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

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:

1. 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).
2. 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.
3. 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.
4. 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.
5. 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....

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.

investing suggesting, WTC, hiring, interviewing, meditating

Some real estate tidbits I’ve recently heard about investing in commercial real estate today:

• Things have bottomed.
• Occupancy is increasing.
• Net effective rents increasing.
• More clarity in the market.
• Lenders forcing borrowers into action.
• Best opportunities may be outside the U.S.
• Banks dumping assets.
• Retail just doesn’t jump off the page.
• There aren’t good or bad assets; there are good or bad prices.
• We’re not underwriting to price perfection, we’re underwriting to value.
• What is the price for liquidity?

As we rapidly approach the 10^th Anniversary of the World Trade Center, Pentagon and Shanksville, PA terrorist attacks, my friend, and real estate columnist for The New York Post, Lois Weiss, wrote this in her column this week:

The World Trade Center site is humming with activity. On Monday, we walked across the site and rode the construction hoist up at Silverstein Properties' 4 World Trade Center as the north Memorial pool was being tested.The nearly one-acre square pools have water that cascades down the sides and flows into another dark square. Each pool is rimmed with the names of the victims, which will glow at night.

All the plaza's white swamp oaks are growing in nicely, with more being added all the time. The Greenwich Street cut through the site is just starting to be filled in as an actual road, slicing off 2 WTC, the Calatrava PATH station, 3 WTC and 4 WTC from the western half of the site with the Memorial area and 1 WTC.

Four WTC has asking rents in the $80s a foot. New York City and the Port Authority have already leased space there. The lobby area feels cocooned from the outside, yet its polished black granite walls will reflect the area through its 65-foot-tall windows.

The largest of the buildings, 1 World Trade Center, where Condé Nast just signed its 1.1 million-square-foot lease, is only halfway to its 1,776 feet but is starting to become visible from all over.

I’ve picked out some of the responses from an interview with Jack Dangermond, founder and president of Esri, which offers geographic information systems, that I thought you might find compelling:

• I have four priorities.
• The first one is to focus on what customers need and want.
• And, second, make my company a really great place to work.  So when we hire somebody, we have in mind finding a person who really fits so well that they realize their life’s work with us.  
• The third is to make sure we’re a very strong business that supports the first two priorities.
• Interviews?  I’ll ask provocative questions that help me quickly get a sense of someone, like, “What’s the worst thing that’s ever happened to you?” In their professional life, the issues they bring up are often associated with challenges like laying people off. I learn a lot about people’s values and their judgment about things based on how they act in those situations. I’m just trying to figure out who they are.   
• Other questions?  “What do you like to do?” It’s an open-ended question. A lot of people start off saying. “I like to go skiing” or “I like to go on vacations.”  This is always nice, but I’m interested in people who have a passion for the work I want them to do.
• I am hunting for people who would be a good colleague or a teammate, not someone who works for me.  
• I like to hire responsible people who really see their life’s work meshing with the goals of our business.
• Writing is a key skill.  That’s usually another question I ask: “How good of a writer are you on a scale of 1 to 10?”  I also actually ask a lot of skill-related questions like, “How good of a software engineer are you?” or “How good are you at public presentations?

“If I talk a lot, it must mean I’m smart.”  I learned that this is a style of some students in graduate school programs. But I also witnessed it recently first hand where one guy in particular in a group setting continually rambled on and on, trying to impress the group with how much he knew.  But in taking a pulse of the body language of many of the group members, I don’t think this guy was winning any points with them.  

Friend and fellow blogger, Ann Oliveri, offers something very interesting in her post this week:

How do you vet candidates for key positions? 

The New York Times reported this week on a method being deployed in medical school admissions processes that test for people skills, the multiple mini interview or MMI.  It's "the admissions equivalent of speed-dating: nine brief interviews that forced candidates to show they had the social skills to navigate a health care system in which good communication has become critical."  Each round is eight minutes and features a different ethical dilemma.  "The most important part of the interviews are not a candidate's initial responses--there are no right or wrong answers--but how well they respond when someone disagrees with them... Candidates, who jump to improper conclusions, fail to listen or are overly opinionated fare poorly because such behavior undermines teams. Those who respond appropriately to the emotional tenor of the interviewer or ask for more information do well..."  The goal is to find those with the ability to work collaboratively with colleagues and establish trust with patients. And, "candidate scores on multiple mini interviews have proved highly predictive of scores on medical licensing exams three to five years later that test doctors' decision-making, patient interactions and cultural competency."

