So, I am building quite a nice business with real estate investors.  I am happy working with residential investors, but very quickly realize that a $150,000 residential deal is almost the same amount of work as a $900,000 commercial deal.  Now, greed isn’t the driving force here, but making enough to be comfortable is.  I decided to do some research and determine if I can do commercial real estate easily or is there some sort of learning curve.  Turns out any licensed person can act as an agent for commercial real estate in our state.  The problem I have is whether I will get a client or myself in trouble because of my inexperience with this animal. 

I hit the books and online resources.  Learned a lot about the business and decided I wanted to get into commercial real estate as well.  Turns out the analysis is quite a bit different because the tax benefits, expenses, and other business points are a little bit different.  Well, I start advertising myself as a commercial real estate agent and I get my first phone call.  An out of state daycare operator is looking for 12 sites in our state to operate a daycare.  They need someone on the ground in our state to find the sites and they will do the rest.  My commission would be protected and we would split it 50/50.   Whoa! 

I got the information on the parent company and hit the ground to find the sites.  Well, I met not only with land owners, but also developers in trying to find sites that will accomodate this type of use.  I quickly met with some heavy hitters in our area who develop property.  I made great connections and was happy to meet with some very wealthy and well-connected people.  I worked for about 9 months and had negotiated a couple of sites – with no luck.  The terms weren’t favorable for these sites because the cost of construction was rising and retailers were willing to pay more to do the deals. 

Here are some things I learned from this.  I absolutely love commercial real estate.  The dollar values are much higher and the deals are much more fun to analyze.  I met with a local developer who was just ramping up his business.  He liked that I was working with some bigger companies and he decided to have me represent him.  I was thrilled.  With two meetings with this guy, I was able to land 4 new listings worth more than $3 Million total. 

Through another contact, I was able to meet with and land a client selling some price vacant land in a much larger development anchored by 2 major retailers who combined took up more than 300,000 sqft of space.  I was in the big leagues now.

One of the parcels I listed with the small developer was a strip center of about 13,000 sqft.  That center drove so many phone calls that kept me busy.  I developed a very nice marketing package for the building including demographics, profit analysis, etc.  I felt like my business was really taking off now.

I also was developing quite a reputation in my firms office as a wealthy person.  The problem was I wasn’t closing any deals.  I was very active and I was listing properties and meeting people and negotiating stuff, but I wasn’t getting deals under contract and therefore to a close – payday.  Our firm is a residential real estate firm and I stood out as the only agent who dedicated his time to commercial real estate.  People thought I was some hotshot agent, but management knew I wasn’t closing anything.  I didn’t know how to move things along.  At one point, I was negotiating more than $6 million in deals which all subsequently fell apart.  Not due to any particular problem, but more the nature of the changing economy and the terms of the deals. 

Then I met Dave.  Dave is a broker from a commercial real estate firm who I tried to negotiate a site for one of the daycare centers.  He was working on some very nice upscale lifestyle centers in a wealthy part of town.  He also was a small-time developer who did mostly single building redevelopment projects.  Dave is a very well-spoken and intelligent person who has a no nonsense approach to business. 

We met a couple of times about various projects as well as the time we were negotiating the daycare center site.  One day, he calls me to invite me to lunch.  I gratefully accept and we meet.  During this meeting, he tells me about a very nice project he is about to get moving.  I agree that it seems like a great opportunity.  He then shocks me by asking me join his firm to get the project moving. 

My mind went blank.  I didn’t expect this and was quite honored.  I met with him one more time to discuss the details further.  I joined his firm.  Now, I am 100% dedicated to commercial real estate. 

Cool!

What became clear quickly was the training in our office neglected to go through what to do to negotiate a contract.  Rarely, does it happen this way, but we were in the finished basement of the home my clients wanted while the sellers and their agent were upstairs.  We agents were running up and down the stairs negotiating the deal while our clients relaxed in the home.  We had an agreement and I didn’t know what to do next.  I discreetly wet upstairs and pulled the other agent aside and asked her how to finalize the deal.  She was very supportive understanding it was my first deal.  She walked me through the earnest money situation and finalizing the deal.  Turns out she is the managing broker at her firm and was very eager to help out new agents.  Was I lucky!  It could very well have gone badly and I could have been exposed as a potential risk to my clients. 

