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DSS Wrap-up: Matthew D. Shore (’00), Chief Investment Officer – DRA Advisors

This week, the Baker Program in Real Estate welcomed back another alumnus of Cornell, Matthew Shore (Cornell ‘00), for its Distinguished Speaker Series. Matthew is the Chief Investment Officer at DRA Advisors, an investment advisory firm specializing in real estate investment and management services for institutional and private investors with over $11 billion in assets under management. He oversees acquisitions primarily focused on retail, office and industrial opportunities across the United States and is also involved in strategic asset management, financing, and dispositions. During his time at DRA, he has sourced and closed over $5 Billion in real estate transactions including the privatization of two publicly traded REIT’s.

Addressing a packed auditorium
(Photo credit: Ali Daye)

Matthew is a strong proponent of the importance of people in every aspect of real estate. He reiterated how some of his best deals came through relationships that he had cultivated and maintained over years, many of whom came on board as investment or local partners. This people-focused mindset is a philosophy that was extended to assets under his custody as well. Building off the adage “people attract people,” he showcased how it was more beneficial to create usable space rather than an oversupply of parking, even in suburbia, and the long-term importance of a tenant that generated cross traffic, even if it necessitated short-term hiccups in eliminating tenant dark properties. He showed examples of property revitalization using the principles of placemaking to create active frontage by replacing garages with retail.

Regarding the company’s investment strategy, Matthew discussed how DRA used a value-add outlook in pursuit of contrarian investments, but most importantly ones that were cash-flow intensive. DRA concentrates on being good stewards of capital, ensuring that even in a downturn, losses would only be on paper, while the company remains cash-flow positive. This drives DRA to focus on secondary and tertiary markets instead of gateway cities. While these markets might not be quite as high-profile, they ensure a higher yield. In terms of asset management, DRA exacts an understanding of tenant requirements and re-invests in its properties to ensure higher tenant returns and consequently higher rents and longer leases.

Recording the Real Estate Review podcast with Ryan Sequeira and Rashaad Robinson
(Photo credit: Trey Duncombe)

When asked about his outlook on the market, especially considering changing demographics and the future of suburbia, Matthew opined that suburbs won’t decline because millennials desire a lifestyle along the same lines as older generations, only they push back their milestones to later in life. However, the demand from millennials is not as much for the quintessential suburban standard, but rather for a lifestyle that includes more experiential components, whether that means being near mass transit or with last mile connectivity. He believes that this shift in preferences should direct development and investment strategies in the near future. He also reiterated that the suburbs “build it and they will come” approach to compete with the city led to overbuilding some asset classes which are now coming to a short end.

On a personal note, Matthew regaled the audience with tales from his days at Cornell, including an enviable semester-at-sea. The Baker Program in Real Estate enjoyed hearing him speak at the Distinguished Speaker Series and thanks Matthew Shore for coming back to share his knowledge and experience.

Matthew Shore and his family with Baker ’19 and ’20 students
(Photo credit: Trey Duncombe)

DSS Wrap-Up: Barry DiRaimondo (MBA ’85), CEO of SteelWave LLC

Photo Credit: http://www.steelwavellc.com

On September 27, 2018, the Cornell Baker Program in Real Estate welcomed Barry DiRaimondo, Chief Executive Officer of SteelWave LLC, to campus as part of the program’s Distinguished Speaker Series.  SteelWave is a full-service real estate manager, operator and investor headquartered outside of San Francisco, California.  SteelWave’s portfolio consists of approximately 12 million square feet of office, industrial and multi-family properties.  Barry described for the audience how SteelWave specializes in properties that require a “heavy touch”, with SteelWave’s projects typically consisting of ground-up construction or significant remodels of existing buildings that allow the company to leverage its design-build expertise.

Barry has been with SteelWave and its predecessor companies for almost his entire career, joining after graduating with an MBA from Cornell’s SC Johnson College of Business.  SteelWave currently has approximately 170 employees and focuses on 6 core markets: Northern California, Southern California, Denver, Seattle, Portland and Texas.  As Barry explained, SteelWave was previously spread in many western markets before deciding to focus on these key markets for three (3) specific reasons.  First, these markets are generally desirable places to live.  Second, these markets feature a high concentration of technology companies.  And third, the demographics of these markets are favorable with populations that are getting younger.

