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So thank you, Grant,
for joining me today on the icons

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of DC Area Real Estate Podcast.
I've reviewed your background in

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the introduction, I met you when you work for

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JBG Rosenfeld,
a partnership between Rob Rosenfeld,

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whose father started his development
company, and JBG companies,

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who brought sort of retail partner
at that time as JBG evolved.

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And Rob Rosenfeld and Jim Garibaldi,
your partners at the firm, retired.

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You decided to start your own
company, Willard Retail.

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Talk at a high level about your role
at Willard and how you position

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the company in the market today.
We'll get to the details later.

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Well, thank you, John,
thanks for asking me to do this,

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I appreciate it, so the the reason we decided to

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start Willard, was when we, when
we founded it was myself and,

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Jim Garibaldi and Michael Majestic.
And Michael Majestic is still my

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partner today.
And Jim, as you know,

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has retired as of probably at
least three years ago.

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it, it was really largely because

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I wasn't ready to stop working.
I really wanted to try, you know,

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to continue to try to do some of
the deals that we, the types of

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deals that we had done previously,
either, you know, existing,

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repositioning or ground up,
although, you know, it doesn't

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there hasn't been a lot of ground
ground up that's occurred, you know,

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you know, the Jim and I were
always good partners together.

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Jim is very smart, very savvy, and as
capable as any person I've ever met.

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And, Michael is, we call him
magic because of his name. Majestic.

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And so it's just been magic for.
And you'll hear me refer to him

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throughout the conversation as magic
more than Michael, because I always

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screw up and say magic. And so. Okay.
And in any case,

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and he has a skill set that I
also felt was complimentary with

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my skill set and and with Jim's.
When Jim left,

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it was not extremely sudden.
It was, you know, some time to

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think about it and magic.
And I decided that we would be

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able to carry on, you know,
the idea and the business plan of the

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of the business, without Jim,
if we found another capital partner,

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you know, to be able to help us
grow and give us a GP capital and

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hopefully help capital for new deals
that we would that we would find,

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of a mini roadshow to talk to a, a

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bunch of different capital partners.
And we talked to a lot of

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different institutional partners,
some family offices,

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but mostly institutional partners,
and got down the road with kind

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of a an array from large
insurance companies to,

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one significant family office that
that had some of the larger names in,

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this, this company and that fell

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apart for a, a crazy reason, or that they lost interest

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for a crazy reason.
So talk about the difference

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between your role and magic's role.
I mean, a little bit, and then

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we'll jump into your background.
So my role really,

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has been and was sort of the
originator of most of the deals,

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most of the opportunities that we
did. That's what I did at Jaeger.

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And that's what I do now. Okay, I also have some I have not

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the deepest capital relationship,
but a reasonable, you know,

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pool of capital relationships.
And so between the capital

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relationships,
knowing most of the brokers,

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if not all of the brokers in the
in the retail investment community

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having a very good knowledge of
where of pretty much every retail

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asset in the greater Washington,
DC metro area and having a pretty

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good idea just in general.
But what works and what doesn't work.

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And then his skill set is he's got a
better quantitative skill set than I

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do. He's more depth financially, he is he is an urban planner

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by training.
And so he can take a take a shopping

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center site plan, move pieces around
and all have a general idea like, oh,

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if we could get rid of this guy,
we can create some residential

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here or something else,
and he'll be the person who

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actually does the initial layout.
We eventually get to a civil to

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do the real layout, but he comes.
He can see whether the idea

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actually makes sense.
You guys can frame. Deals up right.

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In front and he's got good instincts.
He's smart, he's capable,

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he's got a good head for,
you know, the types of tendencies

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that work and don't work.
So let's let's go back to your

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origins here.
Talk a little bit about your youth

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and parental experiences, your
parents, etc., and where you grew up.

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So, my parents, my mother and
my father moved to the greater

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Washington area, then moved to
Northern Virginia when I was three.

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Okay, so I have been here.
I was born in Massachusetts,

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but we moved here when I was three, and start in Springfield and then

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quickly moved to Arlington, where my
parents bought their first house.

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fifth grade.

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or. No, fifth into fifth grade.

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And we moved to McLean.
My parents built a house in McLean.

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And then not that long after that,
my subsequently, my parents got

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divorced and my father moved out.
And so it was my mom and my two

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sisters and I that lived in that
house for a period of time.

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And then my mom got remarried to
my stepfather,

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who she is still married to, still
lives in that same house in McLean.

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And, it's,
I go to visit them, you know,

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and when I'm in town at least once
a week and talk to them multiple

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times a week, they were,
my mom and my stepfather particularly

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were very good influences on me in
terms of creating a strong work

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ethic, a moral code and,
them appreciating my, you know,

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the skill set that I had or just my
nature and sort of living with it,

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I mean, or being comfortable with it.
And I'm kind of a jokey person.

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I'm usually pretty happy person.
And I at times for me to focus

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was a little harder.
And I think now in today's world

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I would have been for sure
diagnosed with ADHD when but but

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then that that wasn't a diagnosis.
So. So what are your parents?

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What did your stepfather and
mother do?

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So my mother did a variety of things.
And one, what I would say the

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the job that she was most proud
of and that she liked,

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liked the most was, she ran
a program after the Vietnam War.

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We had a lot of immigrants
coming in from Southeast Asia,

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from Cambodia, Laos and Vietnam
and Arlington County.

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There was government money that
went out to create programs to

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help these people get educated,
help them, get them jobs,

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and help them find housing.
And she ran one of those programs.

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And yeah, it was really interesting.
And she and she did a really

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good job.
And, you know, those people,

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as you know, came the ones who came
here have completely assimilated into

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American society and have excelled.
And, you know, maybe partially

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due to the people that came,
but it also was due to the fact that

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the program was very useful for them
and helping them to get a start,

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a. Federal program.
Or it was a federal program that

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then went to local jurisdictions.
The funding then went down to

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local jurisdictions.
And my stepfather ran, the,

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the, the court system for,
probation in D.C. that was his that

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was his job up until he retired.
And then he did a consulting gig

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for another ten years after that. Cool.

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So, you went to high school then
in Fairfax? I went to high school.

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I went to, Langley and,
sure loved it and still had,

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you know, had a great time there,
had a great time growing up.

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I love the neighborhood.
I grew up and still friends with

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some of the kids that grew up in
that neighborhood.

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lot of guys that went to high school

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with, you know, two of my very best
friends in the world are two guys

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that I met when I was in sixth grade,
and I still talk to them on a,

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you know, weekly.
If not, you know,

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two times a week. That's great.
Yeah. So then you went to GMU.

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And then I went to JMU.
And why did I go to JMU?

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Well, I went there because I got
rejected at UVA.

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And so I ended up at JMU and I
loved it, had a great time.

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And it's probably just as well that I
went there because my grades were

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not stellar at JMU, and who knows
what they would have been at UVA.

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But as my stepsister will tell
you and my my friends who went

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to UVA will tell you I spent a
lot of time at UVA. On weekends.

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You know, maybe 15 to 20% of my time
was there for a variety of reasons.

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I like girlfriend there.
I had different girlfriends there.

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And I had, you know, just the I
like the partying scene there.

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I like the partying scene at
James Madison.

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But, you know, it was fun for both.
I tell people, you know,

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the there was used to be a party
at UVA called Easters,

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and I don't know if you remember,
my son went there. Oh you did. Yeah.

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Yeah, but Easter was long gone
by then. Probably.

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Yeah, but Easter's was a party
that literally had to shut it

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down because you had 100,000 kids
descending on Charlottesville.

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And, you know, it was fun, but it
was not not sustainable. No. Yeah.

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So what did you study JMU business.
And, in hindsight, that may

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or may not have been, you know,
the right decision to study that.

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I thought that that would be a good
background, you know, for a job,

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you know, in in business,
you know, whatever that is.

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But it was what I learned is the
things that I learned about business.

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There were not that other than
accounting and finance,

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neither of which I was very good at, really aren't weren't that

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applicable to what I ended up doing,
you know, and maybe marketing was

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applicable to what I ended up doing,
but other than that, I think

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I would have had better grades if
I had been an English major or a

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history major, because at that time,
and even today, I read all the time,

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and I am a good writer,
and I think I would have done

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better academically because I
would have been able to harness

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that the ADHD mind to something
that was more interesting to me.

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What were you thinking about in
college about career at that point?

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Did you have any sense? No idea.
Yeah, I had no idea.

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I well, I knew I wanted to be
wealthy. That's all I knew.

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But I didn't know how I was
going to make it happen.

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So what,
when did the real estate bug hit you?

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So one of my very first jobs was I
was working for a company that sold,

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So, and the company that

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you've heard of the firm,
Pitney Bowes. Sure.

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Well, I didn't work for Pitney Bowes,
okay? I worked for their competitor.

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Okay.
That had 5% market share in

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Pitney Bowes had 90. Yeah.
And so this company, you know,

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we sold mailing machines and, yes, I was a salesman. Okay.

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And the job would basically be
going to office buildings,

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trying to find the office manager,
trying to find whoever cold calling.

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And I learned I learned how to
cold call with that job.

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And it was it was challenging.
It was really challenging.

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You know, I tell people the story.
We used to go into it.

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You'd go into office buildings
and this is a day, you know,

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you work out and tired, of course,
and you go into an office building

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and you'd go to the eighth floor,
you'd elude the, you know,

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the security guard, the doorman,
and eventually somebody, one of the,

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the receptionist would say, hey,
you're not supposed to be no

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soliciting, right?
And you leave and then go to the

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second floor and then to the
fourth floor, you know, to avoid.

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Oh, sure regard. Right. Yeah. Yeah, how successful were you doing?

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I was successful at it,
but I did that for maybe a year

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and a half. No more than that.
Maybe two years at most.

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And, I even received some
acknowledgement there.

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I got invited to go to this training,
which they only invited the better.

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You know, the people who were,
you know, better salesmen to go

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to in California,
where the home office was,

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and Hayward, California and,
but a friend of mine, from

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actually seventh grade was he worked
with his father, selling land.

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And he he convinced me to quit
my job, which had, you know,

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a modest salary in order to come
work with him and his dad and a

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couple other people to sell land
for no salary. And so I did that.

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I, you know, I saw it, I thought,
well, it's a great commission.

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It's a straight commission job and
but it could be more interesting,

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more lucrative in the long run.
And so I did that.

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And then, you know,
I had a little bit of savings.

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And I also during the a weekends
I had a painting company and so

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I would,
I would paint houses on the weekends.

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And I had a crew working for me
during the week.

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And so the crew would be
painting and I'd stop by that.

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The job sites, you know,
a couple times a day and I

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wasn't I wasn't a great painter.
I didn't hire great painters.

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And if I apologize to anyone who's
who's listening to this, this house

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I painted during that period.
But I do appreciate you

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assisting me to survive,
to to be able to to move beyond that.

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00:14:58,540 --> 00:15:01,320, and so we did, I did.
That for a period of time.

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And that is all.
In Northern Virginia.

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All in Northern Virginia.
I was focused primarily in

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Prince William County, okay.
And I actually had a, back then,

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they, you know, the getting
information there was no internet.

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You know, there was the way that you
got the data, was tax records.

215
00:15:20,190 --> 00:15:23,880
And so I'd either have to go down to
Prince William County, to the tax,

216
00:15:23,910 --> 00:15:29,310
to the courthouse on microfiche,
read it, transpose it by hand,

217
00:15:29,310 --> 00:15:33,330
of course.
And then or you could call the

218
00:15:33,330 --> 00:15:39,450
office, but they only gave you three
addresses or three names per call.

219
00:15:39,570 --> 00:15:43,050
All right. So how to do that?
And you had to disguise your voice

220
00:15:43,050 --> 00:15:47,820
periodically to call back again.
It's just such a different I mean,

221
00:15:47,820 --> 00:15:51,270
not even close to the world that
we live in. Not even close. Yeah.

222
00:15:51,270 --> 00:15:55,560
So anyway, I had this wall and every
person in western Prince William

223
00:15:55,560 --> 00:16:00,060
County who owned ten acres or more, I
had it all mapped out. There you go.

224
00:16:00,060 --> 00:16:02,910
And so I would call them and,
you know, consistently call them.

225
00:16:02,910 --> 00:16:07,020
And I ended up making enough
transactions to make, you know,

226
00:16:07,020 --> 00:16:11,460
decent living and about.
Selling to hold builders or what

227
00:16:11,460 --> 00:16:15,210
was the deal. What was.
No, I was selling mostly to land

228
00:16:15,210 --> 00:16:20,400
assemblers, you know, people who were
the middlemen in between the the

229
00:16:20,400 --> 00:16:24,150
home builder or the or the in so.
Land developers basically.

230
00:16:24,990 --> 00:16:27,570
So like, you know, that's being.
Generous to call.

231
00:16:27,600 --> 00:16:30,210
Hazel's Bill Hazel,
for instance, for some of what.

232
00:16:30,750 --> 00:16:35,610
He I, I'm sure I talked to somebody
in his firm at one time or another.

233
00:16:35,610 --> 00:16:37,560
And at the time, you know,
I talked to the bunch of the home

234
00:16:37,560 --> 00:16:40,530
builders that were around then,
you know, like Miller and Smith

235
00:16:40,530 --> 00:16:44,700
was around that, right?
NVR was around that in their

236
00:16:44,700 --> 00:16:48,660
first iteration before they,
you know, ended or not ended.

237
00:16:48,660 --> 00:16:53,610
But when BK and then started over
again and, but it was really,

238
00:16:53,820 --> 00:16:56,610
you know, some names. Okay.
Like here's a name that you might

239
00:16:56,610 --> 00:17:01,980
remember that we sold land to Russ
Aronson and Russ Aronson at one time,

240
00:17:01,980 --> 00:17:06,150
you know, was a very wealthy guy
and then, you know, ended up with

241
00:17:06,150 --> 00:17:09,300
too many personal guarantees and
ended up broke and started over

242
00:17:09,300 --> 00:17:12,120
again as a residential age.
Bobby Kettler, another one.

243
00:17:12,120 --> 00:17:15,120
Bobby Kettler, another one. Yeah.
There was a ton of people like that,

244
00:17:15,120 --> 00:17:19,890
you know, read Wills names like that.
So those were the people that were

245
00:17:20,010 --> 00:17:24,480
who we would try to deal with.
And like one transaction I was

246
00:17:24,480 --> 00:17:28,410
involved with,
there was a guy that owned 150 acres

247
00:17:28,410 --> 00:17:32,190
in the middle of Prince Weston,
Prince William, off of Devlin Road.

248
00:17:32,370 --> 00:17:38,850
And this guy, he he was such a
character and kind of unscrupulous.

249
00:17:38,850 --> 00:17:45,060
But he had, he lived in this
property with all these dogs and

250
00:17:45,060 --> 00:17:50,250
horses and the horses that he would
feed the horses with, day old bread

251
00:17:50,250 --> 00:17:53,940
that he'd get that was thrown away.
So these horses were bloated.

252
00:17:53,940 --> 00:17:56,430
Oh my God.
And not, well, you know, not not

253
00:17:56,610 --> 00:18:00,390
nourished. No, not well nourished.
And he sold. He sold the horses.

254
00:18:00,390 --> 00:18:03,360
And I don't know who you know what
he sold the horses for, but the

255
00:18:03,360 --> 00:18:08,340
land was actually worth, you know,
a fair amount, and he ended up.

256
00:18:08,730 --> 00:18:11,430
We ended up what?
He didn't want to pay taxes.

257
00:18:11,430 --> 00:18:16,560
So he and I and my partner one of
multiple times drove around all

258
00:18:16,560 --> 00:18:21,210
over Virginia looking for farms
for him to trade his farm into.

259
00:18:21,570 --> 00:18:26,310
And we ended up finding a few,
and he ended up buying 2 or 3 of

260
00:18:26,310 --> 00:18:31,560
them and selling his property.
And I forgot who he who he sold

261
00:18:31,560 --> 00:18:32,820
it to.
Whoever he sold it to, ended up

262
00:18:32,820 --> 00:18:36,270
losing it and went back to it.
Went back to the lender. Interesting.

263
00:18:36,270 --> 00:18:41,070
Yeah. So how long did you do that?
Three years. Okay.

264
00:18:41,070 --> 00:18:46,050
And then in 1989,
which was my best year,

265
00:18:46,050 --> 00:18:50,700
working, working with him, the,
you know, the world fell apart,

266
00:18:50,700 --> 00:18:53,880
started to fall apart.
So from 1989 and I'm pretty sure

267
00:18:53,880 --> 00:18:57,930
I made that year 100, you know,
$100,000, which back then was a lot.

268
00:18:58,050 --> 00:19:00,360
And, or at least for me,
it was a lot.

269
00:19:00,360 --> 00:19:05,700
And, we, I got married,
bought a house, and then the

270
00:19:05,700 --> 00:19:10,200
next year I went to making 1990.
Not much at all, you know,

271
00:19:10,200 --> 00:19:13,650
because no one was buying land.
It was almost impossible.

272
00:19:13,650 --> 00:19:19,110
So I married a mortgage and not
a very substantial income.

273
00:19:19,110 --> 00:19:21,720
And so I had to figure out,
you know, what am I going to do?

274
00:19:21,720 --> 00:19:28,470
So I went and I found a job in where
I'd found that job working for that

275
00:19:28,470 --> 00:19:32,340
firm, the competitor to to,
Pitney Bowes, freed and Alcatel

276
00:19:32,340 --> 00:19:35,490
went back to the post and
started looking for more jobs.

277
00:19:35,490 --> 00:19:40,140
And I found a job working for a
company called Glen and company.

278
00:19:40,140 --> 00:19:44,220
And Glen and company was founded
by a guy named lied.

279
00:19:44,220 --> 00:19:49,590
Glen and lied was the former
president of Weissberg Corporation.

280
00:19:49,590 --> 00:19:54,180
Oh, okay. Right. Sure.
And so Marvin Weisberg was a very

281
00:19:54,180 --> 00:19:59,580
successful entrepreneurial real
estate person developer who owned.

282
00:19:59,790 --> 00:20:04,410
An array of assets and the the
Marvin, you know,

283
00:20:04,410 --> 00:20:07,230
made enough money and didn't really
want to run the business anymore.

284
00:20:07,230 --> 00:20:12,420
So he outsourced the management
agreements to a lot to like Glenn and

285
00:20:12,420 --> 00:20:17,970
so lead Glenn from this company.
And a guy named Rick Levy ran the

286
00:20:17,970 --> 00:20:23,130
was an EVP for him and ran the
leasing and asset management for him.

287
00:20:23,130 --> 00:20:28,740
Rick hired me to do, when I
started, I was doing some office

288
00:20:28,740 --> 00:20:35,280
leasing in some retail leasing.
And I, you know, while I'm doing

289
00:20:35,280 --> 00:20:38,100
that, I'm thinking, you know,
trying to figure out, like,

290
00:20:38,100 --> 00:20:42,180
what? Where am I going to focus?
Because now I'm 31.

