The Past Becomes Present

The Past Becomes Present

It has been said that if you live long enough, you will see just about everything.  With the advent of the internet and Youtube, I don’t think you have to be around that long anymore.  However, I do believe that the longer you are around, the wiser you will become through experience.

When I first entered real estate in the 1980s, times were booming.  In fact, I am told that more commercial real estate was constructed during the decade of the 1980s than had previously been built during the whole prior history of mankind.  That is a lot of square footage.  The upside was limitless.  That was a heady time as I was learning the ins and outs of commercial real estate development.  However, like with Icarus, the wings reached too close to the sun and the commercial markets came crashing down in the early nineties, bringing the rest of the real estate world with it.

Real estate, though, is a resilient industry.  After all, everyone needs a place to work and a place to live.  Like the mythical phoenix, real estate rose from the ashes with securitized financing and with opportunity funds swooping in to take advantage of distressed assets.  During this time, I cut my teeth on transactional activities, consummating over $500MM worth of real estate transactions.

As real estate, led by the residential markets, began a resurgence in the mid 1990s, I jumped on board for that ride as well.  I planned, developed and built some highly amenitized residential and active adult communities.  What started off as a stream soon became a torrent as the residential markets took off to valuations previously unheard of in prior real estate booms.  However, when you hear that waiters are flipping multiple condo contracts for a profit before the units deliver, you know the apocalypse is near.  This time, the residential markets led the downturn.  100%+ financing with no income verification loans is not a very smart way to conduct homebuyer lending practices.  Everyone learned that real estate is a true investment.  As with any investment, sometimes it goes up and sometimes it goes down.  It was a tough lesson for many people.

We now find ourselves in a tenuous real estate recovery.  Most people feel that the worst is behind us.  However, one eye remains firmly focused on the economy to see if it will continue to lead us to renewed prosperity or back into a new recession.  Either way, the real estate industry will present astute investors and developers with new opportunities in one form or another.  It always does.

So, why the history lesson?  One answer is that those who disregard the lessons of the past are doomed to repeat them.  Unfortunately, it seems that real estate mistakes appear to repeat themselves every twenty years or so regardless of the lessons learned.  The second reason for the review is a gratuitous plug for myself.  While my journey to date has been enjoyable, I am looking for my next opportunity to continue the ride.  For those of you who enjoy my blog and feel my skills and knowledge (and hopefully humor) may be of benefit to your organization, or to other opportunities you may be aware of, I encourage you to message me as to how I may be able to enhance your operations.  For everyone else, I remain humbled by your readership and I look forward to continuing to supply enlightening and witty insights into the real estate industry on a fairly regular basis.

Until next time…

 

Keep kicking the dirt!

Jeff Gersh is President of Gersh Consulting Services, a real estate advisory firm, headquartered in Orlando, FL.  He may be reached at jsgersh@gmail.com or 407-468-9328