important in any profession, why shouldn't they? but what was interesting to me was the way those firms that decided to spend what may be a considerable portion of their annual marketing budget designed their ads. they run the gamut from anyone wear anything to all seven partners wearing the identical suit with only minor color changes in the tie. and everything in between. i don't know which of the firms i would choose from their photo or whether i'd just dismiss them one by one based on fashion statements and facial expressions. however, in addition to the 'ads' there was a directory which was listed by discipline. real estate, as you might imagine, has a lot of lawyers in new york. included in the listings (but not in the ads) were two friends, carl schwartz of herrick, feinstein and david rabinowitz of sutherland. these guys are big-time real estate attorneys and while you may see an ad of theirs from time to time in a real estate publication you won't see them in this superlawyer supplement, new york magazine or entertainment weekly (although, while i've never held one in my hand might be a place where entertainment or libel lawyers do advertise). "perception is reality" is a saying that i believe has a lot of truth to it and when someone runs an ad or a tv commercial where ones visage (the face of several colleagues) are out in the open i think you're taking a chance. is having photos in an ad any different than having photos of people on your website? not really but sort of. while websites should be both information and somewhat promotional they do have certain components of advertising. but ads are "in your face, buddy." whether they're in print, on tv or as a warm up to a movie played in your local theatre (which i think is an infringement of one of my constitutional rights, i just don't know which one). my suggestion: always put yourself in the others persons shoes; bounce ad ideas off people you know and trust (even if you've engaged an ad firm to create your ad). you know your industry better than anyone and they way you are perceived in your ad becomes the reality.


Where will I be?

Oct. 1-3: Chicago for PREA’s 18th Annual Plan Sponsor Real Estate Conference

Oct. 6-8: London

Nov. 12-13: New York to moderate a panel on "Asset Transformation Case Studies) at the fourth annual PERE Forum (Private Equity Real Estate).

Feb. 19-20, 2009: Chapel Hill, NC to attend the Kenan-Flagler Center for Real Estate Development’s Annual Conference and Real Estate Challenge Case Competition.