291
00:20:42,180 --> 00:20:45,510
I had a baby by then.
I guess I had a baby in 1992,

292
00:20:45,540 --> 00:20:49,320
my first son, and I'm trying to
I was 30, so I was trying like,

293
00:20:49,530 --> 00:20:54,150
what am I going to do?
How am I going to build wealth?

294
00:20:54,150 --> 00:20:59,760
What where is my career going to
look like? And doing retail leasing?

295
00:20:59,760 --> 00:21:03,630
I started thinking, well,
this is it's not as lucrative as

296
00:21:03,630 --> 00:21:06,780
office leasing,
but it's more interesting to me,

297
00:21:06,780 --> 00:21:11,550
quite a bit more interesting and more
challenging. And the people are are.

298
00:21:11,610 --> 00:21:13,740
How did you learn it?
Did somebody teach you?

299
00:21:14,430 --> 00:21:18,360
I taught myself, really? Yeah.
Okay. I mean, Rick helped.

300
00:21:18,360 --> 00:21:26,280
Now Rick was a a very smart.
He is a very smart guy. Careful.

301
00:21:26,280 --> 00:21:30,870
And you know, I remember handing
him leases and back then again,

302
00:21:30,870 --> 00:21:35,070
you know, these are type leases
where you're sort of filling in,

303
00:21:35,070 --> 00:21:39,210
you know, some of the material
that square footage and stuff.

304
00:21:39,210 --> 00:21:45,480
And again, the ADHD is still not
resolved. And so I'm making mistakes.

305
00:21:45,480 --> 00:21:48,990
And Rick would look at the lease
and throw it back at me and go,

306
00:21:48,990 --> 00:21:51,450
there are five mistakes here so
you can find them, you know.

307
00:21:51,720 --> 00:21:54,480
So I guess I would say he did
teach me, you know,

308
00:21:54,480 --> 00:21:57,960
a fair amount from that.
But in terms of how to call,

309
00:21:57,960 --> 00:22:02,460
call, how to discern, you know,
what made sense, what didn't,

310
00:22:02,460 --> 00:22:07,290
you know, what kinds of tenants
are were viable, what aren't,

311
00:22:07,290 --> 00:22:10,590
you know, you just sort of learned
through experience osmosis and.

312
00:22:10,860 --> 00:22:14,460
Grocery retail or what what kinds.
Of grocery anchored retail,

313
00:22:14,460 --> 00:22:20,640
except for one little strip
center that was Unanchored.

314
00:22:20,640 --> 00:22:25,710
And I think Weisberg still owns it.
So here's one interesting side

315
00:22:25,710 --> 00:22:29,940
story on that.
When I got, oh no, that,

316
00:22:29,940 --> 00:22:32,100
that's right.
That that's that was my next job

317
00:22:32,100 --> 00:22:34,590
after that. Right.
I was moving to the next job. Okay.

318
00:22:35,070 --> 00:22:36,720
So how long were you with the
Weisberg? We did.

319
00:22:37,110 --> 00:22:39,300
I was with Weisberg for a couple
of years.

320
00:22:39,420 --> 00:22:43,830
And then they lied,
was ready to retire, and the

321
00:22:43,830 --> 00:22:47,070
business was going to wind down.
They were going to, you know,

322
00:22:47,070 --> 00:22:51,390
the office management contracts
were going one place, the retail

323
00:22:51,390 --> 00:22:58,830
contracts were going in other place.
And JBG at that time was,

324
00:23:00,450 --> 00:23:04,020
I think they were taking on the
office leasing, the,

325
00:23:04,020 --> 00:23:06,570
the office assignments, the leasing
and management assignments.

326
00:23:06,570 --> 00:23:11,070
For Weisberg, for. Weisberg. Okay.
And they but they had they also

327
00:23:11,100 --> 00:23:16,290
were founding a retail division.
And I think they put an ad in

328
00:23:16,290 --> 00:23:18,000
the post.
Again, I'm pretty sure I got

329
00:23:18,000 --> 00:23:22,680
another job from the post.
And this job was they were

330
00:23:22,680 --> 00:23:26,430
looking for a quote unquote
retail leasing director.

331
00:23:27,060 --> 00:23:33,420
So I answered the the ad, you know,
the ad for that and met with,

332
00:23:34,230 --> 00:23:39,360
at the time, who was running that.
So I had to interview with Rob

333
00:23:39,360 --> 00:23:44,310
Rosenfeld, who was was a,
a consultant for them.

334
00:23:44,310 --> 00:23:46,650
And Jim Garibaldi had already
been hired.

335
00:23:46,650 --> 00:23:50,310
Jim was a property manager who they
were turning into an asset manager.

336
00:23:50,310 --> 00:23:55,080
So anybody with Jim.
And so, it was Jim.

337
00:23:55,080 --> 00:23:58,350
Was at Ardrey before that. Right?
Jim. Was it Ardrey before that?

338
00:23:58,350 --> 00:24:02,010
Jim's background was a CPA.
I met him, right. He was a CPA.

339
00:24:02,010 --> 00:24:06,750
And then he went back and he went to, GW and got his masters and then,

340
00:24:06,750 --> 00:24:09,930
you know, but was went to JBG and
then they moved him to run this,

341
00:24:09,930 --> 00:24:13,770
this group and this group, we had
one client or one primary client,

342
00:24:13,770 --> 00:24:17,970
which was the Hechinger family.
And the Hechinger family controlled

343
00:24:18,180 --> 00:24:22,260
multiple, shopping centers.
Yes,

344
00:24:22,260 --> 00:24:26,010
and a bunch of freestanding stores.
And this is prior to their,

345
00:24:26,040 --> 00:24:30,480
to their bankruptcy.
So I had two job offers then,

346
00:24:30,480 --> 00:24:35,310
and one was from JBG and one was
from Sol centers, and the Sol

347
00:24:35,310 --> 00:24:41,610
Center job was higher salary.
And, the, you know,

348
00:24:41,610 --> 00:24:44,430
better properties,
significantly better properties.

349
00:24:44,430 --> 00:24:48,660
But the JBG job, for whatever reason,
was more appealing to me,

350
00:24:48,660 --> 00:24:55,080
and it was more appealing to me
because I felt like the brand had a

351
00:24:55,080 --> 00:24:59,610
lot of upside in a lot of growth
potential in the Sol centers was a.

352
00:24:59,700 --> 00:25:02,010
Established,
but I didn't see the same growth.

353
00:25:02,130 --> 00:25:06,720
And and the other kicker was I
could do,

354
00:25:06,720 --> 00:25:12,360
outside deals under JBG, meaning
I could make side commissions.

355
00:25:12,360 --> 00:25:17,730
And they, despite the fact
that it caused some consternation,

356
00:25:17,730 --> 00:25:20,730
you know, with,
with Jim and mostly with Jim.

357
00:25:21,150 --> 00:25:25,350, on on, initially he got
over that pretty quickly,

358
00:25:25,350 --> 00:25:29,040
but on whether that would be too
distracting, you know, to from

359
00:25:29,040 --> 00:25:32,400
focus on the main the main we were.
Focused on leasing at that point.

360
00:25:32,400 --> 00:25:36,720
I was a. Strictly a leasing person.
At that point I would do some modest,

361
00:25:37,680 --> 00:25:39,630
modest investment sales,
but mostly leasing.

362
00:25:40,680 --> 00:25:45,120
And that launched me and, you know,
doing having that portfolio,

363
00:25:45,120 --> 00:25:51,030
the Hechinger portfolio, to work on.
But something happened early in

364
00:25:51,030 --> 00:25:58,350
our one thing happened is that Rob
Rosenfeld then was, had left the

365
00:25:58,350 --> 00:26:01,680
firm that he was he would just JMB
and then came back and was helping

366
00:26:01,680 --> 00:26:06,060
his dad with their family assets.
And then Rob was bored because

367
00:26:06,060 --> 00:26:08,370
he's my he's my age.
He and I are the same and Jim are

368
00:26:08,370 --> 00:26:11,400
all right around the same age.
And Rob wanted to do more.

369
00:26:11,400 --> 00:26:17,070
So he merged his family's assets
in with JBG assets, and that's

370
00:26:17,070 --> 00:26:21,930
where we became JBG Rosenfeld.
And the company then grew from

371
00:26:21,930 --> 00:26:24,660
being pretty small to being,
you know, one of the bigger,

372
00:26:24,660 --> 00:26:29,460
more established firms in the in
the DC metro region for retail.

373
00:26:30,660 --> 00:26:35,310
And we, and that so that was
really that was great because then

374
00:26:35,310 --> 00:26:39,480
I had a lot more interesting,
properties to work on, a lot more

375
00:26:39,480 --> 00:26:43,020
spaces got a lot more exposure to
different tenancies and different,

376
00:26:43,020 --> 00:26:47,010
you know, different, larger,
more national tenants.

377
00:26:47,010 --> 00:26:51,270
And then when Hechinger filed
bankruptcy, that was super

378
00:26:51,270 --> 00:26:55,500
interesting because that put us
in a place where there were these

379
00:26:55,500 --> 00:27:00,930
well-located store locations.
And at that time, there were all

380
00:27:00,930 --> 00:27:05,130
these grocers and retailers that
were in significant expansion mode.

381
00:27:05,130 --> 00:27:09,240
So it gave us exposure to do
these all these great, you know,

382
00:27:09,240 --> 00:27:13,470
anchor deals and, some,
some of them are still around.

383
00:27:13,470 --> 00:27:16,530
Some of the deals we did at that
period of time are still still so

384
00:27:16,530 --> 00:27:23,850
still their side story. Yeah.
I was approached by Jim and I

385
00:27:23,880 --> 00:27:28,350
financed a freestanding giant store.
We did that deal right out in

386
00:27:28,350 --> 00:27:33,180
Fairfax. Yes, yes.
And, that was with our,

387
00:27:33,180 --> 00:27:36,270
credit tenant lease group like
Mason at the time. Okay.

388
00:27:36,270 --> 00:27:38,550
So it was a bond placement deal,
right?

389
00:27:38,670 --> 00:27:43,020
And it was pretty high leverage.
It was like, basically took all

390
00:27:43,020 --> 00:27:45,990
your costs, I think I.
Remember that, yeah, I do remember

391
00:27:45,990 --> 00:27:49,710
that you can't do that today.
Well, actually you can with the

392
00:27:49,710 --> 00:27:54,000
credit if I hold credit was strong
enough. You can get pretty close.

393
00:27:54,300 --> 00:27:58,800
Interest rates are such that unless
the lease is pretty long, like 25,

394
00:27:58,800 --> 00:28:03,120
30 years, you know, it's hard, right,
because of interest rates today.

395
00:28:03,120 --> 00:28:06,510
But I do remember that and I do
remember meeting you at that

396
00:28:06,510 --> 00:28:10,470
time when we when we did that.
Yeah. Yep.

397
00:28:10,980 --> 00:28:17,850
And then you know tried to do
more kept trying. Yeah.

398
00:28:18,780 --> 00:28:23,100
But so that was interesting.
So.

399
00:28:25,320 --> 00:28:30,030 of all the professions and
commercial real estate in my opinion,

400
00:28:30,840 --> 00:28:34,350, retail leasing seems to be
the most hyperactive.

401
00:28:34,350 --> 00:28:38,370
And you talked about your.
My ADHD. ADHD. Yeah.

402
00:28:38,490 --> 00:28:41,670
The business requires a
multidisciplinary approach and

403
00:28:41,670 --> 00:28:46,350
understanding center merchandising,
recognizing the retailer's viability

404
00:28:46,350 --> 00:28:51,150
and customer base, negotiations
with the awareness of your client's

405
00:28:51,150 --> 00:28:54,570
position of strength, etc..
Do you agree with those assessment?

406
00:28:54,570 --> 00:29:04,800
Completely. Completely? No.
I think that it it it requires a

407
00:29:04,800 --> 00:29:09,750
knowledge of a lot of different
sectors.

408
00:29:09,750 --> 00:29:16,200
And you have there's more factors
that you have to take into account,

409
00:29:16,200 --> 00:29:19,380
you know, than you do with office
leasing. Then with office leasing.

410
00:29:19,380 --> 00:29:22,590
Right, talk about those.
Well, the you know,

411
00:29:22,590 --> 00:29:26,730
one obviously the tenant, you know,
if you're if you're let's just say

412
00:29:26,730 --> 00:29:29,730
you're leasing a center from the
ground up in order to be able to

413
00:29:29,730 --> 00:29:32,310
get financing, you have to have
a reasonable amount of credit.

414
00:29:32,310 --> 00:29:35,130
You know, reasonable percentage
of the shopping center has to be,

415
00:29:35,130 --> 00:29:39,810
quote, unquote, credit.
And also the right kind of credit.

416
00:29:39,810 --> 00:29:44,760
Like, you know, most of the centers
that we developed usually had a

417
00:29:44,760 --> 00:29:48,630
grocery, a grocery store as well.
You know, one of the one of the

418
00:29:48,630 --> 00:29:54,840
main anchors in the center.
And we did we did a number of either

419
00:29:54,840 --> 00:29:59,430
of ground up deals, or, you know,
repositioning deals where we bring

420
00:29:59,430 --> 00:30:02,970
in. We'd bring in a grocery anchor.
And then there was a period of

421
00:30:02,970 --> 00:30:05,490
time when we do a grocery anchor
and a health club.

422
00:30:06,030 --> 00:30:10,680, we only did one deal,
one ground up deal where we that

423
00:30:10,680 --> 00:30:14,700
was of a large size, a large
scale that did not have a grocer.

424
00:30:14,700 --> 00:30:17,520
And the reason it didn't have a
grocer is because adjacent to our

425
00:30:17,520 --> 00:30:20,610
site was a brand new Wegmans,
and that was the King of Prussia

426
00:30:20,610 --> 00:30:23,760
town center.
And obviously you're not going to get

427
00:30:23,760 --> 00:30:27,810
another grocer with with Wegmans.
We had a regional mall right there.

428
00:30:27,810 --> 00:30:31,650
Too, and you had a regional mall
another half a mile away or quarter

429
00:30:31,650 --> 00:30:35,940
mile away. It's a. Big retail area.
Right? Yeah. That's interesting.

430
00:30:36,060 --> 00:30:43,320
So, you know, I mean,
I my dad was a retailer,

431
00:30:43,560 --> 00:30:47,850
and I did some retail development,
etc. early in my career.

432
00:30:47,850 --> 00:30:52,830
So just understanding merchandising,
how to position stores in a

433
00:30:52,830 --> 00:30:57,750
center and ideas like that.
And then as you said, credit.

434
00:30:57,870 --> 00:31:02,010
But it's interesting some tenants
that are fairly new to extremely

435
00:31:02,010 --> 00:31:04,950
well and they don't have credit.
So you have to understand that,

436
00:31:04,950 --> 00:31:08,010
don't you. Really.
You do have to understand that.

437
00:31:08,010 --> 00:31:12,240
You have to look at, you know,
the sizzle, you know, I mean, and

438
00:31:12,240 --> 00:31:15,480
there are certain tenants that have
it and certain and some that don't,

439
00:31:15,480 --> 00:31:20,550
you know, and some tenants that you
look at and you go or you meet the,

440
00:31:20,550 --> 00:31:25,230
you meet the, the retailer and
they have whatever it is that,

441
00:31:25,230 --> 00:31:28,920
that drive, that unique sort of
style that you think,

442
00:31:28,920 --> 00:31:32,640
I think this guy is going to make it.
I think that he will he will

443
00:31:32,640 --> 00:31:36,180
bring something to the center,
some life, some, some,

444
00:31:36,660 --> 00:31:40,560
cachet that we don't have right
now that will be really useful.

445
00:31:40,560 --> 00:31:42,450
And maybe,
maybe he doesn't have credit,

446
00:31:42,450 --> 00:31:46,440
but he's got whatever that is.
You know that Genesis Aqua, you know,

447
00:31:46,440 --> 00:31:52,440
the the, just the feel that
this is somebody that's going to

448
00:31:52,470 --> 00:31:55,350
it's going to work for the center.
And, you know, I've worked with

449
00:31:55,350 --> 00:32:00,270
a lot of leasing agents over the
years and have, you know,

450
00:32:00,270 --> 00:32:05,280
seen people who sort of can pick,
sort of cut through and say, okay,

451
00:32:05,280 --> 00:32:08,130
there's a reasonable I understand
the credit profile here.

452
00:32:08,130 --> 00:32:15,720
I understand that this this tenant
is got the, a unique offering

453
00:32:15,720 --> 00:32:19,500
that will be appealing to enough
people that it will survive and

454
00:32:19,500 --> 00:32:22,650
that this whoever's running it
and this is for mostly this mom

455
00:32:22,650 --> 00:32:28,650
and pops that we're talking about
that they will, be able to,

456
00:32:28,650 --> 00:32:31,110
you know, they'll have the drive
and the initiative to make this

457
00:32:31,110 --> 00:32:35,430
thing work because as we know,
it's a really hard business.

458
00:32:35,430 --> 00:32:38,580
And particularly, you know,
the mom and pop retail business

459
00:32:38,580 --> 00:32:42,630
is exceptionally hard to,
to make it work.

460
00:32:42,630 --> 00:32:47,340
And then for the chains, you know,
you do you can sort of feel and

461
00:32:47,340 --> 00:32:50,010
sometimes when you, when you go to
Las Vegas and you'd see sort of

462
00:32:50,010 --> 00:32:53,070
the hot concepts and you'd see all
these people sort of buzzing around,

463
00:32:53,070 --> 00:32:56,340
you know, the booth of the like
Boston Market when it first opened,

464
00:32:56,340 --> 00:33:00,660
it had that, it had that buzz.
You know, nothing lasts forever.

465
00:33:00,660 --> 00:33:05,880
There's a great quote that I
love that, I heard from and

466
00:33:05,880 --> 00:33:08,460
it Milt Cooper said it.
And there's, you know,

467
00:33:08,460 --> 00:33:12,930
the one thing that all retailers
have in common. What is it?

468
00:33:12,930 --> 00:33:18,000
They all go bankrupt someday.
That was and I love the quote.

469
00:33:18,000 --> 00:33:21,120
And I thought, and I think about
it a lot and it's true.

470
00:33:21,120 --> 00:33:25,680
I mean or, you know, maybe we you
and I won't live long enough to see

471
00:33:25,680 --> 00:33:30,030
giant slash old. Let's say Walgreens.
Do you think Walgreens will ever

472
00:33:30,030 --> 00:33:34,200
go bankrupt? Yes, I think so.
Okay. Well, I don't know anymore.

473
00:33:34,200 --> 00:33:36,840
I mean, I haven't looked at
their financials lately.