At the time, I didn’t realize it, but my training at the firm did prepare me for prostecting my client’s interests.  For that, I am grateful.  I have heard horror stories from other agents about training under fire and screwing up deals. 

So, now I have a deal in process.  I am sitting in the office and an up call comes in for one of my coworkers.  He was frustrated in trying to understand this person and I could tell.  Finally, they told the receptioninst they were sending the call back to the front desk as the agent couldn’t work with them and didn’t think they had any money anyway.

Well, the front desk asked me to try, so I was happy to give it a shot.  I got on the phone and this wonderful asian woman was asking about a home very close to our office.  I hopped in the car and met her there to walk through it.  She seemed interested, but very non-commital.  I didn’t know what to make of it.  Was this a cultural thing, was it a negotiating tactic, was she really just wasting my time?  We parted ways saying I would dig up some more information on the property.  In the meantime, the agent who listed that particular property was asking for someone to sit the open house on the weekend.  I volunteered.  The weekend came and I was sitting at the home.  Here comes that same asian lady and her husband.  They walk through the home and I just happened to finish compiling the information for them.  I presented it to her there at the home and she must have been impressed because we wrote up an offer right there on the home. 

Whoa!  Two deals going within two weeks and I had only been with the firm for a month.  I was on a roll and I was unstoppable.  I loved it.  I hadn’t even begun my prospecting yet.  People in the office were a little miffed at my success out of the gates, but I really don’t pay much attention to that stuff. 

Very early on, it became clear who the complainers were in the office and I avoided them like the plague.  Negativity wasn’t going to creep into my mindset from others – I was determined to keep it that way.

So, the first of the two deals closed.  I carried the title company check to my office and presented it to them.  I couldn’t wait to get my check.  Payday!  I got my check and my jaw dropped.  What the…?!?  I went to my managing broker to discuss why the company took so much of my check.  Turns out there are a whole list of fees they get for the pleasure of me doing business through them.  Franchise fees, insurance fees, transaction fees, lead generation fees, company splits, etc.  The list was endless.  Basically, I ended up getting roughly 27% of the total company split. 

To put that into perspective, lets say the home was $400,000 and the commission was 5%.  The firms split that – each getting 2.5% or $10,000.  I brought home a little more than 27% or  $2,700.  

How the hell am I going to make a living bringing home such small checks?  I would have to do two transaction a month for the whole year.  I ratcheted up my goals – began prospecting – and began showing homes. 

Well, the business didn’t get much better.  I total, I closed 7 transactions in my first full year.  I brought home a little bit and it helped the household, but didn’t get us to the point where I was making a solid living.  To add insult to injury, I was working with a lot of buyers as my prospecting for sellers was inconsistent.  There is an old adage about buyers – “Buyers are Liars”.  I can’t tell you how many people I spent time with who either weren’t ready to commit or couldn’t come up with a downpayment to get the ball rolling.  In some cases, people were just killing time or “tire kicking”.  I remember working with a couple to show a series of 8 homes one day.  The found one they liked.  Then asked me to set up a showing in a another neighborhood for 6 more homes.  I did as they asked and showed them.  They found another one they liked.  I spent two full days with them showing homes.  When they decided on a home, they called up a buddy of theirs who is a realtor to actually handle the deal.  I was totaly screwed on that.  I could have fought for my share of the commission for showing them the home they ultimately bought, but I didn’t have confidence in my business yet to know whether I would win.  If it were today, I would have filed a complaint with the state board and would have received a judgement in my favor. 

Anyhow, I was rapily becoming bored showing properties with people who weren’t going to buy anything.  I got a call one day from that very nice asian lady who I sold my second property to.  She wanted to buy another one.  I didn’t realize it at the time, but she was an investor who buys rental properties.  I jumped at the chance to show her another one.  In fact, once I realized she was an investor, I did my best to show her a spreadsheet I created with income projections from this property.  She wasn’t impressed.  She just wanted the property.  Well, she already had a maximum price in mind.  We began negotiating and came within $2000 of each other before both sides decided that was enough.  My client wouldn’t come up any more and the sellers wouldn’t go down any more.  I couldn’t believe we lost a deal with only $2000 difference.

