Show Up . . . and LOOK the Part

One of my favorite colleagues shared this piece of advice for anyone within the service business.  Not only does this apply to real estate brokers, but the simple concept is applicable to anyone from a wealth manager to a fund raiser.  As we all clamor to showcase our individual tastes in an effort to differentiate from the competitors, there is a baseline of taste that transcends audiences of all types: know your audience.

First: Show Up

Former Tektronix Chairman Jerry Meyer once noted as we waited for others to arrive for a meeting that promptly started at 9 a.m after hearing a plethora of excuses via cell phones, "We're here."  Simply said, punctuality is the first cardinal rule of engagement.

The deeper meaning - especially relevant in a world where hybrid work environments continue to remain popular in a post-pandemic reality - is that there is so much we learn from an immersive work experience where people interact in person.  This can also be said for clients, as there is so much to gain from subtle cues like gestures and body language that can't be replicated on a Zoom platform.  Of course there are times when these types of meetings are necessary, but the true client advocate will opt to meet face to face as it is as much a benefit to the client as it is to the vendor.

Second: LOOK (and act) the Part

While it is impossible to clone the dynastic presence of Aerin Lauder who presents as a timeless ambassador of the brand promise of Estee, an image reflecting the type of work is of crucial importance to curate in navigating the complexities of clients of any type.

I recently had an experience with a director-level individual who was seeking information about a platform that I had created years before.  I arrived early, the individual arrived late;  I came dressed for a business coffee, the individual showed up in jeans and tennis shoes; I studied the current trajectory of the institution which we were discussing, the individual came with no questions that forced me to lead dialogue not knowing if I had adequately given answers.  At the end of the meeting, I sent a follow-up email with a link I had promised and some additional information.

A week has passed by today, and: 1) no written thank you note for my time, 2) no email acknowledgment of the link I had sent, and 3) based on the experience, would YOU take another meeting or provide context for this individual in the future?  Probably not.

Hopefully new leaders of tomorrow are being prepared by business coaches or mentors for the realities of working in a space where a modicum of sophistication separates the good from bad actors in any business scenario.  Clients may dress as they please, but as a vendor or someone making a request we must always present the best view as is appropriate for everyone and especially for a well-informed demographic.

Welcome to Regency Magazine!

Welcome to the inaugural issue of my magazine, Regency.  This curated biannual journal is specifically designed for a discerning population segment of pioneers, seekers, wanderers, creators, and leaders.  Featuring inspired innovation in both real estate and lifestyles, it resonates an intentional spirit that suggests not just to live, but live well.

Each page involves a personal experience or memory for me.  I hope the text, visuals, and images provide some new avenues to explore for readers.  Enjoy!

Have Branded Residences Been Over-saturated and Over-licensed?

Yes.

There are great artists, great cars, great restaurants, and a great many other wonderful things that this world has to offer those who can afford the expense of enjoying a completely luxurious lifestyle.  The success is usually attributed to that each almost always stays in the lane where they excel most in their respective genres.

One thing that has been evident of late is the uptick in the clamor to jump on the bandwagon of branded homes and condos under the footprint of a well-regarded hospitality umbrella.  Everyone can guess the usual brand suspects, but few know some of the more sophisticated boutique operations that have carefully managed their foray into creating ownership opportunities for the UHNW demographic which only a select few of real estate brokers understand and can aptly navigate.

Here are several items of interest to review with clients during a review of a branded residence opportunity:

• Addendum: Does the purchase of the property include signing an addendum that notes that while you're purchasing a Brand X condo today, that it may become Brand Z or change focus in the future?
• Culture: What forward-looking commitments are included in the CC&Rs etc.  For example, what is the required percentage of ownership vote to allow short-term rentals of the condos?  What regulation is in place to preserve the "topical" lifestyle of the UHNW purchaser?
• Finance: Any ideas on the future costs of shared services like security, pool, workout, spa, concierge, infrastructure and physical plant with the hospitality company?  Is my $2.00 per square foot monthly HOA fee going to suddenly be $5.00?  Is the Homeowner's Board going to have the wherewithal to guide the relationship with the hospitality partner after a developer exits?

One outstanding concept on the horizon is the advent of One Beverly Hills that meets the triple-platinum expectation of purchasers in this demographic with Aman as a partner.  This destination serves all the needs of the transient owner who is never in one place for more than a month to two.

Licensing of preeminent brand names has its issues - and can potentially result in a very good 3-star property wearing a very temporary haute couture gown of a 5-star name.  This is what could be called the Aldo Gucci Syndrome for how the brand devolved into tier-2 department and duty-free stores in the 1980s/90s before being reinvented through the efforts of Dawn Mello, Domenico De Sole and Tom Ford.  The magic in a name can extend only so far, as the market and this type of real estate buyer are more savvy with much higher expectations.  Fooling uninformed emerging players looking for recognition is easy, but that is not the case with the true UHNW tribe where information travels quickly about the fitness of a property to "fit in" to assumed expectations of absolute unparalleled excellence in every way.

