On the Road with Steve Felix

He not busy being born is busy dying

2012-01-26T14:39:00.000-08:00

"He not busy being born is busy dying." Bob Dylan from It's Alright, Ma (I'm Only Bleeding).

In the spring of 1992, when my mother was dying of brain cancer, I watched as she used her brain to try to fool the doctors. They would ask her questions, "Good morning. Can you tell me your name?" (Her name was Lorna). And some days she got that right. But as she deteriorated, often she couldn't answer that one, or what day it was or what month or what year. Yet my mother was a very sharp cookie. When asked questions she rambled around, telling the doctors about a variety of things, most of it not making any sense depending on which electrical impulses happened to make their way through the frayed wires of the plugs in her brain that used to fit in the right sockets. It was heart-breaking.

While in London this week I took a planned side trip to Geneva to visit my old friend Deb. She was my brothers' first girlfriend when we were all in summer camp. We reconnected after many distant years in 2003 at a camp reunion. My wife and Debbie hit it off and a couple of years after that took a "Thelma & Louise" road trip through the Southwest U.S. which they documented with some incredible (and funny) photos.

As a group, we counselled each other (not the summer camp variety but the kind that good friends do for each other). Deb has always been a brilliantly talented writer (and deft Scrabble player) who for the past number of years has been living in Geneva and working for Rolex, creating and editing some of their most prominent and visible marketing materials. Before taking that job, she was free-lancing as a web music journalist and interviewed some very well-known names in rock, blues and jazz. Music has always been a strong bond amongst our camp friends and her appreciation and love of music even led her to taking up blues harmonica which she played with friends in her adopted country of Guatemala (Debbie grew up in Montreal). We've all seen each other through some of life's growing pains and soul-searching times. Deb is a breast cancer survivor which is one reason why her current condition is so sad. She is suffering from Glioblastoma, an inoperable and except in rare circumstances, incurable brain tumor. More than a year ago doctors gave her three months to live. She embarked on a series of experimental chemotherapy and while it hasn't been any fun (the side effects and what-not) she is still with us. But, her brain is messing with her too.

My wife and I call her periodically and on those calls she sounds extremely lucid and her memory seem phenomenal. She sounds up-beat and tells us of the books she is reading, the writing she is doing and other stuff that had us feeling more hopeful. But a few weeks ago, one of her sisters' told us that all Deb was telling us was fantasy. Well, I witnessed that first hand yesterday and today at her bedside. Yesterday, her 59th birthday, she remembered me as soon as I walked in the door. But this morning she didn't know who I was at first and as the time wore on, she knew me and called me by name. She drifted in and out of making sense or talking nonsense. At times, she used a word that she knew was wrong and tried desperately to correct herself. This morning, a doctor and his colleague came in to talk with her about how she wants to live the remainder of her life. The "living will" stuff. And while Deb gave some conflicting answers (I think I would have too if I was her) she did tell the doctors that her best friend was the one who knew her wishes and should be the one to have the legal authority in such circumstances. It was a heavy scene for me to observe.

The weirdest thing was that during the time I spent with her she got two phone calls and was talking as lucidly (or perhaps even more) than you or I. She remembered projects she'd worked on, the names of children and grandchildren. She said some random things which I told her I'd make into a song and send her the demo. The first line (all her) is "You can't take the sunshine with you no matter where you go." We had a great time writing those lyrics together. The brain is an unbelievable thing; how it works and how it fails to work in almost the same moment.

She is in the palliative care unit of a wonderful hospital just outside Geneva. It's for end of life care, usually very short term, but she has fooled them. There are people who have helped her draw her will for the first time and prepare for death. To some of us, death comes sudden and without warning. The rest of us don't want to admit to ourselves that Bob Dylan's lyric is totally true. And who is to say that we will be given the luxury, of sorts, to have the time to wrap things up in a tidy package and say, "There, I've done what I wanted to do and I am at peace." Deb told me that she's heard how some other patients answer the question, "What do you dream of?" One said, "To swim with dolphins." Deb's dream is simply to see another spring. I don't know that she will. Do we know how many springs we will see? Does anybody really know what time it is? Shouldn't we start caring?

On the road....

January 30-February 1: Scottsdale, Arizona: IREI's VIP Conference
February 6-10: New York
(NEW) February 15 & 16: London and Frankfurt to moderate breakfast briefings for RCA (Real Capital Analytics).
February 23 & 24: Chapel Hill, NC to be attend the UNC Kenan-Flagler Real Estate Conference and be a judge at their case competition.
February 25-26: Asheville, NC
March 29-30: Philadelphia, PA to be a judge in the Villanova University Real Estate Case Challenge
April 25-27: Vienna, Austria to attend the INREV Annual Meeting
May 17-20: North Palm Beach, FL to attend the meeting of The Homer Hoyt Fellows.

2012: The Year of Caution? The Corner Office. Apple's Obsession

2012-01-20T02:43:00.000-08:00

Resigned is not a particularly positive word. The thesaurus suggests submissive, reconciled, accepting, stoic, long-suffering, prepared to accept. Well, some of these are even less appetizing. But resigned is the word that came to my mind this week about the state of things in the commercial real estate industry (perhaps throughout the business community in general). While we were all waiting for things to revert to normal, the normal that we wanted it to be, it hasn't. It's been a while now and I believe we've all accepted that we may not see a time like the last 'normal' for a long, long time. But what's interesting to me is that there are groups, not long-time real estate investors but rather private equity firms, hedge funds, etc. who have seen the light and see that there is opportunity in that there real estate business. And, they've started building real estate investment groups within their companies. They're hiring top talent and throwing dollars at, hopefully, doing it right. Some, perhaps most, of the money these firms manage is not institutional in nature and yet, some of it is. And, at a time when many investors are staying close to those managers with whom they've had a good relationship with and who have proven trustworthy and putting new money out with them, either in the form of a separate account or a joint-venture or a club deal, there are some investment fiduciaries who have been successful in raising good-sized commingled funds. That's what makes this time in the history of our industry so fascinating to me. We are living through change and it's not a change that has been thrust upon us by an alien force, it's an organic change that develops based on the fact that any company that launches a new product or service either has to fill a need or solve a problem. And if you can bring that to the table, whether you are an investment manager, a manufacturer or a consultant or any kind of service provider, there is business to be done.

A weekly column called "The Corner Office" interviews executives and asks them a few questions. I thought this one was pretty good: "If you could ask someone only two or three questions to decide whether you would hire that person, what would those questions be? (1) What idea is driving you right now? (2) What’s on your mind about any aspect of life that you’re really excited about? (3) Tell me about that."

CBRE published its' The Global View 2012 this week. Here are the bullets from their executive summary:

Macro-economic and political landscape uncertainty across the world suggests that a cautious outlook in local property markets is likely to persist into 2012. While 2011 is in the past, many of its challenges continue.
Corporate occupiers in 2012 will continue to exercise caution in their decisions, and demand for space will remain moderate.
Investors in Europe and the United States will therefore tend to adopt more defensive strategies, focusing on high-quality buildings in prime locations within the most liquid and transparent markets.
Asia has not decoupled: Occupiers and investors are becoming more cautious in many markets across Asia due to slowing economic growth in China and concerns about the global impact of the economic slowdown in Europe and sluggish growth in the U.S.
High-quality real estate assets in prime locations should continue to perform well compared to secondary real estate and very competitively with regard to other asset classes. From an investment point of view, secondary property will continue to underperform.
A lack of new construction in many markets globally will boost the performance of existing prime properties.

In line with my first paragraph, note these words sprinkled about in their executive summary: uncertainty, cautious, caution, defensive strategies, cautious. It appears that we may be resigned to accept that 2012 will be The Year of Caution. But, it sure sounds to me like there is opportunity out there, ready to be mined.

I've only had a few of my friends become published authors. The latest, a long-time friend and the drummer in the first real band I played in, Ken Segall's. His book, Insanely Simple: The Obsession That Drives Apples' Success will be released on April 26th. While not suggesting that you do it, I've pre-ordered it for my Kindle. Ken is a veteran advertising guy on the creative side. He has been behind some of the most recognizable advertising campaigns over the past 30 years including some of Apple's major ads and branding stuff. He's a brilliant guy and pretty funny as well. I am sure this will be a good read and not just for core Apple fanatics.

On the road...

Jan. 23-25: London to attend the INREV Winter UK Seminar 2012 and the Thompson Reuters Global Property Outlook 2012

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference

Feb. 6-7: New York

Feb. 8: Baltimore, MD to speak with students in the Accelerated Masters of Science Real Estate Program as Johns Hopkins Carey Business School about careers in commercial real estate.

Feb. 9-10: New York

Feb. 23-24: Chapel Hill, NC to attend the University of North Carolina Keenan-Flagler Real Estate Conference and be a judge at their real estate case competition.

Feb. 25-26: Asheville, NC

Feb. 27-29: Scottsdale, AZ to attend the NCREIF (National Council of Real Estate Investment Fiduciaries) Winter Conference

March 29-30: Philadelphia to be a judge at the Villanova University Real Estate Case Challenge

April 22-25: Chicago to attend the CRE Mid-Year Meetings

April 25-27: Vienna, Austria to attend the INREV Annual Meeting

May 17-20: North Palm Beach, FL to attend the Hoyt Fellows/Weimer School Annual Meeting

Visualizing woodpeckers, One moment of insight, TV Dinners

2012-01-12T19:58:00.000-08:00

One thing that has been coming up more and more in conversations is the idea of raising capital for private equity real estate funds from smaller pension funds, endowments, foundations and family offices. There are investment managers who have been doing this for years. But, as more and more of the big boys are sitting on the sidelines, managers are looking for alternate sources of capital for their commingled funds.

Historically, if you raised money from a family office or just plain ol' rich people, the institutional investors did not relish being in the same fund. I wonder if that will still be the case as we move into a new world order in the institutional real estate investment industry.

Presentation Suggestions (There's obviously a story behind his comments but the main thrust of his suggestions are what grabbed my attention:

The unexpected will rivet audience attention. Breaking a pattern is a very basic way to grab attention. How can you break a visual or sensory pattern in your next presentation to grab attention and get your audience to take action?

Be careful with negative instructions. If you don’t want your audience to do something, don’t even put the idea into their heads. If I tell you to NOT think about woodpeckers right now, guess what you’re going to do? You’re visualizing woodpeckers right now, aren’t you? Yet, you had no intention of doing so… until I told you NOT to do it.

Take words seriously. If you want me to take your words seriously, how about making your font size huge and clearly visible? What about placing your sign (or your PowerPoint) almost smack in front of me, instead of making me peer down a gully or around a post or from the side or through someone’s head?

I've been reading some good books lately-ones that get you thinking about important things. And I was talking with someone this week who said that they'd like to make a contribution to the world and 'leave something behind.' Then yesterday I read this obituary about Dr. Mary Ellen Avery, a medical researcher who helped saved hundreds of thousands of premature infants with a single, crucial discovery about their ability to breathe. Her principal contribution to medicine was in finding out why so many babies died at birth. The answer: their lungs lacked a foamy coating that enables people to breathe. “There was one moment of insight,” she said. “And that was it.”

When Dr. Avery started her work, as many as 15,000 babies a year died from the syndrome. By 2002, fewer than 1,000 did. Estimates of lives saved exceed 800,000. One moment of insight. Such a humble statement about something that has had such an enormous and, in a way, miraculous impact. Very few of us will leave a legacy of this stature. But there is something we can each do that will make a difference. Of course, it'll involve the one thing that I feel is the most valuable thing we have in our lives: time. My proposition to you: make time to spend with an industry person (or someone not in our industry for that matter) who is out of work, or looking to get into the business for the first time or is trying to figure out how to make a career change and get future employers to see them as a whole individual rather than just labeling them by the title of their last job. Most, perhaps all of us, has been in one of those situations in our lives. Remember what it feels like? In learning about what makes me tick, I am clear about one thing: if I can help just one person every day, even in some small way, then it's been a good day for me. We all need each other lean on from time to time. We are all part of a global commercial real estate community (or as Seth Godin calls it 'a tribe.') I can almost guarantee that you will feel better about yourself when you help someone else. P.S. I've been working on a plan to create someplace where we can all gather together and help each other. Stay tuned!

San Francisco International Airport (SFO) always has a cool exhibition in Terminal 3 in the main walkway to the majority of the gates. The current one is on the history Television or TV as we know it. Not only do they have TV sets dating back to the early days, they have games that were spawned by TV shows, lunch boxes (did you have one?) and other sorts of branded stuff. It's a walk down memory lane: We had a black & white TV set. My father and I used to lay on the floor on our left elbows to watch the shows. For some reason the channel dial was funky and periodically my Dad, using his right foot, had to jiggle it a little to get the picture clear again. We lived in a simpler world. There wasn't much fear in America in the Post WWII years (except when we got frightened by who knows who and people started building bomb shelters in their basements). TV was our friend and our nemesis as people bought frozen TV dinners and either set up TV tables or rolled the set into the dining room. So that was our technology addiction. How innocent!

Note: Please feel free to tweet this column.

On the road....

Jan. 17-20: New York

Jan. 23-25: London to attend the INREV UK Winter Seminar 2012 and the Thompson Reuters Global Property Outlook 2012

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference

Feb. 6-10: New York

Feb. 23: Chapel Hill, NC to attend the University of North Carolina (UNC)/Kenan-Flagler Real Estate Conference

Feb. 24: Chapel Hill, NC to be a judge at the UNC Kenan-Flagler Real Estate Case Challenge

Feb. 27-29: Scottsdale, AZ to attend the NCREIF Winter Conference

March 29-30: Philadelphia to attend and be a judge at the Villanova University Real Estate Case Challenge

April 22-25: Chicago to attend the CRE Mid-Year Meetings

April 25-27: Vienna, Austria to attend the INREV annual meeting

May 17-20: North Palm Beach, FL to attend The Hoyt Fellows/Weimer School Annual Meeting

New Year, New Band, New _________

2012-01-06T07:29:00.000-08:00

In 1975, legendary bluesman, John Mayall, released an album called, "New Year, New Band, New Company." If you haven't heard of him, perhaps you've heard of some of the musicians that have either recorded or toured with him: Eric Clapton, Jack Bruce, Mick Taylor, John McVie, Mick Fleetwood, Dr. John & Paul Butterfield (a seriously partial list). Well, this week that title suits me pretty well also: New Year (duh), New Band (I sat in last week with a group and they've sort of asked me to join them. they're now called "Four Shotz" and are rockin' blues band) and New Company. This last category is a curious one at this exact moment in time. While I am involved in a couple of serious dialogues regarding new 'jobs', nothing is definite yet. So, as I've done for many years, I'm offering to provide fee/assignment based services as a management consultant.

In preparing to 'hit the road' I've ordered some new business cards which have this as the headline: "Solutions by Steve Felix" and my contact information. I'm trying to follow all the things I've been reading, and passing on to you guys, about keeping things short and simple. I've also sent this email to a number of my former clients and industry friends:

Dear Friend:

I am offering my consultative/solutions services to a few companies.

One of the services I could provide is to facilitate an internal senior level strategic discussion about how to grow your business. Using a knowledgeable, third-party facilitator like me helps open the conversation and take it to areas that might not be discussed when a meeting such as this is 'moderated' by someone in the firm.

I can also help you in the following areas:

1. How to make your client events more memorable and effective

2. How to improve your presentation books & marketing material

3. How to make your face2face presentations more effective

4. How to improve your communications with clients

5. How to address certain client feedback about your services and client care

6. How to expand your net of potential new clients/investors

7. Providing internal career coaching to help you retain your best people and understand what their aspirations are.

8. Providing recruiting services.

Anyway, if this has piqued your interest, perhaps we could set up a phone call to discuss.

Thanks.

Steve

So, please let me know if you or someone you know may have an interesting in talking with me. Thanks. P.S. I've received some requests to set up calls starting next week and have sent out my first proposal to facilitate an internal product strategy meeting!

Vis a vis last week's career thoughts I was reminded that one very important thing (how could I have forgotten this one) is finding the right people to work with. This involves confidence and trust. Twice in my career I was in a position where I needed a job to support my family. In those instances, I took jobs with people that I didn't trust and didn't like but thought, "Hey, maybe I'm wrong," But I wasn't and both ended in less than a year. When it comes down to it, it's all about the people, isn't it? Thanks for reminding me, Albert.

I've been putting some down time to good use updating and adding to my contact database. While doing this I found a site that has Career Advice for Real Estate Professionals from some industry heavyweights. I offer a few of them here:

-Get a Solid Education: When you enter into real estate, you may work in only one area, such as property management or brokerage, but it's important to have an educational overview of the entire business to guarantee your long-term success.

-Maintain your Education: Have a commitment to keep abreast of all the changes in the industry by attending conferences, educational programs, and by reading and writing for business and academic literature.

-Have Perseverance: One of the most important skills that you need to be successful in business is perseverance. Quite often when you start down a path, you're naive about what it takes to get there. So you can be surprised to keep running into problems. But, you just have to stay with it until you find solutions to move forward.

-Know What Matters: You must be able to look at many complicated issues and see what really matters. People often get caught up in the preciseness of the numbers and the methodologies instead of finding what really matters. And if you can simplify things, then you can make better decisions, and you can also explain things to your clients.

-Measure the Risk: Risk is an essential element in the business. So learn to manage risk. The key to risk is to do extensive research so that you can carefully consider, creatively integrate, and rigorously test information, before making a decision.

Good stuff, right? Pass it along.

Congratulations to my friend Dietrich Heidtmann who has joined Grosvenor as Managing Director of Client Services.

On the road....

Jan. 11-13: Chicago

Jan. 17-20: Laguna Beach, CA to attend IMN's Ninth Annual Winter Forum on Real Estate Opportunity and Private Fund Investing

Jan. 23-25: London to attend the INREV UK Winter Seminar 2012 and the Thompson Reuters Global Property Outlook 2012

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference

Feb. 6-10: (t) New York

Feb. 23: Chapel Hill, NC to attend the 2012 University of North Carolina (UNC) Real Estate Conference

Feb. 24: Chapel Hill, NC to be a judge at the UNC Kenan-Flagler Business School Real Estate Case Challenge

Feb. 27-29: Scottsdale, AZ to attend the NCREIF Winter Conference

March 29-30: Philadelphia to attend and be a judge at the Villanova University Real Estate Case Challenge

April 25-27: Vienna, Austria to attend the INREV annual meeting

May 17-20: North Palm Beach, FL to attend The Hoyt Fellows/Weimer School Annual Meeting

"Where we're going we don't need roads."

2011-12-30T07:04:00.000-08:00

Zowie! The end of the year. It was a great year for me and I hope for you too. But day after day, year after year, your support for this column and hearing from you from time to time continues to be a very special thing for me. Each year, I get to meet some of our OTR community whom I've never met before and this year was no exception. You guys are a special bunch. I look forward to us sharing another year together. Btw, you can connect with me here (felix.steve@gmail.com). Thanks to all of you.

For me, 2011 has had lots of twists and turns professionally and I look forward to new opportunities in 2012. It's been a year of a lot of babies being born into our family and now the planning of how to visit them face2face periodically until they are old enough to come visit us. We're already talking about where everybody will sleep but, as many of you have probably experienced, when it comes to family every available bed, couch, futon and inflatable mattress (aren't those things great?) is fair game.

