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The Inevitable Crossroads For A Successful CRE Broker

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Lee Kiser is a multifamily expert, active broker and Principal of Kiser Group, Chicagoland’s leading mid-market multifamily brokerage firm. 

If you’re someone who feels like you’ve reached the top of the CRE broker mountain, first, my congratulations. I know you didn’t get to this position without hard work. Right now, you’re high-producing and well-compensated, you’ve built out a small support staff or additional junior broker-partners, but your career and prospects for growth can feel stagnant. While you want to continue growing your business and your brand, you feel that you have “maxed out” at your current firm.

So you will find yourself at a natural crossroads. I’ve been there and so have many of my peers. This crossroads has three directions: 1) Stay where you are, 2) leave for another firm where you see greater potential or 3) start your own company. 

The problem with No. 1 is that you’ve already reached the limits at the current firm and are not satisfied. The problem with No. 3 is a crucial difference between “brokerage” and “the business of brokerage.” In starting your own brokerage, you will also have to take on the tasks from managing staff and other brokers to establishing workflows, which leaves you with less time to devote to what you do best — sales.

This leaves option No. 2: Switch to a different firm.

When I found myself standing at the crossroads in 2004, the idea of switching to another firm frankly made me feel a little nauseated. Competitors had been trying to recruit me for years with offers of better splits and lucrative signing bonuses. Even if upfront, more money wouldn’t solve the underlying issue and nobody could show me a situation better than I already had. I really didn’t know what I was looking for; I just knew I didn’t see it. After 26 years of doing this business, I now know what I should’ve been looking for.

I should have looked for a company with an established track record that was making changes to prepare for a period of expansion. I wouldn’t have been attracted to a “get in on the ground floor” opportunity because that would have been the same risk as starting my own company. However, I could have looked for an established company showing signs of entering a vertical growth phase or an inflection point.

When researching, look at the company’s reputation, culture, market strength and support offered to brokers. I detail these further in a previous article. Also, make sure it is a fit for you and your business. (I’ve also written about that.) These articles provide advice for measuring how solid a brokerage firm is, but neither addresses the signs a company might be headed toward an inflection point.

The problem is that you won’t find a company advertising on their website, “We’re getting ready to go vertical! Come join us! We’re at an inflection point!” Many times the leaders of the company themselves don’t even realize they are at an inflection point — it just begins to happen organically. Other times, the company is strategically planning its trajectory. 

Regardless, here are some key indicators that a company is approaching an inflection point and headed for a growth stage. If you’re going to skim through these next few bullets, please note the last one is particularly important.

• Does the company have a higher support-staff-to-broker ratio relative to other companies its size? Many times you can tell if something is in the works because you see more positions, disciplines and people in non-broker roles at a company than its competitors. Sometimes this is an indicator that a foundation is being built for supporting more brokers.

• Is there a brand repositioning? Is the company considering or exploring adding additional product types, services or verticals?

• Are there changes in technology at the company? Are time and money being spent on systems, databases or proprietary technology?

• Is the company’s marketing evolving? Is their digital marketing footprint upgrading? Do you hear their brokers talking about SEO, website redesigns and other new marketing efforts?  

• Has the company developed a system for onboarding and training new hires? (While this may not be directly important to an already successful broker, it will be critical to your own potential to hire additional support or team members.) What does this system look like? Will they show it to you?

• And perhaps the most important factor: What is ownership doing? Nine times out of 10, you’ll be analyzing a company still owned and controlled by the founder(s). Is the founder still actively involved in the day-to-day of the company? Are they still running the entire company themselves or have they recently established any upper-level management positions usually associated with doing this (i.e., CFO, COO)? If the company is bringing in new people to run the company, it could mean one of two things: 1) The founder is planning to begin retiring or exiting, and they want the company to keep running without them, or 2) the founder wants additional bandwidth to focus on growth and expansion and is bringing in people to help run the company and others to create/implement the strategy for going vertical. Obviously, look for situation No. 2. Find this out by asking people you know and trust at the company to tell you how active ownership is and ask questions like “How many hours per week does [Founder] work?” If so, the best indicator of a company at an inflection point is most likely a founder still highly active but also bringing in additional high-level staff.

Other indicators that a company is at an inflection point may be less obvious. Sometimes you can identify indicators with simple research. Sometimes you find indicators by talking with people in the industry or at the company you’re analyzing. Other times you won’t know any of the inside scoop until you’re actually interviewing with the company.

After becoming a power broker in the industry, you will find yourself at this inevitable crossroads. I wish someone had been able to give me this advice when I was standing there scratching my head.