Barry’s presentation included significant discussion of the types of office spaces that SteelWave is creating for its tenants, which include many technology and life science companies.  According to Barry, SteelWave is incorporating many elements from the hospitality and multi-family residential industry into its office products, including significant indoor and outdoor communal spaces.  When it comes to office space, Barry believes that what worked ten years ago will no longer work now, demonstrating this point by contrasting the architecture and amenities of office buildings that SteelWave constructed a decade ago with new neighboring office buildings that it recently completed.  Highlights of the new buildings include significant outdoor communal gathering spaces as well as the use of dynamic glass for the building’s exterior that allows tenants to adjust the amount of sunlight passing through each individual pane of glass in their space, resulting in lower utility bills and higher tenant satisfaction levels.

Photo Credit: Ali Daye

In addition, Barry’s presentation touched on many of the company’s past and future projects, including two (2) notable projects in Costa Mesa, California.  The first is a creative office campus known as the Hive that was recently constructed by the company and that now serves as the headquarters and practice facility for the Los Angeles Chargers.  The second is a former Los Angeles Times printing facility that SteelWave is in the process of redeveloping into unique creative office space.  Further, Barry took some time to describe a few projects in which the company faced unexpected development challenges, highlighting for the audience that there are some risks that cannot be easily discovered or underwritten.

While SteelWave’s primary focus has long been on commercial and mixed-use projects, the company has expanded its platform to include multifamily.  In the span of just a few years, SteelWave has created a pipeline of approximately 2,000 multi-family units.  Barry discussed the company’s focus on providing top-quality tenant amenities, including large common areas with attractions like golf simulators, to differentiate its projects.  Barry expressed excitement about the promise of this new platform for SteelWave.

Like many others, Barry believes that the real estate industry is closer to the end of this cycle than it is to the beginning.  According to Barry, SteelWave’s focus on great products in great locations provides the company with some protection against a downturn.  In his view, it is worth paying more for these kinds of assets because they will maintain more of their value during a downturn and regain their value more quickly as compared to assets of lesser quality in lesser locations.

The Cornell real estate community thanks Barry for sharing his time and insights.  It was a pleasure to have him back on campus, and we wish him and SteelWave continued success.

DSS Wrap-Up: Prashant Arul Raj (MPS RE ’00), Head of Guggenheim Commercial Real Estate Finance

This past Thursday the Baker Program had the pleasure of welcoming back to campus Prashant Arul Raj, Head of Commercial Real Estate Finance at Guggenheim Partners. Prashant is a graduate (MPS RE ‘00) of the Cornell Real Estate Master’s program prior to its sponsorship by Richard Baker. Having been back on campus for the first time since his graduation, he had a lot to say about how far the program has come since its origins in the basement of Sibley only a year before he came to campus in 1998.

During his  podcast interview with the Real Estate Review and subsequent session with all of the Bakers, we were able to dive into Prashant’s career after leaving Cornell and how he progressed through the years all the way to head of Guggenheim Commercial Real Estate Finance (“GCREF”). Prashant began as an analyst with Donaldson, Lufkin, & Jenrette a mere five months prior to its acquisition by Credit Suisse. Working in CMBS originations and sales, Prashant played an important role in the growth of Credit Suisse’s business as he progressed through the ranks in the run up to the 2008 financial crisis. After originating and selling some $108 billion in CMBS products during his time at Credit Suisse, Prashant joined Guggenheim in 2009 as Head of Commercial Real Estate Capital Markets and Special Situations.

Prashant was able to use his experiences during the financial crisis to move into the lending side of the business and executed a number of significant transactions for Guggenheim prior to being named head of GCREF. In discussing his day-to-day role, Prashant said he is now less focused on specific transactions and more focused on putting out fires and tackling specific items of importance within the business. Working with a $12 billion balance sheet sourced from a variety of insurance companies, annuity and family funds, GCREF originates about $2 billion in direct loans annually. According to Prashant, one of GCREF’s main advantages is its in-house servicing and asset management teams. GCREF maintains its loans to maturity and is able to tackle problems and meet the needs of its clients down to a very granular level. This has led to an impressive .5% default ratio across its lending portfolio in the last five years.