A number of you have written to me about the changes that either have happened to you or that you're initiating in your lives. Philosophically we're told that change is good. But it also brings with it uncertainty and some degree of stress. Everyone handles stress differently. For almost my whole life, I have used banging at (when I was very young) and playing the piano as one of my 'Stress Reduction" tools. I also like going to a movie theatre and eating buttered popcorn and drinking a Coke (This week I saw a nice feelgood movie, "We Bought A Zoo."

Today is the last day for me in my current job. I got to work with some great people and I learned a lot. When I talk with people about their careers, I offer this suggestion: "Decide what you like to do, decide what you're good at and then find a place to do it." So now, I'm remembering to follow my own advice. A quote from Goethe that I've always liked, ""What you can do, or dream you can do, begin it! Boldness has genius, power and magic in it." And one more quote from the movie, Hoosiers. "Boys, don't to get caught watchin' the paint dry! (A basketball term which basically means, "Don't get caught asleep at the wheel.").

Recurring Notes On Technology (the original title of this column when I started writing it at IREI in 1999): Last week I was riding my bike and passed a park where two boys were tossing a football. It only lasted two tosses as one of the boys dropped the ball, pulled out his cellphone and appeared to be responding to at text! Technology. A wonderful tool that should not be allowed to take over our lives.

Remember: "Where we're going we don't need roads"!

Happy 2012 everybody.

Steve

On the road...

Jan. 11-13: Chicago

Jan. 17-20: Laguna Beach, CA to attend IMN's Ninth Annual Winter Forum on Real Estate Opportunity and Private Fund Investing

Jan. 24: London to attend the INREV UK Winter Seminar 2012

Jan. 25: London to attend and moderate a panel at the Fifth Annual Thompson Reuters Global Property Outlook 2012 (Invitation only)

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference

Feb. 27-29: Scottsdale, AZ to attend the NCREIF (National Association of Real Estate Investment Fiduciaries) Winter Conference

March 29-30: Philadelphia, PA to attend and be a judge a the Villanova University Case Challenge

April 25-27: Vienna to attend the INREV annual meeting

These are my views and not that of my employer.

Sports Slang, Networking Redux, Joe Robert, Necessary Endings

2011-12-23T05:05:00.000-08:00

Sports slang has been used to describe business situations for years:

Play ball. To go along with what everyone else wants.
Ball park. To estimate something.
Step up. Short for “step up to the plate.” To take responsibility
Level the playing field. Make things even across the board
Play hardball. To get mean and get tough.
Slam dunk. A complete and easy success.

But when I was reading a listing of upcoming concerts this morning what struck me is that there are words used to describe musicians and bands that are also adaptable to companies and people in the commercial real estate industry. While I will not commit industry suicide to applying any of these terms to any company or person in particular, wouldn't it be fun to do an anonymous survey?

Miraculously nimble
Smooth and swinging
Heartthrob
Seasoned trio
Powerful vocalist
Tragic emblem
Enigmatic artist
Frequent collaborator
Over-caffeinated electronic art rock
Nightlife kingpin

Thanks to my friend, Tom, I offer you the following "Tips on Networking" previously published in the Wall Street Journal:

Have a Solid Introduction: First impressions count heavily. Make sure your attire, attitude and overall appearance are the best possible before introducing yourself to someone
Don't Confuse People with Your Pitch: No one needs to hear your entire work history upon meeting you. If someone asks you to tell them a bit about yourself, your explanation from start to finish shouldn't take more than 30 to 60 seconds
Don't Tell a Sob Story: No matter how tough it's been, you need to paint a positive picture when you're making new connections.
Spend More Time Listening Than Talking: The old adage is true: People were given two ears and one mouth, and you should use them proportionately.
Avoid Being Socially Inept: There's a fine line between being friendly and personable and being awkward. You do not want to be the latter
Don't Overstay Your Welcome: Taking up too much of someone's time is almost as bad as ignoring them entirely.
Hand out Your Business Card, Not Your Resume: It's not ok to pass along an unsolicited resume. Offline or online, you need to work on forming a relationship with someone before you ask them for anything at all. Many people overlook this professional courtesy, and ask brand new connections to serve as a referral when submitting a resume or application.
Follow Up and Through: Perhaps the "Cardinal Rule" of networking is that once you've planted the seeds of a new relationship, you must follow up to maintain it. Whether it's a business referral, job lead, or a professional connection, get in touch – within 24 hours – to say you enjoyed meeting them.

So true although I've allowed myself 48 hours to follow up with everyone whose card I get at any event with a simple email. At the same time I enter them in my contact database with a notation of when and where I met them and anything else that I learned (or that I can remember!) Although it's not acceptable in many Asian countries, the first thing I do when or after I meet someone is make a notation on the back of their card (except for those companies who, for some reason unknown to me, have allowed their card designer to have the back of the card be a dark color. Go figure).

Joe Robert died recently at age 59. As many of you know, Joe became visible during the RTC (Resolution Trust Corporation) days when he started managing and then buying assets from that agency that was formed to workout the Savings and Loan crisis in the late 1980's and early 1990's. He built a successful investment management business. I met him only once, at an industry event some years back where he was the keynote speaker. My first impression was that he was a good guy with a contagious positive personality, a sentiment apparently echoed by many who knew him both in business and real vs. real estate life. Anytime a thing like this happens, dying so young, to someone you either know well or know of. it is another wake-up call. We don't know how many days we will be granted the privilege to exist on earth and when I am awakened I get back to doing certain things that I may have put on, as it were, the 'back burner.' These include documenting as many stories as I can about my growing up as a personal history for my grand children. I also have been working on an autobiography for many years and have been negligent about that after a blazing start. The advice I've been given about writing is to write every day, at the same time of day, for a minimum of 30 minutes. When doing this, don't try to edit yourself but just let it flow-there's time for editing later. But it's the discipline that is the key. We all have stories to tell about a family member, friend or acquaintance dying at a young age. But we also read about people who accomplish a lot during their years. I recently interviewed for a new job and was asked, "After many years in the industry, how would you like to be remembered?" I paused as I had not ever been asked that question before. It's a good one to ask ourselves, both about how we'd like to be remembered by the people in the industry we've served and by those people who know us simply as ourselves, which can also be one in the same.

Final note: A friend recently recommended a book to me: "Necessary Endings: The employees, businesses and relationships that all of us have to give up in order to move forward." It's a good read. My summary of it is pretty extensive (it's my way of both absorbing the stuff that strikes a nerve with me and having a 'permanent record' of it that I can refer back to). Here are just a few things I'd like to share with you:

Getting to the next level always requires ending something, leaving it behind and moving on
Endings are necessary when there is no hope
There are three types of people on earth: The Wise, The Foolish and The Evil
If you are a leader sometimes you have to lead, even when no one wants to follow
Part of maturity is getting to the place where you can let go of one wish in order to have another
The longest-lasting and best relationships, as well as the best businesses, are the ones in which everyone involved sees and loves the whole picture, positive and negative.
For the right tomorrow to come, some parts of today may have to come to a necessary ending

Please accept my best wishes to you for a special holiday season and happy 2012. For those that are in a cold climate I hope you get snow; for me there's nothing more perfect than snow on the ground for Christmas. I will not be getting snow where I live but it is pretty chilly in the mornings (remember everything is relative!).

Steve

On the road...

Jan. 17-20: Laguna Beach, CA to attend IMN's Ninth Annual Winter Forum on Real Estate Opportunity & Private Fund Investing

Jan. 24: London to attend the INREV UK Winter Seminar 2012

Jan. 25: London to attend and moderate a panel at the Fifth Annual Thompson Reuters Global Property Outlook 2012 (Invitation only)

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference

Feb. 27-29: Scottsdale, AZ to attend the NCREIF (National Association of Real Estate Investment Fiduciaries) Winter Conference

March 29-30: Philadelphia, PA to attend and be a judge a the Villanova University Case Challenge

April 25-27: Vienna to attend the INREV annual meeting

Movie of the week: The Girl With The Dragon Tattoo. I'd read the book a while back. I saw the movie yesterday. I highly recommend it.

Music club of the week: Silo's, Napa, CA. Recently, I was given a 'backstage' tour by the owner. It's a real 'nightclub' whose calendar offers a very eclectic mix of music and other types of entertainment. And, they have a beautiful grand piano which I'm going to be allowed to play from time to time!

These are my views and not that of my employer.

New York at Christmas Time, Networking and Walt Sutton

2011-12-16T02:31:00.000-08:00

A bunch (40+) of us met up for a holiday drink on Monday night at the Russian Vodka Room in New York. We missed those of you who were not in town or chose to go to other 'parties' (which I've heard were not as much fun as our get-together!) While everybody there was in the commercial/institutional real estate world, the wonderful thing about the group was the diversity in both in generation and speciality. At one point, I stood in a place where I could see the whole group....everyone was talking with each other; my role was simply to make sure that those who came who didn't know anyone else got introduced. It was very cool and it was great to see all of you and toast the holidays and approaching start of a new year.

This week, on two separate occasions, the subject of networking came up in conversations with friends. (Note: we we're talking about 'face2face" networking vs. Internet or social media networking which may be a subject for another week). "I'm not a good networker. I'm really pretty shy," said one. "When I'm at an event people are too cliquy and it's hard to break in." I would guess that while we might not all classify ourselves as shy, we can all probably relate. I have attended some conferences in my life where, while I consider myself a pretty friendly guy, it was impossible to get anyone to talk with me or to break into any group conversation. One shouldn't have to feel that they have to push their way into a conversation; those people in the conversation should welcome someone new, and showing courtesy, invite them in. Because of experiences I had when I was younger I'm very conscious of it. I guess I've become sort of a natural networker but it's definitely easier for me as, at this stage in my career, because generally I know a bunch of people, which, while it sort of violates one of the rules below, I use to introduce people who don't know each other and then often leave them to talk. But I recently attended an event where I didn't know hardly anyone and I had to take a deep breath and think about how I would approach the introducing of myself to them. And remember, it's an individual thing, based on your personality and style. I've collected some 'formal' advice on the subject. Here are a few things that stand out to me:

Spend 75% of your time with people you don't know
Spend 25% of your time building existing relationships
Show up early, looking professional, full of business cards
If you attend a business event with a friend or associate, split up. It's a waste of time to walk, talk or sit together
Remember: Networking is helping people
Networking is figuring out who knows whom
Stay until the end
Have fun

Given the state of affairs in the world today got me thinking about a quote from the famous economist, John Maynard Keynes: "The day is not far off when the economic problem will take the back seat where it belongs, and the arena of the heart and the head will be occupied or reoccupied, by our real problems — the problems of life and of human relations and of creation and behavior" (1945)

Walt Sutton: Many years ago Walt and I sat next to each other on a cross-country flight. He was typing away madly on his computer and we started chatting. After that I bought his book, "Leap of Strength." I thought of him today when I purchased copies for two colleagues as Christmas presents. Then poked around Walt's website. He's an interesting guy and someone you may want to consider as a speaker at one of your events.

Photo: Rockefeller Center, 6am, December 11, 2011 (New York is such a special place to be at all times but especially around this time of year!)

Happy holidays and my best wishes for a healthy and prosperous 2012!

On the road....

Jan. 18-21: Laguna Beach, CA to attend the IMN Winter Forum on Real Estate Opportunity and Private Fund Investing.
Jan. 24: London to attend INREV's UK Winter Summit 2012
Jan. 25: London to moderate a panel at the Thompson Reuters Global Property Outlook 2012 (Invitation only)
Jan. 30-Feb.1: Scottsdale, AZ to attend IREI's VIP Conference
March 14-15: Boston to attend the PREA Spring Conference
April 22-25: Chicago to attend the CRE (Counselors of Real Estate) Mid-Year Meetings and perform again with the "Sound Counsel" band.
April 25-26: Vienna, Austria to attend the INREV Annual Conference
May 17-18: North Palm Beach, FL to attend the Hoyt Fellows Annual Meeting

INREV Survey, Acronymitis, Documenting A Life

2011-12-09T04:25:00.000-08:00

Yesterday, INREV, the European Association for Investors in Non-listed Real Estate Vehicles, published the findings of its' latest survey of their 359 members. Here are some relevant highlights:

75% of those surveyed said that equity allocations to non-listed real estate funds should grow. The growth stems from a combination of uninvested equity already allocated but unplaced institutional capital.
The geographical source of much of this capital is the UK, Germany, the Netherlands and France. But much of that is focused on domestic investing and less focused on value-added or opportunistic investing.
Approximately 10 percent of fund managers have failed to secure refinancing on at least one asset due to the withdrawal of bank lenders from the market.
Like investors, lenders have lost their appetite for risk. In rationalizing their loan books, they are focusing not merely on reducing the size of their real estate exposure, but on increasing the quality of it by focussing on high-quality underlying assets in prime capital cities and core markets.

This is very good information coming from the proverbial horses' mouth. But if we look at the 'headline news' in our industry, there's a lot going on although it may not resemble the 'business as usual' we had gotten used to (up until a few years ago). There are big deals being made. There are big hires being made. There are big plans being made. And, yes, there is some big money being invested by pension funds and their brethern. Perhaps there are more separate/segregated accounts and more joint ventures. There has been a lot of talk about interest in 'club deals' but I haven't been hearing about too many of them. Queues grow to get into large core open-end fund grow with seemingly no end to the appetite of investors. So, in some ways we could say that things are the same. But they're really not. So much is changing in our industry and if you take the time to step back, like I've been doing at this point in my career, and get off the dance floor and go up in the balcony, you'll see that a new landscape is being painted. And as most paintings of landscapes don't include people, we need to find a place for ourselves in that painting. For many, it will look the same. But for others, those who thrive on challenges, those that crave change in their careers and lives from time to time and those who see that to grow you have to embrace change, this is a very exciting time. I am extremely fortunate to have a special network of industry friends. As many of you know, my current job is ending at the end of the year and I am looking at different options for my next gig. Thanks to those friends, I have gotten to understand better than at any other time in my life who I am and what I bring to the table. No matter what I decide to do next, with a little help from those friends, I have learned to appreciate myself more. Some things take a while.

One member of our OTR community sent me a link to a recent blot post. It's titled "I Don't Understand What Anyone Is Saying Anymore." I'd recommend you take the five minutes it took me to read the whole thing but I've pasted this section below as it struck a particular nerve in me. I've written before about some research I've done about why it's not good or right to use acronyms. Here is this guy's take on the 'disease.'

Acronymitis
This is a disease of epic proportions in the world of charity. I was at a meeting just two days ago at which several well-meaning staff members of a charity were presenting to their board, and the meat of their discussion revolved around the acronyms SCEA and some other one that began with "R" that I can't recall. In the span of three minutes these acronyms must have been used eight times each. They were central to any understanding of the topic at hand, but they were never defined. So I had not the vaguest idea what the presenters were talking about. None. Could have been talking about how to make a beurre-blanc sauce for all I know.

It was reported this week that the Pearl Harbor Survivors' Association may be disbanding due to the aging of it's members. It got me thinking: My father, a WWII veteran, never talked with us about his experiences during the war. Actually, he didn't talk much about his growing up at all. But that changed in 1990, when I overcame my fear of talking about important stuff and brought a cassette recorder to my Aunt's apartment where she was making breakfast for my father and me. I pulled out the recorder and put it in the middle of the table and said that I'd like to ask them some questions and record the conversation. Neither objected. We had a great conversation which was the ice-breaker for further Q&A with my Dad on other occasions. Maybe he was just ready to talk and he was just waiting for us to ask him. So, my thought about the memories and experiences of people in any walk of life: we need to interview them and record those conversations. We need to do this stuff both in our families and in our industry....before the stories are lost....forever. We need to start doing this now!

Smile of the week: 3 minutes 34 seconds. Who knew James Cagney and Bob Hope could dance?

Bigger smile: Edie & Benjamin Felix (the newest additions to my team of grandchildren)

On the road....

Dec. 10-16: New York

Dec. 12: "Holiday Drink Thing." Russian Vodka Room, 265 West 52nd Street (Between B'way and 8th-closer to 8th). A bunch of commercial real estate industry folks will be stopping by between 6 and whenever to toast the new year (or maybe the end of this one). If you're around and have some time I'd be great to see you.

Jan. 18-21: Laguna Beach, CA to attend the IMN Winter Forum on Real Estate Opportunity & Private Fund Investing.

Jan. 24: London to attend INREV's UK Winter Seminar 2012

Jan. 25: London to moderate a panel at the Thompson Reuters Global Property Outlook 2012

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference.

These are my views and not that of my employer.

Post Dislaimer

2011-12-03T06:56:00.000-08:00

In yesterday's OTR, I provided a link to a page about "Careers in Commercial Real Estate." I must admit that I only read through a portion of it before recommending it to you. One of our OTR community wrote to me yesterday and mentioned that while there was some excellent career advice, there was also a section that related to religion buried near the back. I found that just now. My disclaimer: I didn't know it was there. If I did, I would not have mentioned that piece. Religion is a personal thing. It's one of the great freedoms we enjoy. Please accept my apologies as this was an unintentional oversight on my part.

Steve

"RCA Says"; NCREIF Nuts & Bolts; Edie & Benjamin; First Impressions

2011-12-02T05:05:00.000-08:00

What did RCA say this week? "Mixed signals coming from the marketplace in Q4.... some energy in the volume numbers for office and retail.....but increasingly clear that buyers are feeling less pressure to do deals in the near term.....the shifting sentiment reflects in part an improving distress picture as liquidations continue to outpace new inflows, suggesting a cyclical change and the likelihood of increasing opportunities ahead in the new year....investor patience is also visible across most sectors....strong sales for regional malls and urban assets have sustained momentum in the retail sector....2012 volume trends could prove the opposite of 2011, with slower activity earlier in the year giving way to stronger investment in the second half of the year, with sales easily pushing ahead of 2011 levels."

A question posed to me: "To do an internship do you have to have a degree?" Given that most summer internships don't pay, I don't feel that you need a degree (actually if you have a degree and are looking at internships it's probably more of a way to get in the door in the hopes of being offered a job sooner rather than later). One of my sons got an internship between his junior and senior year at MTV. They liked him. They said, "When you graduate we'd be happy to have you join us." He did and it launched what has become a successful career in TV.

This week I attended "Nuts & Bolts of Institutional Real Estate 2.0" sponsored by NCREIF (National Council of Real Estate Investment Fiduciaries). The content was both deep and broad and presented by leading industry thinkers. One of the highlights for me was the opening presentation by Blake Eagle, the "father" of NCREIF. In walking us through the the history of institutional real estate investment business he also reminded me of a number of events that occurred in the past 30 years in the commercial/institutional real estate industry. He's a wonderful story teller. From a networking standpoint, I met a number of younger industry professionals including representatives of six pension funds. Some of the attendees came from firms which encourage their people to take advantage of educational opportunities like this: Cornerstone, Prudential, Clarion, Aberdeen, Henderson, Morgan Stanley, Apollo, Guggenheim, Stockbridge, UBS and a number of lesser known names as well. I would highly recommend you looking into future NCREIF educational programs as they are not only opportunities to learn but also to meet new people; people who will grow up with you in the industry. Connections. Relationships. So important. NCREIF puts on a good event-chock full of learning and sprinkled with some fun.

