Trying to make it through the ‘headwinds’
Stamina is a good goal, not just for real estate practitioners but for every business in these challenging times
I recently spoke at a meeting of the Associated Builders and Contractors, and I was asked to make it “positive.”
They, of course, were most interested in what to expect in the economy and specifically in construction over the coming year.
We have a half-dozen transactions “pending.” What does that mean? We describe “projects in the pipeline.” The analogy is that if you keep stuffing things into the pipeline, they will eventually come out the other end. The challenge is that the pipe keeps changing in both length and diameter.
So once a project (a lease, purchase, sale, etc.) is put into the pipe, it is very difficult to predict when it will emerge from the other end. When it closes is when we typically get paid, which is near and dear to our hearts. We frequently have to remind clients and numerous others that this is not a hobby!
As of this writing, we are working on the sale of two former medical clinics – one to a user and one to a developer/investor to lease to a new charter school. We are marketing for sale a very large former printing facility which, like any former single-purpose building that needs to be transformed to another use, has plenty of challenges (and opportunities).
We have a client moving across midtown Manhattan, selling one building, buying an office condo and moving out of the leased building (after 15 years) to another leased building, where they will create a “building within a building” with its own entrance.
We will be starting a new project to assist a client to look at building from the ground up, buying and renovating an existing building or leasing. This client has almost 1½ years left on their lease and will have plenty of time to explore alternatives and make a rational, informed decision which can save them real dollars over the next 10 to 20 years.
While no one project is simple or easy, we are moving forward and helping our clients to make informed decisions in these still disquieting times – what one group calls “oncoming headwinds.” I am not a sailor, but I know from kayaking that stiff headwinds can wear you down. You need to train and be in shape, so when you are confronted by them, you have the stamina to persevere.
Stamina is a good goal, not just for real estate practitioners but for every business in these challenging times.
By the time this article appears in front of you, I will be in China for 10 days.
Our trip is co-sponsored by the Greater Concord Chamber of Commerce. We left from the park-and-ride on a bus at 6 a.m., arriving at JFK at 11, boarding Air China and arriving in Shanghai 14 hours later (straight over the North Pole, not around!). Then, a two-hour flight to Beijing, arriving at 11 p.m. local time.
We are then scheduled to visit the Olympic sites in Beijing, Jade Factories, the Great Wall, Ming Tombs, Palace Museum, Temple of Heaven … you get the drift.
As a student of economics, global markets and commercial real estate (mostly in North America), I have read extensively about China, the current, or soon-to-be, second-largest economy on the globe. In the real estate world, we have seen China dramatically change U.S. retail, warehousing and logistics (what we refer to as high-bay buildings), manufacturing and even medical products. This globalization thing is here to stay.
So the opportunity to see it up close and personal was a no-brainer for me, but even more so for the young ones (all in their 20s) because China is going to be the 900-pound gorilla in their lives, just as the USSR was in ours.
Bill Norton, president of Norton Asset Management, is a Counselor of Real Estate (CRE) and a Fellow of the Royal Institution of Chartered Surveyors (FRICS). He can be reached at firstname.lastname@example.org.