474
00:33:36,840 --> 00:33:40,710
Yeah, I do know you think about
I know I do know this.

475
00:33:40,710 --> 00:33:44,070
Like, I know that, you know,
some of the leases that they signed,

476
00:33:44,070 --> 00:33:49,050
you know, they signed, which may
give them a survivability rate,

477
00:33:49,050 --> 00:33:52,830
you know, factor to,
to figure out is that they don't

478
00:33:53,280 --> 00:33:56,910
they their options are at the
same rate as their initial term.

479
00:33:57,150 --> 00:34:01,290
So potentially they can outlive that.
But I do what I see though is

480
00:34:01,290 --> 00:34:04,830
there's a lot of Walgreens stores
that underperform to at least in

481
00:34:04,830 --> 00:34:10,890
this market, you know, to to CVS.
Well, you know, I mean,

482
00:34:10,890 --> 00:34:13,260
you look at Rite Aid, right?
What happened to that?

483
00:34:13,320 --> 00:34:17,520
They went under, right? Yeah.
And then of course, I my,

484
00:34:17,520 --> 00:34:20,550
early career, I worked for an
affiliate of Sears Roebuck,

485
00:34:20,550 --> 00:34:23,370
Hallmark Development Company,
which became a regional mall.

486
00:34:23,550 --> 00:34:26,400
General growth bought them and
General Growth was bought by

487
00:34:26,520 --> 00:34:28,440
Brookfield.
So it just kind of this

488
00:34:28,440 --> 00:34:31,350
evolution of the business.
And we look at department stores.

489
00:34:31,800 --> 00:34:36,060
Is there a is there one viable
classic department store left?

490
00:34:36,330 --> 00:34:39,900
Macy's? I mean, and how.
Long will they be here?

491
00:34:39,900 --> 00:34:44,100
I don't know, I don't know if they
don't last another ten years.

492
00:34:44,100 --> 00:34:46,080
Yeah,
probably not because they're just not

493
00:34:46,080 --> 00:34:49,140
where people want to shop anymore.
They're closing stores now right.

494
00:34:49,350 --> 00:34:51,540
Well I guess Nordstrom Nordstrom
is still.

495
00:34:51,540 --> 00:34:53,400
But they're not a classic
department store.

496
00:34:53,430 --> 00:34:56,820
They started as a shoe store if
you understand their history.

497
00:34:56,820 --> 00:34:59,460
Yeah they didn't they don't have
everything.

498
00:34:59,700 --> 00:35:01,920
They had clothing,
that was their focus.

499
00:35:01,920 --> 00:35:04,350
They really weren't the classic
department store there, really.

500
00:35:04,710 --> 00:35:08,760
I mean, Sears was the first.
Well, then would you say that,

501
00:35:08,760 --> 00:35:12,090
you know, the sort of the successors
to the classic department stores?

502
00:35:12,090 --> 00:35:14,490
And if you think that the
classic department stores were

503
00:35:14,490 --> 00:35:19,230
starting with J.C. Penney or, say target or, well.

504
00:35:19,230 --> 00:35:21,300
Target in Walmart, target,
the successors.

505
00:35:21,300 --> 00:35:23,490
Evolved out of Dayton,
Hudson Corporation. That's right.

506
00:35:23,790 --> 00:35:27,750
Yes. That where my father worked.
So my dad was at Hudson's. Right.

507
00:35:27,750 --> 00:35:31,890
So I saw and I see my whole life I've
watched the evolution of the retail

508
00:35:31,890 --> 00:35:34,890
industry. Right. It's phenomenal.
The target is. That's right.

509
00:35:34,890 --> 00:35:37,950
And so I would say target is a good
example, but I don't know that.

510
00:35:37,950 --> 00:35:41,850
I mean, I guess Wal mart isn't
because they started their grocer and

511
00:35:41,850 --> 00:35:46,260
you know discount merchant so well.
Wal Mart started as a discount store

512
00:35:46,260 --> 00:35:49,890
to compete with Kmart basically.
I mean that's what Sam Walton saw.

513
00:35:49,890 --> 00:35:53,850
He saw you could he could compete
with Kmart which was S.S. Kresge

514
00:35:53,970 --> 00:35:57,840
out of Detroit. Right.
Which was a discount store basically

515
00:35:57,840 --> 00:36:01,080
from the it was a dime store,
right. By having ten dime. Right.

516
00:36:01,350 --> 00:36:04,410
You know, street retail, right.
At that time. Yeah.

517
00:36:04,770 --> 00:36:08,580, again, a Detroit retailer was
interesting how it grew from there.

518
00:36:09,240 --> 00:36:13,050, my dad managed the three largest
department stores in the Detroit

519
00:36:13,050 --> 00:36:18,150
area, in different parts. Yeah.
The store that he the first

520
00:36:18,150 --> 00:36:23,400
store he managed was 500,000ft².
The store the second store was

521
00:36:23,400 --> 00:36:29,250
700,000ft², and the third store
was over 1,000,000ft².

522
00:36:29,460 --> 00:36:34,140
And different era. To. Wow. Yeah.
I mean, the downtown Detroit Hudson's

523
00:36:34,140 --> 00:36:37,800
store was the second largest retail
store in the country, behind Macy's.

524
00:36:37,800 --> 00:36:40,980
Wow. Yeah, that's pretty significant.
Yeah.

525
00:36:41,610 --> 00:36:44,310
That that when it was at its peak.
Anyway, yeah.

526
00:36:44,310 --> 00:36:48,390
It's interesting to see how retail
has evolved over the years,

527
00:36:48,390 --> 00:36:51,510
in taking on more responsibilities,
including asset management and

528
00:36:51,510 --> 00:36:53,550
people management.
What lessons did you learn

529
00:36:54,600 --> 00:37:01,470
evolving out of the leasing side?
Well, the character matters.

530
00:37:02,040 --> 00:37:07,320
Loyalty matters, in both ways, you know,

531
00:37:07,320 --> 00:37:10,530
cuts both ways.
And, you know, trust your

532
00:37:10,530 --> 00:37:13,890
instincts on people usually.
Not always, but usually.

533
00:37:13,890 --> 00:37:22,290
And when we had at Jaeger, we had,
you know, the hiring decisions

534
00:37:22,290 --> 00:37:26,970
for most of the most positions
were done by by the three of us,

535
00:37:26,970 --> 00:37:31,380
by Jim Robb and I, all of us.
I mean, you know, we'd and

536
00:37:31,380 --> 00:37:35,160
almost every major decision was,
was really made by the three of

537
00:37:35,160 --> 00:37:40,890
us once we became partners.
And we usually almost always agreed.

538
00:37:40,890 --> 00:37:44,460
And the,
the people that we wanted to keep,

539
00:37:44,460 --> 00:37:49,770
we kept, I mean, we, we we would
rarely lose someone to a competitor.

540
00:37:49,770 --> 00:37:52,470
I mean, sometimes, you know,
there were extenuating circumstances

541
00:37:52,470 --> 00:37:55,560
where somebody, you know,
spouse would move, you know,

542
00:37:55,560 --> 00:37:58,560
and then or got to get a job
somewhere else and they'd have to go.

543
00:37:58,560 --> 00:38:01,620
But usually the people that we
wanted to keep were loyal to us.

544
00:38:01,620 --> 00:38:03,240
And we tried.
We were loyal to them,

545
00:38:03,240 --> 00:38:07,530
and we tried to compensate them at
the highest level we could to make

546
00:38:07,530 --> 00:38:10,860
them satisfied and to treat them,
you know, as well as we could.

547
00:38:10,860 --> 00:38:14,280
What about moving from leasing,
which was your focus into asset

548
00:38:14,280 --> 00:38:16,830
management? Well, how did that well.
How'd that happen.

549
00:38:16,830 --> 00:38:20,370
In the ending into that.
And I wouldn't say that I moved I

550
00:38:20,370 --> 00:38:25,500
guess I'm I mean, I wouldn't ever say
I'm doing it now, but that's not been

551
00:38:25,500 --> 00:38:30,840
my primary focus or forte. Okay.
So what I, what I wanted is while

552
00:38:30,840 --> 00:38:36,570
I was doing leasing, I and no,
not to be denigrating to leasing

553
00:38:36,570 --> 00:38:39,540
because it's a lifeblood of of
of the retail business.

554
00:38:39,540 --> 00:38:43,860
It's the most important piece.
But I just decided that I wanted to

555
00:38:43,860 --> 00:38:50,190
do more than that and wanted to to
use that as a springboard to be able

556
00:38:50,190 --> 00:38:55,740
to do acquisitions and development.
And, and it was a good springboard

557
00:38:55,740 --> 00:38:58,950
for that because. Would you learn.
How to underwrite a deal and to

558
00:38:58,980 --> 00:39:00,510
do a development pro forma?
I mean,

559
00:39:00,510 --> 00:39:05,730
when did you learn doing that?
I would say that I am adequate

560
00:39:05,730 --> 00:39:09,810
at that.
But what I am good at is knowing

561
00:39:09,810 --> 00:39:15,480
what works and what doesn't work,
and being able to hire people

562
00:39:15,480 --> 00:39:20,220
who who can build models much
better than I can build them.

563
00:39:20,250 --> 00:39:22,860
I can read them and I can
interpret them.

564
00:39:23,040 --> 00:39:30,930
And I'd say I learned that probably
when maybe we started doing all

565
00:39:30,930 --> 00:39:34,740
those acquisitions pretty early,
I mean, pretty early after the

566
00:39:34,740 --> 00:39:38,370
merger occurred.
And but it was a team effort.

567
00:39:38,370 --> 00:39:41,340
I mean, it really was.
The three of us really worked

568
00:39:41,340 --> 00:39:44,310
together well.
Well, GBG had the discipline to

569
00:39:44,310 --> 00:39:45,390
internally write.
Oh,

570
00:39:45,390 --> 00:39:48,990
gee gee had the discourse internally.
And that was super useful for us

571
00:39:48,990 --> 00:39:53,850
to have them, you know,
one for being able to,

572
00:39:53,850 --> 00:39:58,380
sort of one that had the capital.
The most important reason was

573
00:39:58,620 --> 00:40:01,450
value from.
Was the was their ability to raise

574
00:40:01,450 --> 00:40:07,030
capital and, reputationally
that helped us to in terms of when

575
00:40:07,030 --> 00:40:10,540
we'd go somewhere, people go,
yeah, I'm familiar with the jpg,

576
00:40:10,660 --> 00:40:13,870
jpg companies. Sure.
And so it gave us credibility,

577
00:40:13,870 --> 00:40:20,170
you know, and, and in terms
of what we built up, though,

578
00:40:20,170 --> 00:40:23,680
some of the things that we did that
were there was some redundancies,

579
00:40:23,680 --> 00:40:27,670
like we had a lot of similar people
that would do similar skills to

580
00:40:27,670 --> 00:40:31,240
what they would, what they had.
But the structure that we had,

581
00:40:31,240 --> 00:40:34,150
they owned a minority interest
in our platform. Got it.

582
00:40:34,150 --> 00:40:37,840
And, we so we had our own
asset management.

583
00:40:37,840 --> 00:40:40,000
We had our own construction
management, we had our own

584
00:40:40,000 --> 00:40:44,590
accounting or accounting group
and own property manager, owned

585
00:40:44,590 --> 00:40:48,820
property management and leasing.
And the useful thing,

586
00:40:48,820 --> 00:40:51,700
it was really useful for both.
It was a very positive,

587
00:40:51,700 --> 00:40:56,890
symbiotic relationship because
they didn't have to build for a

588
00:40:56,890 --> 00:41:00,460
long time their own retail team.
We were their retail team.

589
00:41:00,550 --> 00:41:03,790
So for mixed use projects,
you guys would plug in to all their

590
00:41:03,790 --> 00:41:08,320
mixed use deals then basically, yeah,
yeah, yeah, ground floor retail on

591
00:41:08,320 --> 00:41:12,610
an office building or residential.
Yes. Yeah, yeah. That makes sense.

592
00:41:12,610 --> 00:41:18,520
Yeah. And we did that for.
Almost two decades,

593
00:41:19,240 --> 00:41:23,920
and it worked really well.
And then, you know, what?

594
00:41:23,920 --> 00:41:26,710
We're getting ahead of ourselves.
We can get to that later.

595
00:41:26,710 --> 00:41:29,500
Well, I wanted we'll just
evolved from that.

596
00:41:29,680 --> 00:41:33,280, and you became a leader.
And you recognize the ecosystem

597
00:41:33,280 --> 00:41:36,580
of JBG companies, obviously was
wide ranging and influential,

598
00:41:36,580 --> 00:41:39,610
as you just said. Yeah.
Talk a bit about the culture and

599
00:41:39,610 --> 00:41:42,610
how it evolved as the original
leaders that handed the reins to

600
00:41:42,610 --> 00:41:45,940
the second generation and
subsequently now in the public

601
00:41:45,940 --> 00:41:50,470
company as it's become,
we discussed the idea of, you know.

602
00:41:50,470 --> 00:41:54,400
Okay, well, I would say by the
time I got there, it was almost

603
00:41:54,400 --> 00:41:58,960
the second generation. Right?
Because, my classroom. Right.

604
00:41:58,960 --> 00:42:04,030
So when I got there, the,
the managing partners were well,

605
00:42:04,030 --> 00:42:10,300
when I started at, at,
JBG at JBG Rosen or excuse me, it was

606
00:42:10,300 --> 00:42:16,000
JBG companies when I first started
and the partners then were Ben, Mike,

607
00:42:16,000 --> 00:42:19,780
Don Brown was still there. Right.
And they had some younger guys,

608
00:42:19,780 --> 00:42:25,720
Lou Rumford, Bob Brown, Holer. Right.
And then those guys. And then so a.

609
00:42:25,720 --> 00:42:29,500
Watch came in. Pardon me.
Rob then came in as a partner then.

610
00:42:29,740 --> 00:42:32,170
Yes.
And Rob was when I met him,

611
00:42:32,170 --> 00:42:36,910
he was an associate there. Okay.
So Rob got elevated a group a

612
00:42:36,910 --> 00:42:40,060
group of guys about Rob's age,
Brian Coulter and a group of guys

613
00:42:40,060 --> 00:42:44,080
their age got elevated and some
of those other guys moved on.

614
00:42:44,080 --> 00:42:47,440
Bob Brownhill and moved on, Lou Rumford moved on.

615
00:42:47,680 --> 00:42:55,300
And so I watched a series of
people come in and, grow and

616
00:42:55,300 --> 00:42:58,090
become leaders in, in the company.
And I saw, you know,

617
00:42:58,090 --> 00:43:02,380
that that first or one and a half
generation, you know, move on.

618
00:43:02,380 --> 00:43:05,020
And the person,
the two people that stayed does

619
00:43:05,020 --> 00:43:09,100
managing partners were Ben and Mike.
So Ben and Mike and then Rob got

620
00:43:09,100 --> 00:43:13,600
elevated and Brian got elevated, and then I watched the Next

621
00:43:13,600 --> 00:43:17,290
Generation come in after that.
And the culture there,

622
00:43:17,290 --> 00:43:22,690
the culture at JBG was was usually a
pretty positive one because it was

623
00:43:22,690 --> 00:43:25,270
sort of the best and the brightest.
I mean, they hired they were

624
00:43:25,270 --> 00:43:30,100
able to attract super bright,
super capable people from,

625
00:43:30,100 --> 00:43:33,160
you know, the top, you know,
top schools in the country.

626
00:43:33,160 --> 00:43:37,960
And, you know, that was interesting
as well, because what I saw,

627
00:43:37,990 --> 00:43:41,050
you know, you saw a lot of people
that were really, really smart,

628
00:43:41,290 --> 00:43:46,240
that some of them had the ability
to sort of use that intellect to

629
00:43:46,240 --> 00:43:50,020
be practical and create value.
And some could not.

630
00:43:50,440 --> 00:43:56,830
And you quickly, you know, I,
I could discern usually pretty

631
00:43:56,830 --> 00:43:59,050
quickly like who I thought,
okay, well this person's going

632
00:43:59,050 --> 00:44:02,650
to make it or this person,
they're not practical or they're not

633
00:44:02,650 --> 00:44:07,000
their interpersonal skills aren't
going to lead them to a place that

634
00:44:07,000 --> 00:44:10,150
this is going to be a long term,
you know, situation for them.

635
00:44:10,150 --> 00:44:13,030
And I was, you know,
good at sort of discerning who was

636
00:44:13,030 --> 00:44:16,030
going to be there and who was.
Very collegial environment,

637
00:44:16,030 --> 00:44:19,480
very. Collegial environment.
And a lot great interaction,

638
00:44:19,480 --> 00:44:23,110
great synergy between, you know,
at least between our two firms.

639
00:44:23,110 --> 00:44:26,860
There was a lot of great synergy,
and a lot of good, a lot of trust.

640
00:44:26,860 --> 00:44:31,780
You know, one thing I'll say for
both, in,

641
00:44:31,780 --> 00:44:35,050
Rob Rosenfeld and Jim Garibaldi,
and you knew both, you know, both

642
00:44:35,050 --> 00:44:39,220
of them. They both engender trust.
They're both, you know, smart,

643
00:44:39,220 --> 00:44:44,770
straight up, honest, capable people.
And so they they engendered a lot

644
00:44:44,770 --> 00:44:49,960
of trust from the people at JBG.
So talk about the evolution of

645
00:44:49,960 --> 00:44:54,100
the Willard Retail Group from
JBG Rosenfeld. Talk about that.

646
00:44:54,100 --> 00:44:58,660
Well, okay.
So how that happened was JBG was

647
00:44:58,780 --> 00:45:04,900
trying to figure out what they were
going to do, to, to move away

648
00:45:04,900 --> 00:45:07,990
from the funds they had raised.
Fund nine didn't look like they

649
00:45:07,990 --> 00:45:11,050
wanted to raise fund ten.
Looked like some of the older

650
00:45:11,050 --> 00:45:14,350
partners were ready to to
definitively move on.

651
00:45:14,530 --> 00:45:18,220
Some of the younger people
wanted to figure out a way to

652
00:45:18,220 --> 00:45:23,410
monetize the existing platform.
And some, you know, again,

653
00:45:23,410 --> 00:45:29,200
some people wanted to move on.
And so and we were content to keep

654
00:45:29,200 --> 00:45:32,350
things the way they were, but that
was not what was going to happen.

655
00:45:32,350 --> 00:45:34,660
Rob Rosenfeld was also ready to
move on.

656
00:45:34,810 --> 00:45:42,040
So they, JBG made us an
offer to buy out the piece of,

657
00:45:42,040 --> 00:45:48,070
of our platform that they didn't own.
They owned 33% and we owned the rest.