On that note, last night I got to go to my first ever comedy club. Laughter is so contagious but the bar has been set high as the place was Second City. I'd heard about this club for a long, long time via the connection with some of the former 'students' whose names are carved (not really) into the desks: Belushi, Akroyd, Murray, Radner, Curtain, Morris and Fey. This current troop is also really talented. Being a comedian is not an easy gig as I witnessed once when the Robin Williams 'died' (in stage terms) in front of a huge audience in Golden Gate Park in San Francisco. He just couldn't connect with the audience. He knew it. We knew it because he told us, "Help me, I'm dying up here." It was a sobering moment that I'll never forget partially because it's relevant to business as well. We all have an audience we need to connect with. Many, or perhaps, most of the time it's connecting with one person but often it's with multiple people. And it's not always a matter of making a sale or getting a job; it's a matter of building relationships. I've been re-reading some stuff that I've saved over the years. One of them reminds us of why people choose to do business with others: They like us, they trust us, we do what we say we're going to do, we communicate openly....the list goes on. But the foundation of all this stuff is that in some way we've connected with them. And connecting starts with a first impression which I believe takes no more than 4 seconds-the time it takes to shake the other persons' hand and look into their eyes. 4 seconds! And, remember we have only one chance to make a first impression.

Can you believe it's December? We are so seriously close to the end of another year it's almost unfathomable. Where the heck did 2011 go? Some of the conversations I've been having are with firms that are getting prepared to hit the ground running hard at the start of 2012. We continue to be a positive, optimistic thinking bunch and more and more adaptable as well. What I mean by that is I don't hear much talk about waiting for things to return to 'normal.' We won't see that normal again for some time, if ever. I don't like the phrase 'new normal.' I prefer to think in terms of "What it is!" But, given the uncertainty with global economies, geo-politics, employment, you name it, I'm not sure we know "What it is", as well as, in the words of the aforementioned Robin Williams is prone to say, "What it was."

Summer Internships: Thanks to those of you who wrote to tell me that your firm does hire summer interns. Here is another firm that has a slot for a summer intern:

1. Zapolski Real Estate, Napa, CA

Some feedback from the Advice to the Real Estate Students thing I mentioned last week:

1. "My advice, figure out how to get into the industry, take any job you can get and put in 60 hours a week, be the first one in and the last out of the office every day. As the industry runs up, senior management will start to look for talent to start new ventures. There is typically little young or mid-level talent after a bust, those that have stayed in the industry get the first calls."

On another related note, a long time friend and supporter of OTR, Albert Livingston, sent me a link to an excellent piece on "Careers in Commercial Real Estate."

Congratulations to my friend David Slifka who started this week as the head of real assets at the YMCA Retirement Fund.

Also, congratulations to my former colleague, Tim Zietara who is now Chief Investment Officer at Doral Property Finance.

A Family Affair: We have two more additions to the Felix family. Twins, Edie & Benjamin. Edie is the first girl in our family in a long, long time. Very exciting stuff.

On the road....

Dec. 12-16: New York

Jan. 18-20: Laguna Beach, CA to attend IMN's Winter Forum on Real Estate Opportunity & Private Fund Investing.

Jan. 25, 2012: London to attend and moderate a panel at the Thompson Reuters Global Property Outlook 2012

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference.

These are my views and not that of my employer.

Real Estate Career Advice, Million Mile Flyer, Life

2011-11-25T05:50:00.000-08:00

You guys sent me quite a few requests for my "Advice to Real Estate Graduate Students" piece and have also gotten back at least one suggestion of an addition to it. "Great document! My favorite was number 10. "Be willing to learn from the ground up. No attitude." If I had to add my own, I'd say, "Ask questions. You'll be amazed at how much you can learn by listening to people." A few of you who requested it have children who are about to enter the industry. Others wrote telling me they would circulate it to members of their team and one university professor asked permission to reformat, and "White Label" the document and give it to his students. Connectivity. Collaboration. Sharing. Isn't that what it's all about? Coincidentally, I've gotten a few invitations to come speak at graduate real estate programs about careers in real estate starting early in 2012. I'm really looking forward to that.

Many thanks to those of you who wrote me about your company's summer intern program. As I mentioned, I've had a number of very bright, very dedicated people approach me asking if I can help them connect with summer 2012 internship opportunities. If your company has that program, please let me know.

One company is:

National Capital Partners

Salt Lake City, Utah

Contact: Randy Norton, Head of Research and Investments

randy@natcapfunds.com

801.618.2231 x. 103

Customer Appreciation? This week, I opened an envelope from United Airlines. Normally I just throw them away, unopened, as from experience I know they are solicitations for me to open a credit card account with them (if their systems actually worked, they'd know that I have been one of their credit card customers for a long time....it's a dynamic of customer service that is not lost just on them....it's the danger of using automated databases for 'mailings' etc. You end up sending something intended for a non-customer to an existing customer. How does that make the customer feel? Appreciated?). However, this envelope contained:

1. My 1K (100,000 mile flyer) Card that expires January 2012 (why they would send me one that expires so soon I can't figure out)

2. Free drink coupons (I usually give them to others)

3. A note card, glossy faced and "signed" by the President of United's frequent flyer program: "Congratulations. It is our privilege to recognize you as one of the distinct few to reach 1 Million LIfetime Flight Miles. Thank you for your years of loyalty. We are honored that you have chosen to travel on United." Hmmm, I looked back into the envelope to see if I had missed something. Nope. The free drink coupons came with my new frequent flyer card. Perhaps they forgot to put in a coupon for a complimentary in-flight meal to thank me for the million miles? Oh well, I'm sure that someone will appear at my door one of these days with a delivery of something that shows United's appreciation. Not~ If I'm one of the 'distinct few' (however many thousands of people that is) wouldn't you think that they'd do something special for me? Do I see an opportunity here for a "Customer Appreciation" consultant?

I found a wonderful resource this week. It's a site created by James DeLisle, Ph.D. Among other great resources it offers a number of "cases and tutorials to help students and other interested parties master various skill sets for real estate." Jim is the Runstad Professor of Real Estate and Director of Graduate Real Estate Studies in the College of Built Environments at The University of Washington (State of Washington vs. Washington, DC). P.S. I love visual image that "College of Built Environments" suggests.

One of our OTR community members wrote me this week and reminded me of a story. Here it is:

There were three people laying bricks in Paris. A curious passer-by went to one of them who was looking quite tired and was laying the bricks one at a time in a sloppy manner. In all his curiosity, the man asked him “what are you doing?” The visibly tired man replied quite angrily, “Can’t you see, I am laying bricks.” The passer-by, still curious, approached the next man who was working faster but was still a little sloppy. The man asked what he was doing and the man said “Can’t you see I am building a wall”. Finally, the passerby asked that last man who man who seemed to be enjoying laying bricks and asked the same question, ”What are you doing.” The man looked up and with pride said, ”I am building a cathedral.”

She also added this, which, I pass along to you in the spirit that many (dare I say all) of us look in the mirror from time to time (I've been doing that a lot lately) and these type reminders are very poignant.

"Attitude and goals are the difference between whether you will win or you will lose. Whether you are moving in the right direction or the wrong direction. Whether you have set up right goals for you or you need to change directions. Also more importantly whether you will enjoy your life and add happiness in others life in both work and play or you will complain that no one cares for you. This will make a huge difference between whether you will love and live your life, have passion and how you will spend it."

Congratulations to my friend Alexia Gottschalch who has taken over as co-CEO for Grosvenor's US fund business.

Congratulations to the Kenan-Flagler (University of North Carolina) team which took first place in the 2011 Real Estate Challenge hosted by the McCombs School of Business at the University of Texas at Austin.

On the road....

Nov. 30-Dec. 2: Chicago to attend NCREIF's Nuts & Bolts of Institutional Real Estate 2.0 program.

Dec. 12-16: New York

(On December 12, I invite you to join me at my "Not quite annual, buy your own, commercial real estate holiday drink thing." I'll be at the Russian Vodka Room (north side of 52nd Street between Broadway and 8th Avenue) starting at 6pm. If you're in New York and have time, please stop by. It's likely to be an eclectic bunch of commercial real estate people (and some other random folks). Hope to see you there.

Jan. 18-20: Laguna Beach, CA to attend IMN's Winter Forum on Real Estate Opportunity & Private Fund Investing.

Jan. 25, 2012: London to attend and moderate a panel at the Thompson Reuters Global Property Outlook 2012

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference.

Photo: Somewhere in the vast Los Angeles Convention Center

Please pass this along to others who may not be receiving it now. The more subscribers I can get to OTR the more it'll help with a project I'm working on. I alluded to this a couple of weeks ago and some of you asked me about the project. While I don't have the 'elevator pitch' down yet, it's something I've been developing since 2005 and involves all of you, in fact everyone in the commercial real estate business around the globe! I'll share more with you as things evolve but for now....Thanks!

These are my views and not that of my employer.

Summer Internships, The Ones In Between, Thanksgiving

2011-11-18T05:07:00.000-08:00

Summer internships: If your firm takes on summer interns please let me know. I have been asked by a few top-notch students if I could help them connect to find one...both in the U.S. and Europe. Thanks. BTW, in preparing some years back for a tour of Graduate Real Estate Programs and speaking with those students about careers in real estate, I reached out to a number of my industry friends and asked them "What advice would you give a graduate student who is focused on the real estate industry? I've been invited to visit some of these programs again in 2012 and have pulled out that document and will be handing it out to the groups I talk with. I'd be happy to send you a copy. Just email me (steve@simplicate.com) with the word "Advice" in the subject box.

Here are a few websites I added to my "Bookmarks" this week. I hope you find one or more of interest:

1. The Domino Project

2. Songs that made you feel good
3. Meaning & Heart
4. Bondi's Blogspace

Someone sent me this years ago. I re-discovered it poking through some document folders and wanted to share it with you.

" The Ones in Between"

When the road we walk on
is sometimes rough
or is it that we suddenly
take away all what is not necessary
shoes, boots or high hills
from which we easily fall
i suddenly prefer the thrill
to walk on my bare feet
to feel each imperfection of the street
to know each things i did right or wrong
to learn from each mistake
nor to be rich nor to be strong
but just to be human again

like the first day , like the last
and all the ones in between

The U.S. will celebrate it's Thanksgiving Day next Thursday. Canada, already celebrated theirs. While it's roots (no pun intended) were about celebrating a good harvest, it's become a holiday where families and friends get together to eat, enjoy each other and in some neighborhoods, play touch football. As a holiday, it can be a time for personal reflection as well. In challenging times like these, that's not a bad thing to do once in a while and maybe, just like it's suggested that you replace the battery in your smoke detector every year on a holiday, it's important to rediscover "the things worth being, a search that many neglect while striving to obtain the things worth having." (Meyer Friedman, Type A Behavior and Your Heart). My family is spread out geographically and while we'll be together in spirit we won't be able to be physically together next week. I wish you and your family a happy Thanksgiving and just want to let you know how grateful I am to you for being part of the global community that has been created around this weekly column. Thank you.

On the road....

Nov. 30-Dec. 2: Chicago to attend NCREIF's Nuts & Bolts of Institutional Real Estate 2.0 program.

Dec. 8-9: Chicago for various meetings

Dec. 12-16: New York

Jan. 18-20: Laguna Beach, CA to attend IMN's Winter Forum on Real Estate Opportunity & Private Fund Investing.

Jan. 25, 2012: London to attend and moderate a panel at the Thompson Reuters Global Property Outlook 2012

Jan. 30-Feb. 1: Scottsdale, AZ to attend IREI's VIP Conference.

Manney Felix-May 1, 1917-November 19, 2009

Photo: San Francisco Bay Bridge.

These are my views and not that of my employer.

PERE Forum; Presentation plea; Joe Frazier

2011-11-11T05:39:00.000-08:00

"Real estate investors are comfortable sitting on the sidelines."

"We're in for a long, cold winter that will last through 2012 into 2013."

"Every recap deal is a nail biter."

"Until the CMBS market stabilizes it's hard for buyers of single assets to see how they will recapitalize somewhere down the road."

"We're selling everything that looks or smells like core."

"The vault has been opened and the 'good stuff' is coming out-quality real estate marked down-good opportunities for the next 3-4 years."

I heard heavyweight members of our industry say these things this week-a combination of optimism and pessimism but what is reality? The audience at the PERE Forum in New York was attentive and engaged. It was great to see so many young real estate professionals in the audience and they were treated to one of the best programs I've seen (or been part of) in years. Kudos to Zoe, Arleen, Nicole and Erik at PERE who pulled the program together. Also, the venue they used was terrific and I highly recommend it (Sentry Centers, 730 Third Avenue, NY. Contact person there is Chris Ryter (cryter@sentrycenters.com).

I've mentioned Reutersrealestate.com to you before but got a chance to poke around the site this week. There's a bunch of information including analytics and slides you can use in your own presentations. There are free research reports from some of the top commercial real estate industry service providers. This site is in Beta test mode for now. It's a good time to take advantage of it...and it's free!

Some stuff from The Recovery at a Crossroads piece published this week by Asieh Mansour, Head of Americas Research at CBRE:

-Recent evidence confirms our view that the U.S. will avoid a recession.

-The Canadian domestic economy is performing well. Both business and consumer spending are expected to make modest headway this year.

-The outlook for economic growth in Brazil has downshifted.

Africa. It's a word I've heard several times in the past two weeks in relation to where will the next real estate/infrastructure investing opportunities be. There are certainly some compelling reasons to take a look at Africa as a continent and more specifically certain countries. Like with everything, there will be those who are 'early', just like when any investment market emerges. Think back to when U.S. institutional investors first started going abroad (i.e. Europe). It wasn't that many years ago. But, if we want to live up to our own self-billing as a global industry we need to keep looking for those countries/markets where our capital can both make a difference and can provide a reasonable return on our investments. As many of you know, my only personal experience with Africa was my time in Liberia, now five years ago, working with needy children and experiencing a third-world country, up close and personal, for the first time. But listening to a presentation last week by a firm looking to raise capital for investment in Africa has gotten me thinking.....

On Wednesday, I attended the first American breakfast meeting sponsored by PIE (Property Investor Europe) in New York. Allan Saunderson, the fellow behind this publication and I have known each other a number of years. He's got a good sense of what's going on in the European commercial real estate industry. Due to a prior commitment I could only stay for part of the first panel which included my friends, Lee Neibart (AREA Property Partners) and Bob White (Real Capital Analytics). Bob gave a little overview presentation that fueled the conversation. Here's what I took away:

1. Europe: Better 3Q than expected.

2. Clear investor favorites have emerged: Germany, France, Nordics (Denmark, Finland, Iceland, Norway and Sweden).

3. Cross-border capital is looking at taking on more risk.

4. Industrial and peripherals are offering attractive yields.

5. Trophy retail malls attracting interest as are regional markets in the UK.

6. Europe deal volume is halfway back from 2007 peak; U.S. is nowhere near halfway back.

And a few quotes from others:

1. "Italy is the last country that real estate investors are thinking about today."

2. "The Nordics are considered to be one of the best places to invest."

3. "The personality of equity capital has not changed much over the past five years."

An open letter to presenters of any type:

If you use statistics in your presentation/speech (and this is particularly obvious when you use PPT slides...which as you know from earlier writings I feel is the most abused technology tool known to mankind) please update your information periodically. Making any presentation today, for example, with data from 2008, 2009 is absolutely unacceptable. You owe it to your audience to have current data. Making the excuse, "I've been too busy to update the information" is an insult to the audience. And, as 2010 comes to a close, as soon after year-end as the data in your 'one size fits all' presentation becomes available, you have an obligation to update it. Whether you realize it or not, people in the audience notice it...they won't be as vocal as me, but it doesn't make you look good at all.

Joe Frazier, the former heavyweight champion of the world, died this week at 67. My father's was a boxing family (except for him). A couple of this older brothers not only fought in the streets of Brooklyn and the Lower East Side, they also fought professionally. The one who went the furthest was Harry Felix, the oldest brother, who fought for food money for the family and was at one point a middle-weight contender (before an opponent 'thumbed' his eye and ended his career). Another of my fathers' brothers, Barney, was a referee who officiated a number of major bouts including the first Liston/Clay fight when the title was transferred for the first time to Cassius Clay soon to become Muhammad Ali. My Dad liked watching boxing on TV right up to his death on November 19, 2009. But over the years things had changed in the boxing world (as in all other sports) and he more often than not referred to some of the fighters on TV as 'bums.' That term apparently referred to boxers who were brawlers and not fighters or other definitions of his own creation. During the period when Ali was banned from boxing due to his stand as a conscientious objector during the Vietnam War, he went on a college speaking tour. At that time I was the sports editor of our school weekly newspaper. When he came to our school, I was invited to the press conference held before he spoke to the general audience. I asked him, "Champ, do you think Joe Frazier could ever beat you?" Ali replied, without skipping a beat, "Son, if Frazier even dreamed of beating me, he would wake up apologizing!" Joe Frazier was no bum. Frazier, in his quiet, workmanlike way, brought some class into the ring every time he entered it. He exuded quiet confidence. He was a class act.

OTR news: There have been some people starting to follow OTR on Twitter as well as through the Linkedin.com OTR group. I am trying to increase the number of subscribers. There's a reason behind it but I can't tell you about that just yet. So, if you have had this forwarded to you and are not a subscriber please sign up. Also, if you are so inclined I'd appreciate you sending this to others and asking them to sign up as well. Thanks a lot.

Steve
Publishing from somewhere between New York and California in 'The Friendly Skies."

On the road....

Nov. 15: San Francisco to moderate the panel at JPMorgan's "The New Investment Climate: Fostering Transparency from Front to Back Office." It's an important topic and I'm particularly pleased that a good friend, Don Holcher, who spent many years with the City & County of San Francisco Employees Retirement System, is one of the panelists.

Nov. 30-Dec. 2: Chicago to attend NCREIF's Nuts & Bolts of Institutional Real Estate 2.0 program.

Dec. 8-9: Chicago for various meetings.

Dec. 12-16: New York

(On December 12, I invite you to join me at my "Not quite annual, buy your own, commercial real estate holiday drink thing." I'll be at the Russian Vodka Room (north side of 52nd Street near 8th Avenue -small black awning) starting at 6pm. If you're in New York, and have time, please stop by. Last year we had 45 people and while I knew most everyone, I love when I can help bring people together who have never met each other and who work in the same industry. Hope to see you then/there. No RSVP necessary).

Jan. 18-20, 2012: Laguna Beach, CA to attend IMN's Winter Forum on Real Estate Opportunity & Private Fund Investing

Jan. 25, 2012: London to attend the Reuters Real Estate Annual Real Estate Conference and moderate a panel and to visit a good friend who is recovering in a hospital in Geneva.

These are my views and not that of my employer.

