Expert Advice on Real
Estate Investing
When it comes to real
estate investing, Bergsman lets the experts do the talking. In his
newly published book, "Maverick Real Estate Investing: The Art of
Buying and Selling Properties Like Trump, Zell, Simon, and the
World’s Greatest Land Owners," he leaves the talking to the giants
of real estate.
"I took real estate investment and broke it down into 12 parts," he
said. "Then I took a look at each of the 12 parts and found a
successful real estate entrepreneur who worked this part of the
investment well."
Bergsman is a nationally recognized financial and real estate
writer, and regularly contributes to the "Ground Floor" real estate
column in Barron’s. For more than 25 years, he has contributed
articles to such publications as The New York Times, the Wall Street
Journal Sunday and Fortune.
Bergsman was approached by the publisher, John Wiley & Sons, to
write the book and was given a six-month deadline.
"It was a race because there were 12 individuals I focused on, so I
had to find all of these guys and whenever possible I did the
interviews in person," he said. "So if they were in San Francisco, I
went to San Francisco, and if they were in Texas, I went to Texas."
Among the titans he interviewed were:
• Donald Trump, longtime real estate maverick and reality TV star.
• Douglas Shorenstein, chairman and CEO of San Francisco-based
Shorenstein Co., which owns and manages about 25 million square feet
of office property in places like San Francisco, New York, Chicago,
Philadelphia, Phoenix and Miami, Fla.
• John Kukral, president and CEO of New York-based Blackstone Real
Estate Advisors, which has completed more than 100 transactions
comprising more than 600 individual real estate assets valued at
about $13 billion.
• Samuel Zell, chairman of Equity Residential, the largest publicly
owned operator of apartment communities in the United States; Equity
Office Properties Trust, the country’s largest real estate
investment trust; and Manufactured Homes Communities; all are in
Chicago.
• David Simon, CEO of Simon Property Group in Indianapolis. As of
2003, the company owned and had an interest in 243 properties
encompassing about 183 million square feet of gross leasable space
in 36 states.
Today’s real estate mavericks are a mix of those who followed in
their fathers’ footsteps and those who entered real estate on their
own and created an empire from scratch, Bergsman said.
"For instance, John Kukral . . . his family wasn’t in real estate
and he had no gleam in his eye to become a real estate maven," he
said. "But he got a job in college and it was in real estate, and he
loved it and decided to do it."
Bergsman said he learned a lot from talking to the mavericks. For
instance, they may follow the same basic rules as regular investors,
but their perception runs deeper and they have longer-term vision.
"Say you wanted to buy a duplex, something very small," he said. "We
look at it and really get excited about it, and then say ‘I’m going
to go home and think about it.’ That means 24 hours to think about
it, then you rush back there and buy the property."
Regular investors’ idea of patience is 24 hours, while the mavericks
operate on a much longer time period, Bergsman said.
"A lot of these guys will tell you there’s always a second
opportunity in real estate," he said. "So let’s say we rush back the
next day and the duplex has already been sold. We’re disappointed
and we forget about it. But those guys never really forget about the
properties they lose. They keep an eye on it and it comes back. In
real estate there’s always a second act."
The mavericks also have a broader understanding of "location,
location, location," Bergsman said. They see where good locations
can become bad, and vice versa.
"Sometimes the older part of the city gets really run down and
nobody wants to invest there, so it would generally be considered
bad sites for investment," he said. "But you find pioneering efforts
to go in there and invest, and suddenly this old, rundown part of
the city becomes the hottest part of town because somebody took the
chance to invest there."
Although the mavericks are all wealthy, Bergsman said his book is
not about how to get rich by investing in real estate.
"Some people have done it and they’re the inspiration," he said. |
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