I returned to my office to sit and think about this.  I also realized I got a charge out of this type of deal.  It was very logical and she taught me to stick to the numbers.  If the numbers work, then do the deal.  If the numbers don’t; walk away.  Holy crap.  I really liked this.

I did try to get the deal moving again with no luck.  I did however change my prospecting from buyers and sellers to focus now on investors.  I was now working with 2 investors pretty regularly and the business was challenging but growing.  I liked the logical approach.  I liked the numbers and learning what things the investors look for.  I was having fun again and I was working with people who could get the deals done.  I also didn’t have any more opportunities fall apart because the color of the carpet was wrong.

Next time:  Real Estate investors are cool!

I happened to be cruising through the employment ads in the newspaper and saw an ad for a real estate company.  It seemed like it might satisfy my entrepreneurial side, so I made an appointment to talk with their broker.  Well, the broker had me thoroughly convinced that this would work for me.  With my detail oriented work practices and my high comfort with technology, as well as my sales experience, I should do very well in this business and I would be self-employed.  Oh, glorious words “Self-Employed”.  Working for myself.  No boss, no corporate structure.  No HR department hovering overhead threatening some re-training course for some innocuous infraction for which someone else felt threatened.  (It didn’t happen to me, but the department certainly makes you feel like you are guilty before you do anything wrong.)  So, I went home and explained to my wife about my new career choice. 

My wife deserves a little historical information.  She is a bookkeeper/accountant by trade.  She is incredibly good at it and really loves the work.  She can sit for hours and pour through numbers until she finds a missing three cents in her reports.  Well, that personality type comes with its own challenges.  She loves her routines.  She isn’t very spontaneous; she is methodical and spends a lot of time considering things. 

She is not an entrepreneur.

“What do you mean, there’s no salary?” were my memory’s recollection of her response to my chosen direction.  “How do you expect to bring in money?”  We had this conversation before when I interviewed with a computer networking company.  They had offered me the position, but with no salary.  It was 100% commission and at the time, I wasn’t convinced their product would be salable in this market.  So I kept looking for something more definite.  Comfort.

Well, we sat down and figured it all out.  The unemployment would keep paying us for several more weeks.  During which time I would take my real estate classes, take the test and get my license.  After that, I would have some time to set up my marketing and begin getting clients.  By the time I closed my first transaction unemployment would be running out and the timing would be perfect.

So, she was convinced – as was I – that this would work out exactly as I planned. 

I got my course materials, studied very hard and put a lot of hours into getting it right.  I heard the test was full of minute details that cannot be overlooked and I studied with that in mind.  I took some sample tests.  The first sample test I took, I received 72% correct.  A passing grade for the licensing exam, but not good enough.  I studied harder and learned more details.  The next sample test garnered me a 84% correct.  Much better, but I still had time before the licensing exam and I spent it learning more details.  The day of the licensing exam came.  I showed up at the licensing location, gave them all my info to prove I was who I claimed to be.  I sat down at a computer and proceeded to bang out the answers to the test.  One person finished before I did which really put the pressure on.  I struggled to focus on the exam because my mind was wondering if I was getting answers right or was I falling into the trap of trick questions.  The licensing exam is incredibly detail oriented and many of the questions deal with legal and practical issues that arise for which the logical answer isn’t necessarily the right thing to do.  You need to remember real estate law and apply the law to find the solution.  Well, my mind was reeling with the possiblility of failing the exam because of some obscure law that I forgot; or some terminology that I mixed up dealing with Joint tenancy or tenants in common and rights of survivorship.  I started to shake a bit and I remember wondering if I should just get up and leave.

I finally got hold of my attention again and was able to refocus on the remaining questions.  I answered them; finished the test; then quietly left the room to await the results.  I waited for about 5 minutes when they finally called my name so I could retrieve my results.  I passed.  When you pass, they don’t give you a score or a percentage or a fanfare with a brass band.  They only tell you that you passed.  If I had failed, I would have been given results indicating where I needed to study more and which topics I should focus on.  I did however receive my temporary license form which needed to be filled in by my new broker. 

Off to the brokers office.  I met with the broker where my form was signed; I went over numerous brokerage forms and discussed compensation (commission) packages.  I chose a package that worked for a new agent and I was off and running.  Show up on Monday morning to get acclimated and learn the routine.