658
00:45:48,070 --> 00:45:51,400
Jim, Rob and I own the rest.
So they they bought us out for

659
00:45:51,400 --> 00:45:54,940
our piece.
And part of that was to create a

660
00:45:54,940 --> 00:45:59,560
consulting arrangement.
Rob moved on, and for Jim and I to

661
00:45:59,560 --> 00:46:04,840
stay in majestic, to stay on as, owners of this new venture

662
00:46:04,840 --> 00:46:08,770
that we were creating and called
Willard Willard Retail.

663
00:46:08,770 --> 00:46:11,590
And the reason we called it that was
because that was the name of our,

664
00:46:11,950 --> 00:46:15,490
of our street that we were on.
And, you know, candidly,

665
00:46:15,490 --> 00:46:18,430
initially I didn't really.
Like the name, and now it's grown

666
00:46:18,430 --> 00:46:21,670
on me. And I like our logo.
And so I'm I'm content with it.

667
00:46:21,670 --> 00:46:25,480
And the brand is growing, so it's
not going to change. That's good.

668
00:46:25,480 --> 00:46:28,570
But I didn't love it initially
and honestly,

669
00:46:28,570 --> 00:46:30,670
I couldn't come up with anything.
I couldn't come up with anything

670
00:46:30,670 --> 00:46:33,490
better.
And so that's why we we left it

671
00:46:33,490 --> 00:46:37,840
at that.
And you know, initially we for a

672
00:46:37,840 --> 00:46:41,980
few years it was rather static.
You know, we were, you know,

673
00:46:41,980 --> 00:46:46,060
kind of moving from stayed in
the same building as JBG, but we

674
00:46:46,060 --> 00:46:49,240
were there to consult with them.
But there really wasn't that

675
00:46:49,240 --> 00:46:53,080
much to do.
And I was seeing this at the end

676
00:46:53,080 --> 00:46:57,310
of the time at Jaeger as well,
where after we did the King of

677
00:46:57,310 --> 00:47:01,000
Prussia deal in downtown Crown,
I was having a hard time finding

678
00:47:01,000 --> 00:47:05,320
the next new ground up opportunity.
And it wasn't just me,

679
00:47:05,320 --> 00:47:08,950
it was the whole industry.
You know, there were just weren't

680
00:47:09,640 --> 00:47:12,970
there weren't as many opportunities.
The retailers were really

681
00:47:12,970 --> 00:47:17,050
scaling back at that point.
So there just wasn't as much to do.

682
00:47:17,740 --> 00:47:20,800, but again, I still wasn't
ready to, to really stop.

683
00:47:20,800 --> 00:47:28,090
So we,
kind of waited it out and then a few,

684
00:47:28,300 --> 00:47:31,870
I guess it was two years ago.
We had an arrangement with JBG

685
00:47:31,900 --> 00:47:37,810
where we had a non-compete,
and we Jim had decided to retire

686
00:47:37,840 --> 00:47:41,080
three years ago, I guess,
at this point. So it was just magic.

687
00:47:41,080 --> 00:47:43,990
And I and we had a young guy
working with us,

688
00:47:43,990 --> 00:47:48,850
a guy named Thomas Underhill,
and another guy named Tom Sebastian,

689
00:47:48,850 --> 00:47:54,280
who had all been with us at Jaeger.
And so the four of us and we

690
00:47:54,280 --> 00:47:56,650
triggered the we triggered the buy,
sell.

691
00:47:56,650 --> 00:48:03,460
And, which meant that we could
then go after JBS management,

692
00:48:03,460 --> 00:48:07,750
the, the third party management,
leasing, assignments.

693
00:48:07,750 --> 00:48:13,450
And we waited out the six months and
went after him and brought over all,

694
00:48:13,570 --> 00:48:16,180,
all of those third party accounts.

695
00:48:16,180 --> 00:48:20,230
And we had to hire a, you know,
property manager or asset

696
00:48:20,230 --> 00:48:23,230
manager and so on.
And we hired almost all the

697
00:48:23,230 --> 00:48:26,500
people that we hired were former
Jaeger employees,

698
00:48:26,500 --> 00:48:28,960
which had become JV employees.
And then we brought them back.

699
00:48:29,440 --> 00:48:38,290
So, we're now at 15 headcount
and growing the, the platform.

700
00:48:38,470 --> 00:48:47,380, it's probably 3,000,000ft² under
management leasing and at least 5

701
00:48:47,380 --> 00:48:52,660
million of of sorry of management and
about at least 5 million of leasing.

702
00:48:52,660 --> 00:48:57,220
So do you own assets as a company?
We do own assets as a company. Yeah.

703
00:48:57,220 --> 00:49:02,380
And each and each deal is a
standalone deal and capitalized and

704
00:49:02,800 --> 00:49:09,340
on a standalone basis, there they
run the gamut from a core, you know,

705
00:49:09,340 --> 00:49:13,840
grocery anchored center in Lorton,
Virginia that we bought from Edens.

706
00:49:13,840 --> 00:49:19,120
It's, a giant anchored center.
And our capital partner in that is,

707
00:49:19,120 --> 00:49:22,540
you know, declarations in the
general partnership with us.

708
00:49:22,540 --> 00:49:28,750
And then Northwestern Mutual is the
LP and also the debt and to is.

709
00:49:28,750 --> 00:49:32,890
That a GFS center originally?
No, it was an Eden Center.

710
00:49:32,890 --> 00:49:35,530
Originally originally.
Developed. Eden's developed it.

711
00:49:35,530 --> 00:49:38,350
Okay. Yeah. All right. Yeah.
Because I know they bought a lot

712
00:49:38,350 --> 00:49:42,730
of the GFS GFS.
They did and I'll get to that or I

713
00:49:42,730 --> 00:49:44,980
can get to that now if you want.
We can talk about that.

714
00:49:44,980 --> 00:49:49,420
So that's actually one of the
more interesting deals that we

715
00:49:49,420 --> 00:49:54,130
have right now.
So there's a deal that GFS

716
00:49:54,130 --> 00:49:58,540
developed a property back when they
had their development team,

717
00:49:59,020 --> 00:50:01,810
Cascades Marketplace in Sterling.
Yes.

718
00:50:01,810 --> 00:50:05,650
And at the time when,
if you remember when that came up,

719
00:50:05,650 --> 00:50:08,740
that was, you know,
really cutting edge, you know,

720
00:50:08,740 --> 00:50:14,410
they got best in class retailers,
to, you know, to go to go into

721
00:50:14,410 --> 00:50:19,450
the property and, you know,
it had a main street feel, which was

722
00:50:19,450 --> 00:50:23,650
for a suburb for suburban was unique.
It's relatively unique at the time.

723
00:50:23,650 --> 00:50:26,650
Since you're talking about the
history of that, just I'll give the

724
00:50:26,650 --> 00:50:30,850
listeners a little background. Sure.
So that land was owned by a

725
00:50:30,850 --> 00:50:35,020
joint venture between Kepler and
the Bf Sol Company at the time.

726
00:50:35,020 --> 00:50:38,770
We're in Chevy Chase Bank,
which at that point was a joint

727
00:50:38,770 --> 00:50:42,280
venture equity source.
This goes back into the 1980s.

728
00:50:42,280 --> 00:50:46,480
That land, when it was subdivided,
Cascades was a major residential

729
00:50:46,480 --> 00:50:49,450
development.
And then the retail centers,

730
00:50:49,450 --> 00:50:51,910
sites.
Giant food had the first right

731
00:50:51,910 --> 00:50:55,480
of refusal because of the
relationship between giant and

732
00:50:55,480 --> 00:51:00,790
the small company at the time.
So, you know,

733
00:51:00,790 --> 00:51:04,750
GFS Realty ended up developing
that among other properties that

734
00:51:05,020 --> 00:51:10,150
they had relationships with.
And so leading up to, in fact,

735
00:51:10,150 --> 00:51:14,950
when I took over,
Giant Food, they wanted to sell

736
00:51:14,950 --> 00:51:18,660
all the assets and Eden's.
Ended up buying those assets.

737
00:51:18,990 --> 00:51:21,570, right.
Probably 2 to 3 years after the

738
00:51:21,690 --> 00:51:23,970
whole acquisition.
If I'm not recall,

739
00:51:23,970 --> 00:51:27,270
I think you're right. Yeah, roughly.
So that's a little backstory on

740
00:51:27,270 --> 00:51:35,460
that property. Go ahead.
So Edens, was positioning the

741
00:51:35,460 --> 00:51:41,790
property to be able to redevelop it
and create a mixed use environment.

742
00:51:41,790 --> 00:51:47,010
And what we have been doing for
the past 3 or 4 years is looking

743
00:51:47,010 --> 00:51:51,450
for opportunities like Cascades
to be able to do exactly that.

744
00:51:51,450 --> 00:51:55,350
And we had done it a couple of times,
but one time we had done it very

745
00:51:55,350 --> 00:52:00,390
recently.
Nearby we bought I bought it a

746
00:52:00,390 --> 00:52:04,410
Regal movie theater, my firm and then Andy Brown and

747
00:52:04,410 --> 00:52:09,510
Brian Cullen and I bought this Regal
movie theater, which at, you know,

748
00:52:09,510 --> 00:52:13,950
pretty high cap rate doing not very
strong sales. Is that located?

749
00:52:13,950 --> 00:52:17,790
That's in sterling,
very close to the this to this

750
00:52:17,790 --> 00:52:23,190
property and that property, that
whole area was it's near countryside,

751
00:52:23,190 --> 00:52:25,920
if you remember, a countryside
shopping center. That was right.

752
00:52:25,920 --> 00:52:28,980
That was originally developed by a
guy named Bob DeLuca. That's right.

753
00:52:28,980 --> 00:52:32,400
Who ended up in the big house?
Yes. Yeah.

754
00:52:32,970 --> 00:52:36,090
For I don't know,
not sure exactly what, but anyway,

755
00:52:36,090 --> 00:52:40,560
he he ended up he developed that and
a couple other properties around it.

756
00:52:40,980 --> 00:52:46,080
And we bought this movie theater from
Realty Income with the intention

757
00:52:46,080 --> 00:52:49,380
of we knew that the theater wasn't
going to be long for this world,

758
00:52:49,380 --> 00:52:53,880
and it was struggling along.
And then Covid happened and they

759
00:52:53,880 --> 00:52:57,360
shut down and never paid us
another dime in rent.

760
00:52:57,360 --> 00:53:03,390
And that pushed us to get the
entitlements through, you know,

761
00:53:04,170 --> 00:53:07,860
Loudoun County and get it approved
for town for two over two years.

762
00:53:07,860 --> 00:53:12,720
And so we ended up getting approved
for 166, two over twos and sold it

763
00:53:12,720 --> 00:53:20,590
to Beazer Homes in 20 2120 2020.
I can't remember if it's 2021 or

764
00:53:20,590 --> 00:53:24,630
2022, but it was one of the more
successful deals that we did.

765
00:53:24,630 --> 00:53:32,520
But what that sort of was,
a that was proof that our thesis of,

766
00:53:32,520 --> 00:53:36,180
you know, taking this retail land,
which was already graded.

767
00:53:36,180 --> 00:53:39,690
And so you have some of the
infrastructure already in place

768
00:53:39,690 --> 00:53:43,140
and some of the, you know,
land development issues or mitigated

769
00:53:43,140 --> 00:53:45,570
by knowing that, you know,
it's already a graded site.

770
00:53:45,570 --> 00:53:49,500
So when you acquired that site,
it was the freestanding theater was

771
00:53:49,500 --> 00:53:52,740
sitting there vacant. So it wasn't.
Vacant. They were paying rent.

772
00:53:52,740 --> 00:53:56,580
Oh they were but struggling okay.
So when they closed. Yeah.

773
00:53:56,580 --> 00:54:00,360
Did you demolish the building or.
No. We sold it to Beazer.

774
00:54:00,360 --> 00:54:04,680
We sold it to Beazer, with the existing structure

775
00:54:04,680 --> 00:54:08,790
in place, we had a bid.
We had a bid to what? We knew.

776
00:54:08,790 --> 00:54:11,010
We knew what it would cost to
demolish it.

777
00:54:11,010 --> 00:54:14,490
And so that was just, you know,
taken out of whatever what they

778
00:54:14,490 --> 00:54:19,410
ended up paying us.
And anyway, that the success of that

779
00:54:19,410 --> 00:54:25,980
in its proximity to Cascades Market
Place was led when what sort of

780
00:54:25,980 --> 00:54:30,270
interesting Edens had a buy sell
arrangement with, J.P. Morgan,

781
00:54:30,270 --> 00:54:33,240
who was their capital partner in
the deal, they triggered the buy,

782
00:54:33,240 --> 00:54:38,400
sell and then Edens I mean,
J.P. Morgan did a, went out,

783
00:54:38,400 --> 00:54:42,150
did a search and talk to us and
a couple other firms and did to

784
00:54:42,150 --> 00:54:45,630
do presentations and analysis in
terms of what we would do with

785
00:54:45,630 --> 00:54:48,480
the property and, you know,
how we would go about it and the

786
00:54:48,480 --> 00:54:54,150
valuation, the buying we bought in.
So anyway, we bought in and we

787
00:54:54,150 --> 00:54:57,810
now as of the property at that
time though was not zoned.

788
00:54:57,810 --> 00:55:01,320
We had to take it through the the
how much land. Are we talking.

789
00:55:01,320 --> 00:55:05,400
About 30, 30, 34 acres.
This is total.

790
00:55:05,400 --> 00:55:07,500
Right adjacent to Cascades
Marketplace or.

791
00:55:07,500 --> 00:55:11,820
Well, the way that if you
remember Cascades Marketplace,

792
00:55:11,820 --> 00:55:15,780
it's basically four quadrants, right.
Home depot owns their quadrant,

793
00:55:16,050 --> 00:55:21,660
which is and then the their is a
piece behind Home Depot which was big

794
00:55:21,660 --> 00:55:26,010
box tenants at one time probably
had linens and things and Sports

795
00:55:26,010 --> 00:55:29,850
Authority and tenants like that
that approximately ten acres,

796
00:55:29,970 --> 00:55:35,970, Giants, another 10 or 12.
And then, then the other piece was

797
00:55:35,970 --> 00:55:41,280
Marshalls and Gold's Gym, which we
replaced with One Life Fitness.

798
00:55:41,280 --> 00:55:43,440
So now it's One Life Marshalls
is gone.

799
00:55:43,440 --> 00:55:47,940
We're negotiating, lies with some
new tenants to replace Marshalls.

800
00:55:47,940 --> 00:55:52,800
That's another ten acres.
So what our vision was to take

801
00:55:52,800 --> 00:55:56,280
the piece behind Home Depot,
the ten acres there,

802
00:55:56,280 --> 00:56:00,720
and rezone that to give us some
flexibility to either be able to do

803
00:56:00,720 --> 00:56:05,130
towns two over twos or apartments.
And then the piece,

804
00:56:05,130 --> 00:56:10,380
which is occupied by One Life and
the former Marshalls, we got that

805
00:56:10,380 --> 00:56:16,440
entitled to do up to 350 apartments, so what my and I'll give magic.

806
00:56:16,530 --> 00:56:20,100
A credit for this.
He was he wanted to give us

807
00:56:20,100 --> 00:56:24,900
flexibility in our entitlements,
to be able to do whatever you sort

808
00:56:24,900 --> 00:56:28,770
of had the highest and best value
when we were when we finished this

809
00:56:28,770 --> 00:56:33,780
entitlement process and I said,
you'll never get that approved.

810
00:56:33,780 --> 00:56:36,810
No counties,
they like more specificity than that.

811
00:56:37,020 --> 00:56:40,020
And I was wrong.
And they we ended up getting

812
00:56:40,020 --> 00:56:43,290
that flexibility.
So we hired a brokerage firm,

813
00:56:43,290 --> 00:56:47,610
Enterprise Realty, the staff, Steve Varga

814
00:56:47,610 --> 00:56:52,920
and his son Stefan, to go to,
to market and sort of take it out to

815
00:56:52,920 --> 00:56:56,880
and see, you know, prove out. Okay.
What is you know, who will pay,

816
00:56:56,880 --> 00:56:59,700
you know, the,
the most for this land at this point.

817
00:56:59,700 --> 00:57:02,250
And so we got bids from
apartment developers,

818
00:57:02,250 --> 00:57:06,180
we got bids from townhome developers,
we got bids from land developers.

819
00:57:06,180 --> 00:57:11,400
And, the apartment piece is
still we still have seven years,

820
00:57:11,400 --> 00:57:14,040
at least seven years to go
because of the One Life lease.

821
00:57:14,040 --> 00:57:19,890
So anyway, we got the bids for that.
And the the highest offers were

822
00:57:19,890 --> 00:57:23,490
by far for townhome developers.
And so anyway,

823
00:57:23,490 --> 00:57:29,490
that's where we ended up going.
So, talk about how loud and

824
00:57:29,490 --> 00:57:35,310
County was able to I mean, are they
becoming more open to residential

825
00:57:35,310 --> 00:57:39,660
development now because of what's
going on with the data centers and

826
00:57:39,660 --> 00:57:43,380
all the things going on out there?
So sense of that selectively.

827
00:57:43,650 --> 00:57:46,320
I mean,
and it depends on the supervisor.

828
00:57:46,320 --> 00:57:52,200
We, the, we we developed a good
relationship with the supervisor

829
00:57:52,200 --> 00:57:55,290
of this district, which is the
Algonquin district, Julie Brockman.

830
00:57:55,620 --> 00:57:59,850
And Julie was the supervisor of the,
the the same supervisor that we got

831
00:57:59,850 --> 00:58:03,750
the movie theater approved under,
and actually was sort of interesting

832
00:58:03,750 --> 00:58:08,190
during that process, there was a
supervisor that we started with,

833
00:58:08,730 --> 00:58:13,380, who ended up during the
midway through it, midway

834
00:58:13,380 --> 00:58:17,760
through our retirement process,
the election occurred and the the,

835
00:58:17,760 --> 00:58:20,820, Suzanne Volpe was her name.
And Suzanne lost.

836
00:58:20,820 --> 00:58:24,240
And so we had to start over.
And as you know,

837
00:58:24,240 --> 00:58:28,860
it's who these political processes
are completely dependent on the

838
00:58:28,860 --> 00:58:32,880
supervisor of the specific district.
Sponsoring. It. Absolutely.

839
00:58:32,880 --> 00:58:36,600
And so we're like, oh my God,
you know, so we and we had Suzanne.

840
00:58:36,600 --> 00:58:39,150
Suzanne was was with us.
And you know there's a

841
00:58:39,810 --> 00:58:43,590
appreciates smart growth.
And so she was she was an advocate.

842
00:58:43,590 --> 00:58:46,650
She loses. We have to start over.
And we didn't know we didn't

843
00:58:46,650 --> 00:58:49,980
know Julie at all.
And we ended up developing a

844
00:58:49,980 --> 00:58:53,760
relationship with Julie.
And Julie's also a progressive

845
00:58:53,760 --> 00:58:54,960
thinker.
And you know,

846
00:58:54,960 --> 00:58:58,530
she believes in smart growth and
good mixed use development.