Discussing the current state of the lending market, Prashant noted that as the longest running real estate cycle to date seems to be near its peak, GCREF has become more selective in its lending patterns. It is becoming much more wary of Class A multi-family investments and student housing, but still holds strong beliefs in the industrial sector, specifically distribution centers fueled by the growth of online shopping. While he acknowledged that the lending market has become more competitive, which is squeezing price and credit, terms have not necessarily changed. What he is looking out for is more leaps of faith in underwriting in the way of pro-forma cash flows. In reaction, GCREF has lowered its LTV ratios. However, due to GCREF’s position as a strong balance sheet lender, Prashant said he is not under any pressure to deploy capital, unlike many of his competitors. If the market were to turn, it would be able to turn with it.

In his closing remarks, Prashant offered his thoughts on risk, capital, and incentives moving forward:

  • When it comes to risk, possess an “informed intuitiveness”- know your risk appetite. Your premium may be different than the market, and that is okay.
  • For capital, most investment decisions are based on the capital you are deploying, not the investment opportunity. Understand two things: what are the costs and what incentives does it drive? (i.e., what makes it flow, what makes it go?)
  • As for incentives, understand what drives your decision-making and the decision-making of those around you. You will have more success if you understand other people’s incentives and motivations better than your own.

The students and faculty of the Baker Program thank Prashant for sharing his engaging story and experiences as a guest of the Distinguished Speaker Series and look forward to future visits.

 

DSS Wrap-up: Joe Levine ’02, Managing Partner – Mercer Street Partners (5 mins)

The week’s Distinguished Speaker Series marked another example of how this series highlights the power of a Cornell education and the many places it can take you. For this iteration of the series, The Baker Program welcomed back to campus Hotel School alum (SHA’02) Joseph Levine, who, since leaving Cornell, has gone onto cofound Mercer Street Partners, a private investment and advisory firm. Levine founded Mercer Street Partners in 2016 with his other two partners, and in that short time, the company has already amassed a respectable portfolio of properties.

Being a proud Cornellian, Joe was happy to be back on campus and share the trajectory of his career since leaving Cornell. Joe is a dynamic individual with a plethora of interests that extend beyond the success he has had in the real estate industry. This was quickly evident as he sat down to be interviewed by The Review team for an interview that will hopefully be developed into The Review’s new podcast series. Upon sitting down, Joe gave us a few audio pointers from his production experience, given the fact that this is our first foray into recording podcast.

In that interview, Joe walked us through his career, which started at Loews Hotel, where he spent a year in an auditor/analyst role that he considers pivotal in setting a foundation for him. After realizing that he didn’t want to continue a career in food and beverage management, he seized an opportunity to go to Chartres Lodging, where he was only the small company’s second hire. During the time he spent at Chartres, he helped the company grow its portfolio significantly to reach over $1.5 billion in value.

With success in hotel asset management and the desire to explore different asset classes, Joe eventually ended up atUnited Realty Trust, a non-traded public REIT. During his time at United, he helped grow the company’s portfolio from $50 million to $220 million in assets as Head of Acquisitions. At United he also worked with the two men with whom he would go onto found Mercer Street Partners, Milan Parekh and Alex Libin.

Joe sitting being interviewed for The Review podcast by Ali Daye, Peter Romano & Julian Karel (Photo Courtesy: Ali Daye)

During his presentation, in addition to walking students through his career, Joe imparted several pieces of advice that he called his Rule to Success. Most notable was the idea of “authoring your 0wn story.”He urged students to choose and write their own paths and to not let others choose your path for you. He gave examples of how in his career, he has been able to branch out into other areas of interest, such as the time he spent working on real estate deals by day and working as a standup comic by night.

Joe imparted many other pieces of wisdom such as “seize opportunities to work with smart people” and “in every crisis there is an opportunity”. He also expanded on how the service mentality that he acquired while in the Hotel School has allowed him to be successful in the asset management space by creating a service-based experience in the properties MSP acquires.

Since its founding in 2016, Mercer Street Partners has developed a portfolio with an aggregate value of over $125 million of commercial real estate and is continuing to grow. Due to this growth, the company is investing in people who can add value. Second-year Baker student Dustin Dunham had the opportunity to work there over the summer and said, “My experience at Mercer Street Partners was wonderful. Having the opportunity to work with such a talented team of partners really shaped my perspective of what it takes to be successful in the asset management space.”

The students and faculty of the Baker Program in Real Estate thank Joe Levine for coming back to Cornell and sharing his wealth of experience.

