My office my home

My office my home

I recently read that One World Trade Center in New York will be the tallest building in the western hemisphere and the third tallest building in the world.  The 9/11 symbolism and pride that it will bring to the Manhattan skyline is self -explanatory.  I just wonder whether such extravagant structures are really necessary or will they soon become reminders of what the world was like before the technological revolution. 

Consider the following.  Conventional metropolitan office space has historically been about convenience.  There is the convenience of large population centers and ease of access to service professionals.  There is proximity to clients as well as major sources of transportation, whether those be road, rail or air.  You would also be close to food, entertainment and lodging alternatives.

Now, consider the changes being wrought by the technological age.  Hard document deliveries and signatures have been replaced by electronic files with electronic signatures.  Smart phones and more compact server opportunities have reduced umbilical cord ties to close by data centers.  Video conferencing capabilities have taken the place of the need for face to face meetings.  You are now to the point where an individual with a home office and a wireless connection can be just as productive and interactive as a co-worker located in an adjacent office space.  This is not to say that face to face human interaction has no value.  However, at what price?  Is it worth the stress and time spent commuting to an office location?  Is it worth the rental cost of the office space?  Does it add true value to your client communication?  Or, could you be just as effective and efficient in a smaller, more flexible office environment with more employees working off-site?

Remember, the large scale office building is a phenomenon of the 20^th century.  Why can’t the work environment continue to evolve and improve?  The mass affordability of the car is what led to the suburbanization of America.  It also led to its current traffic congestion.  Who is to say that the power of technology won’t create a new wave of living that will change the way housing and office spaces work together?   It is very possible that the future of Wall Street and Main Street could merge into a cyber-community form of working and living whose future is closer than we may think.  Just don’t tell that to the large institutions that have billions of dollars tied up in downtown office buildings.  After all, we still leave our horses tied to hitching posts when we arrive at the office, right?    

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

 

Attitude may only be skin deep

Attitude may only be skin deep

It is funny how we tend to remember the bad more than the good.  I can’t tell you how many times I have heard salespeople tell me how they were disgusted by the negative attitude of their customer.

However, what the sales staff tends to forget is the amount of thought and effort made by that customer to just walk through the door.  Understanding that effort is, unfortunately, what often gets lost in the sales process.  It is critical for the sales team to remember it is not how you are treated by the customer, but how the customer is treated by you.

There are times when the customer may appear not to care and, in fact, it may seem that they want to be anywhere other than visiting the sales office and models.  However, let’s recognize the effort made by the customer to come visit you.  They needed to do some research on you as a builder and community.  They needed to plan a visit.  That alone takes time.  Then, by making the actual visit, you have become a major part of their day.  Just as you will remember their poor attitude and perceived indifference, they will remember how you treated them and responded to them long after they leave.

This leads to long term impact.  They may not have lived up to your expectations of etiquette, but what impression did you make on them.  Did they find you professional, knowledgeable and caring?   It is critical to remember that the best customers are referral customers.  Will they recommend you to others?  More often than not, their visit was more meaningful than they will want you to believe.  They may even still buy a home from you.  The impression that you make on them will have ramifications for future opportunities. 

Remember the saying not to judge a book by its cover.  No matter how tattered and worn that cover may be, you may be surprised to find a compelling story underneath.

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

 

 

 

It's not easy being green

It’s not easy being green

Green is a beautiful thing.  It is the color of grass, the color of money and the somewhat universal name given to something that is good for the environment.  I am not trying to go all Kermit the Frog on you, but I do want to talk about the green basis that seems to be used for energy efficiency ratings on new homes, the HERS index. 

HERS stands for Home Energy Rating System and has become the standard to define the energy efficiency rating of a home.  I think this is a great idea.  However, I do believe that the information is somewhat misleading.  The rating claims that a Standard New Home has a basis of 100.  Therefore, any home that has a HERS rating lower than 100 is more energy efficient than a Standard New Home.  Once again, this sounds great.  In fact, homebuilders are continually touting how their homes have HERS ratings well below the Standard New Home benchmark.  This is where the problem comes into play.  I am not aware of any new home builders that build standard homes to a HERS rating of 100.  Whether it be due to in-house construction improvements or changes to local building codes, every new home builder that I am aware of builds all their homes to a HERS rating less than 100.  This allows all builders to promote how green their construction practices are.

This is great for the builders and they should all be applauded for building better and more efficient homes.  However, wouldn’t it be more appropriate for the HERS standard to be adjusted on a yearly basis?  In reality, if construction practices and building codes are improving every year, shouldn’t the standard rating bar be moved every year as well?

I agree that a home that is more efficient that the Standard New Home is a very energy efficient home.  Just show me where they are building new homes to a 100 HERS rating for comparison.  Otherwise, change the bar on a regular basis so that we can get a better idea as to which new home builders are being truly innovative in their green building construction practices.

Our old pal Kermit once sang “It’s not easy being green!”  Let’s raise the bar and keep it that way.

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

 

 

 

Twas the month before year end

Twas the month before year end

 
The holidays are near
Oh yes, what a sight
We want to be happy
But the numbers are light
We had set up our budgets
With high hopes and good cheer
Though now do we panic
As the year end looms near
To turn the corner we planned
New sales they would soar
The recession behind us
Of that we were sure
Not just a few were expected
But a ton of new sales
We felt strong about the market
We would emblazon new trails
Large acreage had been purchased
New lots now secured
We were set for the budget year
Of that we were assured
New sales they would come
We knew that this year would be great
We staffed up for the increase
Sure to have a full plate
But our eyes were too big
A large jump was the lure
In both contracts and closings
Our thoughts they were pure
And now we find ourselves short
Not by a lot, but enough
Our bonuses will suffer
It may get bumpy, a little bit rough
We must move out the inventory
Great year end prices to sell
So at the end of December
We will have a good story to tell
Such is the tale of the builder
To do the best is their plight
While making guesses for the future
And hoping the year end is bright!

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

 

 

 

 

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