847
00:58:58,530 --> 00:59:00,900
So Julie approved the the movie
theater deal.

848
00:59:00,900 --> 00:59:05,040
And then we started over again with
the with with Cascades Marketplace.

849
00:59:05,040 --> 00:59:09,450
So that was a probably a two
year process, though to to go

850
00:59:09,450 --> 00:59:15,000
from the inception of the idea.
And we worked hand in hand,

851
00:59:15,000 --> 00:59:19,080
you know, with the county,
with staff, met with citizens,

852
00:59:19,080 --> 00:59:22,830
met with the planning commissioner
a number of times, and, you know,

853
00:59:22,830 --> 00:59:27,930
to come up with a program that
everybody could, could sign off on.

854
00:59:29,010 --> 00:59:32,400
Let me,
add something for the listeners.

855
00:59:32,610 --> 00:59:37,560, about four episodes ago,
I interviewed Art Fusilli of

856
00:59:37,560 --> 00:59:40,890
Lerner Corporation.
Art talks about the history of

857
00:59:40,890 --> 00:59:46,440
Loudoun County zoning in his in his
episode and the evolution of it

858
00:59:46,440 --> 00:59:51,600
being very Wild West to now, pretty
well structured. It sounds like.

859
00:59:51,600 --> 00:59:55,560
Yeah, much more urban oriented
than what it used to be.

860
00:59:55,560 --> 01:00:00,930
But his stories were very interesting
about how they laid everything out on

861
01:00:00,930 --> 01:00:04,530
a whiteboard basically back then.
So it's a whole different process.

862
01:00:04,530 --> 01:00:08,670
It seems like. I think it is.
And I would agree.

863
01:00:08,670 --> 01:00:13,830
I mean, it is, it's a, it's a,
it's a much more, structured

864
01:00:13,830 --> 01:00:18,480
process than it was when art,
when art started, for sure.

865
01:00:20,010 --> 01:00:23,400, so looking at your past and
current portfolio properties,

866
01:00:23,400 --> 01:00:27,180
talk about how it evolved over time,
both in the types of properties

867
01:00:27,180 --> 01:00:29,520
and the focus of acquisitions
and development.

868
01:00:29,520 --> 01:00:37,580
How did you adapt to the current
markets and competition? Well.

869
01:00:40,310 --> 01:00:43,040
You know, it's funny.
I mean, what I the way we,

870
01:00:43,040 --> 01:00:46,970
the way we adapt is we, you know,
constantly assess like what works,

871
01:00:46,970 --> 01:00:49,430
what doesn't work, you know.
And what have we.

872
01:00:49,430 --> 01:00:52,340
Seen today that's different than,
say, ten, 15 years ago?

873
01:00:52,340 --> 01:00:56,750
Well, I would say one thing.
I mean, in two years ago, retail

874
01:00:56,750 --> 01:01:00,350
was a dirty word, you know, and
nobody wanted to invest in retail.

875
01:01:00,350 --> 01:01:03,050
And so it was really challenging
to find capital that was willing

876
01:01:03,080 --> 01:01:07,280
to do anything right. You know.
And now in two years time,

877
01:01:07,280 --> 01:01:09,920
all of a sudden it's, you know,
the second best asset class.

878
01:01:09,920 --> 01:01:12,650
Now, you know, or, you know,
maybe, maybe third is.

879
01:01:12,650 --> 01:01:15,200
That the infusion of capital by
the federal government,

880
01:01:15,200 --> 01:01:18,260
basically to the market where
there's a lot of, you know,

881
01:01:18,260 --> 01:01:21,440
a lot of cash now for consumers
and therefore they're saying,

882
01:01:21,440 --> 01:01:24,620
so what do we do with all this money?
I think that people were

883
01:01:24,620 --> 01:01:27,770
terrified that there was a
dynamic change during Covid,

884
01:01:27,830 --> 01:01:31,520
but there but there and there
wasn't there wasn't not in retail.

885
01:01:31,520 --> 01:01:33,650
I mean, everyone thought,
oh my God, everyone's going to have

886
01:01:33,650 --> 01:01:36,980
everything delivered. That's it.
It's over, you know, it's finished.

887
01:01:37,280 --> 01:01:41,480
And, that didn't turn out to
be to be the case. No.

888
01:01:41,480 --> 01:01:44,120
People still need to congregate.
They want to congregate.

889
01:01:44,120 --> 01:01:47,300
They still, for whatever reason,
they still like going to the grocery

890
01:01:47,300 --> 01:01:52,910
store and picking out their produce
themselves, you know, and maybe

891
01:01:52,910 --> 01:02:00,200
it's because deliveries haven't
aren't as clean as everybody thought

892
01:02:00,200 --> 01:02:05,150
they would be or as error free.
Maybe I will be, you know,

893
01:02:05,150 --> 01:02:09,740
a game changer and change that.
And maybe robots will become, you

894
01:02:09,740 --> 01:02:11,810
know, robots and I will change it.
But, you know,

895
01:02:11,810 --> 01:02:18,050
it seems still seems a ways off.
So, I would say one of the things

896
01:02:18,050 --> 01:02:24,170
that we are pretty good at is seeing
trends and seeing things evolve.

897
01:02:24,170 --> 01:02:29,630
And I thought years ago that at
least 50% of the movie theaters in

898
01:02:29,630 --> 01:02:34,070
this country were going to go away.
And I know I'm right about that.

899
01:02:34,430 --> 01:02:38,480
And, you know, Covid accelerates
that process and streaming.

900
01:02:38,480 --> 01:02:41,840
I mean, people, you know,
my kids almost never go to the

901
01:02:41,840 --> 01:02:47,270
movie theaters. Never.
And so, you know, it's sort of the

902
01:02:47,270 --> 01:02:50,120
handwriting is more than on the wall.
I mean, it's everywhere.

903
01:02:50,120 --> 01:02:55,250
And so, and then in terms of.
But what about entertainment in

904
01:02:55,250 --> 01:02:56,420
general?
I'm not talking about movie

905
01:02:56,420 --> 01:02:59,870
theaters per se. Okay.
Isn't you know,

906
01:02:59,870 --> 01:03:04,220
I read about what Edens is doing
and at some of their centers,

907
01:03:04,220 --> 01:03:08,210
this kind of this whole entertainment
engagement type of thing.

908
01:03:08,210 --> 01:03:10,760
So what are you seeing as far as
that evolution?

909
01:03:11,600 --> 01:03:14,780
I will I think that things can
be over.

910
01:03:16,850 --> 01:03:20,210
I think trends can be copied too
many times.

911
01:03:20,390 --> 01:03:24,410
Like I would say that there are
way too many food courts all over

912
01:03:24,410 --> 01:03:27,980
the country. And food halls.
Food halls, sorry, food, I called,

913
01:03:27,980 --> 01:03:30,320
I shouldn't have. You're right.
Food hall, which is basically a

914
01:03:30,320 --> 01:03:33,620
food court and maybe a little,
you know, maybe more upscale,

915
01:03:33,620 --> 01:03:38,000
but I think many of them will fail
and I've seen like, for instance,

916
01:03:38,000 --> 01:03:41,690
I'll give you an example.
There's one that, I go,

917
01:03:41,690 --> 01:03:46,550
I have a house in Delray Beach,
Florida, and this beautiful new food

918
01:03:46,550 --> 01:03:50,960
hall or a, food hall opened
up called Delray Marketplace.

919
01:03:50,960 --> 01:03:54,950
It's half a block off the main drag,
which is Atlantic Avenue,

920
01:03:54,950 --> 01:04:01,400
and it's a a purpose built
building with, parking above,

921
01:04:01,400 --> 01:04:05,030
right above the food hall.
And at the time, they had, you know,

922
01:04:05,030 --> 01:04:09,230
good best in class concepts
throughout the food hall and a bar,

923
01:04:09,230 --> 01:04:12,560
you know, second, second level bar.
And I walked through it in the

924
01:04:12,560 --> 01:04:15,650
first time I walked through it,
I go, this will fail. It will fail.

925
01:04:15,650 --> 01:04:22,680
What told you that? It.
It wasn't vibrant enough from the

926
01:04:22,680 --> 01:04:26,820
beginning and and maybe it was it
opened after Covid in Florida.

927
01:04:26,850 --> 01:04:29,130
You know, Covid didn't really
happen very long in Florida.

928
01:04:29,130 --> 01:04:33,090
It was over pretty, pretty quick.
So people wore masks, right?

929
01:04:33,330 --> 01:04:38,940
Right. That's right.
And so I, I just looked at it and the

930
01:04:38,940 --> 01:04:41,760
the offerings just weren't unique.
And even I mean,

931
01:04:41,760 --> 01:04:44,310
they were reasonable,
but they weren't quite unique enough.

932
01:04:44,310 --> 01:04:46,440
And I'm not sure you can make
them unique enough.

933
01:04:46,440 --> 01:04:49,800
I just feel like there's just
only a couple of select places

934
01:04:49,800 --> 01:04:52,620
where it's really going to work.
I'd say union market is an

935
01:04:52,620 --> 01:04:57,870
anomaly in my opinion.
I mean, there are a number

936
01:04:57,870 --> 01:05:00,360
of other ones I don't even want
to say because I don't want to,

937
01:05:00,390 --> 01:05:02,760
you know, be negative.
But there are a number of ones

938
01:05:02,760 --> 01:05:05,610
I've been around recently.
I go to a place like Eataly in

939
01:05:05,610 --> 01:05:07,980
New York.
And how can you get that environment?

940
01:05:07,980 --> 01:05:10,260
You know, it's.
So hard to recreate something

941
01:05:10,260 --> 01:05:13,050
like that.
So what I would say is and I

942
01:05:13,050 --> 01:05:19,110
watched and I've done placemaking,
and placemaking is so hard and

943
01:05:19,110 --> 01:05:25,440
it's an art more than a science.
And it even then it's,

944
01:05:25,440 --> 01:05:29,520
it's hard to make it work.
You know, it's just hard to figure

945
01:05:29,520 --> 01:05:35,010
out exactly how it's going to work.
And so I'm, I, I'm maybe I've seen

946
01:05:35,010 --> 01:05:39,630
enough that I kind of moved to a
more pedestrian view of retail.

947
01:05:39,630 --> 01:05:45,390
And I like good solid retailers
that are some are credit worthy,

948
01:05:45,390 --> 01:05:47,580
some are not.
You know, some have like what we

949
01:05:47,580 --> 01:05:51,240
talked about earlier, you know,
that exuberance or that ability

950
01:05:51,240 --> 01:05:53,760
to really run, you know,
mom and pop business.

951
01:05:53,760 --> 01:05:58,860
But in terms of the coolest,
hottest concept and giving him $300

952
01:05:58,860 --> 01:06:02,430
a foot to build out of space and,
you know, getting percentage

953
01:06:02,430 --> 01:06:04,770
rent in order to get him.
I've never done a deal like that,

954
01:06:04,770 --> 01:06:07,710
and I probably never will.
I don't believe in that kind of

955
01:06:07,710 --> 01:06:11,370
retail and never, you know,
it just doesn't make sense to me.

956
01:06:11,670 --> 01:06:17,490
And, you know, if I owned an office
building where I had to have,

957
01:06:17,490 --> 01:06:20,850
that, you know, this cool retail
in order to lease up the office

958
01:06:20,850 --> 01:06:23,670
building, I might do that,
but that's not what we own.

959
01:06:23,670 --> 01:06:26,520
Well, let's talk about ambiance
at a retail center a little bit.

960
01:06:26,520 --> 01:06:31,650
Okay, so I go to a federal shopping
center, and I know, I know,

961
01:06:31,650 --> 01:06:34,860
I'm at a federal shopping center.
Yeah. Why do I know that?

962
01:06:35,940 --> 01:06:40,350
I think you know that because of
the quality of the design.

963
01:06:40,350 --> 01:06:45,030
I think they're really solid in terms
of the quality of their design.

964
01:06:45,030 --> 01:06:48,240
And but there's an aesthetic
that they have that they know

965
01:06:48,240 --> 01:06:52,590
how to replicate,
which not everybody knows how to do.

966
01:06:52,680 --> 01:06:58,020
And I would say they do it well.
I'd say Edens does it well,

967
01:06:58,350 --> 01:07:03,540
and it but it takes a lot of capital
to be able to do that, you know,

968
01:07:03,540 --> 01:07:07,650
and a lot of the assets that
federal does that are assets that

969
01:07:07,650 --> 01:07:10,500
they've controlled for a long time.
So their basis is low enough to

970
01:07:10,500 --> 01:07:13,530
be able to do it.
Well, I look at Pike and Rose and

971
01:07:13,530 --> 01:07:18,240
you get it. It's a unique setting.
They're agreed and actually

972
01:07:18,240 --> 01:07:21,000
interesting enough.
So, there's and I'm an

973
01:07:21,000 --> 01:07:26,040
investor in a deal not far from
there where some friends of mine

974
01:07:26,040 --> 01:07:29,070
bought an office building and
allowed me to invest in it.

975
01:07:29,190 --> 01:07:31,290
And it's a surface park office
building,

976
01:07:31,290 --> 01:07:36,810
but walkable to Pike and Rose.
And they entitled it for,

977
01:07:36,810 --> 01:07:39,270
townhouses. And it's a home.
It's going to be a home.

978
01:07:39,270 --> 01:07:42,840
It's a home run deal.
But the reason is because it's a,

979
01:07:42,870 --> 01:07:46,560
you know, good spot in Montgomery
County, but it's walkable to

980
01:07:46,560 --> 01:07:50,700
Pike and rest. Interesting. Yeah.
So you mentioned the project earlier.

981
01:07:50,700 --> 01:07:53,010
I wanted to get into a little
bit one of your bigger projects

982
01:07:53,010 --> 01:07:55,560
from Downtown Crown.
Talk about that project in

983
01:07:55,560 --> 01:07:58,290
Montgomery County.
And and what were you trying to

984
01:07:58,290 --> 01:08:00,600
do there? Well, that.
Was an interesting project.

985
01:08:00,600 --> 01:08:05,400
And so the history on that is that
piece of land used to be a farm,

986
01:08:05,400 --> 01:08:08,610
one of the Gaithersburg,
Maryland, one of the last working

987
01:08:08,610 --> 01:08:13,320
farms in in Montgomery County.
And it was owned by the Crown family,

988
01:08:13,320 --> 01:08:16,020
which is why it's called, you know,
they call it a Crown farm.

989
01:08:16,140 --> 01:08:22,170
And, the land was purchased
originally by 2 or 3 homebuilders,

990
01:08:22,170 --> 01:08:26,460
Pulte and I forget the maybe K
have k of nanny and and then

991
01:08:26,460 --> 01:08:30,030
maybe one other.
And they ended up losing it in

992
01:08:30,030 --> 01:08:36,720
the recession of 2008 GFC. Right.
So they lost it in the recession of

993
01:08:36,720 --> 01:08:43,740
2008, Bank of America foreclosed.
They they sold it to Westbrook.

994
01:08:43,860 --> 01:08:50,040
Westbrook then was had to take the plans

995
01:08:50,040 --> 01:08:53,940
that were in place at that point.
And there was, was this.

996
01:08:53,940 --> 01:08:59,130
Terra Brook or just Westbrook
Partners? It was it was terrible.

997
01:08:59,160 --> 01:09:01,920
It was Tara. Brook was.
You know, it was it was terrible.

998
01:09:03,120 --> 01:09:06,150
It was a yes.
It was an affiliate of of

999
01:09:06,150 --> 01:09:10,200
Westbrook is Tara Brook.
So Tara Brook was overseeing it.

1000
01:09:10,860 --> 01:09:15,030
Tara Brook then you know was had to
do a lot of the infrastructure work.

1001
01:09:15,030 --> 01:09:18,330
And they had to pick someone to
be able to create this retail

1002
01:09:18,330 --> 01:09:22,000
town center. You know that.
Pretty critical part of the overall

1003
01:09:22,000 --> 01:09:27,550
project, and the original people that
were in it, had come up with a

1004
01:09:27,550 --> 01:09:32,680
vertical plan that I never believed.
It felt like that,

1005
01:09:32,680 --> 01:09:35,740
that I just said, this is this is
too dense for this environment.

1006
01:09:35,740 --> 01:09:38,440
You need to have a Surface Park
grocery store here or it's going

1007
01:09:38,440 --> 01:09:41,950
to fail.
And so we came up with a new plan.

1008
01:09:41,980 --> 01:09:45,490
Talk about the location a little bit.
Well, the new section. Sure.

1009
01:09:45,490 --> 01:09:53,890
The the it is at at the intersection,
it's two 7370 and Fields Road,

1010
01:09:53,890 --> 01:09:56,290
it's at the intersection of
Fields Road and three.

1011
01:09:56,290 --> 01:10:00,040
So it's near the Washingtonian.
It's. Yes, yes.

1012
01:10:00,040 --> 01:10:03,400
It's right one road over from
Washingtonian. Correct.

1013
01:10:03,400 --> 01:10:05,770
Which is a big.
Retail, which is a big retail center.

1014
01:10:05,770 --> 01:10:07,240
Really.
I think it was called at the

1015
01:10:07,240 --> 01:10:10,780
time real, real.
And we and that was a concern

1016
01:10:10,780 --> 01:10:12,910
because there was a lot of
retail already there.

1017
01:10:13,060 --> 01:10:16,750
So we were like, is there can we
create this? Can we not create this?

1018
01:10:16,750 --> 01:10:23,320
But we we put it under contract.
We, sold to Brooke on the vision

1019
01:10:23,320 --> 01:10:26,350
of what we were, what we were
going to do. And they believed it.

1020
01:10:26,440 --> 01:10:31,240
And, we then went out and did a,
you know,

1021
01:10:31,240 --> 01:10:34,930
talk to a bunch of different grocers.
And we ended up deciding at that.

1022
01:10:34,930 --> 01:10:41,140
And at that time, Harris Teeter was,
I felt, had had more cash and

1023
01:10:41,140 --> 01:10:43,900
was more interesting than,
than some of the than Safeway or

1024
01:10:43,930 --> 01:10:46,390
Giant at this time.
I don't know that I think that

1025
01:10:46,390 --> 01:10:50,110
anymore, but we ended up doing the deal

1026
01:10:50,110 --> 01:10:55,690
with them and, it was going to
be what they wanted was, you know,

1027
01:10:55,690 --> 01:11:01,300
Surface park, traditional store.
And we had some small stores

1028
01:11:01,300 --> 01:11:03,670
around it.
But then the rest of the project

1029
01:11:03,670 --> 01:11:07,330
was going to be the majority of
it was going to be mixed use.

1030
01:11:07,330 --> 01:11:10,630
It was going to be first floor
retail with apartments above.