(Photo Courtesy: Ali Daye)

DSS Wrap-up: Derek Olsen (Class of ’92), Senior Vice President with CHMWarnick (5 mins)

Derek Olsen   –  Photo Credit: CHMWarnick

On Thursday, September 6, 2018, the Baker Program in Real Estate had the privilege of hosting Derek Olsen, Class of 1992, for its Distinguished Speaker Series (DSS).  Derek is a Senior Vice President with CHMWarnick (CHMW).  CHMW is a highly regarded hospitality asset manager and provider of owner advisory services.  Derek’s responsibilities include overseeing “financial modeling and valuations associated with the firm’s value enhancement, lease negotiations and redevelopment strategies.”[1]  During his visit Derek wowed students with reflections on his career trajectory, overviews of exciting CHMW projects, discussion of challenges and opportunities facing the hospitality industry, and advice for professional success.

Derek quickly captivated the attention of DSS attendees with a presentation slide titled “adapting to change.”   Featured prominently on this slide was a chart showcasing “U.S. Hotel Performance, 1989 – 2018” overlaid with symbols signifying key milestones in his academic and professional life.  It became readily apparent that many of Derek’s achievements, accomplishments such as graduating from Cornell, completing his Master’s degree at MIT, and even starting new jobs, occurred during downturns.  Derek went on to state that forging a successful career in the real estate industry requires adaptability and a willingness to apply your skillset to new areas of focus.  With this segue, Derek shared about his diverse work experience in the areas of appraisals, feasibility analysis, brokerage, acquisitions, and restructuring.

Derek Olsen presenting at DSS   –     Photo Credit: Ali Daye

Through his work with CHMW, Derek has provided development advisory oversight for many prestigious hotels throughout the United States.  Derek showcased several example projects during his presentation to expose students to the vast array of services that development advisory work entails.  The Candler Hotel Atlanta, part of the Curio Collection by Hilton, was the first example discussed.  This 265-room hotel is scheduled to open in March 2019.  CHMW is providing lead hospitality advisory services for the hotel and will serve as the asset manager upon project completion.  As an advisor, CHMW has assisted the client with tasks such as concept development, facility programing, management and brand selection, developer selection, investment analysis, and due diligence. Since this project involves the conversion of the historic Chandler Building, CHMW also assisted the client with securing Historic Tax Credits.

Through its advisory work, CHMW is often at the forefront of innovations within the hospitality industry.  Its work on W & Element Hotel, a dual-branded hotel underway in Philadelphia, PA, is a keen example of this.  CHMW serves as the lead development advisor and anticipated asset manager for this project.  Once complete, the W & Element Hotel will boast 755 rooms and 45,000 SF in meeting space.  The hotel will also contain separate lobby areas and amenities for each brand.  Students were very intrigued with this project, which, for some, was their first exposure to the dual-branding concept.  Derek went on to explain that dual-branded hotels can be a great way to increase an asset’s occupancy, create operational efficiencies, target various market segments with a single asset, and diversify product offerings as a hedge against economic downturns.

Rendering of the W & Element Hotel Photo Credit: Tierney Agency

During the question and answer portion of the discussion, students were curious to learn Derek’s perspective on the biggest challenges and opportunities facing the hospitality industry.  In response, Derek shared that securing adequate labor is a significant hurdle for the industry.  Historically low unemployment rates, rising labor costs and turbulence in the immigration system have all culminated in an environment that makes it hard for hotels to maintain adequate staffing levels.  In discussing opportunities within hospitality, Derek highlighted how advances in artificial intelligence (AI) are changing how hotels operate.  Examples of this shift he cited were growing use of self-check-in kiosks, robotic vacuums, and applications of AI for security.

Derek concluded his presentation with sage words of advice drawn from his 20 plus years of experience in the real estate industry.  This advice included:

  • Develop broad-based skills to help you navigate through all phases of the real estate investment cycle.
  • Listen to your lawyers and other business advisors – you are paying them because they know more than you do.
  • Real estate is not rocket science, success is largely driven by how hard you work.
  • Create projects that you are proud of and make the built environment a better place to live, work and play.
  • Give back to the community and stay involved as alumni whenever you can…it’s your biggest network.
  • And most importantly…enjoy the ride!

The Baker Program in Real Estate tremendously enjoyed Derek’s visit and is incredibly grateful for the time and valuable insight that he shared with students.