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How To Modernize Your Home on a Budget

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How To Modernize Your Home on a Budget

We all have spent a great deal of time in our homes over this past year. And like the rest of us, you probably spent a good chunk of time browsing your favorite real estate app. If so, it’s probably safe to say you have been inspired by looking at the interior of hundreds of houses and now you’re considering ways you can improve your own space, right? Or if you’re looking for inspiration, check out which home improvement and interior design trends can help increase home value or resale. 

Though it may be common to assume that home renovations or improvements will inevitably cost you a fortune, that isn’t always the case. If you want to learn how to modernize your home on a budget, here are 7 ways that you can affordably give your space the lift it needs.

1. Address the first impressions

Old, worn-out doors and windows can really make a property look dated. If your budget can handle it, consider replacing your windows with hardwood frames or even steel ones. If not, repainting them in a more modern shade will instantly improve the look of your home – classic yet fashionable shades such as blues, sage greens, and soft greys work wonders.

Another tip on how to modernize your home and make a world of difference is having the outside of your exterior cleaned with a pressure washer. If you live in a wet climate like Portland, OR, or Vancouver, BC, this will take years of dust, dirt, and moss off your siding and roof. It can really bring your property back to life, and even take years off its appearance.

2. Revamp your kitchen to modernize your home

A brand new kitchen could set you back thousands of dollars, but there are several clever ways to breathe new life into your kitchen without doing a full remodel. Kitchen upgrades such as repainting your cabinets and replacing the cabinet handles can easily modernize your kitchen and make it feel clean and fresh. 

You can also reface your cabinets, which is a cost-effective way of modernizing your kitchen without replacing all of your cabinetry. Basically, it’s like giving your kitchen a facelift since you’d only be swapping out your cabinet doors for new ones, giving it a fresh, clean look.

Kitchens can also easily become a place of clutter and simply tidying away the excess and focusing on minimization can make a big difference to your kitchen’s appearance and usability. The kitchen is usually the centerpiece of a home and should be at the top of the list when it comes to important areas to keep clean and tidy.

3. Give your bathroom a facelift

It’s common for people to leave bathrooms until last when it comes to making home improvements because without a full remodel, it sometimes feels as though there isn’t much of a change. There are, however, several easy superficial ways to modernize your home bathroom.

To begin, dated bathrooms often need a good, deep clean. Giving tiles and grout lines a deep clean and scrubbing limescale off the sink, bath, and toilet is the perfect start to freshening up a tired bathroom. From there, replacing accessories such as towels, mats, shower curtains, and even toilet seats can make a sizable impact. Also, you should consider re-painting any walls that may be darker in color or dated with old wallpaper. Instead apply a bright, cleaner color to your walls. All of these small changes can make a big impact on the look and feel of your bathroom. 

bath 4005 NE 57th Street Seattle WA

4. Declutter

Minimization is the way to go for a more modern look and feel, so consider modernizing your home with a major decluttering project – think minimalist. 

Make a point of not only maximizing your storage space but becoming a little picky when it comes to deciding what should stay and what should go. If an item hasn’t been used in a year and doesn’t add any value to you, toss it.

Whatever is left that you simply can’t live without, find a home for it that is out of sight. Under the stairs, in the cupboards, in the basement or attic – whatever you can do to minimize the amount of ‘stuff’ on display. Minimalist interiors tend to calm the mind and body and are certainly the more modern approach to designing a living space. If the process of decluttering your home is too much or overwhelming, consider hiring a professional declutter to help you with the project. 

5. Freshen up your walls 

Refreshing your walls with paint or wallpaper can be the best bang for your buck when it comes to affordable home improvements. But with so many different options for paint colors and wallpaper, it’s important to carefully consider color schemes.

Dark shades can leave a room feeling smaller, whilst brilliant whites everywhere can feel too cold or stark. Depending on your tastes, you may want to opt for neutral tones and soft, lighter hues that freshen up and add warmth without being too intense. If you are having trouble picking the right colors to match your space, consider reaching out to a color consultant to assist you and ensure you choose the right shades for your space. 

6. Have your floors refinished 

Floors are the foundation of your home and set the tone for your color palette and decorating style. If you want to know how to modernize your home on a budget and have hardwood flooring that has not been refinished in years, consider having your floors re-sanded and re-sealed. This project can significantly rejuvenate a room and make all the difference. 

Additionally, many homeowners don’t realize that you can change the color of hardwood flooring when you refinish your floors. You can go light, dark, and anywhere in between. So, if you are trying to modernize your house opt for textured warm or cool tones to tie your space together. 