Bottom Line: Beware of the licensed brand.  Not all developers are created equally in delivering the intended experience.  Quality control measures intended to protect the buyer within a licensing framework can be lip service to watch out for with little enforcement other than to eventually pull the brand name and exit.

If You Build It . . . Endow It!

While it's not the oldest story in the book, it could come close.  A donor has a vision, and those in charge are ecstatic that someone has the resources to make their (sometimes) dreams come alive in the form of a park, performing arts center or concert series, foundation, science hall, experimental community, or anything one can affix letters to for naming rights.  The ribbon is cut, and the building or space is a successful monument in time to something very worthy.

Then . . . it happens.  Errors in decision making, maintenance costs, and changes in personas and priorities all of a sudden make a dream irrelevant.  What was seemingly a blue-ribbon idea has been cast aside in favor of the next bell or whistle with little more than an afterthought to the original intention or purpose of the physical plant or concept.

Looking at the trajectory, original donors have the option to make sure their intention stands the test of time.  Doris Duke did exactly that when her will spelled out a very specific architecture of a foundation that was established in 1996 after her death in 1993.  Other founders have not been so fortunate to find their passions taking on other avenues that abandoned the original intentions their legacies were meant to serve.

Establishing tight controls from the beginning with conditions for a specific intention helps level the playing field and assists trustees in their role to keep focused.  Narrow guardrails eliminates the need for reinvention.  Now - apply that philosophy to something physical.  Take for example an idea to take one square block in an urban core and dedicate it to glass sculpture.  Scenario: $100 million builds out the facility and secures permanent "statement pieces."  Then factor in staff, level of ongoing interest, a crack in the pond that develops over time, the cleaning of the glass exposed to unfriendly climate (example: Madeline Redstone's gift of Chihuly's "End of the Day Boat" to Eisenhower Medical Center), or any other number of details where future donors may be called to maintain a benevolent gift of the past.  When providing a gift to establish something tangible, immediately double the gift to endow its future to make sure it lives on in perpetuity or has a solid deaccession plan associated with the donation - most applicable for art which is definitely in the eye of the beholder - or a museum's Acquisitions Committee.

At the end of the day, gifts that are well-intentioned all come with a price.  The best methodology is to formalize a plan in writing in advance between the donor and recipient or custodian so that the long-term purpose can remain in tact or change with fluidity as required.

Collecting the Collector - An Arform Unto itself

The Collector as buyer or seller is a unique persona who demands a discerning eye from any vendor, especially the real estate professional.  An additional layer of technical knowledge and ability to nurture is required when venturing into a fickle space with a tremendous array of diversity.

PERSONA
Discovery is part of the client relations process.  If a broker is not "in step" with client tastes, representation is nearly impossible to source an adequate property in which to appropriately showcase a new or existing collection.  Client personality is a phenomenal window into their tolerances of certain artistic expressions and mediums.

PASSION
Exploring the creative spirit behind the client vision is a necessity as they consider their long-term purpose and goals for collecting with their own interpretive wand.  The psychology and need that collecting fulfills are as valid as the art itself.  For example, how do you counsel a man whose parents have amassed an extraordinary collection as he develops ways to differentiate his personal brand from theirs?

PLACEMENT
An intuitive edge guides the agent to be mindful of signature elements important to the collector.  Skill in placement transcends where art should go and provides assurance that aesthetic matches their goals.  Appraisers, framers, installers, transportation, lighting, security, insurers, cataloging, and art opinion leaders are relationships that must be developed to function with this demographic.

I was able to begin my path in this arena through volunteering for a major art auction committee populated by experts in the field in addition to acting as a liaison to an art collection management committee of a private club.  My knowledge was augmented further through a pivotal seminar on art appraising organized by the area's leading private advisory for personal insurance and risk analysis, Candace Jennings.  The notes from that one seminar and relationship with the presenter are still with me as guideposts from 2011.

Art moves each individual in vastly different ways.  Relationships with real estate professionals are defined by the breadth and diversity of experiences.  Proficiency in working with the creative mood of the Collector and highly technical aspects of supporting collection placement is a key tool for skilled representation.

The Lender-Trained Real Estate Agent is Top of Game

A top-producing real estate broker once said “the best agent in real estate is one who is lender-trained.”  As someone who previously managed all aspects of marketing and compliance for a mortgage firm, I had the benefit of working under the guidance of three different presidents of Oregon’s mortgage professional association and learned a great deal about how the relationships they built with industry partners made the collective work easier and produced a superior net goal for the client.