 

[1] “Derek Olsen.” CHMWarnick, https://chmwarnick.com/team-member/derek-olsen/.

DSS Wrap-up: Spencer Levy (IRL ’92), Americas Head of Research at CBRE (3 Mins)

 

Spencer Levy (ILR ’92) – CBRE

On Thursday, August 30th, 2018, the Baker Program’s Distinguished Speaker Series was honored to host its first speaker of the new school year, senior member of CBRE’s global research team and Americas Head of Research, Spencer Levy (ILR ’92).  In his position at CBRE, Spencer serves as the principal external spokesperson on real estate issues in the Americas region and frequently makes appearances on financial news outlets. He is a leading voice in commercial real estate and students were excited to welcome Spencer back to campus.

The theme of Spencer’s presentation was largely about the major economic trends impacting commercial real estate asset classes. As the inaugural speaker for new first year Baker students, the opportunity to learn about trends shaping the future of real estate was truly an eye-opening experience. From defining the macroeconomic forces behind the urban renaissance that local business is currently experiencing, to describing the new desire for a “Live, Work, Play” environment in the work place, students and faculty gained valuable insights into the future of the built environment.

Chris Trahan (MPSRE ’19)  Spencer Levy (ILR ’92)

Spencer’s entertaining and engaging presentation style combined with his deep market knowledge and multi-disciplinary approach to serving clients stands out among industry leaders, but his ability to relate and build connections shone brightly. At one point in his presentation, he played a clip of an appearance he made on the game show, “The Price Is Right” with Bob Barker, a first for any speaker in the Distinguished Speaker Series.  The clip served to highlight his ability to connect as footage showed him trading jokes with the television show host at a young age.

At the end of Spencer’s presentation, he tied the themes of his talk together with career advice for students graduating in the next year. His advice is to think carefully about the risk and reward tradeoff in terms of career decisions. After surveying the room, Spencer suggested that some students might be best served by considering “sell-side” jobs to learn market fundamentals as he did.  He also suggested that students focus on learning underwriting fundamentals, building relationships and gaining experience working with investors across economic trends.

The students and faculty of the Baker Program in Real Estate thank Spencer for coming to Cornell and sharing his vision with us. His captivating presentation and economic insights created a powerful foundation to begin the new semester.

DSS Wrap-up: Richard Baker (SHA ’88) Governor and Executive Chairman of the Hudson’s Bay Company

 

Richard Baker Photo Credit: Archie Preissman

Last week the Baker Program was honored to have entrepreneur, philanthropist and the namesake benefactor of the program, Richard Baker, on campus to meet with students in the Distinguished Speaker Series. As the final speaker for the class of 2018, Richard shared his remarkable entrepreneurial story and offered parting wisdom to the to the graduating class.

Richard’s classic story of finding a market, becoming excellent at a strategy and sticking to core principles along the way resonated well with students, but Richard’s eye for art and curating a bigger vision within his work revealed a deep passion and not just a process. 

It was a great privilege to have many distinguished speakers like Richard Baker this year. Those that have had the privilege of attending the Baker Program in Real Estate and Cornell University wish to extend our sincere appreciation to Richard for his dedication to furthering graduate real estate education at Cornell.

Richard Baker Photo Credit: Julian Karel

 

DSS Wrap-up: Ken Himmel, CEO Related Urban (5 mins)

Last week the Baker Program hosted one of the most inspiring presentations of the year as it welcomed Ken Himmel ‘70, CEO of Related Urban. Himmel, who is an accomplished Hotel School alum, spoke to students about the importance of placemaking and curating unique experiences through real estate.

Himmel took students thru his career at Related that began one memorable afternoon with a phone call from Related Chairman, Stephen Ross. In that call, Ross asked Himmel to fly from his home in Boston and have dinner with him in New York that very evening. Ross told Himmel that once he listened to what he had to tell him, he might not want to go back.

During that dinner, the two began to conceive the initial plans of what would eventually become the Time Warner Center. At the time, New York’s West Side was void of any significant activity and the site of the former New York Coliseum. When Ross and Himmel sat down to formulate their plan for the site, they were already late to the party. Eight other notable development firms had already come up with plans for the site.