I find this approach fascinating.  

After meditating twice a day for about two years I stopped doing it but not because I didn't see that it made a difference-it did. So why did I stop?  Beats me but my brother has been encouraging me to start again and I am going to.  Interestingly there's an article in the Spring 2011 issue of Ode magazine called, "Management as meditation."  It presents a compelling argument for meditation, in the workplace:

• How you deal with your emotions and thoughts as a leader has a direct effect on employees and organization.
• By meditating, you learn how to deal with stress and take your mind off things.  It has to do with discovering consciousness and performing activities, such as meetings or listening, with more attention, whereby you function less on automatic pilot.
• A Detroit chemical manufacturer instituted regular meditation sessions in 1983.  Within three years, absenteeism fell by 85%, productivity rose by 120%, injuries dropped by 70%, sick days fell by 16%-and profit soared by 250 percent!  "People enjoyed their work; they were more creative and more productive.  If you do this you'll get a return on your investment in one year."
• Before a meeting, if managers first take a couple of minutes to be still and focus on what is most important to them, they will get results faster."
• The entire effect of meditation relies on willingness and openness.  To relax, we need patience, trust and time.  Whoever thinks that meditation is a waste of time will never have patience for it.

I am going to start meditating again tomorrow.

This past Wednesday, July 13^th, was the 26th anniversary of a huge music event, Live Aid.  The great thing about it is that it was the idea of just one man, Bob Geldorf.  One person can make a difference!

Photo:  The 3-legged chair in Geneva looms opposite the "Palais des Nations". Standing 12 metres (39.37 feet) high, The Broken Chair is a reminder of the tragedy caused to human lives and limbs by land mines.

Restaurant of the week.  Nishimura, 8684 Melrose Avenue, W. Hollywood, CA(310.659.4770).  Danger: this is very serious sushi.  A little tricky to find but worth it.

On the road...

July 18-22:  New York
July 25-Aug. 14:  Northern California
Aug. 15-19:  New York
Aug. 23-Sept. 6:  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 and perform with the CREatures of Havoc Band
Nov. 9-10: New York to moderate a panel at the PERE Forum-New York

These are my views and not that of my employer.

The future?, New jobs, Knish-Nos

So, welcome to the future, aka the third quarter of 2011.  First of all, can you believe the passage of time?  But I'll leave that for another day.  Because we're in an industry that measures a lot of performance and activity by quarter, I thought I'd talk about that for a minute.  Real Capital Analytics (RCA) had this to say at the end of May in their U.S. Big Picture Report:

May marked an important benchmark as sales achieved their highest monthly total so far in 2011, rising to $15.6b and notching a remarkable 124% gain over the year-earlier month. The growth trend was broad, as every property type registered its most active month this year and both pending deals and new offerings point to a strong June. Still, wide variances in momentum persist both among and within property sectors. CBD office, garden apartments, and full-service hotels continue to drive growth at present, although regional malls are quickly gaining currency, as evident not only in recent transactions but also in a spate of new offerings, including Westfield’s 17-property US portfolio. Suburban office sales remain lackluster, but surprising strength is emerging in secondary and tertiary markets for retail and apartment properties as yield-seeking investors scour markets for more.  

This is a very encouraging report but then there's the debt side to any deal as only a few cultures has enough to pay cash for buildings these days.  Talking to some commercial lenders recently they told me that, yes, they are lending, still selectively but with a bit more aggressiveness (can you say compromises in underwriting, maybe?).  And, talking about the infamous "Lessons Learned" from the 'last down so low it looks like up to me cycle' I'm still concerned about the flood of institutional money chasing core deals and driving prices up and cap rates down, way down.  Hey, we're now in that time where we're creating the next cycle and, just like trying to call the bottom of the market, we won't know what this cycle will look like until the next one.

Congratulations to, Jeff Gandel and his colleagues who have successfully lifted out their team from Fidelity and have formed Long Wharf Real Estate Partners in Boston.