6. Upgrade your lighting

You can transform the look and feel of your home with lighting, turning dated, dingy spaces into cozy, warm areas that feel inviting. There are so many different types of lighting to choose from, whether you want super modern pieces or more classic timeless lighting, they have it all. 

Whether it’s a pretty table lamp, some hidden spotlights, or a statement pendant light over a kitchen island, you can easily modernize your home and create a dynamic new aesthetic with some carefully considered lighting for your home.

7. Add finishing touches

Shopping around for decor such as lamps, art, rugs, and furniture can be fun, especially in today’s online world. Use your creativity and possibly the help of an interior designer to assist you in putting the finishing touches on your space and bringing your home together into a modernized, inviting space. 

You can also save money while putting the final touches of the house together by using home decor coupons, so be sure to shop around to find the best prices and look for online stores that have great deals.

With a little imagination and these tips on how to modernize your home on a budget, there is no end to the improvements you can make, so let your creativity flow and have fun with it.

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One Of Florida’s Biggest Real Estate Investors Says Market Is Headed For Correction

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Governor Florida Democrats

Just before a power lunch at Sant Ambroeus in Palm Beach, real estate billionaire Jeff Greene picks up the phone to discuss the past year’s “huge migration” to Southern Florida. “People have realized that they can get a much higher quality life and still make the same amount of income,” he says. “I’ll see more interesting people at Sant Ambroeus in Palm Beach than I would at Sant Ambroeus in Manhattan.” 

But Greene—who owns more than $2 billion worth of property, roughly half of it in Florida, Forbes estimates (he says it’s worth more)—thinks the frenzy is nearing a peak. “Prices have just gone higher than anyone ever could have imagined,” he says. Come autumn, he believes, many families will return to their original homes in New York, Los Angeles and other cities, causing prices to moderate.

It’s a cooling effect Greene expects to see far outside of Palm Beach. “My view on all the markets is that we’re in somewhat of an omni-bubble in every category,” he says. “Between central banks around the world and the government’s fiscal and monetary stimulus we have trillions and trillions of dollars of extra money that wasn’t around before….At some point you can’t keep printing.”

Florida’s real estate market has been one of the biggest beneficiaries of the pandemic, beckoning wealthy Americans with low taxes, warm weather and a relative lack of crowds. “It’s been a seven-day-a-week work week, from the time you get up until the time you go to bed,” says Nathan Zeder, a broker-associate at the Jills Zeder Group, which is based in Miami Beach and Coral Gables. The firm sold about $800 million worth of property in the second half of 2020, he says, more than it did in all of 2019.

One of the largest purchases of the pandemic closed on Thursday, when Larry Ellison reportedly acquired an $80 million megamansion in North Palm Beach, just above the original asking price. (Chris Leavitt, Ashley McIntosh and Tonja Garamella of Douglas Elliman, who handled the sale for the buyer and seller, declined to comment.) 

An even larger deal closed in February, a newly completed mansion at 535 N. County Road in Palm Beach that went for more than $120 million, setting a record for the region and likely the state, according to the Palm Beach Daily News.

Overall, properties in Palm Beach have appreciated nearly 8% in the last year, according to Zillow data, though some areas are seeing an even larger boost. Such figures are even more striking considering the shift in buyers. Almost half of the Miami real estate sales market is ordinarily composed of foreign individuals, Zeder says. During the pandemic that number has fallen close to zero. “Generally if we were a 100% domestic market, the market would go down. But it’s done the exact opposite.”

The climb is partly attributable to the arrival of so many wealthy New Yorkers. According to Placer.ai, a data analytics firm, the two most popular destinations outside of the Northeast for those fleeing New York County between January of 2020 and 2021 were Palm Beach County and Miami-Dade County.

Frederick Peters, CEO of Warburg Realty in New York, says it’s a trend stretching back years. “People, especially in the top .01%, just find the tax advantages such that they’re looking at becoming Florida residents,” he says. “That probably accelerated during the pandemic… But it didn’t start during the pandemic.”

As for Greene, he plans to stick it out in Palm Beach no matter how quickly the trend slows. “I have deep roots in this community,” he says. Greene’s parents moved to Florida when he was in high school, and he continued to visit on breaks from Johns Hopkins University; during winter vacations he worked as a waiter and busboy at the famed Breakers Hotel.  

Greene, who is worth $3.9 billion overall, first got into real estate while at Harvard Business School, when he bought a house and rented out rooms to earn extra cash. By the time he graduated he owned 18 properties. It was decades later, though, that he became a billionaire, thanks to credit default swaps he bought in the run-up to the housing market collapse that ignited the financial crisis. 

“I moved here in December of 2009,” he says, of Palm Beach, at which point he started buying up properties, including the Tideline Hotel and dozens of condominiums. “I really felt it was very undervalued.