Counselors of Real Estate, Tent Cities, 70 year olds talk about their lives

2011-11-04T06:01:00.000-07:00

This week I attended the CRE (Counselors of Real Estate) annual convention in Washington, DC. One thing that surprised me as I made my way around the city was the number of tent cities connected to the "Occupy Wall Street" movement. I hadn't been following this story much but I asked a few folks what the purpose was and it sounds to me like a very disjointed effort with different people 'protesting' about different things. Just like in the 60's and early 70's, the reason that change could not be effected then, and now, is that people cannot get behind just one cause at a time. If we could elected officials would be forced to sit up and take notice and take action. But they knew then, and now too, that if they just sit back and do nothing the effort will evaporate due to lack of single purpose.

Anyway, I may have written this before but I want to say it again: The Counselors of Real Estate is a bunch of knowledgeable, talented, successful real estate professionals who also happen to be very nice. Egos are checked at the door and the collaborative, nay, totally friendly environment that exists at their events is a breath of fresh air. The CRE Consulting Corps case studies are fascinating and global. The debates about key issues affecting the commercial real estate industry are stimulating. And the collegial atmosphere is special. They are openly welcoming of new members and guests. I am proud to be a member and appreciate Geof Dohrmann of IREI who nominated me to be considered for membership.

Some takeaways from a presentation from a well-known and respected industry strategist:

"Those of us who don't live within The Beltway (Washington, DC area) don't really understand what's happening."
"Today money is basically free."
"Maybe its' time for radical answers."
"The other shoe? Forget about commercial real estate, it's state and local governments....and it's dropping."
"State and local governments had always been an engine of growth...but no more."

The more people, of all ages, that I talk with, the more two things are clear: (1) Things are changing on a daily basis globally; (2) No one really knows what is going on or what to expect. Uncertainty, about most anything in our lives, creates stress. Stress is not healthy. But now, in addition to personal stress, we have an inordinate amount of Earth-stress, challenges to our basic way of life and to the future of our planet. I've always admired the 'big thinkers', those that don't get bogged down in the day to day stuff. I haven't been hearing much from these people lately, in fact, I'm not even sure who will go down in history from this period as a truly big and forward thinker. Right now, I'm focused on the small things but I am not sweating them. However, I recall Steve Winwood's voice when he and Traffic recorded, "Who Knows What Tomorrow May Bring?" Let's put our collective mental energy together towards a better tomorrow for our selves and our children's children children (Moody Blues).

New York Times columnist, David Brooks, wrote in one of his columns this week, "If you are over 70, I’d like to ask for a gift. I’d like you to write a brief report on your life so far, an evaluation of what you did well, of what you did not so well and what you learned along the way." He got more than 200 comments submitted pretty darn quickly. I like this kind of life stuff so went through those comments and pulled out some things that I found interesting and I hope you do too:

The United States, for the past 70 years, has been a place of soaring optimism, where things always got better. So 70 year olds today, for the most part, can recall fondly their past lives (despite any foolish risks they took)--because today they are still much better off than when they were growing up. But it is now possibe to contemplate that the US has peaked, and life in the United States, today, may be the best the younger generation will ever experience.
Don't try to prove things to other people, especially your parents and friends, try to prove a few things to yourself. Try to balance being responsible with the grand adventure that life can be while also making a positive contribution. Our existence on this tiny planet is a miracle, don't waste it.
Aim high and see how far you can go. Learn from everything and everyone, all the time. Be self critical only when it can help you grow, not as a force of habit. Realize, too, that everyone before you who accomplished something grand started out with doubts, fears and doubters saying it couldn't be done. Live your dreams because, otherwise, you will have to watch while someone else does it in your stead.
I have learned that I don't know anything, don't understanding anything, and never will. Far from making me despondent, this has been a big relief. I also realize that no-one else knows anything or understands anything, especially the "experts" - a word I think should always be in quotation marks. Trust your own judgment more than you trust anyone else's. Even the honest and well-intentioned can lead you astray, and most certainly they do not have your well-being at heart as much as you do.

These are just a few. If you like this kind of stuff here is the link to the page where all the comments are posted. It's a pretty interesting read.

RCA’s 3Q2011 Europe Capital Trends report was recently published. Here are a few of their conclusions:

Despite the economic and financial market turbulence European investment activity continues to improve. Countries showing an improvement in transaction volume, notably Germany, France, Nordics and Central Europe are increasingly being driven by cross-border capital.
Prime retail continues to perform strongly, with office volume flat year-over-year. Hotels also posted robust gains, while large transactions boosted the apartment and industrial sectors.
While London and Paris still boast the largest volume, many other cities now are drawing a larger percentage of cross-border investment.
The most significant changes in the sources of these global inflows have come from Asia and Canada, with their investment activity in Europe reaching or surpassing peak levels.
US investors, while comprising half of global capital flows into Europe, acquired just €14.7b over the past 12 months, a fraction of 2007 levels.

To me, Canada is the story to watch as they have become a very aggressive investor in direct real estate in many parts of the world.

Congratulations to my friend Julian Schiller who joined Brookfield Asset Management as senior vice president at the firm’s global private funds group in London.

Cool stuff of the week: ArX Solutions. Terrific animation company. This art/technology has really evolved since I was first exposed to it at the MIPIM conference in about 2004.

Photo: Six of the 17 CRE Band members at rehearsal studio earlier this week preparing for the show last night at the Chairman's Gala Dinner where John Leary handed the Chairman's title to Ken Riggs. It was a really fun night.

On the road....

Nov. 4-11: New York

Nov. 9-10: PERE Forum in New York where I'll be moderating a panel called "LPs: Far from Limited). My panelists: Tom Arnold, Abu Dhabi Investment Authority; Steve Hason, APG Asset Management; David Rose, HewittEnnisKnupp and Bill Bowman, former senior portfolio manager for an institutional investment management company. There is still time to sign up and be there.

Nov. 15: San Francisco to host a discussion sponsored by JP Morgan's Private Equity and Real Estate Services Group on "The New Investment Climate: Fostering Transparency from Front to Back Office."

Nov. 30-Dec. 2: Chicago to attend NCREIF's 'Nuts & Bolts of Institutional Real Estate 2.0.'

Dec. 12-16: New York (Including my "Not quite annual holiday buy your own drink holiday drink thing." Date, time and location TBA. Stay tuned.

Jan. 25: London to moderate a panel at the annual Reuters Real Estate Conference.

These are my views and not that of my employer.

ULI, Emerging Trends, The Beach Boys

2011-10-28T11:24:00.000-07:00

This week, at the last minute, I decided to attend the ULI Fall Conference in Los Angeles. +/-6,000 commercial real estate industry people and as diverse a group as you can imagine which spans the entire spectrum of commercial real estate were there. I ran into a good number of people I knew including two that I haven't seen in a dogs' age. ULI/pwc also released the legendary Emerging Trends 2012 report authored by my good friend, Jonathan Miller. The findings are based on opinions of trends for 2012 gained in more than 950 interviews (including me for the first time!) or surveys . The release presentation featured Jonathan, Mitchell Roschelle and Chuck DiRocco of pwc and one of the most savvy guys in the commercial real estate industry, ULI Senior Fellow (and long time good friend) Steve Blank.

"Demand drivers don't exist and fundamentals need to catch up."
"Is it global chaos or crisis?"
"Dysfunctional government."
"Too much capital chasing too little product."
"No refinancing emergency."
"Pension funds: Talk-Seek income returns. Walk-Shout for more opportunistic returns to fill liability gaps; the denominator effect is back."
"Foreign investors: The U.S. looks relatively safe compared to their home countries."
"Most U.S. markets have stopped deteriorating but most haven't really improved."
"Most 'walkable' cities are doing better (NY, San Francisco, Boston, Seattle, DC, San Jose, Austin)-check this out."
"Caution rules-it's not the time to be "all in"-investors should maintain liquidity."
"Holders and sellers may do better than buyers."

One interesting sidenote: It appears that the word 'tenant' is gone from our lexicon. It's been replaced by 'occupier' which is the term used by our British friends. Can it be long before "z" is replaced by "s?" and what about that 'u?'

One ULI panel that was of particular interest to me was where very senior leaders of CBRE, C&W, JLL and Colliers shared their thoughts on commercial real estate service companies. Here are a few of their comments:

Clients want

more integration of services
more information
their problems solved
a broad range of services
consistency and quality of services
targeted solutions that create value
customized solutions to their needs

From the service company perspective

Winners will be those firms able to bundle services, align them and price them properly
Services where one size fits one vs. one size fits all are key
You can't just offer services; you have to be really good at what you offer
Be able to offer strategic advice for the lifetime of an asset
Clients don't care how we do it; they just want their needs met
Young people joining our organization have less of an entitlement issue

There was another panel, apropos of the Gender Networking piece I quoted (and a bunch of you asked me to send you the whole article) last week, made up of all women. The dynamics were much different from all-male panels. Even the way some things were said shows the differences between how women and men do and say things. The subject focused on doing business globally. A few quotes:

"We want to find opportunities we can believe in."
"There's no difference between doing business in Galveston, TX in the late 70's and going into Brazil now."
"There is only one time that the world is globalizing and that's now and I want to be part of it."
"I love operating cross-border because people will pay you for it."
"In the Western world you negotiate a pre-nup before you get married; in China you work out the details afterwards."
"Don't forget: Americans think linear; Chinese think circular."
"You have to know what makes the other person tick."
"In China, there's a lot of domestic money searching for knowledge."

At ULI, a former boss of mine and I were catching up when a former boss of his ambled up with his sons who are also in the industry. I had not met this fellow before but he was introduced first as Jim. And then in a few minutes, Jim's other 'titles' came out: "Godfather of the Workout", "Pioneer of Asset Swaps" and "Jimmy the Magician." Having been involved in workouts for so long myself I don't know why I hadn't heard of him. He's a guy that I could see sharing workout stories with for hours and hours. In my career I have worked for (although never met as he lived somewhat like a recluse), the original sale/leaseback "King" and others who have been pioneers in the industry. I've also met some who claim to have been pioneers but they are cut from a different cloth. It's one thing when others give refer to you a certain way versus how you refer to yourself. Anyway, we had a great time for those few minutes and that is why I love attending conferences and other industry events so much...that random connection that you remember for a long time.

Last item about ULI: They hired Brian Wilson of The Beach Boys to perform. Listening to Brian and his great back-up band go through hit after hit after hit, so true to the original recordings, sent chills down my spine. Brian, as brilliant as he is, has had a difficult life. Seeing him, on stage, leading that band was really, really special.

Personal note: My heartfelt thanks to all of you who wrote to me or talked with me at the PREA and ULI conferences about the upcoming changes in my career announcement that was sent out by my employer, Aviva Investors. I appreciate all the offers of assistance and support. I'm having some very interesting conversations about different things but have determined that whatever I do I'm going to be true to myself. Recently, I've begun to appreciate and understand who I am and what that would mean to what I do going forward. Conveniently, many of my friends see me in the same way I see myself. Phew! Anyway, I will be in my current position until the end of the year. We are looking for recapitalization deals (fund, joint ventures, etc.). Please feel free to contact me if you have something which is up that alley. Thanks.

Photo: A really interesting thing at the ULI Convention. "Reimagine Wilshire" by James Rojas. "An interactive model that invites participants to explore and reshape this Los Angeles street to fit their ideas. Participants will be provided with a medley of recycled materials ranging from colored (no 'u' yet!) and popsicle sticks and discarded metal and bottle tops. Using these materials, they will create their ideal urban forms on a plot plan of Wilshire Blvd. that will change and develop throughout the course of this exhibition." Fun eh? No, these pieces are not edible!

On the road....

Nov. 2-3: Washington, DC to attend the Counselors of Real Estate (CRE) annual convention and play once again with the "CREatures of Havoc" band.

Nov. 4-11: New York

Nov. 30-Dec. 2: Chicago to attend NCREIF's 'Nuts & Bolts of Institutional Real Estate 2.0.'

Dec. 12-16: New York

Jan. 25: London to moderate a panel at the annual Reuters Real Estate Conference.

These are my views and not that of my employer.

PREA, Animal Murder, Networking: Women v. Men

2011-10-21T03:39:00.000-07:00

This week, along with more than 900 of my closest friends, I attended the PREA Fall Conference in Chicago. It's the semi-annual get-together of the institutional real estate world. One smart change this year is that on the first day, after the PREA "official" reception, a number of managers joined forces for an "invitation only" cocktail party (see venue comment below). Heretofore (is that really a word?) there have been several competing cocktail parties with everyone trying to attract the same 34 people (you know who you are!). So, this is sensible and seems to indicate that there is a more collaborative feel these days which also runs to collaboration in taking down deals rather than competing and driving prices up. I hope this is true as I believe that collaboration is the future (along with "Alternate Merge" which I am also a big believer in...and not just on the road).

So what did I take away from the PREA conference?

-Definitely less interest in commingled funds and more towards co-investment & club deals.

-Clear concern about the state of the world economies and politics and their current and future impact

-More 'new' managers getting into the game (these are typical real estate operating companies that have not approached institutional investors about investing with them).

-Still a lot of interest in investing in 'distress' in one way, shape or form

-Valid interest from U.S. institutional investors in investing with established managers in Asia and Europe

-Caution. I wish I could say cautious optimism but I didn't sense too much optimism; sort of a 'what it is, it is' feeling.

-Consensus that we are not out of the woods and uncertainty about when things would start feeling good again

-Desire to keep things simpler rather than more complicated

A good industry friend of mine shared this with me about PREA:

There was a European cloud over the conference and I must say the mood I sensed is “frustrated.” LPs are looking for distributions from older vintage investments, GPs are looking for commitments, and people don’t seem to have much optimism.

How many of you besides me had tears flood their eyes when reading or seeing the murder of animals that had been let loose by their cowardly and warped owner in Ohio this week? The police defended their actions (Don't they always?) I know, some animal rights people said the police had no choice. Sorry. Some local police force who were completely unprepared for anything like this just reveled in being big game hunters for a few moments. Why couldn't all or at least a majority of those animals been tranquilized and saved instead of being killed? In killing those animals, aren't we killing ourselves as well-aren't we all animals, trying to survive on the same planet, bring our off-spring into this crazy world and praying that mankind will not destroy itself? How sad. Who will save our souls? And, how dare that guy that owned these animals...letting them out....dooming them.

"All about Steve:" For those that got my announcement last week or saw the article in PERE about my job situation, I appreciate your support as I received a overwhelming and heartwarming number of emails, wishing me well and offering to help in however they could. At the PREA conference as well, so many people asked me what I was going to do next. I can't tell you how that made me feel. I am thinking about what the next chapter in my career should be, looking at myself and trying, as one friend told me, "to be my own career coach." Part of that exercise is that I'm learning to appreciate myself more. Also, to sit down and make a list of what I'm good at, what I like to do and how to combine those two into making a living. There are a few very interesting conversations I'm having as we speak. But, because this is a very important time in my career and my life ("Is there any other kind," Jack Nicholson would say to me (stolen and adapted from "A Few Good Men.") I want to take my time and do the right thing. I'm looking at another 15 years of full-time work. My father was very proud of working full-time until he was "79 and a half" as he used to tell people. 15 years is still a healthy chunk of time and ideally I'd like to get into something that will take me to 2026! And, be true to myself. Anyway, stay tuned!

Within the past few months (this is all about me right :-) more and more people have been asking me, "So what's up with your music?" The answer is this: After more than two years in the making, our next CD, "Robot Mannequin" will be available before the end of the year. This is another collaboration between my sons and I and an all-star cast of Chicago-based musicians. "What kind of music is it?" Impossible to describe as all songs different!

My good friend, Barbara Fish, is a career counselor based in Toronto. Actually she and I were both summer camp counselors together years ago. Camp counselor/Career counselor. Hmmm, maybe they're connected? Oh well, last week she forward me a piece called The networking gender gap and how to bridge it. While there are few things in life that we can all agree on, I know one of them is that, well, men and women are just plain different. It's part of the attraction (I think). Anyway, here are some snippets from that piece (If you'd like the whole article just email me with the word "Networking" in the subject box).

-Networking observers say that for men, networking is largely about selling themselves or a product, or trading information. They want their conversation to lead to a tangible result, such as a business lead, a sale or an introduction. They get straight to the point.

-Women, on the other hand, will often initiate an exchange with a pleasantry or a compliment (“Love your shoes”) and will converse on a range of subjects, regardless of potential professional benefits. Rather than thinking quid pro quo, they think “How can I help her? How can I connect?” One networking commentator on Linkedin put the difference succinctly: Men “start with a statement of their status ... Women create community.”

-Another key difference is that women use networks for what psychologists call “social comparison,” a process by which we understand ourselves and learn how to behave by comparing our attitudes and behaviors with those of others.

-Sadly, women often don’t take advantage of their ability to connect. Here’s where they can take a lesson from the guys. Whereas men talk matter-of-factly about their accomplishments, women tend to undersell themselves lest they be seen as boastful. Or where a man might bluntly ask, “Could you please introduce me to ... ?” women are so nuanced about asking for assistance that a person whose help they seek might not even realize a request has been made.

Interesting stuff, right?

New: NCREIF Research Center: Jeff Havsy, Director of Research for NCREIF told me that there's a new 'button' on the top right hand side of their home page. This is a new section on the NCREIF website designed to answer a question that was posed by or to Jeff or one of the other members of the staff. One piece that's posted is called Cap Rate: Please Explain! A really good value-add service to the industry.

New Book: Real Estate Mathematics will be published next week by PEI Press. "Real Estate Mathematics is a detailed and practical guide for private real estate fund managers and investors. Edited by David Lynn and Tim Wang of Clarion Partners, this guide features contributions from over 25 leading real estate professionals in the industry today that will shed light on some of the most challenging arithmetical problems that face private real estate today." Congratulation you guys.

Restaurant of the week: Sunda, 110 W. Illinois, Chicago, IL. A multi-manager hosted cocktail party on Monday evening brought me to this place for the first time. When you walk in, the dramatic design suggests an immediate, "Wow." To call it Asian-Fusion is not fair; yes, there is a serious sushi bar but it's also a lot more than just sushi. Actually, just go there. Ask for Nicole who is the Director of Sales and Marketing and enjoy yourself. Oh, did I mention that it's one of the hippest places in Chicago?

Congratulations to my friends Bob Weaver who is joining TPG Capital and Roman Bas who joined The Carlyle Group.

My, and I know the industry's, sincere condolences, to the family of Keith Brown of Klaff Realty in Chicago who passed away recently. Too young. Too soon.

Take care and safe travels.

Steve

Photo: Sign at San Francisco International Airport. I got a kick out of the last item.

On the road....

Nov. 4-11: New York including moderating a panel at the PERE Forum

Nov. 15: San Francisco to moderate a panel for JPMorgan

Jan. 18-20: Laguna Beach, CA to attend the IMN Opportunity and Private Fund Conference

These are my views and not that of my employer.

Fall Conferences, Seth Godin, Tap Dancing

2011-10-14T08:47:00.000-07:00

It's interesting: This morning I sent an email out to a large group. The number of "Out of Office" automated replies was surprising in some ways but in other ways it wasn't...it's just indicative of how much traveling people are still doing (or are they?). Yes, this time of year there are all kinds of conferences and while the bean-counters in many firms have clamped down on travel expenses, when there's a "Must Attend" conference or meeting, people still should be permitted to go. Our industry manages gazillions of dollars of money invested in real estate, much of it wisely invested for the benefit of retired people who are counting on getting their monthly check (I wonder what that would be like!). Anyway, to seriously limit those folks that are managing that money from attending any/all conferences that they believe are important to them doing their job properly (and learning something along the way that may help them do their job even better) seems to me to be penny wise and pound foolish.