The other interesting things occurring are the continued moves of some senior people to different firms...seems like a lot of this is in Asia but in Europe as well. The "Asian" market seems to be more and more the topic of discussion of global players but there are also excellent opportunities closer to home, wherever your home might be.

Knish-Nosh has been in Forest Hills, NY since 1952.  My friends and I have been eating their knishes for a long time.  Serendipitously I was walking through Central Park in New York last Monday.  At the sailboat pond there’s a little concession stand that I’ve walked by hundreds of times, always thinking that one day I’ll stop there, sit and relax and have a coffee like I’ve seen many people do (often with their dogs which I admire for being able to behave off-leash).  Anyway, it was a holiday and I wasn’t going anywhere so I stopped for coffee and a bagel and I see something on a high shelf that says Knish-Nosh.  As I return my tray I see a guy there and ask him if this place is run by Knish-Nosh.  He says yes and I tell him about growing up in Forest Hills, blah, blah, blah. He says that that type of thing happens twice a day.  He also tells me that they’re moving locations in Forest Hills and will be next to the Midway Theatre (also an old haunt of ours).  In addition, he tells me that they ship knishes (mostly to people who can put the sizable shipping cost on their corporate expense statement).  But, the most important part of this story is that they’re going to start distributing Knish-Nosh Knishes through places like Costco on a nationwide basis (well, maybe not nationwide as I’m not sure that knishes would ‘play’ in some markets).  Anyway, watch out for them in your neighborhood Costco soon.

Congratulations to, Tim Shine, who has recently joined Parmenter Realty Partners.

YouTube of the week:  I didn’t know that Daryl Hall wrote, “Every time you go away”.  I always liked that song but here it is played the way I think he envisioned it when he wrote it. 

Congratulations to the folks at Pearlmark Real Estate Partners (formerly Transwestern Investment Company) on their snazzy new name.

Restaurant of the week.  Tatra restaurant, 24 Goldhawk Road, London.  Disclaimer:  I have not yet visited this restaurant.  I met the husband and wife team that own and operate the restaurant at my friends’ wedding last week.  I just have a good feel that this is excellent Mediterranean food.

Photo: Recently discovered:  my mother swimming with her father at a resort in New Jersey (August 17, 1936)

Congratulations to Chris Gerra, who has just made an internal move and joined Thomson Reuters Tax and Accounting division.

On the road....(taking it a little easy over the summer):

July 10-12: Beverly Hills for the NMS Real Estate/Real Assets Roundtable

July 18-22: New York

August 8-12: 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 and perform with the CREatures of Havoc Band

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

These are my views and not that of my employer.

Embracing differences, Playing the game?, Charles Angoff

Ok, so this morning a random driver, arranged by the hotel, drove me to the airport. As I had adopted from Gerald Hines many years ago, I sat in the front passenger seat with the driver.  He was from Pakistan, about the same age as me and we had a lively conversation.  His name is Abdul.   We talked about a lot and found that we agreed on many things.  He used two good sayings and I thought I’d relate them to you.  One, in regard to the massive amount of debt that people in developed countries have taken on, he said (and maybe he didn’t originate these but I hadn’t heard them before):  “I don’t agree with the philosophy of ‘buy now, pay later.’  I believe many people have adopted the attitude of ‘buy now, pay in the next life.’  And the other one, in relation to the sub-prime mortgage situation (how about the news this week that Bank of America is setting aside $12Bn to pay fines!) he said, “When the ship is going down, I’m going to look out for myself.  For all I care, the captain can go down with his ship.” 

One of the wonderful things about leading a serendipitous life is experiencing random interactions of this type.  But, you also have to be open to them.  I’ve long believed that while I don’t believe that the world will ever experience ‘peace on earth’ (for reasons that I’d rather not discuss here) we can bring the world closer together, one person at a time, by taking time to engage people.  We can learn from each other and, like with Abdul this morning, we can appreciate that we are all members of the human race and value and respect our differences.