After that initial dinner, the two convened a team that worked for six straight weeks to develop the programming concept that would eventually lead them to landing the project. One notable aspect of their proposal was securing Time Warner as their anchor tenant, who at the time was leasing space in Rockefeller Center that provided no cache for the media giant. Through a mutual friend, they were able to schedule a 45-minute meeting with Time Warner CEO, Richard “Dick” Parson. By providing a unique programming concept, an hour and 45 mins later, Parsons agreed to sign on to the project, although he had already been pitched to by the other eight developers who were competing for the site. A week later, the Related team had an official commitment letter from Time Warner Corporation.

Himmel used this story to underscore his “hospitality programing” approach towards development. Throughout his talk he emphasized the importance of great programming and creating a vibrant sense of place. By creating well curated environments for people to work, live, play and shop, Related has the ability to solicit top tier tenants.

Himmel told students about how learning hospitality at Cornell’s Hotel School gave him the perspective he has taken throughout his real estate career. He walked students through other Related projects that emphasized the “hospitality programming” philosophy that he applies to all of his projects; like CityPlace in West Palm Beach, The Galleria on Abu Dhabi’s Maryah Island and The Grand in Downtown Los Angeles. He also took students through Related’s current flagship project Hudson Yards, the largest real estate development in US history.

Being a loyal “hotelie”, Himmel spent his time engaging with not just Baker students. After his DSS speech to the Baker students, he was off to have dinner with other students from the Hotel School. The next morning, he held an intimate session with less than a dozen students from the Baker Program and the Johnson MBA program, where he went in more depth about some of the specific programming examples that gives Related its unique approach towards development. Immediately following this session, he made time to speak in private to the undergraduate real estate club. Later that afternoon he gave a speech, open to all, in the Statler Auditorium.

Ken Himmel’s approach towards development provided a refreshing perspective. Throughout his entire visit to campus he emphasized the important role that design, and creativity have in development.  He also noted how critical it is to spend the right amount of time and resources to develop the right programming for a project. It is that philosophy that has allowed him to attain so much success throughout his career.

The students and faculty of the Baker Program in Real Estate thank Mr. Himmel for coming back to Cornell and sharing his wealth of experience.

DSS Wrap-up: Daniel Zelson, Co-founder and Principal of Charter Realty and Development (5 mins)

On Thursday, April 12, 2018, the Baker Program of Real Estate had the privilege of hosting Daniel Zelson, (A&S ’88), for its Distinguished Speaker Series (DSS).  Dan is Co-founder and Principal of Charter Realty and Development.  Charter is a real estate investment, development, and leasing company that specializes in retail properties.  During his visit Dan shared with students about many interesting topics including Charter’s retail strategy, signature projects completed by the firm, and an ongoing project taking place in Ithaca, NY.

Dan kicked off his visit over a lunch conversation with three Baker students.  During this meeting Dan discussed Charter’s successful value-added retail investment strategy.  With this approach, Charter looks for underperforming retail assets that can be repurposed with more profitable uses.  In recent years much of this strategy has involved the properties of big box retails such as Kmart and Sears who have been off-loading locations.  Students were surprised to learn that profiting off of the value-added retail strategy does not always require purchasing the underlying asset.  In many cases, effective arbitrage of the deal can be achieved by simply buying out the leasehold interest of a property.  This was eye-opening perspective for many of the students present.

Later that day, in an interview with the Cornell Real Estate Review, Dan shared about his experiences as an entrepreneur.  His initial foray into entrepreneurship occurred in college when he and classmate Richard Baker devised a plan to open a chain of chicken wing restaurants.  After months of meticulous planning and taste testing lots of wings, the plan fell through when the landlord of the retail space they rented for the venture filed for bankruptcy.  Dan went on to begin a successful brokerage career at National Realty & Development Corp. but the desire to be an entrepreneur never left.  Eventually he and National Realty colleague Paul Brandes founded Charter in 1993.  Dan acknowledged that starting out was a challenge.  With limited capital, Dan and Paul had to rely on their brokerage background to get the business up and running.  Eventually they were able to convert leased spaces into assets that they own and the business took off.  Dan credits the brokerage arm of the business for much of their success stating that “retail business is about tenant knowledge.”  As a broker, Charter gains unique insight into retail trends that inform the company’s investment and development decisions and give it a competitive advantage over competitors.