Some of my takeaways from one of the most stimulating sessions I've attended in quite a while given at the CBRE Americas Summit last week by Lara O’Connor Hodgson:

What happens when what we know gets in the way of what we notice?

“Why” is what you notice.
“What” is what you know.

We stop asking “Why?” because we're afraid to let people know that we don’t know something.
Be a contrarian

What would I never do?

Defiance

That won’t work-so how can I make it work?

Creative Reconstruction

Break down your assets/challenges and take each one away

Scenario-based thinking

Where would we never look?

Laughter at an idea means something is working
Innovation: look at a place completely differently and apply it to your industry
Quotes from Dr, Jonas Salk (Polio Vaccine):

“The answer is the question.”
“Ask the right question to find the answer.”
“You don’t invent the answer; you reveal the answer.”

Fostering Innovation in Real Estate

To succeed consistently over time you must understand key trends and time their activities accordingly

Creativity: the ability to look at the same thing as everyone else but see something different

within 8 seconds of creating an idea, someone will tell you there’s something wrong with it-often it’s yourself.

Suggestion: Wait 8 seconds before commenting/criticizing

Real estate: we literally change the world (buildings, cities, etc)

We commoditize our projects. So, if we change our thinking.....(i.e. we think about how to get 10 cents more per square foot, etc).

What drives value?
What is unique”

Don’t commoditize your product.

Success vs. Significance

Success is finite
Significance is infinite

If you’re focused on success you’re not thinking big enough.

Innovation is driven by noticing human behavior.
Your greatest solutions happen when you lack resources.
If you quit with the first “No” you may be asking the wrong question.

Don’t be afraid of coming back with another, “Why?"

Force your brain not to be you!

Your customer is not you-you have to get into their heads to understand their challenges/problems before you can come up with a solution

Figure out who does something well-what makes them own their industry-and apply it to your business
Look in places you’d never look-that is where innovation is-not at your competitors.
In a down economy no one is talking-you can sneeze and get noticed.”
Einstein: “The world we live in today has problems that cannot be solved by old thinking

Seth Godin is a very interesting guy. I was first introduced to his writing via one of his books called, "The Purple Cow." He describes himself as a writer, speaker and agent of change. I subscribed to his blog earlier this year and have found certain of his writings resonate with me. He publishes every day and one from this week I share with you as I thought many of you would get something out of this:

Open Conversations or Close them.

A guy walks into a shop that sells ties. He's opened the conversation by walking in.
Salesman says, "can I help you?"
The conversation is now closed. The prospect can politely say, "no thanks, just looking."
Consider the alternative: "That's a [insert adjective here] tie you're wearing, sir. Where did you buy it?"
Conversation is now open. Attention has been paid, a rapport can be built. They can talk about ties. And good taste.
Or consider a patron at a fancy restaurant. He was served an old piece of fish, something hardly worth the place's reputation. On the way out, he says to the chef,
"It must be hard to get great fish on Mondays. I'm afraid the filet I was served had turned."
If the chef says, "I'm sorry you didn't enjoy your meal..." then the conversation is over. The patron has been rebuffed, the feedback considered merely whining and a matter of personal perspective.
What if the chef said instead, "what kind of fish was it?" What if the chef invited the patron back into the kitchen to take a look at the process and was asked for feedback?
Open conversations generate loyalty, sales and most of all, learning... for both sides.

On Sunday I happened to catch the last half of "Dirty Dancing" on TV. What a great movie. How sad that Patrick Swayze died so young (57) another victim of cancer. Watching that movie got me on to Youtube. Many years ago, I worked for a company where one of the administrative assistants was the daughter of the famous dancer, Honi Coles (who also had a role in Dirty Dancing). Check out this great dance routine. Sad also that tap dancing like is from an era long gone.

Congratulations to Paul Anthony DiCarlo who has joined Rockrose Development in the acquisitions group and Yokasta Baez who joined Pantheon as Vice President, Global Client Services in New York. She was most recently with AXA Private Equity.

San Francisco Event: Larry Souza, a very insightful guy is presenting the conclusions of his deep research project on real estate finance and capital market research, which includes monetary and fiscal policy analysis, public administration and political science, political economy and philosophical analysis. It's on Tuesday, October 18th at 5:30-6:30 pm at Golden Gate University (536 Mission Street) in San Francisco, in Room 6208. Larry says "You are all invited."

On the road....

Oct. 17-19: Chicago for the PREA Fall Conference

Oct. 20: Boston

Oct. 20-21: New York

Oct. 24-28: On the road...destinations TBD

Nov. 1-3: Washington, DC to attend the CRE Annual Convention

Nov. 4-11: New York including moderating a panel including at the PERE Forum

Nov. 15: San Francisco to moderate a panel for JPMorgan.

These are my views and not that of my employer.

On the road...Asheville, Las Vegas, Steve Jobs

2011-10-07T06:57:00.000-07:00

RCA Briefing Note: As overall sales volume slowed sharply in Q3, foreign investors were bucking the trend by continuing to expand their acquisitions of US commercial real estate. With Asian and Latin American capital growing at the fastest rate, cross-border investment should top $5.0 billion in Q3 for the first time in four years and account for over 10% of market activity.

Sad news. Wayne King of The Goldstein Group in New Jersey passed away at 52, another victim of cancer. Wayne was the second employee at CREOL (Commercial Real Estate Online) which was one of those ahead of the times Internet ideas that didn't make it. I worked with Wayne. He was the architect that took Steve Oder's vision and made it real. Wayne was a bright, interesting and just plain nice guy who had a heart. I hate this cancer crap!

I spent time last weekend with my son, his wife and their two sons-yes, my grandsons, Sean (2+) and Gavin (one month) in their home in Asheville, NC. A busy house to be sure! Hanging out with Sean I was reminded about how kids find such simple ways of entertaining themselves, being entertained and entertaining us. Things we take for granted, the trees swaying in the wind, the fog that appears on a window when you breath on it, running around and diving onto a couch, banging on a drum, laughing at silly words that your Grandpa teaches you (i.e. Pizza Juice), listening to The Beatles while in the car seat of your Daddy's car. It's wonderful to see and served as a great reminder to me about how there are so many simple things in life that we just take for granted, or overlook or, don't have time for. It's these simple things, most of them with no cost involved, that can give us pleasure every day if we just take a minute to appreciate them. Btw, Asheville is very cool. It's like a time warp in some ways back to the late 60's/early 70's. It's a college town with a vibrant restaurant, shopping and music scene. There's also a lot of 'real green' (trees) in and around that beautiful part of America.

Dig This!

The world's first Heavy Equipment Playground: Where you can relive your childhood sandbox days. It's in Las Vegas, not far from the Strip and this week I had a chance to experience it for myself. It's the kind of thing that you will keep telling people about. It's fun by yourself (but more fun with a group) and it's run in a first-class and extremely safe way. Some participants were on the bulldozers and I was on an excavator (see below). It's a really cool thing to do and this is the only place in the world (for now) where you can do it. It's attracted people of all shapes, sizes, ages and genders and is the #1 attraction/thing to do in Las Vegas on Tripadvisor.com. I met a couple of guys whose wives gave it to them as a birthday present. It's also a perfect venue for 'team building.' Special Offer: Because I have a connection with the ownership of Dig This, they have authorized me to offer a 25% discount to anyone who mentions my name when they make their reservation.

Dig This site: I drove this heavy machine (there's a better picture here). Didn't do as well as the other two drivers but I had tons (140,000 pounds worth) of fun.

I heard some very good stuff this week from a very interesting speaker but I want to take some time to digest what she said before I share my takeaways with you....next week.

"A legendary hero is usually the founder of something-the founder of a new age, the founder of a new religion, the founder of a new city, the founder of a new way of life. In order to found something new, one has to leave the old and go on a quest of the seed idea, a germinal idea that will have the potential of bringing forth that new thing." Joseph Campbell, Hero with a Thousand Faces.

Steve Jobs: he had a vision that was right on as far as what the world wanted/needed and how Apple could fill that need. But identifying a customer need isn't what Jobs was all about; he created a need but having not just his fingers but his whole being on the pulse of the future. He figured out who his customers were and what they wanted. There have been some folks, in our lifetime and throughout history, who have had the same 'seventh sense' and perhaps it's because Jobs made his mark in an era of unprecedented media coverage and Internet connectivity, that he's achieved the status that society is putting on him. Originally, Mac users were a cult; going against the grain of the PC. They did 'think different' and now there are many of us who are using Mac's and other Apple products and it seems like more and more are adopting them. PC use is still in the majority...particularly as companies, for the most part, use them. But from a personal perspective, how many of us use a PC and related peripherals for work and an iPhone, iPad, Nano (is that still the current thing for music or are people just using their iPhones for everything) for everything else? At a time when the world needs more heros, Steve Jobs will go down as one of them.

Congratulations to my friends, Joan Matera who has joined JPMorgan as a Senior Credit Banker in their Real Estate Banking Group and Hugh MacDonnell who has joined Clarion Partners as a Managing Director in their Capital Raising group.

On the road....

Oct. 10-15: Northern California

Oct. 17-19: Chicago for the PREA Fall Conference

Oct. 20: Boston

Oct. 20-21: New York including seeing my new grandchildren, Edie and Benjamin (yup, lots of grandkids!)

Oct. 24-28: On the road...destinations TBD

Nov. 1-3: Washington, DC to attend the CRE Annual Convention

Nov. 4-11: New York including moderating a panel including at the PERE Forum

These are my views and not that of my employer. This column is written on a MacBook.

On the road with Steve Felix

2011-09-30T06:57:00.000-07:00

As I promised to the audience at the PERE Global Forum in Amsterdam last week here is the Summary of Key Findings & Trends from a Compensation Survey that was recently conducted in the real estate investment industry (U.S.). 46 companies participated:

1. After two years of declining compensation, pay levels for performance year 2010 were up, but still below pre-recession levels at most companies.

2. 88% of participants raised salaries in early 201, with most increases falling in the 3-5% range. Increases were most prevalent for mid-level and junior professionals.

3. 76% of participants paid out larger bonuses for performance year 2010 than they did for performance year 2009, with amounts at or above target levels in most cases (60% of respondents)

-Executive managers fared the best: median increase of 31% and average increase of 70%

-Less than 10% of firms reduced bonuses, whereas over 40% reported doing this in last year's survey

4. Year-over-year changes in long-term incentive awards varied considerably among participants

-Roughly half of participants (52%) increased long-term incentive awards for performance year 2010, with the remaining companies split between keeping long term incentive awards flat (24%) and reducing it (24%)

5. Looking ahead, most firms expect to increase pay for performance year 2011, but at relatively modest rates due to uncertainty regarding how the rest of the year will pan out from a performance perspective

-2012 salary increases are expected to be 3-4% (on average), although a meaningful number of firms (24% of participants) expect to keep salaries flat (only 11% took this approach in 2011)

-44% of participants expect to pay out larger bonuses, most of whom expect 1-20% increases over performance year 2010 levels, while 41% of participants expect to keep bonuses flat (18% reported this in 2010)

-long-term incentive awards continue to vary by company, and eligibility parameters may broaden at some firms.

This week I was a guest at the NAREIM (National Association of Real Estate Investment Managers) Executive Officers Mid-Year Meeting. It was the first NAREIM meeting with Gunnar Branson as President of the organization. The attendees are typically very senior executives from investment management firms who get together and share openly. It's a comfortable group and I had the opportunity of meeting a number of senior industry folks that I hadn't known before. If you're an investment manager, it's a good organization to check out. In addition to the business benefits, there was a mentalist entertaining us at the closing dinner. I had seen him perform once before at a CBRE event. The stuff he does just makes you shake your head in amazement and smile with the joy of someone doing something you can't (and don't care) to figure out. He also has a great dry sense of humor (and you appreciate it more if you have one too!). He's memorable.

Here are some of my takeaways from the NAREIM event:

1. Industry consolidation and capitalization trends

a. Real estate M&A activity: Who are the buyers? Wealth management firms (smaller transactions); Money management firms; Financial firms; Insurance companies & Bank/Trust companies.

b. Insurance companies are showing more interest in acquiring real estate companies

c. Advice when looking at a company to acquire: Go for growth and opportunity; get out in front of the growth opportunity

d. "Once you're labelled an "Emerging Manager" you may never be able to get away from that label."

e. Deal environment panel comments:

(1) "People are adjusting their thinking re: price discovery which makes more transactions possible."

(2) "As time has progressed its gotten tougher and tougher to underwrite deals to make sense."

(3) "We're proceeding with caution; but we're proceeding." Large institutional real estate owner

(4) "Investors are dialing back assumptions and elongating absorption."

(5) "For the first time we're seeing Sovereign Wealth Funds investing "off the coast."

(6) "I see 2012 as a very difficult year."

A friend and very talented artist, Shannon Corey, has announced the following shows. Unfortunately I won't be able to attend either but if you're in NY or Philly and like singer-songwriters (she's a piano player) you should check her out:

1. Mon, Oct. 3rd - NYC - Birthday Show - The Bitter End-free download and cupcakes - Amazing

2. Wed, Oct. 5th - Philly - UPenn - to get in you have to be on the 'list.' Write directly to Shannon and she'll get you on the list (shannoncorey88@gmail.com).

I got an email from a friend in Europe who got this from a friend which I pass along to you even though I have no stomach for political rhetoric but I know that a lot of folks will find these comments interesting: "Last night I attended a dinner hosted by Nigel Bolton (head of European equities at Blackrock) who on the previous night had dinner with Frau Merkel with a small number of European investors. Merkel believes the IMF is trying to force EU into leveraging the EFSF fund but this is basically a US scheme. Q. What is the EFSF? A. As part of the overall rescue package of €750 billion, EFSF is able to issue bonds guaranteed by EAMS (Euro Area Member States) for up to € 440 billion for on-lending to EAMS in difficulty, subject to conditions negotiated with the European Commission in liaison with the European Central Bank and International Monetary Fund and to be approved by the Eurogroup. Merkel says this is a non runner... It would be Unconstitutional in Germany. She is totally is against this. Her view is this crisis will take time and there is no short, easy solution. She was very negative on the US and their response. Her tone was a shock to those investors listening. She was more positive on the long term benfits of the EUR as long as the peripherial countries focused on balanced budgets.... Spain & Ireland OK. Greece - "we can only get the PM to do things if we half drown him... He didn't want want help last year but we have to force him into this life support system."

Reuters Real Estate has revamped its site and is in their Beta test period. They have made some excellent updates and there's a lot of good information and other stuff there.

Remember: There are only a few seats left for The Nick Tyrell Memorial Seminar on October 12 in London. You can register and contribute here. It'll be an educational and beautiful day honoring the memory of an industry influencer and beautiful guy.

A find in Amsterdam. So I had a little break during the PERE Forum in Amsterdam and was walking down the street and walked by a very interesting window display. I couldn't figure it out right away but it looked like a place where I could buy something for my wife. I went in and realized that it was a massage place called 'doctorfeelgood.' I hadn't had a massage in ages and after studying the menu board, made an appointment for the next morning. After the massage, which was long overdue (I hadn't realized how much stress had built up), I was sitting, zone-ed out in a peaceful place and sipping water, when in front of me I noticed hanging on the wall, two large framed montages and went to take a closer look. There were a lot of backstage passes to rock concerts and a lot of hand-written notes of thanks from some very well-known rockers. They were all addressed to the owner of the salon who I learned had been a go-to massage person for rock musicians on tour for a number of years. It's a great place.

doctorfeelgood, Scheldestraat 16, Amsterdam. I may actually start getting monthly massages but it's really a luxury for me right now. Anyway, enjoy!

On the road....

Sept. 30-Oct.3: Asheville, NC to visit my grandsons Sean (2+) and Gavin born Aug. 25.

Oct. 3-6: Las Vegas to attend and be on a panel at the CBRE Summit.

Oct. 10-15: Northern California

Oct. 17-19: Chicago for the PREA Fall Conference

Oct. 20-21: New York including seeing my new grandchildren, Edie and Benjamin (yup, lots of kids!)

Oct. 24-28: On the road...destinations TBD

Nov. 1-3: Washington, DC to attend the CRE Annual Convention

Nov. 4-11: New York including moderating a panel including at the PERE Forum

6:55am California Time-Posted in-flight. Amazing!

These are my views and not that of my employer.

PERE Global Forum/Are we in the wrong business?/Solving the European financial crisis

2011-09-21T23:36:00.000-07:00

I'm sending this out while I can. I'm in Amsterdam and shortly will be off-line until Friday evening when I return to New York after a really long flight that takes me from Amsterdam to Moscow (10 your layover there) and then on to New York. The price of the ticket when I booked it was really good but it's going to be a long 24+ hours.

Some notes and quotes from this week's PERE Global Forum in Amsterdam:

1. Today's market: Overcast with frequent violent storms.

2. There are many investment opportunities available today if you have equity; it's difficult to raise equity unless you have a significant track record or niche strategy; specialist managers are in vogue.

3. In the past 90 days the world has come to a screeching halt.

4. The denominator effect exists again as equities are down.

5. Someone is going to create a better mousetrap. You need a compelling story about why pension funds should invest with you. Otherwise it's like shifting deck chairs on the Titanic.

6. This is the most difficult period to predict in my 25 years as an economist because it's all about politics.

Hidden gem-Amsterdam: In the same low-cost vein as my flight this week, I found a wonderful three room apartment literally a two minute walk to the PERE conference venue. I'm pretty lucky with these type things and will probably continue to seek these accommodations out as some of the rates charged by some conference hotels are, well, in my opinion, just too much. Here's my hidden gem of a place: BoekEnzo. If you contact them please send Joost my regards.

At the PERE Global Forum in Amsterdam this week, a good friend of mine came up and told me that he had woken up that morning with a thought about the financial crisis in Europe. He feels it resembles an already tired marriage going sour and there are four options that can be pursued:

1. Ignore it: Didn't work; won't work.

2. Let's muddle through it.

3. Forgive them; here's a gift (i.e. bail Greece out); let's truly make up (i.e. what ever caused the rift won't happen again) although in the case of Europe it's all about politics and lack of trust.

4. Break up the EU (Euro Currency Countries).

Sounds like there may be some common sense to this but since when do things that involve money and politics operate with common sense?

Here are some interesting numbers about the Private (not real estate) Equity world

(Source: Private Equity International).

1. 10 Weeks. How long it took Vista Equity to raise $1.6Bn for it's fourth fund which included some LP friendly terms.

2. $4.5Bn. Amount of capital raised by Berkshire Partners for its' eighth fund.

3. 50% of LP's expected to increase their private equity allocations in the next year.

4. $80Bn. Amount of private equity deal volume in the first half of 2010.

5. $130Bn. Total private equity deal volume for the first half of 2011.

6. $240Bn. Estimate of total private equity deal volume for 2011.

7. $14Bn. Amount changing hands in the global secondaries (not real estate) market in the first half of 2011.

8. 22.5%. CalSTRS return from their private equity portfolio for the 12 month period ending 6/30/11.