1031
01:11:10,630 --> 01:11:14,680
And the here I ran,
we ran into a problem because the

1032
01:11:14,680 --> 01:11:19,300
problem that we ran into was, the JBG didn't believe in

1033
01:11:19,300 --> 01:11:22,810
the residential at that site.
They were okay with the retail,

1034
01:11:22,810 --> 01:11:25,690
but they didn't believe that the
residential was accretive at the

1035
01:11:25,690 --> 01:11:27,550
pricing that you're going to
have to pay for.

1036
01:11:27,550 --> 01:11:31,120
I don't even remember what it was
35 or 40 or something like that.

1037
01:11:31,240 --> 01:11:35,620
And they didn't believe that that
that would be a viable project.

1038
01:11:35,740 --> 01:11:40,720
So we had to create an incredibly
complicated structure where we did,

1039
01:11:40,900 --> 01:11:46,390, in that mixed use building.
We had,

1040
01:11:46,690 --> 01:11:50,020
pseudo came in to do the apartments.
So they were the developer on

1041
01:11:50,020 --> 01:11:53,800
the apartments.
We had one, I think,

1042
01:11:53,800 --> 01:12:00,370
I think Northwestern Mutual was the
lender for I can't remember if there

1043
01:12:00,370 --> 01:12:02,500
was a lender for both the retail.
It had to be.

1044
01:12:02,500 --> 01:12:05,320
They had to be the lender for both
the retail and the residential.

1045
01:12:05,320 --> 01:12:07,630
But, you know,
there were different partnerships,

1046
01:12:07,630 --> 01:12:09,970
you know, for each deal.
So it was really it was really

1047
01:12:09,970 --> 01:12:12,910
complicated. Yeah.
It was a condominium regime.

1048
01:12:12,910 --> 01:12:17,020
Interesting. Yeah.
And so and it was a lot of units.

1049
01:12:17,020 --> 01:12:21,700
It was like 500, almost 550 apartment
units. So it wasn't it wasn't.

1050
01:12:21,700 --> 01:12:27,160
A small housing in there too.
We did not. But but. Nearby.

1051
01:12:27,160 --> 01:12:29,920
And now then Tara Brooke went out
and started selling, you know,

1052
01:12:29,920 --> 01:12:32,710
parcels to these different,
you know, homebuilders. Right.

1053
01:12:32,710 --> 01:12:37,630
And if you go there today,
it's a you know,

1054
01:12:37,630 --> 01:12:40,780
it's a super successful project.
The retail successful,

1055
01:12:40,780 --> 01:12:44,170
the residential successful.
There's an array of different types

1056
01:12:44,170 --> 01:12:47,440
of residential product in there.
There's apartments.

1057
01:12:47,440 --> 01:12:50,770
There's two over twos. Just two.
Did you have other anchors. No.

1058
01:12:50,770 --> 01:12:54,040
We brought so we got LA fitness
in for a health club okay.

1059
01:12:54,460 --> 01:12:59,140
One of the and this is you talk about
the retailers that are, you know

1060
01:12:59,140 --> 01:13:04,690
unique that sort of add the cachet to
be able to to draw the customers.

1061
01:13:05,200 --> 01:13:10,090
We went to great American restaurants
and great American restaurants are

1062
01:13:10,390 --> 01:13:14,080
almost all their stores are in
Virginia and Northern Virginia.

1063
01:13:14,080 --> 01:13:20,170
And they are they are run,
you know, a very tight operation.

1064
01:13:20,290 --> 01:13:25,690
They they have I'd say their food is
okay, but they appeal to a lot of

1065
01:13:25,690 --> 01:13:29,830
people, to a broad array of people.
And they had never done a store in

1066
01:13:29,830 --> 01:13:33,220
Maryland or Montgomery County before.
So we had to convince them to

1067
01:13:33,220 --> 01:13:36,970
come across the river and do
this deal and their deal.

1068
01:13:36,970 --> 01:13:41,140
And this this fits sort of the
model that I'm comfortable with

1069
01:13:41,170 --> 01:13:45,190
is they'll take a lower rent,
but they put in all the ties.

1070
01:13:45,250 --> 01:13:48,820, interesting. Yes.
And I don't know if they still do.

1071
01:13:48,820 --> 01:13:51,400
They have a standard package that
they do for all their stores.

1072
01:13:51,400 --> 01:13:55,120
All their restaurants.
No, every, every store customize.

1073
01:13:55,120 --> 01:13:58,990
They customize every store. Yeah.
And so they did a coastal flats

1074
01:13:58,990 --> 01:14:01,870
in that location.
And, and it's a beautiful store

1075
01:14:01,870 --> 01:14:04,210
still they're still doing,
you know, strong numbers.

1076
01:14:04,210 --> 01:14:08,680
And so we built that I guess at this
point, you know, that's 15 years ago.

1077
01:14:08,680 --> 01:14:11,080
And they're still they're still
still doing well.

1078
01:14:11,980 --> 01:14:17,500, but that was a, you know,
that project actually turned out

1079
01:14:17,500 --> 01:14:21,180
to be financially one of the more.
Successful projects that we did.

1080
01:14:21,180 --> 01:14:25,110
We sold it.
Sub five cap, you know,

1081
01:14:25,110 --> 01:14:27,300
on a projected NOI.
Because it was additional.

1082
01:14:27,300 --> 01:14:31,710
Buyer, institutional buyer.
We sold it to,

1083
01:14:32,400 --> 01:14:40,470
the predecessor to to RPI.
We sold it to RPI and now they

1084
01:14:40,470 --> 01:14:43,860
merged with kite.
So kite now manages an interesting.

1085
01:14:43,860 --> 01:14:47,640
Yes. Yeah. Yeah.
And do you do you don't manage

1086
01:14:47,640 --> 01:14:51,090
it anymore. Oh no.
We when we sold it I think we

1087
01:14:51,090 --> 01:14:53,700
had a one year agreement.
Or maybe we didn't even have a

1088
01:14:53,700 --> 01:14:55,860
one year agreement.
I think RPI took it over.

1089
01:14:55,860 --> 01:14:57,990
Took it over right away. Yeah.
And you know,

1090
01:14:58,020 --> 01:15:02,460
that was one of the things,
one of the the lessons I've learned

1091
01:15:02,460 --> 01:15:05,190
throughout my career, you know,
is that you build these things,

1092
01:15:05,190 --> 01:15:09,690
don't fall in love with any of
your real estate because, one,

1093
01:15:09,690 --> 01:15:14,340
it may not stay as appealing to you,
you know, after ten years. Yeah.

1094
01:15:14,340 --> 01:15:17,910
And two, you know,
if if the money can be put to a

1095
01:15:17,910 --> 01:15:21,420
better use and or a better yield,
then, you know, take it.

1096
01:15:21,420 --> 01:15:25,260
And part of the problem, though, was
that the money that we were using was

1097
01:15:25,260 --> 01:15:31,170
high octane money and is IRR driven.
And so, you know, we and we really

1098
01:15:31,290 --> 01:15:34,980
weren't the ultimate decision maker.
I mean, you know, we we didn't

1099
01:15:34,980 --> 01:15:38,400
have the the luxury of saying,
oh no, we want to keep this.

1100
01:15:38,400 --> 01:15:41,820
What's that part of a JBG fund.
That deal that. Was in GBG fund.

1101
01:15:41,820 --> 01:15:48,480
That was in fund. Five I think.
Yeah. Yeah. Okay.

1102
01:15:48,480 --> 01:15:51,540
So that was all you were at JBG
at the time. That was a Jaeger.

1103
01:15:51,540 --> 01:15:54,780
Yeah. Okay. Yep.
So how do you see the retail

1104
01:15:54,900 --> 01:15:58,560
business evolving and where
where is it prospering from your

1105
01:15:58,560 --> 01:16:02,850
perspective right now?
I mean, I would tell you that right

1106
01:16:02,850 --> 01:16:06,090
now our centers are as leased as
they've ever been in my career.

1107
01:16:06,090 --> 01:16:09,570
There were.
And part of that is due to the

1108
01:16:09,570 --> 01:16:13,890
fact that there's been a lot of
attrition and the worst centers are,

1109
01:16:13,890 --> 01:16:17,010
you know, gone and they've
become something else.

1110
01:16:17,550 --> 01:16:21,330, but also, you know, there hasn't
been any new haven't been any new

1111
01:16:21,330 --> 01:16:26,070
shopping centers built in ten years.
You know, this is a selectively,

1112
01:16:26,070 --> 01:16:29,460
you know, there have been properties
built or if you some ancillary

1113
01:16:29,460 --> 01:16:33,630
retail, but not on any significant
basis the way it was during sort

1114
01:16:33,630 --> 01:16:36,630
of the heyday of my career,
you know, for good or for bad,

1115
01:16:36,630 --> 01:16:39,210
you know, that's that.
So are there retailers expanding

1116
01:16:39,210 --> 01:16:42,450
right now?
And if there are, who and why?

1117
01:16:43,080 --> 01:16:44,970
Well,
I read an article just recently.

1118
01:16:44,970 --> 01:16:49,950
Wal-Mart is said they want to do
150 new stores. Really? Yes.

1119
01:16:49,950 --> 01:16:54,780
But they want to do urban. No.
No, nobody wants to do it.

1120
01:16:54,810 --> 01:16:56,610
They don't want. To do urban.
Nobody wants to do urban.

1121
01:16:56,880 --> 01:17:01,020
That's interesting.
And those urban stores that we did,

1122
01:17:01,140 --> 01:17:05,880
and we did four of them. Right.
And that was that was actually one

1123
01:17:05,880 --> 01:17:10,680
of the more enjoyable parts of,
you know, sort of the,

1124
01:17:10,980 --> 01:17:14,730
projects I ever got to work on
was when Walmart was doing that.

1125
01:17:14,730 --> 01:17:18,780
And they, they had they had a CEO at
the time that was pretty progressive.

1126
01:17:18,780 --> 01:17:22,140
And he wanted to do, you know,
where was Walmart?

1127
01:17:22,140 --> 01:17:26,160
Where were they not and where
were they weren't was urban,

1128
01:17:26,160 --> 01:17:28,950
you know, dense environments.
So there was a period of time

1129
01:17:28,950 --> 01:17:33,810
when they were doing smaller
format stores 80,000ft or so,

1130
01:17:33,990 --> 01:17:39,300
80 to 100,000ft in infill locations.
And they were being.

1131
01:17:39,300 --> 01:17:43,110
I think, of one on Georgia Avenue.
Right. That was the first one. Yeah.

1132
01:17:43,110 --> 01:17:48,900
And I tried to buy that site and
got outbid by Folger Pratt and

1133
01:17:48,900 --> 01:17:53,700
then all the rest of them except
for the the one in southeast,

1134
01:17:53,700 --> 01:17:59,220
which, which they never opened.
We did, and we did the deal at 77

1135
01:17:59,220 --> 01:18:03,390
inch and near Gonzaga High School.
We did for cotton.

1136
01:18:03,600 --> 01:18:07,050
We did Tysons Corner,
and we did route one in Alexandria.

1137
01:18:07,530 --> 01:18:12,180
And how were those stores doing route
one? It's doing well. That's fine.

1138
01:18:12,180 --> 01:18:17,100
But again, that's that's not all
that, unique. It's Surface Park.

1139
01:18:17,790 --> 01:18:20,370,
Tysons Corner I think is doing well.

1140
01:18:20,370 --> 01:18:24,690
But that and that structure part
and then the other 277

1141
01:18:24,870 --> 01:18:28,170
unfortunately is closed.
And that one obviously didn't do

1142
01:18:28,170 --> 01:18:32,910
very well for an array of, you know,
sort of an array of reasons.

1143
01:18:32,910 --> 01:18:37,230
Among them, it's sort of an almost a
second story store because of this,

1144
01:18:37,230 --> 01:18:43,890
the the topography of the site.
And then, it is an urban store.

1145
01:18:43,890 --> 01:18:47,730
So they had a lot of shrinkage
at that store, I think.

1146
01:18:47,730 --> 01:18:50,940
And the format was always tough.
It just never was quite big

1147
01:18:50,940 --> 01:18:53,370
enough for what they wanted.
So what's that store now?

1148
01:18:53,370 --> 01:18:56,820
It's vacant.
Oh, it is the Georgetown University

1149
01:18:56,820 --> 01:19:00,210
we sold the building to.
We sold the whole thing, the Walmart

1150
01:19:00,210 --> 01:19:01,980
and the apartments above it.
And by the way,

1151
01:19:01,980 --> 01:19:07,740
that was the first store in no.
I know it was the first Walmart

1152
01:19:07,740 --> 01:19:10,770
in the United States that had
residential above it, and it might

1153
01:19:10,770 --> 01:19:13,050
be the first one in the world.
I'm not positive about that,

1154
01:19:13,050 --> 01:19:17,820
but the first part I am certain of,
and that was the first one, and I

1155
01:19:17,820 --> 01:19:22,120
was super proud of that. And we.
On the July Deal of the year award

1156
01:19:22,120 --> 01:19:27,490
for that, for that, that project
and that was on a ground lease.

1157
01:19:27,490 --> 01:19:34,030
The city, had ground lease the
land to a developer who wanted to

1158
01:19:34,030 --> 01:19:35,860
build an office building there,
and they were running out of

1159
01:19:35,860 --> 01:19:39,760
time to there was just no,
you know, no demand.

1160
01:19:39,760 --> 01:19:44,920
And then we but they could buy
right to residential into retail.

1161
01:19:44,920 --> 01:19:50,050
And Walmart was doing this program.
And so we ended up making a deal

1162
01:19:50,050 --> 01:19:52,750
with the developer.
And so it was a, you know,

1163
01:19:52,750 --> 01:19:55,900
pretty complicated structure,
but it ended up working, working

1164
01:19:55,900 --> 01:20:00,880
well, Walmart paid a ground rent
and paid for to build their show.

1165
01:20:01,480 --> 01:20:05,530
So again, it's that same idea of
mitigating your, you know,

1166
01:20:05,530 --> 01:20:08,860
the developer's risk by getting
the retailer to share some of the

1167
01:20:09,190 --> 01:20:13,120
risk of the, of the physical plant.
So if you were if you owned that

1168
01:20:13,120 --> 01:20:16,870
property today, what would you do?
Well, Georgetown University bought

1169
01:20:16,870 --> 01:20:20,080
it. So we sold it to Clarion.
And I would do exactly what

1170
01:20:20,080 --> 01:20:23,380
Georgetown is going to do.
So Georgetown bought it and

1171
01:20:23,380 --> 01:20:26,860
they're going to use the
apartments for student housing.

1172
01:20:27,100 --> 01:20:33,880
And the store I would if I'm
Georgetown classrooms, you could do

1173
01:20:33,880 --> 01:20:37,660
classrooms, you could do indoor.
School right there. Right?

1174
01:20:37,660 --> 01:20:40,390
You could do classrooms,
you could do indoor health club.

1175
01:20:40,390 --> 01:20:44,260
I mean, you could do any, any number
of things or I might try to run it.

1176
01:20:44,620 --> 01:20:48,700
I mean, Walmart is still on the hook
for another ten years at least.

1177
01:20:49,300 --> 01:20:51,400
Is a covered land play for them
to some extent.

1178
01:20:51,400 --> 01:20:54,430
To some extent they're still getting
the rent from the from the Walmart.

1179
01:20:54,430 --> 01:20:59,080
Yeah, yeah.
And you know, again though it's

1180
01:20:59,080 --> 01:21:01,960
disappointing to me that that the
Walmart didn't survive there.

1181
01:21:02,200 --> 01:21:05,260
And they probably would have
been happy if it did.

1182
01:21:05,260 --> 01:21:08,230
And then they just own the, you know,
the apartments above because they

1183
01:21:08,230 --> 01:21:11,590
bought it mostly for the residential.
I would I would assume. Sure.

1184
01:21:11,740 --> 01:21:13,960
That's interesting. Yeah.
That's cool.

1185
01:21:14,320 --> 01:21:18,490
So, in addition to the
restructuring of the retail market,

1186
01:21:18,790 --> 01:21:21,940
we're now in the restructuring
of the office market contributed

1187
01:21:22,210 --> 01:21:25,210
to greatly by the pandemic and
its aftermath. Yeah.

1188
01:21:25,480 --> 01:21:28,810
How are you adapting your mixed
use properties to compete today?

1189
01:21:29,260 --> 01:21:33,280
Only residential and retail,
only residential, retail?

1190
01:21:33,280 --> 01:21:40,320
Or are you interspersing other uses?
Well, we've looked like,

1191
01:21:40,320 --> 01:21:45,060
for instance, there's a property
that we own in Manassas Park Ridge

1192
01:21:45,060 --> 01:21:49,260
Shopping Center, and we it's a
partnership between us and Buchanan,

1193
01:21:49,950 --> 01:21:55,500, became a I think became a
partners and we, we bought,

1194
01:21:55,710 --> 01:22:01,440
so we bought the center and a
adjacent to the center there is

1195
01:22:01,440 --> 01:22:05,760
a data center overlay district.
So I thought one of the uses

1196
01:22:05,760 --> 01:22:08,340
that we could potentially do
there would be data center,

1197
01:22:08,340 --> 01:22:12,750
but it is also adjacent to on two
sides of the Manassas battlefield.

1198
01:22:12,840 --> 01:22:17,430
And when we bought the property,
the supervisor, the chairman of the

1199
01:22:17,430 --> 01:22:23,910
board of Supervisors, told us that
she did not want to see at that site,

1200
01:22:24,360 --> 01:22:28,890, she wanted something attractive.
She didn't want to see data centers.

1201
01:22:28,890 --> 01:22:31,020
And because she didn't think
they were attractive.

1202
01:22:31,320 --> 01:22:36,390
And so that idea went out the window.
But I am totally open to finding

1203
01:22:36,390 --> 01:22:39,150
a site that we could buy that we
could do either.

1204
01:22:39,150 --> 01:22:41,700
It's a whether it be a vacant
office building that we could do

1205
01:22:41,700 --> 01:22:46,410
data center on or,
even an existing shopping center.

1206
01:22:46,410 --> 01:22:51,240
I would have done it here if because
that as a land, for the land,

1207
01:22:51,450 --> 01:22:54,930
for the land value, there is
nothing that's is worth as much as

1208
01:22:54,930 --> 01:22:58,410
data center land. Not even close.
Not even. Close. Even downtown.

1209
01:22:58,410 --> 01:23:01,320
Even in Midtown Manhattan.
I don't think they pay land for

1210
01:23:01,320 --> 01:23:04,650
the same numbers. It's crazy.
It's really interesting,

1211
01:23:04,650 --> 01:23:08,100
you know, and it sort of changed.
Like, I was talking to a friend today

1212
01:23:08,100 --> 01:23:10,950
who told me that another friend,
somebody you've interviewed,

1213
01:23:10,950 --> 01:23:14,280
Taylor, Chess and Taylor is
really what he's focused on.