Many real estate agents will suggest to “stay in your wheelhouse.”  To me, that statement presents issues for prospective clients on a number of levels.  By no means do I advocate that the agent should be involved in the pre-approval process for a mortgage loan – but it is fundamental to the backbone of the real estate profession that we understand the nuances of critical tasks we entrust as referrals to a loan originator.  Here are some basic items that brokers in any market segment should understand:

1)     A footprint of the mortgage loan program landscape and how to get information from the client so a referral is beneficial for everyone (i.e. a private bank loan originator who may leverage certain appropriate products will have a completely different lens than one who specializes in reverse mortgage products etc.)

2)     Knowledge of how and where mortgage loans are qualified, processed, and closed.  If a real estate agent knows that a certain set of documents are needed for a solid pre-approval, they should arm their clients with the information to make the transaction successful from the beginning in addition to what tools and overrides are available to the mortgage company to obtain the desired result.  Penrith Home Loans (disclosure: owned by my company, Windermere) has remarkable access and flexibility to meet timelines and its leadership is as hands-on as local originators may need them to be.

3)     Overarching knowledge of financial markets and mortgage loans.  If a broker does not have a grasp on financial indicators, they have lost touch with being a touchstone and central figure of a transaction.  Maintaining thought leadership is part of the real estate broker’s role and that expectation increases as the level of sophistication of a transaction increases as well.

As a client, here is a fun test for your real estate professional.  You’ll know you’ve selected a leading real estate advisor if they know the following answers:

1)     How many members are there of the Federal Reserve Board and what are they called?
Answer: The seven members of the Federal Reserve Board are called Governors

2)    What is a tranche?
Answer: Tranches are segments created from a pool of securities—usually debt instruments such as bonds or mortgages—that are divided up by risk, time to maturity, or other characteristics in order to be marketable to different investors.

3)     How are mortgage interest rates determined?
Answer: The Federal Reserve, bond market, Secured Overnight Finance Rate, Constant Maturity Treasury and the health of the economy and inflation all affect mortgage rates.

4)     What economist has a real estate index named for him?
Answer: Yale Economist Robert Shiller.  The S&P CoreLogic Case-Shiller Home Price Indices are a group of indices that measure real estate or housing prices. They track changes in residential home prices throughout the United States.

5)     What bureau in the US Government supervises consumer finance regulation?
Answer: The CFPB was created to provide a single point of accountability for enforcing federal consumer financial laws and protecting consumers in the financial marketplace.

6)     BONUS: What company is America’s largest loan servicer?
Answer: Wells Fargo with a $962 billion portfolio.  The bank plans to reduce its servicing to concentrate more on bank customers and minority communities.  Loan servicing is described as the administrative aspects of a loan from the time the proceeds are dispersed to the borrower until the loan is paid off.

This quiz is part of assessing the overall fitness of the real estate professional to know macro finance influencers that contribute to stellar client relations experience and representation.  It's nice to be lender-trained.  Enjoy!

Truth in Title - The Anatomy of a Winning Title and Escrow Partnership

ADVISORY: This particular segment is longer than usual, but worth a read.  It is a date-stamped opinion from my recollections circa 2021 - it also reflects the amazing people, culture, and time of a  specific era of the company that has since changed.
Many clients and industry partners have asked “why are you such an ‘evangelist’ for your title partner?”  The answer is not because I previously worked for the company – but the all-around approach that encapsulates the client experience is what I fondly remember far before I ever worked there.  With that disclosure, here is simple reasoning as to why a choice in title insurance and escrow services is a fundamental capstone that rounds out the equation of solid client representation.

GREAT ESCROW
This is now a basic expectation within the transaction landscape.  Part of that service is accessibility and when and how an escrow officer is willing to interact with a real estate broker, lender, or client.  I’ve often noted that our collective share of escrow officers in Portland is smaller than the membership of our most exclusive private golf club, the Waverley.  This is true.  Within the escrow club is a much smaller set of truly gifted individuals who transcend that of masters of numbers and attention to detail and have the human touch where they weave the real estate broker into the conversation to make the client feel completely confident that they are surrounded by total competence.

INTERPRETIVE GUIDANCE
Each escrow company has what was formerly known as “customer service.”  Customers shop at a grocery store, but clients use the services of an escrow company.  Not all client services groups are created alike.  The best ones have a team of true data scientists who are able to help real estate brokers and lenders with special projects to find solutions to their business needs.  In some markets, the regulatory framework requires the broker to pay for information, but on many occasions data has been used to source hidden “product” to assist brokers in finding their clients a match.  Ask me sometime about a research project using a GIS specialist for locating the ideal zone for a client within a country club for an industry partner in another market.  Client services teams refine data to make it manageable and usable for a wide array of purposes and good ones succeed in matching those expectations.