9. $3.00. Average amount a GP makes in management fees for every $1.00 of performance based carried interest.

Question: Are we all in the wrong business?!

I found this on the placemat at a restaurant in Amsterdam this week and thought you'd like it: "The spirit of "ichigo ichie"-a Japanese phrase derived from the tea ceremony means, "Treasure every encounter, for it will never recur."

And this one which I saw on the wall in the New Jersey Transit waiting room at Pennsylvania Station in New York: "Loud in the quiet night, warning me not to mistake a hill for a mountain." Sometimes you find something like this at just the right time in your life don't you think?

Deep-thinking moment of the week: World cultures don’t agree too often but I believe it’s safe to say that right now we all agree on one thing: that nobody know what tomorrow will bring in any facet of our lives.

Other than being a a professional musician, I am a life-long real estate person. I truly believe that the real estate business is not about buildings or cash flows or IRR’s: it’s about people. And as our industry has become truly global, we have been able to do business with people in other parts of the world based on one simple word: trust. We have learned and continue to learn that we can trust each other and while trust takes time to develop it has to begin somewhere.

I see our industry as ambassadors of building bridges between regions and cultures and in doings so, between people. Coming together in forums like this week’s PERE Global Forum in Amsterdam gives us a chance to talk with and learn more about each other. Representatives from many countries attended this event. Some will become friends and people who end up doing business with each other. But more than someone to do a deal with, we are all in this together and from time to time we all need someone we can lean on. Meeting someone and exchanging a handshake and a business card is just the beginning. To connect with each other takes some effort. The one area I’ve observed that could use some more effort is in the follow-up. So, in the spirit of community and collaboration, I offer this challenge to you: within three days of attending a conference, write an email to everyone whose business card you collected and simply say, “Good meeting you at the XYZ Conference. Looking forward to staying in touch.” I don’t care how many cards you collected; this process doesn’t take long (I incorporate it with the entering of a persons’ contact information in my database.) Of course, some of the connections will result in more substantive follow up communication about a deal that was discussed or a service being offered. And that’s great. But at a minimum, if we simply take that handshake, that exchange of business cards and that look into one anothers eyes just one step further we have contributed in a small way to bringing the world closer together. And isn't that be a wonderful legacy to leave the next generation?

On the road:

September 26-28: Colorado Springs to attend the first NAREIM Executive Officers Meeting hosted by their new CEO, and my good friend, Gunnar Branson.

September 20-October 3: Asheville, NC to see my newest grandson, Gavin, for the first time.

October 4-6: Las Vegas to attend and be a panelist at CBRE's Americas Summit.

October 17-19: Chicago to attend the PREA conference

November 1-4: Washington, DC to attend the CRE Annual Convention

November 9-10: New York to moderate a panel at the PERE Forum

These are my views and not that of my employer.

"You may be walking around lucky and not even know it."

2011-09-16T02:41:00.000-07:00

There are very few 'life-changing' moments that I can remember experiencing but this past week I had one. It came in the unexpected form of a meeting I had with someone I had never met before. And, as our conversation evolved, it was pretty clear that we had connected at some level, finding that some of our beliefs, about people, about business and other things had similarities. But 3/4 of the way through our meeting, he told me something he had observed about me, in a very constructive way. I sat silent and motionless for a few seconds, digested what he had said, and then simply said, "You're absolutely right. That's a very helpful observation. I can't thank you enough." What he told me isn't really important (except to me :-) What is important is that once in a blue moon, you meet someone who shows interest in you, as a person. Whether this fellow and I ever end up doing business together doesn't matter. What matters is that he and I connected as people. I had the tables turned on me for the first time in I can't even remember how many years as he wanted to help me! It was huge and I woke up the next morning feeling different about myself....in a positive way. There's a line in one of my favorite movies, "Let it Ride", when Richard Dreyfuss is having, in his words, "a good day" (which was not usual for him), and he walks up to a waitress he knows at a food stand in the race track; they banter a little as he orders a hot dog; and then with a very piercing but kind stare she turns around, points a 'magical' finger at him, and says, "You may be walking around lucky and not even know it." In his case it was about betting on horses. In my case, it's about changing my life.

Too many of the conversations I had this week end up with the same theme: "What the heck is going on in the world?" And, because most of the conversations I have, at least during working hours, are about real estate that translates to "Where are we heading?" Well, as I think we all know, but may be reluctant to admit, we're either stalled or slipping backwards. In a preview of their August "Month in Review", which will be published next week, RCA has moderately lowered their 2011 transaction volume projections. An email I got from RCA Editorial Director, Peter Slatin states, "The slowing likely reflects greater unease about the broader economy as well as the recent pullback in CMBS originations and tighter credit availability from other lenders as well."

I totally agree. But I believe, in general, that it's simply a feeling of total uncertainty about so many things that have put people into a funk. The answer simply is: We just don't know. We no more know what's going happen tomorrow than we know what will happen in a month, six months, a year, five years. All we are pretty sure about is what we know that happened yesterday. And what we can do, while the world is, hopefully, sorting itself out is to focus on those things that we can change and make a positive impact on. While these are the kinds of times that try mens' souls, these are also the times when we learn more about who we really are. And, to me anyway, there is nothing more important than being true to yourself.

Update: The Nick Tyrell Memorial Seminar. October 12, 2011.
You can register here (it's free to attend) and I'll send you a link next week about how to donate to the fund set up in Nick's name. The program for the day looks great with presentations by a number of the leading industry thinkers. My colleague, John Gellatly, and Paul McNamara will deliver the eulogy. If you can, please attend.

Congratulations to my friend, Jeff Fisher, who was appointed by both ARGUS and RCA to the position of Senior Global Consultant strengthening and further aligning the partnership of the two companies.

Memorable Experience of the Week: Kitchak Cellers, Napa, CA. Many months ago, I met a couple while having dinner by myself at the bar in a Napa bistro. They offered me a taste of the wine they had brought with them. It was delicious. I learned that it was wine that they make themselves. But in another amazingly small world encounter, Peter Kitchak is a career commercial real estate consultant. So, with that as the backdrop, last weekend, after months of back and forth about trying to schedule a day for us to stop by their place, we finally made. Not having gone on their website beforehand, I truly had no idea what to expect. But if you go on their website, you will have an idea and what you see there truly exists and is even more special in person. Kitchak is a private winery with tastings by appointment only. They have a wine club with a significant membership and Patricia and Peter Kitchak are very nice, interesting and passionate people. If you are serious about wine I encourage you to contact them next time you are in the Napa area. But, if that may be a while out, I can, without reservation (no pun intended) highly recommend their wine which you can get via their wine club.

On the Road:

September 21-22: Amsterdam to attend and moderate a panel at the PERE Global Forum.
September 26-28: Colorado Springs to attend the NAREIM Executive Officers Meeting.
September 30-October 3: Asheville, NC to visit see my newest grandson for the first time.
October 4-6: Las Vegas to attend and be a panelist at CBRE's Americas Summit.
October 17-19: Chicago to attend the PREA conference.
November 1-4: Washington, DC to attend the CRE Annual Convention
November 9-10: New York to attend and moderate a panel at the PERE Forum
November 17-18: Frankfurt to attend and moderate a panel at the PERE Forum-Europe

These are my views and not that of my employer.

Good Ole Days, Nick Tyrell, Dreams and ice cream

2011-09-09T05:28:00.000-07:00

Matt Slepin and his colleagues at Terra Search Partners publish a regular piece called Viewpoints. Yesterday their most recent issue hit my mailbox. I thought you'd find this section particularly interesting.

"At the beginning of this year, it felt like we were exiting the darkness of the recession. There seemed to be a light at the end of the tunnel, a glimpse that maybe we would indeed return, although cautiously, to the realm of the Good Ole Days. CMBS 2.0 was gaining momentum, investment sales volume seemed to be returning, and indeed our search business felt back on a roll. But the second quarter brought us back down to reality as employment remained flat, CMBS 2.0 fell apart, and the ripples of the failed debt reduction talks, the S&P downgrade, and the parallel dysfunctions in Europe sunk in. Now it feels as though the first quarter was the effect of pent-up demand and the settling into the New Normal versus a return to the Good Ole Days. Real estate in the US is saying crazy, contradictory things. Multifamily is the one sector with largely positive long term drivers. The other sectors all seem more affected by secular changes – technology, globalization, and corporate efficiencies all have deep and obvious impact on the other major real estate “food groups.” Hospitality is, as always, more volatile and the bottom in the residential sector sadly still seems to be several years out."

Special Event: The Nick Tyrrell Memorial Seminar : Applying Research Insights to Real Estate Investment Management:

Nick was a friend of mine as he was of many in the industry. This looks like a great program with some of the leading Research/Investment Strategists in the industry in attendance. Unfortunately, I will only be able to attend in spirit. The seminar will be used to raise money for the Nick Tyrrell Memorial Fund, which will present awards to papers that combine academic discipline with practical insights for the real estate profession. The event is being hosted by JPMorgan Asset Management, Nick's last employer and is being held on October 12 at 4pm to 8pm at Victoria Embankment, London. I will include more details as I get them.

This quote, sent to me yesterday by a good friend, really hits home: "We live in a moment of history where change is so speeded up that we begin to see the present only when it is already disappearing." Ronnie Laing

I don't dream all that often. I've been trying to corollate my dreaming being associated with when I eat ice cream just before going to bed...but I'm going to have to keep testing that thesis! But early this morning I woke up from a dream and just couldn't go back to sleep. I dreamed about getting up and calling my father. Just to see how he was doing. The problem is that he died in November 2009. I guess in my dream he was still reachable by phone. But, I remember what one of you guys wrote me when I was spending a lot of time with my Dad in his final months: you can talk with him anytime you want. I remembered that just now and decided to close my eyes and have a chat with him. He really didn't want to talk much about how he's doing and what type of things he's involved with...perhaps he's not allowed to divulge that kind of stuff. But he did listen to what was on my mind and these days there are a few things that should be keeping me up at night. It's been a good early morning for me, simply the ability to reach out to my Dad and also to write about this to you. Actually, the more I think about it, I'm pretty sure the dreaming is due to ice cream but maybe it's only specific flavors. More research is definitely in order.

Enjoy your weekend.

Steve

P.S. My cousin, Jeff Smiley, went to the Air Force Academy and flew B-52's in Vietnam. More than 20 years ago, at age 41, he died of some type of leukemia. After the funeral ceremony, attended by hundreds of people whose lives he had touched, I went back to his house and found the following poem, framed and hung on a wall. My old classmate, Peggy Noonan, drew from this for President Regan's speech after the Challenger disaster. Even though it's been adopted as a mantra by pilots, I thought it also had meaning for those who had innocently boarded those airplanes on September 11, 2001. I offer it to you in honor of their memory.

High Flight

Oh! I have slipped the surly bonds of earth
And danced the skies on laughter-silvered wings;
Sunward I've climbed, and joined the tumbling mirth
Of sun-split clouds - and done a hundred things
You have not dreamed of - wheeled and soared and swung
High in the sunlit silence. Hov'ring there
I've chased the shouting wind along, and flung
My eager craft through footless halls of air.
Up, up the long delirious, burning blue,
I've topped the windswept heights with easy grace
Where never lark, or even eagle flew -
And, while with silent lifting mind I've trod
The high untresspassed sanctity of space,
Put out my hand and touched the face of God.

Pilot Officer Gillespie Magee
No 412 squadron, RCAF
Killed 11 December 1941

On the Road:

September 11-16: New York (Yes, I am flying to New York from San Francisco on Sept. 11)
September 20-21: Amsterdam to moderate a panel at the PERE Global Forum
September 26-28: Colorado Springs to attend the NAREIM Executive Officers Meeting
October 4-6: Las Vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.”
October 17-19: Chicago to attend the PREA fall meeting
November 1-4: Washington, DC to attend the CRE Annual convention
November 9-10: New York to moderate a panel at the PERE Forum-North America
November 17-18: Frankfurt to moderate a panel at the PERE Forum-Europe

Congratulations to my friend, Peter Lewis, who has just joined the consulting firm Towers Watson as head of their U.S. consulting business.

These are my views and not that of my employer.

Labor Day 2011

2011-09-02T20:04:00.000-07:00

So, the big news this week was the announcement that The Townsend Group had sold a 70% interest in their firm to a start-up private equity group. Congrats to Townsend on what appears to be an excellent deal. Also good to read was that the remaining 30% still to be controlled by Townsend has been divided amongst a number of their current 'internal' partners. A classy move I'd say as there have been too many of these type deals, not necessarily in our industry, where a few people get really rich and the rest of the employees basically suck wind. I guess one thing that crosses my mind in reading the news is whether Townsend will continue to focus on growing their investment management business vs. their advisory business and how their advisory clients are going to react (if at all) to this deal. I guess, there's a lot more buzz amongst the consulting community who may be licking their chops feeling that Townsend's advisory client list is ripe for picking off. It could be an interesting story unfolding right before our eyes.

Well, the summer is over...can it possibly be? But, I see it in some ways as a time of renewal, or perhaps renewed energy. In some ways Europe basically shuts down as people are off on their holidays and it's difficult to either get to someone or get an answer on something. In the U.S., from where I sit, it was a confusing summer and perhaps we all should have taken the summer off as well. But with the crisp mornings and clear skies (at least in Napa) it's energizing. Those who are looking for new jobs are hoping that the fall brings with it more clarity; those that are looking to raise capital hope that the uncertainty that has constrained some institutional investors from making commitments, is over completely, that it's understood or accepted enough to allow them to move forward; those of us who attend fall conferences are finalizing our travel schedules and those who need to be 'on the road' to get their job done are looking at how to arrange everything they want to accomplish without going nuts. There's a lot going on!

I guess that by next week virtually all public school systems in the U.S. will be back in session. I remember those years, going shopping for school supplies which included loose leaf binders, dividers, pencil cases (I know, sounds nerdy but we all had them), book straps (dangerous elastic things that allowed us to carry a number of textbooks to and from school; book bags have made that easier). It all sounds antique now. But other than during the years that I went to summer camp and the end of the summer (for those of us teenagers and older) meant teary good-byes, I don't remember ever feeling bad about going back to school. In fact, I wouldn't mind going back now but perhaps as a teacher (although aren't we always students? A friend recently told me, "When a student is ready, a teacher will appear"). I've approached my local community college about teaching some classes on improving presentation skills (aka how to live without PowerPoint slides), networking skills and managing a contact database, public speaking skills, you get the idea. I don't think too much of this is actually taught these days although I do know that some schools do offer interview skills classes. Anyway, I wrote to the President of the school this week and I'll let you know if anything transpires.

My life is people. I love learning about people, not just what they do but who they are, where they grew up, went to high school, etc. . And what's great is that people love sharing stuff about themselves; all you have to do is ask them. It really brings us closer together. When I was running an RTC contractor office and had hired 55 people in short order to work out hundreds of troubled loans and assets, I started a Friday morning "Bagels and..." session. At these, each week, three people would tell the group about themselves; stuff we might not know and also about their background in the real estate industry and skills they'd developed. Not only did we learn more about each other as people we also learned who had specialized experience in this, that or the other thing so that when something came up regarding one of our assets, we knew who the 'go-to' person was. It's the true value-add. Do you know who in your shop knows more than they may be asked to do on a day-to-day basis? It might be interesting finding out, don't you think?

"Labor Day, the first Monday in September, is a creation of the labor movement and is dedicated to the social and economic achievements of American workers. It constitutes a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country. The first Labor Day holiday was celebrated on Tuesday, September 5, 1882, in New York City. The form that the observance and celebration of Labor Day should take were outlined in the first proposal of the holiday — a street parade to exhibit to the public "the strength and esprit de corps of the trade and labor organizations" of the community, followed by a festival for the recreation and amusement of the workers and their families. The vital force of labor added materially to the highest standard of living and the greatest production the world has ever known and has brought us closer to the realization of our traditional ideals of economic and political democracy. It is appropriate, therefore, that the nation pay tribute on Labor Day to the creator of so much of the nation's strength, freedom, and leadership — the American worker."

The preceding is from the U.S. Government website. It seems a little self-serving, perhaps typically American. Another way to look at it might be simply that it's time to give each other a little pat on the back because, when you come down to it, all of us who work for a living are connected. Perhaps it's time to revisit the definition of Labor Day and use it as a way to bring America together again.

On the Road:

September 11-16: New York
September 20-21: Amsterdam to moderate a panel at the PERE Global Forum
September 26-28: Colorado Springs to attend the NAREIM Executive Officers Meeting
October 4-6: Las Vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.”
October 17-19: Chicago to attend the PREA fall meeting
November 1-4: Washington, DC to attend the CRE Annual convention
November 9-10: New York to moderate a panel at the PERE Forum-North America
November 17-18: Frankfurt to moderate a panel at the PERE Forum-Europe

Congratulations to my friend Wietse de Vries who has joined Almazara Real Assets Advisory as a partner. The firm advises pension funds, insurers and other institutional investors on their investments in real estate and infrastructure.

These are my views and not that of my employer.

Labor Day 2011

2011-09-02T09:09:00.000-07:00

Congratulations to my son, Brian and his wife, Bridget on the birth of their second son, Gavin who is being kissed by his older brother Sean. A very sweet picture!

These are my views and not that of my employer.

Are you getting OTR into your inbox?

2011-08-29T06:17:00.001-07:00

Hi. Two people wrote me to say they wondered if I had stopped publishing as they hadn't heard from me in the past two weeks.

Could you please reply and let me know 'yes' or 'no' if you've received OTR the past two weeks?

Thanks a lot.
Steve

Deal slowdown, Prequin survey, Alzheimer appeal, Steve Jobs, Gavin Muldoon Felix

2011-08-26T02:08:00.000-07:00

With so much tumult in the world these days is it any wonder that commercial real estate transactions are slowing....again?

RCA reported this week: Sales of significant commercial property totaled $13.0b in July, roughly the monthly average for the first five months this year, excluding the stand-out June volume. Nevertheless, on a year-over-year basis, the 16% increase in transactions is the lowest recorded since growth turned positive in December 2009, likely reflecting the greater economic turbulence and pullback in CMBS conduit originations that have emerged this summer. The tempering of activity was widespread.

Also, I found some of the published results of Prequin’s 2Q11 Quarterly pretty interesting and offer them to you here:

Survey of Investment Consultants

more than ⅔ of respondents believe that North America will present the best investment opportunities over the coming 12 months.
Half of respondents believe that Asia, with it’s developing markets, will offer attractive opportunities in the next year, while around one third believe Europe and South America present good prospects.
Asked to rank fund types on a scale of 1-5 (5 being the most attractive):

Opportunistic: 3.7
Distressed private real estate: 3.6
Value add real estate: 3.6
Core-plus: 3.0
Core: 2.6

Key-est issue right now? Valuation of investments

Fund of Funds

fundraising remains a challenging prospect
fewer funds being launched

targeting less capital

amount of capital raised has fallen dramatically

Strategy demand of investors?

core, debt and distressed strategies

Accessing top-tier funds and global diversification not as compelling as in previous years

investor appetite for fund of funds has declined

number of new investors investing in real estate for the first time via fund of funds has declined

Appeal to help to end Alzheimer’s Disease:
The other day, just after getting off a call with a long-time friend who told me his mother is suffering from Alzheimer’s Disease, I received an email from a very good (and generous) industry friend telling me that her sister and a friend are raising money for the nation’s largest “walk”sponsored by The Alzheimer’s Association to raise awareness and supply funds for Alzheimer care, support and research to take place on October 22, 2011. I have made a donation and hope you can find it in your heart to donate as well. I believe that there are not too many of us do not know someone who has this really crummy disease. Please follow this link . Every little bit helps. Thanks a lot.