Over the years Charter has established a reputation for creating iconic mixed-used destinations that serve as community anchors.  During the DSS presentation, Dan introduced students to several key projects that have solidified this reputation.  The first project discussed was Bedford Square, a mixed-used development located in Westport, Connecticut.  This project took ten years to complete.  The development includes ground floor retail with two-story townhomes above.  With this project, Charter faced the challenge of providing invigorating programing for downtown Westport while maintaining the historic character of the site.  Not only did the project involve complete renovation of the historic Bedford Mansion and Firehouse built in the 1920s, but it also required preservation of the historic Kemper Gunn House.   This proved to be a major feat that involved moving the historic Kemper Gunn House offsite, winning a city sponsored request for proposal (RFP) used to award ownership of the house, and subsequently negotiating a $15,000 per year ground lease to locate the property on a city owned parking lot near the Bedford Square site.  Despite the many challenges, the Bedford Square development was a tremendous milestone for Charter.

Source: Charter Realty and Development

The success of the Bedford Square project was a catalyst for Charter’s emergence as a preeminent developer of mixed-use projects in college communities.   The Storrs Center development near the University of Connecticut (UConn) in Storrs, Connecticut is perhaps the most well-known in this genre.  This project transformed a nondescript strip mall into a vibrant community center.  The completed development includes 11 mixed-use buildings containing 626 apartments, 42 for-sale townhouses and condominiums, 139,707 square feet of retail and office space, a 600-car parking garage, and community green space.[1]  Charter was involved in development and leasing of the retail portion of the development.  During the DSS presentation, Dan noted the success of this project was not just tied to the performance of the asset but also drawn from the positive relationships achieved with project stakeholders such as school officials and local government.  These success factors have led to Charter working on similar projects at Yale University, Mississippi State University, North Carolina A&T University and most recently Cornell University.

Storrs Center
Source: Urban Land Institute

Dan concluded his presentation with an overview of East Hill Village, a redevelopment project Charter is taking on near Cornell campus.  Charter was selected as the developer for the site through an RFP process conducted by Cornell.  In describing the existing area, the Cornell University Master Plan states:

“East Hill Plaza and its surroundings sit at the important southern gateway to Cornell and have become an integral part of the campus while continuing to function as a neighborhood commercial node. The area, however, has developed in a piecemeal, auto-oriented fashion and lacks an identity and attractive image. Given that much of the area is owned by Cornell and is close to Core Campus, it has the potential to become a unique place and community that functionally supports the core and enhances surrounding neighborhoods.”

The goal of the East Hill Village development is to transform the area into a main gateway into Cornell campus.[2]  Following DSS, several Baker students had the opportunity to attend the final day of a community design charrette for the development.  In discussing the East Hill Village project, first-year Baker student Ali Daye stated that “it is awesome that Baker students will have the opportunity to see a major development unfold right in our backyard over the next couple of years.  This project will give us a great opportunity to gain first hand exposure to the development process.”

Rendering of East Hill Village
Source: David Csont/Urban Design Associates

 

The Baker Program in Real Estate truly enjoyed Dan’s visit and is incredibly grateful for the time and valuable insight that he shared with students.

[1] See https://www.bararch.com/project/cornell-east-hill-village.

[2] See https://casestudies.uli.org/storrs-center/.

 

DSS Wrap-up: Alumni panel (5 mins)

The alumni panel for the Distinguished Speaker Series for 2018 had the following Cornell alumni talk to students about their success in the industry:

 

Jonathan Cohen ’10

Jonathan has been in the real estate and construction industry for over 12 years. As a builder, Jonathan has overseen over 400 million dollars of construction including, residential, commercial, retail, hotel, education, healthcare and multifamily projects. After receiving his Master’s Degree from Cornell, Jonathan spent the next 5 years working for two highly regarded Connecticut-based developers, RMS Companies, and Spinnaker Real Estate Partners.  As a team member, he was able to participate in, construct, manage, lease, market or sell over 600 million dollars of real estate before forming J. Forrest Development, LLC.

 

Rob Dunn ’10

Rob has worked in portfolio management, due diligence, acquisitions, asset management, and lease negotiations since graduation in 2010. For almost 3 years after graduation, he worked as an associate at Long Wharf Real Estate partners working with value-add equity investments in primary and secondary U.S. markets. In 2013, Rob transitioned to Hubb NYC as a Director in the Property Management division. In this role, he manages residential and mixed-use properties in New York.