Most of my career has been spent working for entrepreneurial type companies.  A couple of times I have worked for larger firms like A&P supermarkets & Midlantic Bank.  But I have been a real estate consultant rather than an employee to more larger firms such as (you’ll excuse the reference to some long gone) Chase Manhattan Bank, Bankers’ Trust, Chemical Bank, Mass Mutual, John Hancock, Kohler Co., Merrill Lynch Smith Barney, The New York Urban Development Corporation.  I have also had the privilege of being, for lack of a better term, the ‘industry shrink’ to a number of real estate investment management firms, which, in some ways, would read like a who’s who of that industry.  And, as an independent trusted advisor I was brought into the inner workings of a company to provide consulting and coaching services (I forgot if I wrote this to you recently but a friend of mine educated me on the differences between coaching and consulting.  A consultant provides ideas and solutions; a coach asks questions…it’s up to you to find your own way.    When she told me that I simply shook my head in agreement.  I may be getting a little off the path here but that’s nothing new, right?  

When I worked for Herb Kohler in Kohler (next door to Sheboygan, Wisconsin) I was brought in to provide consulting services on one project but as time went on I was ‘dragged’ deeper and deeper into the company and sometimes the politics started taking a toll on my ability to perform my services.  On a number of occasions during my two year engagement I went downstairs in the Kohler Design Center to watch a multi-media presentation about the history and future of Kohler (the company and the town) and it helped me remember that a lot of what was being done there was working towards the realization of a visionary, Herb Kohler, and didn’t necessarily need to make economic sense.  And, on two occasions I went to visit the man himself.  After he asked me how things were going (I used to see him monthly in the real estate committee meetings as well) he asked me why I was there.  I told him that I was being dragged into departmental politics and it was both draining and distracting.  He simply told me, “Steve, one of the reasons I wanted you here was that you can keep yourself distant from those things; you aren’t an employee and you can operate on a different plane.  Don’t let them suck you in.”  I left those brief meetings both energized and with more reinforcement of my involvement and how I could help Herb, in some small ways, achieve his dream.  That was probably the deepest corporate political doo-doo that I’ve ever experienced.  But many large companies (large being relative) seem to suffer from the drain of bureaucracy, politics, insecurity, fear and jealousy.  And having been both a coach and consultant to firms in North America, Europe and to a small degree Asia I can validate the negative impact that those things have on a company, on the morale of the people and on the price of gaining desired results.  The amount of time wasted, the games played, the failure to stay focused on the mission but rather on keeping your job (or doing your darndest to help someone fail at theirs and watch them pack up their stuff in a box and walk out the door.)  As Bill Withers sang, “We all need someone we can lean on and baby you can lean on me.”  I have found that to be more and more true as time goes on and am grateful for the friends and colleagues I have that I can lean on from time.  

When I started college, at Fairleigh Dickinson University (FDU)in Rutherford, NJ, I was fortunate enough to be assigned to a freshman English class with a professor named Charles Angoff.  Our FDU campus was close to Manhattan and was able to attract teachers of a higher quality, who lived in NY, than you might expect from a relatively obscure (except in New Jersey) university.  Angoff was one of those special ones.  He was an accomplished author and editor.  I don’t know what got me thinking about him recently but I bought a book written by someone who knew him well:  The Man From The Mercury:  A Charles Angoff Memorial Reader.  Edited and with an Introduction by Thomas Yoseloff.  Among other stuff it contains one Angoff short story titled, “The Tone of the Twenties” (as in 1920’s).  There are a bunch of quotable and notable things but the one that struck me and that I want to share with you is this: “Times of vital leaping imagination are not times of unalloyed happiness.  No happiness is ever unalloyed.  The sense of fleeting time and the apparent purposelessness of the entire scheme of things surround all calm and all joy with an inaudible sigh.  This seems to be the divine plan.”

Heavy eh?

Congratulations to Richard Lowe, new editor of IPE Real Estate.

Congratulations also to Martin Hurst who has assumed the COO role at IPE.

Congratulations to Mike Stratta who has joined the Aviva Investors Real Estate Multi-Manager group.

To all Americans, enjoy the Independence Day weekend.  To everybody else, enjoy your weekend.

On the road….

July 1-7:  Northern California
July 10-12:  Beverly Hills to attend the NMS Real Estate Roundtable
July 14:  Bistro Jeanty,Yountville, CA to celebrate Bastille Day.  A friend of mine plays the accordion to add to the festivities.  Sounds like it'll be a fun time.
July 18-21:  New York

These are my views and not that of my employer.