Today Greene is continuing to bet on Florida’s long-term vitality, despite his muted predictions for the fall. He is building two 30-story towers in Palm Beach at a reported cost of $250 million—on a 3.3 acre site he bought in 2014—and which sparked headlines last year over construction delays due to zoning issues.  

“I’m a long-term believer in this area,” he says. “I hope I have a long life and can enjoy the fruits of my labor.”

 

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Stop. Drop. Adapt. How The Former Covid Epicenter Is Changing Its Development Approach For Post-Pandemic Living

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Coronavirus Pandemic Causes Climate Of Anxiety And Changing Routines In America

The days of the National Guard strolling a containment zone in New Rochelle, New York may have ended, but the visible reminders of the covid pandemic on the city’s streets will last for years to come. 

Some of the changes will be ways to stop people from getting too close to each other—such as physical barriers so retail and restaurant frontage can interact with customers in greater numbers without having to sacrifice social distancing requirements. Other changes will be ways to give people more places to be outdoors—such as planting trees in so-called ‘heat islands’ to create places where people can gather on hot days.

As Mayor Noah Bramson says the city will now start to, “look differently at every chance to add new open space.” Citing one large piece of property the city has the opportunity to obtain and repurpose for communal outdoor use, he adds, “In years past that might not have risen to be a top ranked priority. But now we see it in a different light.”

Five years ago the city of New Rochelle launched a extensive master development plan which aimed to bring approximately 7,000 new residential units and millions of square feet of retail, hotel and office space to the city of 80,000 residents. Back then there was little reason to think every inch of outdoor space would become crucial to local quality of life or that retail frontage would need strategic barriers on their sidewalks.

But then in March of last year a resident who worked in Manhattan tested positive for coronavirus and was soon linked to dozens of other cases in the area. On March 10, New York Governor Andrew Cuomo implemented a containment area around a one-mile radius in New Rochelle which brought in the National Guard to distribute meals to quarantined residents, assist with deep cleaning and ensure people stay away from all the spaces closed to the public. The sudden change in living conditions brought to bear a need to give a new look at the development plan, specifically as it relates to how and where people interact outdoors.

Bramson mentions a proposal to turn an unused overbuilt highway into a linear park. “With covid we can make an even stronger case for its importance,” he said of the LINC project. “That may be valuable in terms of attracting funding from higher levels of government.”

The design changes are reaching their way into the residential developments as well. RXR Realty, the master developer for New Rochelle’s development plan, has already started to adapt floor plans so they accommodate working remotely. David Garten, Senior Vice President at RXR, says they have already started looking at ways to optimize their physical spaces and, “Balcony and outdoor space is something that we’re going to be incorporating in terms of our residential product moving forward.” As a nod toward reducing barriers to social isolation, they also plan to increase the number of fire pits on the terrace of at least one of their buildings so the outdoors can be used during more of the year.

Other changes RXR has implemented include increasing the amount of break-out spaces and private banquet seating in common areas, changing to MERV-13 filters in the HVAC systems, requiring reservations at the resident’s gym and enhanced procedures for cleaning and PPE requirements.

To keep construction projects in progress, and several hundred workers actively employed during the pandemic, RXR and other developers implemented everything from mandatory temperature checks, bimonthly covid tests, and on-site medics for screening (at larger construction sites). Office staff at RXR wear body sensors that alert them if they aren’t standing more than six feet from another person.

RXR also created a relief fund which provided grants to local businesses and charities as well as provided free consulting services from their in-house team of experts to businesses in need. Additionally, the company joined dozens of other organizations in a city-wide initiative called Nourish All which used public and private funds to buy gift cards to local restaurants who would then use the income to purchase food from their existing supply chain sources and provide it to local residents burdened by food insecurity.

With New Rochelle’s proximity to Manhattan the new residential projects may be coming online at just the right time. As residents of downtown Manhattan started seeking out less expensive rent in the wake of the pandemic, New Rochelle was one of the first places many sought out since it is about half an hour train’s ride away from downtown on the Metro North line. “We’ve been very pleased with the rate of lease up,” says Bramson. “It has exceeded our expectations,” referring to some buildings which have seen 90% lease rates sooner than expected.

The changes coming to New Rochelle weren’t on anyone’s radar this time a year ago, but the city has adapted quickly to its new reality. The outdoors aren’t going to look the same as they ever have and previous norms for how people gather indoors will be substantially different as well.

“It’s not going to be the same that it was before the pandemic,” says Garten. “But there’s a reason to believe that it can come back stronger and more prosperous than before.”

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