Archive for August, 2009

PROBLEM SOLVING: Use opposite thinking

August 27, 2009

What is opposite thinking? I first heard of it many years ago in an interview with the author of a   book, “The Power of Opposite Thinking.” He described what opposite thinking was and gave this example:

One morning he read in the newspaper that a new high rise office building was having a difficult time signing leases and was in fact losing some of the tenants it already had. Why? The explanation was that when they designed the building the architects determined how many elevator trips would be made each day and divided by 24; the hours in a day.

The fact that most trips would be made from 8:00 – 9:00 AM as workers arrived, then during lunch hour and again at 5:00 PM when workers left for home was not factored in. As a result the long wait in the elevator lobbies had people angry and demanding to be let out of, or actually canceling their leases.

Engineering studies were done and the only solution the engineers could come up with was to remove the office at the end of one corridor on each floor and install an outside elevator. The cost, along with the loss of revenue, was staggering.

Our author contacted the building’s owners and persuaded them to let him have one week to study the problem, to see if there was another solution. The owners were reluctant, having been worn down by the process, but finally gave in. He had one week.

The author spent a day observing the elevator usage and computed the average wait time. Then he went to other buildings and timed the average wait at those buildings. It turned out that the wait time for an elevator in the subject building was only 20-seconds longer than in other buildings. So, the problem was perceived, not real. What solution did he come up with? He appealed to the human ego.

The author met with the building owners and after giving them his findings advised them to line the lobbies with ceiling high mirrors. People love to check themselves out in a mirror, he explained.

After installing the mirrors the anxious owners and the author watched and saw that while few people looked directly into a mirror, most would look at themselves out of the corner of their eye.

The extra 20 seconds was no longer noticeable, people became calm, the tenants no longer had a problem (even though they didn’t realize it) and soon the building was fully leased.

Don’t always look for the logical answer – look for the opposite answer.



August 19, 2009

The neighbors will say, “All of a sudden they were building “it” and nobody knew anything about “it” until they began to move dirt.”

If only that were true.

The process of getting a development or building approved can be quick and painless in one community – and a nightmare in the next one over.

Municipalities vary in philosophy; some encourage development for many reasons; betterment of the community, increase the tax base, belief in the free enterprise system, etc. – and some are downright unfriendly to developers.

Sometimes the unfriendliness may be justified in a particular case, or with a particular builder and/or developer, but when it is consistent you know there is a problem. If you want to conduct business there you must give yourself enough contingency time in the sales contract to obtain your approvals.

It is well known in my area that the time required to gain site plan approval is much greater than in municipalities just a short distance away. Without going into speculation as to why that is, I will just cite two examples.

In the first one an out-of-state developer of a national discount store asked me, even though I was not involved in the deal, “How long do you think it will take us to get approved?” I told him, “About two years.” He was actually flabbergasted, saying, “We have never taken anywhere near that long in any state where we do business.” Two years later he phoned me, reminded me of what I had said, and told me it had taken 23 ½ months. He thanked me for giving him the advice to get plenty of contingency time in his sales contract.

The second example I will simply say, “I was in my 50s when the sales contract was signed and qualified for Medicare when we finally closed the sale.”

Know the community in which you are about to do business, and if you don’t, use local professionals and heed their advice. The best time to get the time you need is when the sales contract is being negotiated.


August 12, 2009

This news release, dated January 16, 2009, is welcome news to the commercial real estate community:

Sperry Van Ness International (SVNI), one of the nation’s largest commercial real estate brokerage firms, will launch Sperry Van Ness/Better Capital Partners on Monday, January 19, 2009. The new division will be led by premier investment banker Eric H. Better who will serve as President and Principal of the new division. A new website has been created exclusively for Sperry Van Ness/Better Capital Partners and can be found on the internet at

Sperry Van Ness/Better Capital Partners will offer Sperry Van Ness advisors and their clients a full capital stack which includes debt, equity and joint ventures for all forms of commercial real estate properties nationwide. The firm’s services include: Permanent, Bridge, Mezzanine, Construction, and customized financing for acquisition and refinance.

“During this financial crisis, it is vital that Sperry Van Ness provide a national financing platform that will service, and assist our advisors and their clients, so that more deals can be closed,” said Kevin Maggiacomo, President of Sperry Van Ness International. “Eric Better is one of the industry’s premier commercial real estate investment bankers and we are confident that his team has the capital market knowledge and lender relationships that will ensure success. We welcome Eric Better and his lending team to Sperry Van Ness.”

Sperry Van Ness recruited Eric H. Better from Los Angeles based George Smith Partners Inc., a leading commercial real estate investment banking firm. Mr. Better has formed a dedicated commercial real estate banking division that will provide financial services to more than 1000 Sperry Van Ness advisors and their clients nationwide. Mr. Better is joined by a seasoned team of commercial real estate lenders, bankers, brokers and sales professionals.

[Bios deleted – please go to for the very impressive biographies of the team; as well as the extensive list of Loan Programs, Property Types, and more. It’s worth the trip.]

Founded in 1987, Sperry Van Ness is one of the largest and fastest-growing commercial real estate brokerage firms in the industry, with more than 1000 advisors in over 150 locations. Sperry Van Ness delivers results for clients through a proven business model that immediately markets every one of its clients’ properties to the entire brokerage community. Based in Irvine, California, the firm operates internationally and provides brokerage, consultation, asset management, property management, leasing, accelerated marketing, and auction services. Sperry Van Ness’ gross sales volume totals billions of dollars annually in office, multifamily, retail, industrial, self-storage, hospitality and land transactions. For more information, please visit and

Vacant Land: is now the time to buy?

August 5, 2009

There is no question that vacant land values have been punished, especially in the last year – and there is the opportunity.

Having specialized in vacant land sales since 1967 I have seen many ups and downs in the market and admittedly this current market is the worst I have seen.

A few years ago I spent over a year persuading a farmer to accept a $6 million cash offer from a national builder. The sales contract was finally signed, just in time for the housing crash, and I now have that property listed for $2.6 million and the owner will take terms.

About that time I received a $2.65 million cash offer on a beautiful hunt and fish club in northern Michigan, with a 30 day closing. The offer was soundly rejected but that property is listed with me now for $2.65 mil and I am not encouraged by the current lack of interest, nor are the owners.

So if the opportunities are so good why am I citing what amounts to horror stories for the owners? Because the value was once there and I believe the values will soon come back – and more. In many cases, much more.

Now is the time to make an offer on that 800-acre hunt and fish club with a private lake.