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Saturday, February 11, 2012 Five Questions With...
CREF: How did you get into the real estate business? RL: I was a finance major at San Diego State University and took an internship with Daum Johnstown Commercial. I worked there my senior year as an intern and then came on after college to work with my current partner Glen Volk. I was a finance major when I took the job but I didn't know much about the industry at all. I've always enjoyed sales and did a lot of it through school with odds-and-ends jobs to get me through college. The internship was one of those things that fell in my lap. It was the opportunity to get credit and some experience on my resume, but once I saw what they did in the industry with the job, the sales, the money, the dollars - I took a strong interest toward it. CREF: What notable deals have you been involved with? RL: I just closed a $27.2 million sale of four business parks in San Diego totaling 162,000 square feet. I represented both the seller and the buyer, Colony Realty Advisors, in that transaction. I also just completed a $6 million sale of a 103,000 square foot, multi-tenant distribution building in Miramar. I represented the seller, CT Realty. The buyer in that one was Argus Realty. CREF: In what commercial real estate industry do you specialize? RL: I specialize in industrial properties for two reasons. My senior partner who hired me 20 years ago, Glen Volk, specialized in industrial and I began working under him. The other reason is the simplicity of the approach. It's a simple business where the clients are worried about function, not image, looks, or views. When you work with an office tenant there is much more involved. An industrial tenant needs to be in a certain market with a certain type of loading, square footage, clear height and power requirement. Those are all basic function buildings. In my opinion, there are more image issues with retail and office. The beautiful thing about the industrial market in San Diego is that it's a stable industry. There's not a lot of it and you've got to have it. They're not impacted by recession as much as retail or office. I was certainly drawn to those aspects of it. CREF: How has the industry changed since you've been involved? RL: The biggest change is the way we do business in terms of technology - whether it's Internet, cell phones, fax machines or e-mail - it's made our business much more streamlined. The other change is the institutional clientele in our market. When I first started there were more "Ma and Pa" type businesses and property owners. Because San Diego has been one of the top two areas in the country for capital investment in real estate for many years, we're seeing more institutional buyers and owners of real estate than we did 20 years ago. Because of this, you have to bring value to the table. These investors are very experienced real estate owners and operators and they have expectations of a professional real estate agent. If you don't meet those, you're not going to keep your job. It's no longer a "Good Ol' Boy" system. CREF: How does the market look over the next 12 months? RL: I think the leasing market is going to continue to be strong - vacancy rates will continue to decline. However, there should be some decent rental growth that is a little bit above the inflation rate. The sale side is a different story. The owners/users/buyers are all becoming hesitant because of what's happening in the capital markets. I think the amount of sales volume in 2008 will be considerably less than in 2007 - perhaps even by 50 percent in the amount of transactional value. This is driven by the capital markets. It's significantly changed the amount of equity requirements for the buyer. I also think there's a transition going on; the buyers and sellers don't have equilibrium with what they think their property is worth. When they don't agree, it's the hardest time in this business to make a living. Filed Under: Five Questions With... E-mail this article to a friend | Printer friendly format| DIGG this| Post to del.icio.us Comments on this article
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