1214
01:23:14,400 --> 01:23:15,690
I don't blame him, you know?
I mean,

1215
01:23:15,690 --> 01:23:19,650
he's got really good instincts.
And Taylor's out looking for land,

1216
01:23:19,650 --> 01:23:21,360
you know,
that he can do data centers on.

1217
01:23:21,360 --> 01:23:24,720
Well, I mean, art,
if you solo talked about a sale

1218
01:23:24,720 --> 01:23:28,110
that the Lerner Corporation had in
Prince William County recently,

1219
01:23:28,110 --> 01:23:30,780
which was the largest land sale,
I think, in the history of

1220
01:23:30,780 --> 01:23:34,350
Northern Virginia. Right. Yeah.
This was their former regional

1221
01:23:34,350 --> 01:23:37,680
mall site in Gainesville, right,
that they sold for a data center.

1222
01:23:37,680 --> 01:23:39,990
That's right. Yeah, that was.
One of the parcels. That.

1223
01:23:39,990 --> 01:23:42,870
So they waited for that.
200 million or something.

1224
01:23:42,870 --> 01:23:47,010
For that rezoning to occur. Right.
Huge number. I know it's crazy.

1225
01:23:47,010 --> 01:23:50,790
It's really, really astounding.
So what we ended up doing a Park

1226
01:23:50,790 --> 01:23:53,640
Ridge since we couldn't get that
approved,

1227
01:23:53,640 --> 01:23:58,680
we got residential approved.
So we got, approximately I

1228
01:23:58,680 --> 01:24:03,510
guess we can do up to 300,
townhomes and two over twos.

1229
01:24:03,600 --> 01:24:07,710
And so we're going to keep portion
of the property is a regal there.

1230
01:24:07,710 --> 01:24:13,020
Now that first phase is going to be
150, 160 townhomes and two over twos.

1231
01:24:13,230 --> 01:24:16,470
Keep the middle of the center.
And eventually the eastern

1232
01:24:16,470 --> 01:24:18,750
portion of the property will be
residential as well.

1233
01:24:19,140 --> 01:24:22,680
So there's a theme, as you can see,
with where what the kinds of

1234
01:24:22,680 --> 01:24:26,640
deals that I'm looking to do now.
And we're also looking at

1235
01:24:26,640 --> 01:24:28,770
opportunities, you know,
outside of this market.

1236
01:24:28,770 --> 01:24:31,890
I mean, we're looking in the
Carolinas, we're looking in,

1237
01:24:32,130 --> 01:24:35,370
eastern side of Florida, Georgia,
you know, outside of Atlanta.

1238
01:24:35,790 --> 01:24:39,930
So what you're basically doing is
taking your retail mind and applying

1239
01:24:39,930 --> 01:24:44,280
it to how can we reconfigure this
asset to maximize the retail.

1240
01:24:44,280 --> 01:24:47,670
Is there maybe. Yes.
And then add on other uses that

1241
01:24:47,670 --> 01:24:51,450
might be complementary to it.
Yeah. Fundamentally. Yes.

1242
01:24:51,450 --> 01:24:56,550
I mean, we still look at at land
and real estate in general as

1243
01:24:56,550 --> 01:25:01,230
land like what is the highest and
best use and what is feasible.

1244
01:25:01,230 --> 01:25:04,260
I mean, you know, again,
highest and best use would have

1245
01:25:04,260 --> 01:25:06,750
been at Park Ridge.
It would have been data center.

1246
01:25:06,750 --> 01:25:11,730
But politically that was impossible.
So you pivot and do you do what

1247
01:25:11,730 --> 01:25:15,570
makes sense? Sure.
So talk about Willard retail and

1248
01:25:15,570 --> 01:25:18,300
its services.
It looks like you invest, develop

1249
01:25:18,300 --> 01:25:22,950
asset and property, manage and lease.
How do you implement and staff

1250
01:25:22,950 --> 01:25:26,520
each of those disciplines?
Do you work only on your own

1251
01:25:26,520 --> 01:25:29,670
portfolio or do you represent other
owners in leasing and management?

1252
01:25:29,670 --> 01:25:32,940
Why? No, we do.
I mean,

1253
01:25:32,940 --> 01:25:37,950
as I think I listed that statistic,
I mean, we we have probably half of

1254
01:25:37,950 --> 01:25:42,090
our portfolio leasing, leasing or
properties that we own or have an

1255
01:25:42,090 --> 01:25:47,910
ownership interest in and at least,
you know, 40% and hopefully more,

1256
01:25:48,390 --> 01:25:52,950, will be, third,
third party listings and just for

1257
01:25:52,950 --> 01:25:57,720
leasing. Just for leasing. Right.
And we also manage third party,

1258
01:25:57,720 --> 01:26:00,570
a lot of our, of our properties
that we manage our third party.

1259
01:26:00,570 --> 01:26:03,240
We don't we don't have an
ownership interest in all of them.

1260
01:26:03,240 --> 01:26:05,580
We have an ownership in most of them,
but not all of them.

1261
01:26:05,850 --> 01:26:11,460
And, we brought so the guy
who heads up our leasing group

1262
01:26:11,460 --> 01:26:15,180
is a guy named he's he's my
partner is Chris Wilkinson.

1263
01:26:15,180 --> 01:26:20,610
And Chris was a person that we
hired a Jaeger and loved Chris

1264
01:26:20,610 --> 01:26:24,210
always from the from the day we
hired him and he stayed.

1265
01:26:24,210 --> 01:26:28,260
When we sold the business to JBG,
Chris went to JBG and was there

1266
01:26:28,260 --> 01:26:32,070
until we brought him back over here.
And now he runs our leasing group

1267
01:26:32,070 --> 01:26:36,420
for us, and he has done a great
job in bringing in a ton of new.

1268
01:26:36,590 --> 01:26:41,240
To third party clients.
And also he's he's brought in a lot

1269
01:26:41,240 --> 01:26:47,120
of good hires. So initially just him.
And now we have him and three other

1270
01:26:47,120 --> 01:26:51,710
people who are who are doing leasing.
We have a guy who runs our asset

1271
01:26:51,710 --> 01:26:56,270
management group who again,
also used to work for us at JBR, did

1272
01:26:56,270 --> 01:27:01,040
asset management for us of Jaeger, he did not work for JBG,

1273
01:27:01,070 --> 01:27:05,300
though he did work for another
firm and moved around because

1274
01:27:05,300 --> 01:27:10,250
his wife is a pediatric surgeon.
And so she was, you know,

1275
01:27:10,250 --> 01:27:12,980
moving to residency.
And then she moved to get her

1276
01:27:12,980 --> 01:27:16,550
permanent job in.
And she and he live in Atlanta.

1277
01:27:16,760 --> 01:27:20,330
So he runs our asset management
out of Atlanta.

1278
01:27:20,510 --> 01:27:24,890
And one thing that I've learned,
and I'm now pretty comfortable

1279
01:27:24,890 --> 01:27:30,350
with it, is that many of your
employees do not have to come in

1280
01:27:30,350 --> 01:27:34,850
the office on a regular basis.
And if you have the right people

1281
01:27:34,850 --> 01:27:40,730
that are reliable and capable
and in the right role,

1282
01:27:40,730 --> 01:27:46,820
they can do those jobs from anywhere.
So he again oversees the asset

1283
01:27:46,820 --> 01:27:49,190
management.
So he ever sees all the,

1284
01:27:49,190 --> 01:27:51,860
you know, interacts with the
leasing with Chris and the leasing

1285
01:27:51,860 --> 01:27:56,060
department oversees the accounting,
which is outsourced as well.

1286
01:27:56,060 --> 01:27:59,000
We don't have in-house accounting.
We have outsourced accounting.

1287
01:27:59,150 --> 01:28:04,070
And, and then, property
managers, most of the property

1288
01:28:04,070 --> 01:28:08,210
managers never come in the office.
They work out of their houses

1289
01:28:08,210 --> 01:28:12,170
and they have they have home
offices and they do their work.

1290
01:28:12,170 --> 01:28:14,630
You know, they go to the
properties on a consistent basis,

1291
01:28:14,630 --> 01:28:17,840
which is what they are supposed
to do, and they don't need to

1292
01:28:17,840 --> 01:28:20,600
come in the office very often.
That's interesting. Yeah.

1293
01:28:20,750 --> 01:28:23,120
And you're like a virtual
company to some extent.

1294
01:28:23,540 --> 01:28:28,490
We have 15 employees and seven of us
come in here on a regular basis,

1295
01:28:28,490 --> 01:28:32,660
and the rest don't have any
accountants who never come in.

1296
01:28:32,690 --> 01:28:34,610
Do you have off sites where you
get together as a,

1297
01:28:34,760 --> 01:28:38,330
as a company and do kind of planning
and that kind of thing? We do.

1298
01:28:38,360 --> 01:28:41,660
We have that and you know,
we have company events,

1299
01:28:41,660 --> 01:28:45,560
we have company outings, we have,
lunch that we have once a month.

1300
01:28:45,560 --> 01:28:49,280
And people who don't can't,
don't want to come into the office or

1301
01:28:49,280 --> 01:28:54,740
can't like our lease administration.
The lease administrator is a,

1302
01:28:54,740 --> 01:28:59,300
a woman who lives in Connecticut.
And so all the people that

1303
01:28:59,300 --> 01:29:02,390
wanted to come in today for
lunch for pizza came in,

1304
01:29:02,390 --> 01:29:06,320
and she's up on the screen virtual.
And whoever wants to be up on the

1305
01:29:06,320 --> 01:29:11,210
screen, virtually up on the screen.
Well, that's great that you're

1306
01:29:11,210 --> 01:29:14,000
flexible in that regard.
So I think. It's the future.

1307
01:29:14,240 --> 01:29:18,320
I think it's I mean, and I've seen
other firms and I won't name them

1308
01:29:18,320 --> 01:29:23,090
who, you know, have edicts like you
must come in the office and yeah,

1309
01:29:23,090 --> 01:29:25,850
I mean, and there are things
that are going to get missed by

1310
01:29:25,850 --> 01:29:28,580
not going in the office and not
interacting on a regular basis.

1311
01:29:28,580 --> 01:29:31,820
But you're also going to lose
some people.

1312
01:29:33,290 --> 01:29:36,710, it seems that every company
has a niche and they carve out

1313
01:29:36,860 --> 01:29:39,980
that they carve out in the market.
You have significant competition

1314
01:29:39,980 --> 01:29:43,790
in each of the disciplines.
You talked about how talk about

1315
01:29:43,790 --> 01:29:47,780
Willard's niche and how you thrive
and where you thrive in that niche.

1316
01:29:49,790 --> 01:29:53,360
In leasing and say, oh, well,
for instance, start with that.

1317
01:29:53,690 --> 01:29:57,950
Well, I, I guess really more broadly,
I would say we're adaptable.

1318
01:29:57,950 --> 01:30:02,330
I mean, we, we see trends and
move with trends. Okay.

1319
01:30:02,540 --> 01:30:08,540, and I would say like a person
who's career is probably the closest

1320
01:30:08,540 --> 01:30:13,940
to mine and, and who's done something
similar as Taylor Chase and Taylor

1321
01:30:13,940 --> 01:30:18,380
sees trends and he follows them.
And, you know, he and I have always

1322
01:30:18,380 --> 01:30:21,080
we've been always been we've
known each other for, you know,

1323
01:30:21,080 --> 01:30:27,260
30 plus years and our careers have
been similar. And we see things.

1324
01:30:27,260 --> 01:30:30,470
We see things similarly.
I mean, in terms of, of, you know,

1325
01:30:30,470 --> 01:30:35,540
real estate investing in development.
And so I would say just be

1326
01:30:35,540 --> 01:30:39,920
flexible and adapt.
And Willard is, is that I mean,

1327
01:30:39,920 --> 01:30:48,140
you know, if we have always been I'm
used to the capital, I mean, to,

1328
01:30:48,440 --> 01:30:53,540
a private equity model of looking
for yield and opportunistic yield.

1329
01:30:53,540 --> 01:30:58,130
And so the deals that we look at,
like we don't look at single digit

1330
01:30:58,130 --> 01:31:01,550
return deals, it's just not,
you know, they're just not appealing.

1331
01:31:01,550 --> 01:31:07,730
And maybe I don't know, you know,
I doubt that we will ever look at

1332
01:31:07,730 --> 01:31:11,210
deals like that that would that would
be appealing just because of the kind

1333
01:31:11,210 --> 01:31:16,340
of capital that we that's attractive
to or that is attracted to us is also

1334
01:31:16,340 --> 01:31:20,450
looking for those kinds of returns.
And one thing you know,

1335
01:31:20,450 --> 01:31:24,440
there are one thing we don't
have or is are very many deals

1336
01:31:24,440 --> 01:31:29,570
that are sort of legacy assets.
And I have sort of mixed

1337
01:31:29,570 --> 01:31:32,300
feelings about that.
You know, there are there's one

1338
01:31:32,300 --> 01:31:36,380
center that we developed, you know,
15 years ago that we still own that.

1339
01:31:36,690 --> 01:31:40,290
You know, Great Center,
Market Square, Frederick and

1340
01:31:40,470 --> 01:31:42,480
still own it. It's great.
And I get, you know,

1341
01:31:42,480 --> 01:31:45,690
a distribution every quarter.
And I wish I had more of those,

1342
01:31:45,690 --> 01:31:48,480
you know.
But and there are a few assets

1343
01:31:48,480 --> 01:31:51,150
that we've developed over the
years that I wish we still owned.

1344
01:31:51,150 --> 01:31:54,360
But there's a lot that I've said
that I'm glad that that we don't

1345
01:31:54,360 --> 01:31:57,210
for a variety of reasons.
And the three that I wish I

1346
01:31:57,210 --> 01:32:00,450
still owned, or we bought
Village Center at Dulles years

1347
01:32:00,450 --> 01:32:03,570
ago from you remember Batman,
of course we bought it. We bought it.

1348
01:32:03,570 --> 01:32:05,760
Well, Batman was being basically
foreclosed.

1349
01:32:05,760 --> 01:32:09,810
You've been squeezed by the the had.
The bell tower on it. Exactly.

1350
01:32:09,810 --> 01:32:14,370
It still does. Yes. Third, third. No.
Trust holder put the squeeze on

1351
01:32:14,370 --> 01:32:19,200
him and we got in, you know,
through there and then, you know,

1352
01:32:19,200 --> 01:32:23,460
took over, took over the property,
repositioned it and then sold it

1353
01:32:23,460 --> 01:32:27,660
to Regency who still owns it.
And that properties thumbs still

1354
01:32:27,660 --> 01:32:31,530
homes. So I'm sad we don't own that.
And I'm sad we don't own Downtown

1355
01:32:31,530 --> 01:32:36,060
Crown because that is kind of
irreplaceable. Irreplaceable, right.

1356
01:32:36,060 --> 01:32:41,250
And then King of Prussia. Yeah.
Interesting. But you just well, we.

1357
01:32:41,250 --> 01:32:44,700
Took the capital and, you know,
again used it for other things.

1358
01:32:44,700 --> 01:32:52,080
Yeah. There you go. Interesting.
So, when you hire people,

1359
01:32:52,080 --> 01:32:58,830
what characteristics you look for?
Well, intelligence again,

1360
01:32:58,830 --> 01:33:04,920
you know, creativity,
flexibility and affability.

1361
01:33:04,920 --> 01:33:07,860
You know, I mean,
not necessarily in that order.

1362
01:33:07,860 --> 01:33:10,470
It sort of depends on would you.
Hire somebody right out of college

1363
01:33:10,470 --> 01:33:12,960
and teach them the business, or are
you looking for people with some

1364
01:33:12,960 --> 01:33:15,870
experience? Typically it depends.
On the position. Okay.

1365
01:33:16,050 --> 01:33:21,510
You know, like for if, if,
Chris needed a junior leasing person,

1366
01:33:21,930 --> 01:33:25,020
I mean, maybe I'd rather have
one year of experience doing

1367
01:33:25,020 --> 01:33:27,750
something else, you know?
But we'd be we'd be open to that.

1368
01:33:27,810 --> 01:33:29,670
We've been a.
Sales experience of some sort.

1369
01:33:29,850 --> 01:33:32,430
Some sort. Exactly.
You had when you start. Right.

1370
01:33:32,430 --> 01:33:36,900
Because it's not an easy sell.
It is a complicated sales,

1371
01:33:36,900 --> 01:33:41,970
you know, a sales process.
So having some, you know,

1372
01:33:41,970 --> 01:33:46,110
one a little polish, a little expert,
you know, a little background

1373
01:33:46,290 --> 01:33:49,140
doesn't won't hurt, wouldn't hurt.
Same with property management.

1374
01:33:50,250 --> 01:33:54,900
We have not hired a property.
No we we would we would have to

1375
01:33:54,900 --> 01:33:56,760
hire a property manager who's
got some experience.

1376
01:33:56,760 --> 01:34:00,870
I mean, they just I mean,
that's maybe it's their second job,

1377
01:34:00,870 --> 01:34:03,720
but you know we I don't know.
And we did it a couple times of

1378
01:34:03,720 --> 01:34:06,900
Jaeger and you know there's a
heavy learning curve.

1379
01:34:06,900 --> 01:34:09,150
So it would be it's always
preferable I think,

1380
01:34:09,150 --> 01:34:12,150
to have a little bit of experience.
And you outsource other things

1381
01:34:12,150 --> 01:34:14,460
basically. Right.
Accounting and yes,

1382
01:34:14,460 --> 01:34:21,360
and all that. So. Okay, you worked in and dealt with

1383
01:34:21,360 --> 01:34:24,720
perhaps thousands of people in your
career, which people have stood out

1384
01:34:24,720 --> 01:34:28,980
to you as inspirations and why?
You mentioned Taylor Chess so.

1385
01:34:29,070 --> 01:34:33,780
Well, Taylor stood out, you know,
Rob Rosenfeld, because he's

1386
01:34:33,780 --> 01:34:37,500
one of the smarter people I know
and great judgment and careful,

1387
01:34:37,500 --> 01:34:43,410
methodical and really good judgment,
though, and has an interesting

1388
01:34:43,650 --> 01:34:48,270
way of, of negotiating.
And then and the way he negotiates is

1389
01:34:48,270 --> 01:34:56,340
this like, it's a, it's a, it's a, a response of indifference, which

1390
01:34:56,340 --> 01:35:00,240
if somebody really wants to sell you
something or buy something from you,

1391
01:35:00,390 --> 01:35:07,920
it works. You just go to an event.
And if they really want to really

1392
01:35:07,920 --> 01:35:11,760
want what you have, they'll keep
coming, you know? And I love it.

1393
01:35:11,760 --> 01:35:15,960
I've watched him for decades now do
that. And so I really respect him.