We are living in a world that has a lot on its’ mind. Perhaps too much. And, because of the proliferation of irresponsible media, there are things that should not get ‘air time’ that do. Why are reality shows so popular? I believe that, like sports, they are an escape from reality and perhaps they are truly what entertainment is supposed to be....a way for us to detach from the day to day things we have to deal with and transport ourselves into ‘their’ world for 23 minutes. But I am worried about us as a society. I am really worried about the world that my grandchildren will inherit. Will we leave it better than we found it? I am worried that we won’t.

I just learned that John Ingram died in July. John had been, for many years, the real estate guy at Marshall's Department Stores. He also was the Chairman of the ICSC (International Council of Shopping Centers). John and I got to know each other, not through deals that we made, but through the ICSC. John was a good man. He had integrity and a big grin. He was a class act and a guy who exemplified a real professional.

With Steve Jobs stepping down this week as CEO of Apple there were a number of articles and blog postings , some sounding like obituaries. I’ve been using a Mac since 1998 and while not a Maciac, I’m glad I made the switch from PC. I’ve pulled a couple of lines from one of the postings that I think are particularly poignant: “He said we will carry our music in one place, and we did. He said we will download our entertainment, and we did...Steve Jobs hasn't merely created technology for us. He has created the way we interact with it, and in so doing he's recreated the way we live. We've evolved because of Steve Jobs. We see technology the way he sees it, and that's because he, like almost no one else, has always had a unique ability to see the world as we see it.” This guy has changed our world. How many people, in all of history, can we say that about?

Serious sushi of last week: My ‘special’ sushi place in New York for more than 20 years has been Sushi Zen on 44th Street just west of Sixth Avenue. And, while other sushi fans have invited me to ‘their special place’ it wasn’t until last week that I ate at a serious contender: Sushi Yasuda, 204 E. 43rd Street, New York. (P.S. If you decide to try it out please invite me :-)

Welcome to the world: Gavin Muldoon Felix; August 25; 7am; 8.9 lbs; 22 inches!

On the Road:

August 29-September 9: Northern California
September 11-16: New York
September 20-21: Amsterdam to moderate a panel at the PERE Global Forum
September 26-28: Colorado Springs to attend the NAREIM Executive Officers Meeting
October 4-6: Las Vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.”
October 17-19: Chicago to attend the PREA fall meeting
November 1-4: Washington, DC to attend the CRE Annual convention
November 9-10: New York to moderate a panel at the PERE Forum-North America
November 17-18: Frankfurt to moderate a panel at the PERE Forum-Europe

Congratulations to my good friend Gunnar Branson on being named President/CEO of NAREIM (National Association of Real Estate Investment Managers).

These are my views and not that of my employer.

CalPERS; organizing your email; concert stage collapse

2011-08-19T06:16:00.000-07:00

CalPERS has often been looked at as one of the leaders that many other pension funds follow. just this past week they announced plans to launch a new emerging manager program. in a world that likes labels, the definition of 'emerging manager' has been somewhat of a moving target but the CalPERs definition is one that i personally subscribe to: "managers with (a) less than $1Bn of assets under management and (b) no more than three prior commingled funds or separate account investment vehicles." like with anything, there will be objection to this definition from some managers who think of themselves as still emerging. as stated in the public record of the recent investment committee meeting, the proposed five-year program will not exceed $200MM and will focus on investment in managers and assets located in urban California markets. CalPERS retained Crosswater Realty Advisors (aka ted leary and his posse) to present a report to the investment committee on this subject. while a number of public pension funds already have an emerging manager program in place, it'll be interesting to see if others follow.

i apologize for overloading your inbox with three OTRs this week. without boring you, after two weeks of failing to deliver OTR to you, i finally found out what the problem was (i hope).

update on my new email management system. a few months ago i wrote you about a new way to manage emails that i read about. i decided to implement it immediately. i'm here to tell you that it is working for me. simply, it's the same idea that was suggested years ago when all we had was paper. when something lands on your desk or in your in box, do one of three things with it: act on it, delegate it or toss it. this email system is similar but with a couple of extra wrinkles. yes, every day, i do use that system (although i don't have many situations where i can delegate stuff) but i also created email folders with the following labels: tickler (which i check first thing every day and which contains items that need attention soon); reference (for stuff that i want to 'file' that could be research stuff or things i feel i will be able to use somewhere down the line); waiting for (as it says, for things that i'm waiting for from somebody); future meetings (where i want to remember to schedule a meeting with someone at a future date); someday/maybe (needs no explanation). i also have labels for each month where i do save a number of emails from that month but then, at the end of each month, i purge those files wondering, "why the heck did i save this one or that one?" anyway, it's working for me although we all have different ways of keeping our lives organized and, it's whatever works for you that counts, right?

as the media tends to behave, when one disaster, natural or otherwise happens, they scour the world looking for other things that resemble the first disaster. but, i can't let this week pass without mentioning the horrible stage collapse at the music venue in indiana. watching the one video on you-tube which captured the horrific scene brought tears to my eyes and chills to my body. i haven't read anything in the past couple of days but as you would expect, there is finger pointing and stuff that comes along with it, looking to place blame. and, just from going by what has been reported, some are suggesting that there were advance warnings of very high winds approaching. should they have been heeded immediately? were they even communicated to the stage manager and audience?

looking at the size and elaborateness of the stage/sound/lighting and everything that goes along with producing a big, live music event, i was thinking about how it's all grown, so big, from the good old days when the beatles played shea stadium in ny with their vox amplifiers and simple stage arrangement (of course, no one could hear them due to all the screaming!). and, as ticket prices for live shows have soared, promoters and the bands themselves have escalated the elaborateness of the delivery (i saw the stones in germany a few years ago when their stage recreated an ocean liner and U2 and bon jovi and pink floyd which also had huge set ups). this tragedy won't change things but i think that given the great advances of technology, especially in sound engineering, music can be delivered to certain size crowds with less gigantic structures (although a lot of what's on those structures is lighting related). i remember when MTV first launched. my reaction was, "this is music, it's an audio sensory thing, not a visual sensory thing." of course, history has shown that that has all changed. but in my simple way of looking at things, it's still all about the music, the sound, the human beings performing rather than the ancillary entertainment that almost serves as a distraction from the music. but (big sigh), i'm probably exposing the fact that i yearn for some of the simpler things and yet, i know that they will most likely never return. those killed and hurt in indiana could have (and may actually be) our sons or daughters or our friends who had just gone there to groove on the music. what happened is just so, so sad but just like lots of things. it seemed like it was mother nature, once again flexing her muscles, perhaps warning us in some ways that she's concerned about the direction society is moving. who knows?

who said “size matters”? there are two published pieces i receive that are in an interesting format (is it a trend?). they’re about half the size of an 8 ½ x 11 piece of paper and are very cute. one, called the decisive eye is published by Internos Real Investors and the other called the property perspective is published by Frogmore. I like the “kindle” size as it makes it easy to take with you. Nice to see some people thinking differently.

restaurants of the week (first time at both):
1. fig & olive, several manhattan locations. i ate at the one on 52nd street between madison and fifth. thanks zoe.
2. fresco by scotto, also on 52nd between park and madison. thanks jerry (my accountant for longer than we both want to admit) who published a periodic blog called, achieve great things!

OTR was listed as #7 in the best real estate/finance blogs in a just published survey in The Institutional Real Estate Letter-North America. thanks for all your support and encouragement over the years.

photo: nj balloon festival, august 2011. thanks jerry

on the road….

aug. 22-26: new york
aug. 29-sept. 9: northern california
sept. 12-16: new york
sept. 20-21: amsterdam to moderate a panel at the PERE Global Forum (flying aeroflot from jfk-moscow-amsterdam). first time on aeroflot. Called them numerous times to try to reserve as seat. They either don't answer or have no one who speaks English! Should I be concerned?
oct. 4-6: las vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.” (oh no, that crystal ball thing again!) thanks to asieh mansour, CBRE’s head of research americas for inviting me to join ray torto of CBRE and geof dohrmann of IREI in this discussion.
oct. 17-19: chicago to attend the PREA fall meeting
nov. 2-5: washington, dc to attend the CRE Annual convention
nov. 9-10: new york to moderate a panel at the PERE forum

These are my views and not that of my employer.

August 5, 2011

2011-08-17T18:45:00.000-07:00

in a harvard business school case, “bono and U2”, professor nancy koehn discusses business lessons to be earned from the famous band.

key concepts include:

• · take stock of how you are using your funds, your authority and your people.
• · a leader’s mission and purpose isn’t static; it evolves.
• · the mission of the ceo should be related to the organizations performance.
• · who you are and what you stand for as an organization have great relevance to the people who buy your product (or service)

“in the bigger picture, U2’s journey reflects our own moment here in the early 21st century. U2’s appeal has always been about our common humanity and the yearning we all experience to follow a higher path. people are looking for the light and U2’s music has spoken to that since the band started.”

“any ceo who thinks his or her job is primarily about maximizing shareholder value is living in the past. the game of what kind of capitalism will define this century has changed very quickly and dramatically. creative capitalism, conscious capitalism, stakeholder capitalism, call it what you will. the larger social footprint and role of business are here to stay.”

it’s a very interesting piece which i’ll be happy to send you. and, while it’s written towards ceo’s of companies, when you think about it, we are all our own ceo’s of ourselves and the way we choose to live our lives matters to us, if to nobody else. we have those choices to make. i have made it my mission to try to bring the world closer together, one person at a time. one of the wonderful byproducts of all the travel I’ve done is getting to meet people and understanding them better and hopefully leaving them with a little better understanding of americans. we're talking about people here, not countries, not religions as we are all the same....human beings. from the time very early one morning that I talked with a paris policeman who was guarding the palace of the president of france right after we invaded iraq and americans were ‘personna non gratt’ in france and we agreed that we did not hate each other, we just hated what america had done to meeting people in liberia and bringing back the challenges that they face, these experiences have been really meaningful to me.

like many of you, i’ve been planning what industry events to attend this fall and winter. and as you can see by my schedule below, i’ve made some decisions already. but it got me thinking: what are my expectations from attending a conference? are they met? exceeded? what is it that you’re not getting that you’d like to? after all, attending almost any conference (and some in particular) is expensive and time consuming and when you combine those you’d like to leave a conference feeling that not only was it worth spending your time and money but that you would recommend it to a friend.

if you have some time, i’d really appreciate you sending me your thoughts, perhaps wish list, when you say, “ I wish there was an event which provided this (whatever this is to you).” thanks.

thanks to drew genova of cbre in washington, dc who sent me an article called “secrets to better networking.” the suggestions come from a book called “never make the first offer” by donald dell, founder of the proserv sports agency.

make friends. create opportunities to get to know people out of the office, out of the normal parameters of the business relationship and outside mutual comfort zones.
make friends of their friends.
find mentors.
give advice (carefully)
don’t keep score.
massage your network. send personal notes.
show no fear.
do good works. charitable endeavors

i’ve built a wonderful network of people which is now global. this column is read (or at least received J by people all over the world. i consider it both a privilege and a responsibility and have always treated the people i know with respect and consideration. my connectivity has never been calculated. i just love people and love helping people. i realized, not all that long ago, when I was trying to identify what made a good day for me, it was when i was able to help someone, not necessarily in a big way. it feels good. i endorse some of the points that dell makes above but a couple of things i’d add is ‘be yourself’, ‘be natural’, 'don't take people for granted' and 'don't abuse your network.'

On the road….

aug. 15-26: new york
sept. 12-16: new york
sept. 20-21: amsterdam to moderate a panel at the PERE Global Forum
oct. 4-6: las vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.” (Oh no, that crystal ball thing again!) Thanks to asieh mansour, CBRE’s head of research Americas for inviting me to join ray torto of CBRE and geof dohrmann of IREI in this discussion.
oct. 17-19: chicago to attend the PREA fall meeting
nov. 2-5: washington, dc to attend the CRE Annual convention
nov. 9-10: new york to moderate a panel at the PERE forum

these are my views and not that of my employer.

August 12, 2011

2011-08-17T18:41:00.001-07:00

this morning, for the first time in a long, long time, i sat down to write this little story to you, stared at the blank page, and wondered what i could write that would be of interest to you.

i’m not qualified to write about the craziness of the stock market (although my opinion is that, just like so many things, over-reaction is rampant in the world).

as you know, with an occasional slip-up, i’ve stayed away from politics (also not qualified to comment).

and, as many of my european real estate industry friends are off on ‘real’ holidays (i.e. at least two weeks during the summer and when you get a ‘gone fishing’ email reply, saying they will not be checking email, you know they mean it.

but, the commercial real estate business chugs along, just like the little engine that could, working it’s way up a steep hill and trying to find itself again.

RCA published a release this week on the subject of Development Land deals.

• Sales of developable land increased by 64% year-over-year in H1'11 to $3.2 billion. Though that's still below growth for other property sectors, increasing volume in this sector indicates some loosening of what has seemed a near moratorium on development.
• As in the broader market, investors have focused on multifamily and CBD sites in primary markets. Prices for land have fallen farther than for all other property types, and lenders are still achieving lower recovery rates on average for land than in other sectors. Nonetheless, well-located land has achieved close to peak-era pricing as well as recovery rates that are closer to the average rates for other property types.

to me, this is not unexpected. developers have always been the real risk takers in our industry. through exhaustive market research (sometimes) they determine that a piece of property has potential. when they’re right, it’s a big win. when they’re wrong, well, it’s a problem. real estate has always been a game of deep pockets, deep enough to ride out the storms that affect absorption of houses, apartments, office, retail and industrial space, what have you. and with a renewed optimism about things, it’s not surprising that development sites are hot again. and, if you were trained, like i was, that the upside is made on the buy, prices like these are probably very tempting. who is lending money for development sites i’m not sure about but there are more pockets of money these days than the traditional sources, deep or otherwise, which have a higher threshold of risk (although there will come a day of reckoning when they’ll have to face their investors…either with a check, a bill or the news that they had to give the property back).

there is one thing that i would like to share with you today: in the summer of 2008, when i was thinking about the next step in my career, i read a bunch and summarized of books. these days i've been thinking about me waking up one day, just after my 106th birthday, and feeling, ‘i shoulda done this or i shoulda done that or i shoulda…..’ i’m sure some of you know those feelings. so here are a few things from some of the stuff i've read (and in some cases been re-reading) that have struck me this week:

• it’s human nature for people to take precisely as much interest in you as they believe you’re taking in them. there is no stronger way to build relationships than taking a genuine interest in other human beings and allowing them to share their stories.
• everyone should start at ground zero. they should ask, ‘is this viable anymore? is this what the world wants?”
• having a vision is not enough; if you fail to envision the potential of your creation, it will be left for others to exploit. what you need is a vision and the ability to develop a strategy to achieve it.
• “if a man has a talent and cannot use it, he has failed.” thomas wolfe
• “what you can do or think you can do, begin it. for boldness has magic, power and genius in it.” goethe
• "if you let them, things just happen in the right way, at the right time. at least they do when you let them, when you work with circumstances instead of saying, “this isn’t supposed to be happening this way, “ and trying hard to make it happen some other way. if you’re in tune with The Way Things Work, then they work the way they need to, no matter what you may think about it at the time. later on, you can look back and say, “oh, now I understand. that had to happen so those could happen and those had to happen in order for this to happen….” then you realize that even if you’d tried to make it all turn out perfectly, you couldn’t have done better and if you’d really tried, you would have made a mess of the whole thing.” the tao of pooh
here are the tour dates for a good friend (and the guitarist in my ‘band’) ernie hendrickson. if he is coming to a place near you i encourage you to check him out. i also guarantee that you will enjoy it. ernie is the real deal!

Friday, August 26th
Cafe Carpe
Ft. Atkinson, WI
Saturday, August 20th
FarmFest
Kinsman, IL
Thursday, September 1st
The Lemon Grove Cafe
Youngstown, OH
Friday, September 2nd
South Park Tavern
Dayton, OH
Thursday, September 8th
Tiger Room at Calhoun Street Spirits
Fort Wayne, IN
Saturday, September 10th
The Living Room
New York, NY
Sunday, September 11th
Felicia's Atomic Lounge
Ithaca, NY
Monday, September 12th
Bullfrog Brewery
Williamsport, PA
Friday, September 23rd
Six Strings Club
Bloomington, IL
Friday, September 30th
Redstone Room
Davenport, IA
Saturday, October 1st
Cheesefest!
Shullsburg, WI
Saturday, October 1st
The Wheel Inn
Shullsburg, WI
Thursday, October 20th
Anderson Fair
Houston, TX
Friday, October 21
The Bugle Boy
La Grange , TX

Congratulations to my friend Lynn Kehoe who joined another friend, Ed Schwartz at ORG Real Property as a consultant and a member of the investment committee.

on the road….
aug 11-aug. 14: northern california
aug. 15-19: new york
aug. 22-sept. 9: northern california
sept. 12-16: new york
sept. 20-21: amsterdam to moderate a panel at the PERE Global Forum
oct. 4-6: las vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.” (Oh no, that crystal ball thing again!) Thanks to asieh mansour, CBRE’s head of research Americas for inviting me to join ray torto of CBRE and geof dohrmann of IREI in this discussion.
oct. 17-19: chicago to attend the PREA fall meeting
nov. 2-5: washington, dc to attend the CRE Annual convention
nov. 9-10: new york to moderate a panel at the PERE forum

These are my views and not that of my employer.

what's going on?; coulda, shoulda, woulda

2011-08-12T10:45:00.000-07:00

this morning, for the first time in a long, long time, i sat down to write this little story to you, stared at the blank page, and wondered what i could write that would be of interest to you.

i’m not qualified to write about the craziness of the stock market (although my opinion is that, just like so many things, over-reaction is rampant in the world).

as you know, with an occasional slip-up, i’ve stayed away from politics (also not qualified to comment).

and, as many of my european real estate industry friends are off on ‘real’ holidays (i.e. at least two weeks during the summer and when you get a ‘gone fishing’ email reply, saying they will not be checking email, you know they mean it.

but, the commercial real estate business chugs along, just like the little engine that could, working it’s way up a steep hill and trying to find itself again.

RCA published a release this week on the subject of Development Land deals.

