Commercial Success

Success in the real estate profession typically comes down to dollars and deals: the bigger, the better. In the commercial realm, where competition can be tough and the stakes high, leaders count other factors, such as education, expertise and long-held relationships with repeat customers, all of which come with time on the job.

Those qualities are critical to possess, particularly when the market softens, as some say is happening now.

In Southwest Florida, where office, retail and industrial development activity has flourished in recent years, opportunities have abounded for brokers of all experience levels. If the tide does change, look for the veterans to survive—and thrive.

There are many in the region. We talked to five, asking them to share their insights and secrets about what has made them movers and shakers in commercial real estate.

Name: Randal L. Mercer

Company: CB Richard Ellis-Fort Myers/Naples

Background: After working several years in the mid-1980s as a residential realtor for a firm on Sanibel Island, Mercer opened his first commercial brokerage company in May of 1988, naming it Mercer Investment Properties and ultimately specializing in office leasing. His company, with the help of some talented associates, became a presence that lasted more than a decade. In late 1997, Southwest Florida’s commercial market landed on the world’s radar screen. CB Richard Ellis, the largest international commercial brokerage firm in the world for more than 100 years, entered a relationship with five local commercial brokers, Mercer included. The partnership became the first commercial group to establish national and international ties in Southwest Florida, Mercer says.

The local operation has offices in Fort Myers and Naples with a team of more than 50 full-time professionals. Life’s not all about real estate deals for Mercer, though. He enjoys hiking in the mountains of Colorado, entertaining and cooking for friends, and traveling with his wife, Debbie.

Years practicing in Southwest Florida: Licensed in 1983

Areas of expertise: Office properties, both sales and leasing, and investment properties in office, retail and industrial

Geographic area of specialty: "In Southwest Florida, the office market is typically located in a very compressed geographic area I refer to as ‘the box’." That’s an area within McGregor Boulevard to the west, Cypress Lake and Daniels Parkway to the south, Colonial Boulevard to the north and I-75 to the east. "However, additional submarkets are springing up along most arterial roads. Transportation and accessibility are two important keys to successful office migration," he says, and tenants are willing to move from one location to another along corridors such as Daniels, which has been widened. New buildings in those areas attract tenants who are looking for space where they can operate with more efficiency with movable walls or Internet access (T-1 lines), for example.

Secrets to success: "Never, ever give up trying or believing the possibilities. Success is not measured in longevity, but in repeat business from valued clients. Many practitioners have been successful in a hyper-growth market in spite of themselves, [but those who continue serving their] clients, regardless of the personal scorecard, will ensure continued business."

Deals of note: The $20,565,000 sale in December of the Shaw Aero Design & Manufacturing Facility in Naples. Arranged by Mercer and colleagues in the Miami office, it included an office, manufacturing and testing facility on 14.77 acres. His biggest deal prior to that was the purchase and subsequent resale of the Metro Distribution Center, a 264,000-square-foot, 20-building industrial park.

Commercial market outlook: "Steady growth, improved transportation and access to markets, a more educated workforce and, lately, slightly more affordable housing will continue to propel us to greater heights than ever before. A popular theory is that money is made on real estate when one buys it, not when one sells it. If we accept that theory—and I do—the next 12 to 24 months will be the most logical time to buy investment real estate in a decade. However, a long view of five or more years is certainly more prudent than a short one, as the investment can be somewhat illiquid."

Name: Karen Johnson-Crowther

Company: Colliers Arnold in Fort Myers

Background: The Chicago native’s path to success began 20 years ago out of necessity. She lost her parents and had two small children to raise, without help from an absentee ex-husband. She immersed herself in her fledgling commercial real estate career, working with commercial real estate developer Stiles Corp. of Ft. Lauderdale, which provided her with the education she needed to operate successfully in the business. "They held my hand," she says. She later worked at VIP Commercial and wound up as a partner at Colliers Arnold, where she directs the retail services division. She credits her success, in part, to various mentors: her father, Joe, who told her she could do anything she wanted, "and I was young enough to believe him"; friends and business colleagues Pam Van Vleck and Partridge, who taught her the ropes of the real estate profession, with emphasis on honesty and ethics; and her husband, David, an owner of Crowther Roofing, from whose business acumen and guidance she draws. Away from the office, Johnson-Crowther volunteers her time to causes including the Lee County PACE Center for Girls, and is dedicated to her family. She has four children and a grandchild on the way.

Years practicing in Southwest Florida: 20

Areas of expertise: Retail—landlord and tenant representation
 
Geographic areas of specialty: Lee and Collier counties

Secret to success: "I look at every transaction as if I were making decisions with my own money. It’s my job to [educate] my clients on every aspect of the transaction and let them make a decision that best suits their investment parameters," she says. "The size of the deal doesn’t matter; relationships do. My clients are looking for return on investment, be it the profitability of a lease location for their business or a 1031 tax exchange on a replacement retail property. If they don’t achieve it, then I haven’t done my job. ... There are some brokers who don’t care as much about relationships with clients as they do about the deal. I’ve seen brokers proceed with transactions with people who had no business buying those products."

Deals of note: This year she closed on the Wal-Mart Neighborhood Market on College Parkway. "A former colleague, Cramer Partridge, and I worked on that deal for almost three and a half years. It wasn’t just a deal; it became a mission."

Commercial market outlook: "Without question, 2008 will be a little more difficult than 2007. It’s still on the decline. In some areas, it’s because of [low] absorption of inventory."

Name: Andrew DeSalvo
Company: Premier Commercial Properties, a division of Premier Properties of Southwest Florida Inc.
Background: Before getting into real estate in 1980, DeSalvo taught American literature at Fort Myers High School for three years, and helped coach the 1978 and 1979 state champion wrestling teams. He cites R. Floyd Luckey Jr. as the most influential person in his business life. "My two years with him in the early 1980s were my first post-graduate study in development, business, politics and people," he says. The value he places on education is evident on his résumé. In addition to his bachelor’s and master’s degrees, he has completed several courses related to the real estate and development professions. He also has led boards of the Bonita Springs-Estero Association of Realtors, the Bonita Springs Area Chamber of Commerce and the Bonita Springs YMCA. The Estero resident is married to Cathy. They have three adult children and four grandchildren—with one more on the way—all residing in Lee County. His wife jokes that his hobby is work, but he enjoys boating and snow-skiing.

Years practicing: 28 years in Bonita Springs

Areas of expertise: Land acquisition, site selection, purchase and sale of investment properties, and the sale and lease of office and flex-industrial space

Geographic areas of specialty: "My primary area of expertise is Lee and Collier counties. The vast majority of my work is in the Bonita Springs-Estero marketplace."

Secrets to success: "There really are no secrets. I believe that a good education, disciplined work ethic and strong moral compass are the foundations to success, along with tenacity, continuing education and constantly improving my base of knowledge and experience," he says. "I treat my client the way I would like to be treated. I never chase the money. The money takes care of itself if you take care of the client. I’ve also lived here since I was seven years old. I’ve seen all of the changes."

Deals of note: This year, the sale of three, fully leased buildings to investors. Last year’s sale of 100 acres in Estero to parent company, The Lutgert Companies, was the largest single sale he’s made in his career. It was in excess of $30 million.

Commercial outlook: "In my primary geographic area of Bonita Springs-Estero, I believe the office-space supply will level off and continue to be absorbed. More retail space will be constructed and the vacancy rates will remain within an acceptable historic range. Small companies and subcontractors will continue to constrict and, as a result, rental rates for that segment will continue to be pushed downward," he says. "A large part of our business is buyer representation.