1394
01:35:16,620 --> 01:35:21,960, Rob Stuart, who you know,
I really respect his, his,

1395
01:35:21,960 --> 01:35:25,320
his mind and the way he thinks
about real estate and the way he

1396
01:35:25,320 --> 01:35:27,990
thinks about investing.
And he's taught me a tremendous

1397
01:35:27,990 --> 01:35:33,240
amount, they, Brian Coulter, who's,

1398
01:35:33,240 --> 01:35:36,420
you know, I've watched him over the
years, and I and I really liked

1399
01:35:36,420 --> 01:35:39,600
the way his measured approach to
things and the way he interacts

1400
01:35:39,600 --> 01:35:43,650
with people and how he treats,
you know, all, all his employees

1401
01:35:43,650 --> 01:35:51,090
with consideration and, you know,
and fairness and, those are the

1402
01:35:51,090 --> 01:35:54,060
the names that really, you know,
pop into my pop into my head.

1403
01:35:54,060 --> 01:35:57,360
And there's other people who have
interacted with who at different

1404
01:35:57,360 --> 01:36:00,270
firms over the years who I think
I mean, there's certain people,

1405
01:36:00,270 --> 01:36:03,210
certain entrepreneurs who I
really respect, you know,

1406
01:36:03,210 --> 01:36:07,830
what they created out of nothing.
You know, that I always respect that.

1407
01:36:07,830 --> 01:36:13,200
I always respect a person who didn't
get handed anything and creates,

1408
01:36:13,200 --> 01:36:16,770
you know, something out of nothing
because it's not it's hard to do.

1409
01:36:16,770 --> 01:36:19,320
It's really hard to do.
So I really respect that.

1410
01:36:20,340 --> 01:36:22,590
Well, you,
I know you have an equity partner

1411
01:36:22,590 --> 01:36:25,560
who is sitting in this office.
You probably have a lot of

1412
01:36:25,560 --> 01:36:29,760
respect for us. Absolutely.
Yeah. Rich. Yeah, sure. Yeah.

1413
01:36:29,760 --> 01:36:35,190
And Todd, I've known him since we
worked together at. In fact. When?

1414
01:36:35,580 --> 01:36:39,290
When? Todd. Went to declaration.
And then, you know, I was out

1415
01:36:39,290 --> 01:36:42,290
looking for capital, partner.
You know, I came went to him.

1416
01:36:42,290 --> 01:36:46,130
And, you know, obviously we ended
up being, you know, marrying up.

1417
01:36:46,130 --> 01:36:50,720
So it was it was fortuitous that
I knew him this fortuitous that

1418
01:36:50,720 --> 01:36:53,150
I respected him and respected
his intellect.

1419
01:36:53,150 --> 01:36:57,980
And, you know, obviously, you know,
he picked a great capital partner,

1420
01:36:58,340 --> 01:37:01,340
you know, astute investor to
affiliate himself with.

1421
01:37:01,340 --> 01:37:03,920
So, you know,
hopefully it's been, you know,

1422
01:37:03,920 --> 01:37:06,740
a symbiotic partnership a new.
Owner of the Baltimore Orioles.

1423
01:37:06,890 --> 01:37:10,700
I know which is astounding isn't.
It. It's incredible.

1424
01:37:11,060 --> 01:37:16,250
David Rubenstein,
what are your life priorities among

1425
01:37:16,250 --> 01:37:21,080
family work and giving back grant, well,

1426
01:37:21,080 --> 01:37:27,860
I'm I've only been married once, it's 30 this year will be

1427
01:37:27,860 --> 01:37:31,190
November, will be 35 years.
I have three. Thank you.

1428
01:37:31,190 --> 01:37:37,610
I have three sons, and,
they're 31, 28 and 26.

1429
01:37:37,610 --> 01:37:41,570
And my, you know,
my priorities have always been,

1430
01:37:41,570 --> 01:37:44,990
you know, spend as much time
with your family as you can,

1431
01:37:45,230 --> 01:37:48,920
spend as much time with your
friends as you can, and, you know,

1432
01:37:48,920 --> 01:37:55,340
have a a broad interest pool.
And, in terms of,

1433
01:37:55,340 --> 01:38:02,000
giving back, I spent a fair amount
of time doing, not well,

1434
01:38:02,000 --> 01:38:05,300
I mean, probably I should do more,
but a reasonable amount of time

1435
01:38:05,300 --> 01:38:08,240
doing nonprofit work.
So I've been on a few boards.

1436
01:38:08,240 --> 01:38:12,590
I'm still on the board of an
organization called OAH, which is

1437
01:38:12,590 --> 01:38:15,890
an acronym for, opportunities,
Alternatives and Resources.

1438
01:38:15,890 --> 01:38:19,850
And we work with people in the
criminal justice system,

1439
01:38:19,850 --> 01:38:24,620
justice involved individuals and, and work with them while

1440
01:38:24,620 --> 01:38:28,880
they're incarcerated.
And then when they get out to help

1441
01:38:28,880 --> 01:38:37,070
them, you know, to get re acclimated
and get jobs and educate them while

1442
01:38:37,070 --> 01:38:41,060
they're incarcerated and so on,
help with their families and do

1443
01:38:41,060 --> 01:38:45,620
what we can. That's great.
What are your biggest wins,

1444
01:38:45,620 --> 01:38:48,710
losses and most surprising
events in your career?

1445
01:38:52,050 --> 01:38:56,070
Well, I mean, I don't know if
they're surprising, but the winds,

1446
01:38:56,310 --> 01:39:02,220. Were some of those. Great.
There were just so interesting to do,

1447
01:39:02,220 --> 01:39:05,490
those mixed use projects and,
you know, seeing a piece of land

1448
01:39:05,490 --> 01:39:09,060
and and having a vision and then,
you know, being able to take

1449
01:39:09,060 --> 01:39:12,030
that vision and turn it into
something that, you know,

1450
01:39:12,030 --> 01:39:15,300
will be here after I'm gone,
you know, so development. Really?

1451
01:39:15,300 --> 01:39:19,680
Yeah, I really liked I really liked
doing I liked doing development.

1452
01:39:19,800 --> 01:39:26,040
And, I would probably like to
do it again, you know, but it's.

1453
01:39:27,000 --> 01:39:30,720
And if the right opportunity shows
itself, we will we will do it again.

1454
01:39:30,720 --> 01:39:33,960
I mean it, you know, Cascades
Marketplace, we're redeveloping.

1455
01:39:34,110 --> 01:39:38,520
So in essence we're doing it.
It's just not quite it's it's a

1456
01:39:38,520 --> 01:39:41,550
little different because it's
not a raw piece of land. Sure.

1457
01:39:41,550 --> 01:39:45,810
That we're, that we're looking at.
And some of the things I've learned

1458
01:39:45,810 --> 01:39:51,540
along the way, the hard knocks are
like we did the Tysons West deal,

1459
01:39:51,540 --> 01:39:54,510
where we did the Walmart.
That was the worst financial deal I

1460
01:39:54,510 --> 01:39:59,700
ever did that I was ever invested in,
because we end up paying too much for

1461
01:39:59,700 --> 01:40:02,670
the car dealership that was there.
It was a Cadillac dealership,

1462
01:40:02,760 --> 01:40:08,040
and then we bought the Sheridan Hotel
next to it and overpaid for that.

1463
01:40:08,040 --> 01:40:11,700
And so that deal, you know,
was a complete wash, you know, even

1464
01:40:11,700 --> 01:40:15,390
though the first phase is successful,
but the overall investment was not

1465
01:40:15,390 --> 01:40:20,280
a good one. That's too bad. Yeah, and then we built Woodland

1466
01:40:20,280 --> 01:40:24,240
Park Crossing in Herndon,
and it's a super attractive project.

1467
01:40:24,240 --> 01:40:28,470
I'm very proud of its appearance,
you know, in the way that it looks.

1468
01:40:28,470 --> 01:40:32,670
But we broke too many rules,
retail rules.

1469
01:40:32,670 --> 01:40:37,320
And if you if you know what I mean by
that, is we put too much density on

1470
01:40:37,320 --> 01:40:41,340
a small site on an 80 acre site,
we put 140,000ft of retail and

1471
01:40:41,370 --> 01:40:45,930
200 apartments in a suburban
surface park environment.

1472
01:40:46,320 --> 01:40:49,380
And I learned the hard way that
you can't do that.

1473
01:40:49,380 --> 01:40:54,750
And or you can, but it's going to be
challenging to make it successful.

1474
01:40:54,750 --> 01:40:59,490
If there are competing retail centers
that are surface park, easier access

1475
01:40:59,490 --> 01:41:03,180
or at least perceived easier access.
Leasing difficult there.

1476
01:41:03,480 --> 01:41:06,180
And not initially because it was
super attractive.

1477
01:41:06,180 --> 01:41:08,460
So we leased it up and then we
sold it.

1478
01:41:08,790 --> 01:41:11,610
And it was expensive to build too,
because we did.

1479
01:41:12,300 --> 01:41:14,640
Most of the parking for the
retail is underground.

1480
01:41:14,880 --> 01:41:19,020
And so we had to do, you know,
we knew there was rock, but there

1481
01:41:19,020 --> 01:41:22,680
was more rock than we thought.
So it was expensive to develop.

1482
01:41:23,550 --> 01:41:29,250, and then we, we since we sold it,
I've, I go back there, you know,

1483
01:41:29,250 --> 01:41:31,800
periodically just to,
to to look at it.

1484
01:41:31,800 --> 01:41:35,940
And the retail has not done very
well and I don't think it's a very

1485
01:41:35,940 --> 01:41:39,570
successful Harris Teeter, you know.
And again, because it's competing

1486
01:41:39,570 --> 01:41:44,400
with a bunch of surface park easy
more visible you know sites.

1487
01:41:44,400 --> 01:41:50,520
So I you can't live and learn
and you can't force retail.

1488
01:41:50,520 --> 01:41:53,520
And I learned that over the years
because I've watched a lot of

1489
01:41:53,520 --> 01:41:57,240
people have come to me with sites
that either like in Arlington,

1490
01:41:57,240 --> 01:42:01,230
you know, for the county,
forced every developer to have

1491
01:42:01,230 --> 01:42:04,410
every street, Main Street,
have retail on the first floor of

1492
01:42:04,410 --> 01:42:07,920
every building. And it didn't work.
And now they you know,

1493
01:42:07,920 --> 01:42:10,350
they've acknowledged that.
So a lot of times developers

1494
01:42:10,350 --> 01:42:13,320
would come to me in the county,
a lot of planners, you know,

1495
01:42:13,320 --> 01:42:16,410
they bought into that vision and
they people would come to me and

1496
01:42:16,410 --> 01:42:18,450
they go, do you think you can
make this retail work?

1497
01:42:18,450 --> 01:42:24,480
And I'd go, no, I don't I'm sorry.
You know,

1498
01:42:24,480 --> 01:42:28,560
some people don't want to hear that.
You know, they they what do you mean?

1499
01:42:28,560 --> 01:42:32,370
I go, well, you know, it's just
not the right place for retail.

1500
01:42:32,940 --> 01:42:35,730
Well, I didn't put this summit
on a list of questions,

1501
01:42:35,730 --> 01:42:38,940
but I'm going to throw out.
You just mentioned it looking at

1502
01:42:38,940 --> 01:42:42,480
downtown Washington right now,
if you were leasing down there,

1503
01:42:42,480 --> 01:42:46,170
how would you manage that process and
what what would you do to to fire

1504
01:42:46,170 --> 01:42:49,680
things up? Well, we have we have.
Some listings down there.

1505
01:42:49,950 --> 01:42:53,100, you know, a fair number of
listings in the CBD. Yeah.

1506
01:42:53,100 --> 01:43:00,150
And, and I had an idea, actually,
that I, I shared with Jody McLean

1507
01:43:00,150 --> 01:43:05,430
from Edens, which was what if you
because I think monumental is gone.

1508
01:43:05,430 --> 01:43:08,070
I don't think there's there's
any way that they're staying.

1509
01:43:08,070 --> 01:43:14,310
What if you took the cap one center
and created something like the Sphere

1510
01:43:14,310 --> 01:43:17,460
in Las Vegas? Well, there you go.
And I think she'd already had the

1511
01:43:17,460 --> 01:43:20,460
idea because she said that's,
you know, seems.

1512
01:43:20,460 --> 01:43:23,460
I haven't seen the sphere so.
Well, I've seen videos of it.

1513
01:43:23,460 --> 01:43:25,680
I haven't seen it,
but I have multiple friends who've

1514
01:43:25,680 --> 01:43:30,030
been there since, you know,
U2 has done a residency in Vegas

1515
01:43:30,030 --> 01:43:33,180
and done a number of shows there,
but it's one of the coolest

1516
01:43:33,180 --> 01:43:38,190
things I've ever seen, where it's
like a dome. It's a dome with.

1517
01:43:38,940 --> 01:43:42,930
As part of a casino. No.
Well, I guess it's no,

1518
01:43:42,930 --> 01:43:47,100
I think it's owned separately,
but it's near the Venetian. Right.

1519
01:43:47,220 --> 01:43:52,610
And they put this LED screens.
Over the whole outside of it.

1520
01:43:52,610 --> 01:43:56,780
So it does it.
You can literally have these

1521
01:43:56,780 --> 01:44:01,730
incredible, you know,
displays on the exterior.

1522
01:44:01,730 --> 01:44:04,040
And then the interior has the
same thing.

1523
01:44:04,040 --> 01:44:07,340
And so people have sent me
videos and I've seen, you know,

1524
01:44:07,340 --> 01:44:11,840
this, this literally your entire
everything around you is a screen.

1525
01:44:11,840 --> 01:44:15,320
And so the bands playing in front
of you and then you see this

1526
01:44:15,680 --> 01:44:18,650
whatever video screen, you know,
visions that they want, like one.

1527
01:44:18,650 --> 01:44:22,250
Of those Disney surround things.
Yes. It seems amazing.

1528
01:44:22,250 --> 01:44:26,330
So something like that, you know,
something unique to to backfill it.

1529
01:44:26,780 --> 01:44:31,130, it's going to be challenging.
I would try I would make zoning.

1530
01:44:31,340 --> 01:44:36,740, I would, I would reduce
requirements for, to make

1531
01:44:36,740 --> 01:44:42,800
buildings less expensive to develop.
I would allow a ton more residential

1532
01:44:42,800 --> 01:44:46,130
as fast as you can make it happen.
Because I don't think office is

1533
01:44:46,130 --> 01:44:50,480
coming back anytime soon.
I don't, you know, I. Don't I'm.

1534
01:44:50,720 --> 01:44:53,840
I interviewed, a fellow by the
name of Matt Pastrnak, who's with

1535
01:44:53,840 --> 01:44:55,250
Post Brothers. Oh, I know who he is.
Yeah,

1536
01:44:55,250 --> 01:44:59,120
and they're doing two huge right use,
right. Those old office buildings.

1537
01:44:59,120 --> 01:45:02,270
Yeah, one in Connecticut,
two on Connecticut Avenue, and then

1538
01:45:02,270 --> 01:45:07,070
one over on Elm Street. Right.
Big projects, huge 600 units plus,

1539
01:45:07,070 --> 01:45:09,740
I know. I wish him well.
I hope it. Works.

1540
01:45:09,740 --> 01:45:12,350
It's going to be interesting to
see how that plays out.

1541
01:45:12,830 --> 01:45:19,610
So what advice would you give
your 25 year old self.

1542
01:45:22,500 --> 01:45:27,450
You know, maybe be, you know,
be calmer, you know, know that,

1543
01:45:29,100 --> 01:45:32,760
give yourself more leeway.
You know, be.

1544
01:45:32,910 --> 01:45:36,630
But but but I say that.
And then I don't know that I

1545
01:45:36,630 --> 01:45:39,300
would have had to drive.
You know, if I wasn't anxious.

1546
01:45:39,300 --> 01:45:43,830
You know, the anxiety,
which is painful when you go

1547
01:45:43,830 --> 01:45:47,970
through it and makes, you know,
maybe other people's lives

1548
01:45:47,970 --> 01:45:53,340
around you not so pleasant.
And but it gives you drive,

1549
01:45:53,340 --> 01:45:59,730
you know, but in the end, for what?
You know, what's the what is it?

1550
01:45:59,820 --> 01:46:02,190
What does it lead to?
I mean, I hope I was a good father.

1551
01:46:02,190 --> 01:46:05,640
I hope I've been a good husband.
I know, I mean, I think I've been

1552
01:46:05,640 --> 01:46:10,230
a good friend to a lot of people.
And, I just say focus on that,

1553
01:46:10,230 --> 01:46:14,940
you know, think think about that
more maybe than you did when you

1554
01:46:14,940 --> 01:46:18,180
were in it, you know, and everybody
who's a young parent, you know,

1555
01:46:18,180 --> 01:46:21,780
you it's like, well, you're in it.
It just feels so overwhelming.

1556
01:46:21,780 --> 01:46:25,440
But nothing's better as you get
to our age, you know,

1557
01:46:25,440 --> 01:46:27,990
and you look back and like,
that's what you think about.

1558
01:46:28,500 --> 01:46:33,120
Well, I reflect back and I think,
you know, I wish I had been,

1559
01:46:33,120 --> 01:46:37,200
a little more present for my
children that. I. Totally, totally.

1560
01:46:38,380 --> 01:46:42,490
You know, just be there with them.
I did take the liberty of

1561
01:46:42,490 --> 01:46:46,360
reading to them every night.
Yeah. Me too, at that time.

1562
01:46:46,450 --> 01:46:49,270
And so I spent at least an hour
before they'd go to sleep.

1563
01:46:49,270 --> 01:46:52,120
So that was at least one luxury
I had. Right.

1564
01:46:52,480 --> 01:46:55,630
So if you could post a statement
on a billboard on the Capitol

1565
01:46:55,630 --> 01:46:57,910
Beltway for millions to see,
what would it say for you?

1566
01:47:01,840 --> 01:47:08,380
Be kind and listen to others.
That's almost identical to the

1567
01:47:08,380 --> 01:47:12,760
one I gave. Is that right? Yeah.
Almost identical. Yeah. That's great.

1568
01:47:12,760 --> 01:47:16,750
Well, because I know what I think.
I know, you know, you need to

1569
01:47:16,750 --> 01:47:20,080
know what other people think.
And being mean doesn't get you

1570
01:47:20,080 --> 01:47:24,190
anywhere. Yeah I agree. Yeah.
So Grant Ehab,

1571
01:47:24,190 --> 01:47:27,610
thank you very much for joining me on
icons of this year. Real estate.

1572
01:47:27,610 --> 01:47:29,530
Thank you. Thank you John.
Thanks for the interview.

1573
01:47:29,560 --> 01:47:32,770
I appreciate it. All right.
Well that was.