Sales of developable land increased by 64% year-over-year in H1'11 to $3.2 billion. Though that's still below growth for other property sectors, increasing volume in this sector indicates some loosening of what has seemed a near moratorium on development.
As in the broader market, investors have focused on multifamily and CBD sites in primary markets. Prices for land have fallen farther than for all other property types, and lenders are still achieving lower recovery rates on average for land than in other sectors. Nonetheless, well-located land has achieved close to peak-era pricing as well as recovery rates that are closer to the average rates for other property types.

to me, this is not unexpected. developers have always been the real risk takers in our industry. through exhaustive market research (sometimes) they determine that a piece of property has potential. when they’re right, it’s a big win. when they’re wrong, well, it’s a problem. real estate has always been a game of deep pockets, deep enough to ride out the storms that affect absorption of houses, apartments, office, retail and industrial space, what have you. and with a renewed optimism about things, it’s not surprising that development sites are hot again. and, if you were trained, like i was, that the upside is made on the buy, prices like these are probably very tempting. who is lending money for development sites i’m not sure about but there are more pockets of money these days than the traditional sources, deep or otherwise, which have a higher threshold of risk (although there will come a day of reckoning when they’ll have to face their investors…either with a check, a bill or the news that they had to give the property back).

there is one thing that i would like to share with you today: in the summer of 2008, when i was thinking about the next step in my career, i read a bunch and summarized of books. these days i've been thinking about me waking up one day, just after my 106^th birthday, and feeling, ‘i shoulda done this or i shoulda done that or i shoulda…..’ i’m sure some of you know those feelings. so here are a few things from some of the stuff i've read (and in some cases been re-reading) that have struck me this week:

it’s human nature for people to take precisely as much interest in you as they believe you’re taking in them. there is no stronger way to build relationships than taking a genuine interest in other human beings and allowing them to share their stories.
everyone should start at ground zero. they should ask, ‘is this viable anymore? is this what the world wants?”
having a vision is not enough; if you fail to envision the potential of your creation, it will be left for others to exploit. what you need is a vision and the ability to develop a strategy to achieve it.
“if a man has a talent and cannot use it, he has failed.” thomas wolfe
“what you can do or think you can do, begin it. for boldness has magic, power and genius in it.” goethe
"if you let them, things just happen in the right way, at the right time. at least they do when you let them, when you work with circumstances instead of saying, “this isn’t supposed to be happening this way, “ and trying hard to make it happen some other way. if you’re in tune with The Way Things Work, then they work the way they need to, no matter what you may think about it at the time. later on, you can look back and say, “oh, now I understand. that had to happen so those could happen and those had to happen in order for this to happen….” then you realize that even if you’d tried to make it all turn out perfectly, you couldn’t have done better and if you’d really tried, you would have made a mess of the whole thing.” the tao of pooh

here are the tour dates for a good friend (and the guitarist in my ‘band’) ernie hendrickson. if he is coming to a place near you i encourage you to check him out. i also guarantee that you will enjoy it. ernie is the real deal!

Friday, August 26th

Cafe Carpe
Ft. Atkinson, WI

Saturday, August 20th

FarmFest
Kinsman, IL

Thursday, September 1st

The Lemon Grove Cafe
Youngstown, OH

Friday, September 2nd

South Park Tavern
Dayton, OH

Thursday, September 8th

Tiger Room at Calhoun Street Spirits
Fort Wayne, IN

Saturday, September 10th

The Living Room
New York, NY

Sunday, September 11th

Felicia's Atomic Lounge
Ithaca, NY

Monday, September 12th

Bullfrog Brewery
Williamsport, PA

Friday, September 23rd

Six Strings Club
Bloomington, IL

Friday, September 30th

Redstone Room
Davenport, IA

Saturday, October 1st

Cheesefest!
Shullsburg, WI

Saturday, October 1st

The Wheel Inn
Shullsburg, WI

Thursday, October 20th

Anderson Fair
Houston, TX

Friday, October 21

The Bugle Boy
La Grange , TX

Congratulations to my friend Lynn Kehoe who joined another friend, Ed Schwartz at ORG Real Property as a consultant and a member of the investment committee.

on the road….

aug 11-aug. 14: northern california
aug. 15-19: new york

aug. 22-sept. 9: northern california
sept. 12-16: new york
sept. 20-21: amsterdam to moderate a panel at the PERE Global Forum

oct. 4-6: las vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.” (Oh no, that crystal ball thing again!) Thanks to asieh mansour, CBRE’s head of research Americas for inviting me to join ray torto of CBRE and geof dohrmann of IREI in this discussion.

oct. 17-19: chicago to attend the PREA fall meeting

nov. 2-5: washington, dc to attend the CRE Annual convention

nov. 9-10: new york to moderate a panel at the PERE forum

These are my views and not that of my employer.

ceo's and bono, industry events, networking

2011-08-05T08:14:00.000-07:00

in a harvard business school case, “bono and U2”, professor nancy koehn discusses business lessons to be earned from the famous band.

key concepts include:

· take stock of how you are using your funds, your authority and your people.
· a leader’s mission and purpose isn’t static; it evolves.
· the mission of the ceo should be related to the organizations performance.
· who you are and what you stand for as an organization have great relevance to the people who buy your product (or service)

“in the bigger picture, U2’s journey reflects our own moment here in the early 21^st century. U2’s appeal has always been about our common humanity and the yearning we all experience to follow a higher path. people are looking for the light and U2’s music has spoken to that since the band started.”

“any ceo who thinks his or her job is primarily about maximizing shareholder value is living in the past. the game of what kind of capitalism will define this century has changed very quickly and dramatically. creative capitalism, conscious capitalism, stakeholder capitalism, call it what you will. the larger social footprint and role of business are here to stay.”

it’s a very interesting piece which i’ll be happy to send you. and, while it’s written towards ceo’s of companies, when you think about it, we are all our own ceo’s of ourselves and the way we choose to live our lives matters to us, if to nobody else. we have those choices to make. i have made it my mission to try to bring the world closer together, one person at a time. one of the wonderful byproducts of all the travel I’ve done is getting to meet people and understanding them better and hopefully leaving them with a little better understanding of americans. we're talking about people here, not countries, not religions as we are all the same....human beings. from the time very early one morning that I talked with a paris policeman who was guarding the palace of the president of france right after we invaded iraq and americans were ‘personna non gratt’ in france and we agreed that we did not hate each other, we just hated what america had done to meeting people in liberia and bringing back the challenges that they face, these experiences have been really meaningful to me.

like many of you, i’ve been planning what industry events to attend this fall and winter. and as you can see by my schedule below, i’ve made some decisions already. but it got me thinking: what are my expectations from attending a conference? are they met? exceeded? what is it that you’re not getting that you’d like to? after all, attending almost any conference (and some in particular) is expensive and time consuming and when you combine those you’d like to leave a conference feeling that not only was it worth spending your time and money but that you would recommend it to a friend.

if you have some time, i’d really appreciate you sending me your thoughts, perhaps wish list, when you say, “ I wish there was an event which provided this (whatever this is to you).” thanks.

thanks to drew genova of cbre in washington, dc who sent me an article called “secrets to better networking.” the suggestions come from a book called “never make the first offer” by donald dell, founder of the proserv sports agency.

1. make friends. create opportunities to get to know people out of the office, out of the normal parameters of the business relationship and outside mutual comfort zones.

2. make friends of their friends.

· 3. find mentors.

· 4. give advice (carefully)

· 5. don’t keep score.

· 6. massage your network. send personal notes.

· 7. show no fear.

· 8. do good works. charitable endeavors

YouTube find of the week

On the road….

aug 5-aug. 14: northern california
aug. 15-19: new york
aug. 29-sept. 9: vacation
sept. 12-16: new york
sept. 20-21: amsterdam to moderate a panel at the PERE Global Forum

oct. 4-6: las vegas to be a panelist at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.” (Oh no, that crystal ball thing again!) Thanks to asieh mansour, CBRE’s head of research Americas for inviting me to join ray torto of CBRE and geof dohrmann of IREI in this discussion.

oct. 17-19: chicago to attend the PREA fall meeting

nov. 2-5: washington, dc to attend the CRE Annual convention

nov. 9-10: new york to moderate a panel at the PERE forum

these are my views and not that of my employer.

RCA mid-year reports; “above all, be true to yourself, and if you cannot put your heart in it, take yourself out of it.”

2011-07-29T11:12:00.000-07:00

one of you guys wrote me last week asking why i hadn’t mentioned RCA’s Mid-Year Reviews. i think it was because i can’t believe we are this far into 2011 already. but now that i’ve overcome that, here are some take-aways from the RCA reports:

Sales Surge at Mid-Year: Extend and Pretend Kicked Down the Road
Investment volume surged to $55.6b in Q2, a 117% increase from a year earlier
and totaling just shy of the year-end spike in transactions recorded in Q4’10. The acceleration in sales cut across all property types but was led by retail property sales of $15.2b. Prices were generally stable or improved over the quarter, but the dichotomy in pricing between the favored major markets and all others persisted, with some closing of the gap noted in the apartment and retail sectors.
New offerings also surged in Q2 and totaled $76.2b as improving prices have encouraged many more investors to list properties for sale. The volume of offerings in Q2 jumped 79% from a year earlier, the highest yoy gain since 2005, a point marking the end of the previous post recessionary period and the beginning of the pre-crisis property boom. Most property types should readily absorb this new supply of offerings, except the industrial sector, where offerings exceed closings by more than 2:1.

before sharing more of RCA’s mid-year commentary i have one comment to make:

the FDIC is doing a disservice to the industry, the American economy and the American people by allowing banks to extend loan maturities. they are trying to do something different than the RTC did and for which the RTC came under significant criticism. but, if the hope, and i can’t see it as anything more than hope, is that they’ll continue to allow this until the real estate market ‘picks up’, well, i’d like to know when in their crystal ball they see that coming. oh, wait a minute, i seem to recall reading somewhere : it’s going to be march 24^th 2012. sorry, but these assets should be cleared now. will banks take losses? sure. but the positive contribution that this will make to the industry will be a good thing. i know from talking with people on this that there is a lot of dissenting opinion and i fall back on ‘who knows?’ just a thought…now on with the RCA stuff:

Hotels: the hotel market continues to move smartly forward, with sales in Q2 of $4.7b providing the fifth consecutive quarter where volume increased by more than 150% year-over-year (yoy).
Industrial: with $6.6b of significant sales in Q2, the industrial property market had its second most active quarter since Q4’10, and enjoyed a 64% gain year-over-year (yoy) from the same quarter last year. the growth was fairly even across both sub-types, with flex boosted by the big-ticket sale of huge showrooms in Las Vegas and North Carolina.
Retail: the second quarter marked a breakout point for retail properties, with $15.2b in sales volume bending the growth curve skyward to 337% year-over-year (yoy), the highest of any property type. More strip centers changed hand in Q2 than in all of 2010 in the wake of the Blackstone/Centro deal. even excluding that benchmark transaction, yoy gain in Q2 was a respectable 75%, an acceleration from Q1. volume in the mall & other subtype rose 66% in Q2 from the year-earlier quarter. cap rates overall were relatively unchanged in Q2 and are at slightly lower levels than at the beginning of the year.
Apartments: with nearly $14.0b in volume, the sales trajectory for apartments was phenomenal, turning in the most active quarter since Q4’10. transaction volume surged 132% on a year-over-year (yoy) basis, a strong acceleration over Q1’s 72% increase. pricing has been stable, with average cap rates steady in Q2 and down only slightly from the beginning of 2011, while average pricing has remained near $100,000 per unit.
Office: with sales of significant properties reaching $14.0b in Q2’11, the office sector enjoyed its second best quarter since the financial crisis. Q2 office volume was up 50% year-over-year (yoy), a slower increase than the overall market, yet the sector was the first to witness a spike in activity beginning this time last year. sales of CBD properties, at $7.8b in Q2, were up 66% yoy buoyed by DC and Manhattan, which accounted for more than half of total volume. cap rates fell slightly nationwide but are only marginally below levels recorded at the beginning of the year.

i was interviewed this week for the 2012 edition of a well-known industry report. i knew that i had left my own crystal ball somewhere in my house (or maybe the FDIC had borrowed it) but try as i might i couldn’t find it so i had to wing it. actually, the questions i was asked got me thinking about what i’ve seen, what i’ve heard and what i believe....about the overall economy, about capital markets, about property types, about debt, about whether the situation with the banks (i refuse to write E&P) will end up being good or not, etc. this was no ‘puffy’ interview. and i too will have to wait to see what some of my industry colleagues had to say and what they were thinking in the middle of the summer of 2011 about our vision for 2012. fortunately, the interviews are confidential and there are no attributable quotes....that’s a relief!

have you ever wondered why someone comes into your life at a certain time? or why you hear a song that means so much to you just at the time you needed to hear it. or when something arrives in your mailbox and it says things that you’ve been thinking or that you read at another time in your life but the day it appears is the day that you needed reinforcement? well, that happened to me this week when an email called “Zen Habits” arrived.
a guy named scott dinsmore of Liveyourlegend.com wrote this special guest post on Zen Habits. maybe some of it has meaning for you too.

1. surround yourself with passionate people.
2. create space. If you don’t give big ideas room, they’ll never show up.
3. help someone in a way only you can.
4. keep a journal of what inspires and excites you.
5. challenge the norm.
6. scare yourself – live outside your comfort zone.
7. find the right reasons. you can’t control what happens but you can control your reaction to it. what challenges have come up today? How could you reframe them? the juiciest possibilities often have the best disguises. notice them.
8. learn something new.
9. the point is to constantly fuel something that interests you.

“above all, be true to yourself, and if you cannot put your heart in it, take yourself out of it.” Hardy D. Jackson

enjoy your weekend.

On the road....
july 29-aug. 14: northern california
aug. 15-19: new york
aug. 29-sept. 9: vacation
sept. 12-16: new york
sept. 20-21: amsterdam to moderate a panel at the PERE Global Forum

oct. 4-6: las vegas to moderate a panel at CBRE’s Americas Summit on “The Commercial Real Estate Industry of the Future: A 5-10 Year Outlook.” (Oh no, that crystal ball thing again!) Thanks to asieh mansour, CBRE’s head of research Americas for inviting me to join ray torto of CBRE and geof dohrmann of IREI in this discussion.

oct. 17-19: chicago to attend the PREA fall meeting

nov. 2-5: washington, dc to attend the CRE Annual convention

nov. 9-10: new york to moderate a panel at the PERE forum

“Life is all about trying-trying new things, not being afraid to try...."

Photo: "Building castles in the sand."

These are my views and not that of my employer.

food for thought and building your own digital cookbook....

2011-07-22T03:46:00.000-07:00

it’s a sweltering summer throughout most of the country (it'll be 101 in new york today!) but business goes on. years ago, many saw the summer as slow-down time, people are on vacations, leaving early (at least on fridays) and so it became sort of a self-fulfilling prophecy. but i firmly believe that business is almost as intense during the summer as it is during the rest of the year. yes, people take vacations when you’d really like them to be waiting for your call or answering your email. but that doesn’t mean that things come to a standstill....it’s that things require more patience, which, is truly a virtue.

a very interesting report was published this week by egon zehnder international and mckinsey & company. the title: return on leadership. a few morsels:

nothing matters more than customer impact

understanding the evolving needs of customers in detail
customer orientation is a key leadership competency necessary for improvement (along with people development and change leadership)

there is no standard skill for success but...

the organic revenue growth a company achieves by capitalizing on market growth of existing segments requires

outstanding, consistent execution across the organization and, often, across the globe which is driven by...

a strong cadre of senior managers (e.g. not the top team) who excel at business and people leadership

the senior management of companies with top-quartile portfolio momentum growth excelled in three key leadership competencies...

developing organizational capability

a systematic focus on developing critical skills throughout the organization

team leadership

the ability to focus, align and build high-performing teams

change leadership

the ability to drive large-scale, coordinated change across the entire organization

to summarize:

competencies for successful growth strategies require:

customer impact: continually takes action to add value to the customer
market insight: looks beyond current context
results orientation: drives uncompromisingly for higher performance
change leadership: advocates change
team leadership: actively involves team
collaboration and influencing: motivates others to work with self
strategic orientation: defines strategy for own area

perfect for a busy friday travel day: top 10 pet peeves of usa today's frequent business travelers (i’ve added some of my own comments in bold type). btw, don’t most of these relate to simple common courtesy and common sense?

1. loud cell phone conversations. (i put earplugs in as soon as i board to try to control my own environment as much as possible).

2. people who disobey the rules and try to carry on too many bags or carry too much liquid through security.

3. people who play music so loudly, even with earplugs or headphones, that others can hear it.

4. disrespect that passengers show to flight attendants and gate personnel.

5. parents who don't try to control their children. (rampant problem. neither flight attendants, nor teachers for that matter, are responsible for either teaching their children manners or disciplining them. that’s a parental job).

6. people who think the "turn-off-all-electronics" message is not for them. (these people did things behind the teachers’ back as well).

7. passengers who carry on and eat messy or smelly food. (smelly is the problem).

8. people who board with multiple or oversize bags and fill the bins in the front of the cabin when they're seated in the rear. (just plain rude but i know many flight attendants watch for this).

9. reclining a seat in a tight coach cabin. (these people are just plain scum.)

10. Leaving a window shade open when everyone else has closed theirs and is trying to sleep.

build your own a la carte digital cookbook! on tuesday, cookstr launched its first collection of ibooks recipes on apple's ibookstore, presenting renowned chef and cookbook author rozanne gold's 1-2-3 collection. fifteen years ago, gold started a revolution around the idea of simplicity in cooking. today, her exciting three-ingredient recipes, available for the first time digitally, are breaking new ground in a format designed for in-kitchen use. each recipe is 140 words or less. there are 250 recipes ($9.99), which can also be purchased separately by theme ($3.99 for 50 recipes) or chapter ($0.99 for 10 recipes). this is extremely cool and, in the spirit of full transparency, I know rozanne and her husband, the highly sought after international restaurant consultant, michael whiteman. but this is just one great use of technology and could even get me to start cooking!

and, just a little more food for thought for the weekend. a friend suggested I read the book “how life imitates chess.” i went through the book last saturday and pulled some stuff out that i’d like to share with you:

you need to be able to identify your mistakes and analyze why you made them.
“the man who knows how will always have a job. the man who also knows why will always be his boss.’ ralph waldo emerson
having a vision is not enough; if you fail to envision the potential of your creation, it will be left for others to exploit. what you need is a vision and the ability to develop a strategy to achieve it.
don’t spend so much time worrying about the other guy that you lose sight of your own goals and your own performance.
how much more affective would you become if, at the end of each day, you asked yourself what lessons you had taken away for tomorrow?
“if a man has a talent and cannot use it, he has failed.” thomas wolfe
dedicate yourself to making the time, finding a space in which you can think and learn and finding new ideas with which to shock your adversaries. (note: i was out to lunch this week with a good friend at a chinese restaurant in new york that has really smartly priced lunch specials in a very nice setting. the fortune in his cookie was, “always do right-this will gratify some and astonish the rest.” pretty heavy for lunch i’d say).
“what you can do or think you can do, begin it. for boldness has magic, power and genius in it.” goethe (i first saw this quote when i was a consultant to herb kohler at kohler company. i think it’s one of the most powerful things i’ve ever read. the challenge is to do it!).

on the road....

july 25-aug. 14: northern california
aug. 15-19: new york
aug. 29-sept. 9: vacation
sept. 12-16: new york
sept. 20-21: amsterdam to moderate a panel at the PERE Global Forum
nov. 2-5: washington, dc to attend the CRE Annual convention
nov. 9-10: new york to moderate a panel at the PERE forum

these are my views and not that of my employer.