EXCEPTIONAL TOOLS
Title companies are famous for repackaging data that is readily available to interpret via a variety of platforms.  However, there are standouts that every title client development officer (sales is so pedestrian) should have at their fingertips.  A solid rule-of-thumb is to master three tools – just as we advise new brokers to do with the barrage of product arrows that are hurled in their direction.  As these are almost always rebranded filters of like-information, choose the user interface that works in concert with your desired consumer client experience.

ACCESS
Your title company is neutral in many ways as it serves many masters.  That neutrality offers an incredible opportunity for them to act as a “connector” as relationships are free but take time to nurture and develop.  One such example is having an out-of-market expert on a certain client segment.  Upon learning that my former company had an expert on Asia-Pacific marketing, I invited her to the Portland market under the banner “Director – Insights and Analysis - Asia-Pacific, Global Markets Practice.”  In one day, she participated in a grueling schedule to bring her message to over 300 real estate professionals.  And, I was able to fulfill on my brand promise that I still use in my real estate practice today to “give them something they can’t get anywhere else.”

MARKET INTELLIGENCE
At my company, Windermere Realty Trust, we are blessed to have an in-house economist, best-of-class education on social media and other marketing tools, and the counsel of extraordinary wisdom in the comparative Ivy League quality team of managing principal brokers.  Title partners where C-suite personnel are visible and available for dialogue and sharing best practices are extremely valuable and create an environment which elevates the real estate profession as a whole.  Investigate how regional and national title company leadership are participating in growing and sustaining business of their local operations.  These individuals see hundreds of markets in action, and have incredible insight to macro trends and how they will affect the local marketplace.

OFFICE ENVIRONMENT
In a post-Covid world, nothing can replace human interaction.  This is especially true with something that has the gravitas of transferring large assets like property.  Clients are curious, nervous, excited and the emotional spectrum runs the gamut.  The goal of the escrow office is to reflect the market it serves and to assure the consumer that their transaction is in good hands.  We designed a 10-point plan that summarized the escrow experience from “introducing the transaction” to the closing and beyond.  Security, privacy, and a dash of relevant local artist works and furniture (in a private client setting) all contribute to the recipe of a positive client experience.

DON’T LET RESPA BITE YOU
Above all else – adhere to and beware of title partners who offer a pot of gold for your business.  In California, the environment is heavily regulated to ensure that companies are not buying business.  The reputation of the title company should be as such as a client feels the interaction is so natural that they expect the same experience in future transactions.  Intellectual capital and idea sharing are free, and that deep knowledge and close connection with the escrow team, client development officer, and local/regional/national leadership is all you need in your toolbox to be successful.  Local regulators have not been beneath asking for proof of payment for advertising and events, measuring size of ads proportionate to payment, other items that may seem easy to slide under the radar.  Therefore, short term benefit and bragging that the “title company will pay for this or that” is a sure sign of the suspect character of a real estate broker and the financial fine, professional reprimand, and damage to reputation is not worth the risk.

AND FINALLY – COMPANY REPUTATION AND FINANCIAL STRENGTH
I’ll admit, my former employer is the highest ranking Fortune 500 title insurance company.  While that is a benefit, this company takes its business very seriously and pays out “losses” if they are incurred to the consumer with precision accuracy.  This cannot be said for all companies in this sphere.  In recent times, a new title player emerged that was funded by a private equity firm (the investment exit strategy for these types of companies is always acquisition) and therefore the interest is not with the industry partner or public’s trust, but with acquisition in mind fueled by a take-no-prisoners ravenous mentality.  Loss reserves of public companies are well-documented and while losses are infrequent, public companies can back up their title insurance commitments and claims.  Selecting a title insurance company with documented reserves and a rich history is as much a benefit to the client as it is to the real estate professional.  An incorrect title vendor decision and an unpaid or heavily disputed loss will cloud a real estate broker and is a concept of reputation management that we collectively never truly analyze.  Thinking long-term is a necessity with any vendor selection and most of mine have been with me for my entire time in the real estate sphere.

If you haven’t already guessed by now, my example of stellar performance in escrow services and title insurance was of Fidelity National Title and their market leading teams in client, development, and escrow services.  My 20-year relationship with the company on both the inside (as VP Corporate Relations) and the outside (both before and after as client) reflects on a very special place in time when FNT Portland’s Jeff Meucci was the undisputed visionary as the company’s sales organization leader prior to his promotion within the operation.  May we only have more thought leaders like him within our market and throughout the industry.