 

Sarah Brown ’10

Sarah graduated from Cornell with a dual MBA and Master’s in Real Estate degree in 2010, as well as a Bachelor’s degree in Industrial and Labor Relations in 2004. While at Cornell, Sarah was President of the Strategic HR, Leadership, and Organizational Effectiveness (SHRLOE) Group and Co-President of the Associate Real Estate Council (AREC). Since graduation, she has worked in various human resources roles for Bank of America and TIAA. For TIAA she has worked as Director and Sr Director HR Business Partner in Institutional Investment Products. With Bank of America, Sarah was an HR Manager for Consumer Real Estate Services and Consumer Marketing.

 

Khari Buck ’11

Khari has worked for multiple companies on corporate real estate strategy since her graduation from Cornell in 2011. From 2011 to 2013, Khari was in the Construction and Real Estate Advisory Services division of EY. Since that time, she has worked with CBRE in portfolio strategy for the MUFG Union Bank account and, more recently, the McKesson account. In that role, she has worked to transform the client’s workplace efficiency and helped to maximize retention and productivity. While at Cornell, Khari was a Co-President of AREC and was actively involved in Cornell Real Estate Women.

 

Ian McKay ’11

Ian McKay is a member of the Portfolio Management team at Clarion Partners, a real estate investment manager with more than $44 billion in assets under management. Clarion invests in a broad range of real estate strategies across the risk/return spectrum and across the major property types. Ian manages projects for the firm’s value-add and development funds, which currently include active investments in various multi-family, office, industrial, and retail projects, with a weighting toward multi-family investments. While at Cornell, Ian was involved in AREC and was an assistant editor of the Cornell Real Estate Newsletter.

 

The panelists began the talk by asking the students to introduce themselves in order to cater the advice towards their career interests. The panelists then gave a brief about their professional journey and explained how the Cornell education helped them pivot or continue in the pursuit of their respective aspirations. Ian explained how his background in construction helped him climb the corporate ranks at Clarion Partners as a portfolio manager for the development and value-add fund. Khari talked about her work in corporate strategy work, workplace strategy and portfolio optimization which has helped her in advising some of the largest clients in the country. Rob leveraged his education and position at Fidelity to currently work at Hubb NYC in acquisitions and asset management in Manhattan for retail and multifamily properties.  Jonathan’s current role requires him to draw on his prior experiences to conduct development, residential & commercial construction and consulting assignments for different asset types. Sarah explained her decision to choose TIAA as her job out of the Cornell MBA and Masters. The mission of TIAA was actually founded at Cornell where the professors needed to be provided financial stability post-retirement. TIAA manages 1 trillion dollars for over 15,000 institutional clients and is the 3rd biggest asset management company in real estate globally. Sarah supports the supports the team that makes the institutional investment products at the company.

The panelists were then asked to reflect on how the financial market and job market performed at the time of graduation and how they dealt with the challenges. The answered unanimously saying that industry is cyclical and coming into a recession taught them how one can protect yourself in a downtown and create opportunities. This learning will be valuable throughout their careers. Sarah advised students that another important consideration was the level of risk one was comfortable with, given the scenario.

Ian mentioned that if you willing to put your mind to it, success will come to you and patience in the long term always works. Sarah talked about how her first job at Ernst & Young helped her discover new skill sets. She enjoyed the problem-solving aspect and learned a lot in the process. Rob advised students to be humble in the way they approached the job market and future opportunities. Jonathan pursued development after school and grew that experience to build the requisite expertise to set up his own company. Sarah had her 1st internship with Macquarie in a property capital advisory role in the US and the 2nd internship in Sydney. She enjoyed the asset management role and looks forward to meshing her passion with the HR career.

The alumni talked further about their careers and future goals. Ian praised the culture and team members at Clarion partners and is inclined to grow within the organization. Khari talked about the various paths people could take to build on a corporate real estate career. Rob talked about the phenomenal growth Hubb NYC has had over the last few years which has also helped him grow quickly in his career. Sarah mentioned that she has the opportunity to work closely with senior people with TIAA on complex engagements and succession planning. Jonathan mentioned the level of responsibility that comes with running his company is high. Most of his development projects are speculative, equity is tied up for a long period. One has to continuously execute and know the facts for the market forward and backward.

Comparing the size of organizations, the panelists agreed that in smaller companies, personalities run through. In a smaller shop, it is great to get perspective from other departments. Culture is incredibly important. One performs better when you like the people you work with irrespective of the size of the organization.

 

 

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