Call my parents.  Everyone is excited.  I am independent.  I am an entrepreneur.  I am self-employed.

I am scared.

And wait.  And wait some more.

No calls.

Rework the resume, re-post it.  Same result. 

Resume services, job hunting services, unemployment office assistance, job hunting networking groups. 

Nothing.

So, now that I was thoroughly disenchanted, it was time to examine what I really wanted to do because IT was not going to happen.  I went to my tried and true Tony Robbins tapes.  Went through all 26 days of Personal Power and determined I had a lot of holes in my daily routines.  More on that later.  What did come out of it was a realization that I had the heart of an entrepreneur but was doing nothing toward that end. 

One day out of the blue, I got a call from a staffing company who was looking for an internal candidate who would operate as a branch manager.  Based on the description, I knew I could do the job and with nothing else on the horizon, I gratefully accepted the position.  I told my wife I would do the job for maybe a year so, then come back to IT when the market was better.  So, I was off to training.  Two full weeks of training to learn their systems, processes, procedures and ways of doing business.  It was a lot of fun.  I learned a lot.  And I really felt like I was going to be a strong player in this company.  My training was quite successful and my Director got feedback from the trainers that I was going to be very successful at this.  Cool.  Strong start.

I got to my branch and met with my staff.  I had a staff of 3 people who had been working in this staffing business for a combined 45+ years.  They started with a smaller firm who was absorbed by this larger corporation.  Their procedures were not company approved.  Their methods were unproductive.  Their reporting was useless and the worst was some of their paperwork ran counter to approved government requirements.  The staffing business is naturally regulated by the government – not in the typical sense like the banking industry – but in the sense that we deal with people’s social security numbers, employment records, W-2 forms and the like.  Typical HR stuff. 

So, here I walk in fresh from training – ready to change the world.  My staff resented me from day 1.  They liked the way they did things.  They felt they did a good job and quite frankly “This is the way we’ve always done it”, was a phrase repeated in many conversations.  I had my work cut out for me.  I worked out a plan with my Director to start on some of the worst problems in the office.  Rather than change the world all at once, it was better to nip away at it until the world didn’t realize it had changed.  So I proceeded to work at the many items on my list.  Long days; some late nights; external employee problems.  Finding work for people.  It was exciting and exhausting all at the same time.  And I felt a little like an entrepreneur.  It was my branch.  It was budgeted to lose money that year due to the many problems.  Once I addressed may of the problems, we actually made a nice profit that year.  Yeah Me.  Yeah team!  We celebrated.

The next year, we were operating more smoothly and we were budgeted to make more profit.  Another challenge.  All right, I am ready!  Oh and one more thing.  Now that the branch is running more smoothly, I need to get out and drum up some more business. 

OK.  How do I do that again?  It had been almost 9 months since training and I don’t remember our approved approach to getting new customers.  Back to the training books.  Looks easy enough.  Lets do it. 

I get my list of prospects and hit the phones. 

Holy crap.  This isn’t easy.  No one wants to talk to me and no one wants to talk to another staffing company.  It turns out that we aren’t the only staffing company out there and in reality, there are dozens of staffing companies calling on the same prospects day after day.  The gatekeepers are well versed in keeping out the staffing companies.  Some in our industry resort to trickery and deception to try to get past the gatekeepers.  I refuse to stoop to that level.  I was advised to try actually showing up at these companies to try to get in to see someone.  Well, that worked just as well as the phone.  The same gatekeepers who protect management from phone calls also protect them from walk-ins. 

What was I going to do?  We were expensive compared to our competitors due to the quality of people we provided and the checks and verifications we performed on our people.  The problem was I was going up against companies providing low-quality employees for low prices and didn’t mind the high turnover.  I was getting discouraged pretty quickly and I was definitely out of my comfort zone.  I had never had to do prospecting before.  All of my customers previously had been pre-screened and pre-qualified and invitied us in to talk with them.  Now, I was being asked to find the prospects using “tried and true” methods that weren’t working for me.  I was rapidly spiraling down.  My Director was on me to generate some new customers.  I could tell the shine was off the apple now.  The bright new kid who could turn the office around was not so bright anymore.  My successful first year was turning into a miserable 2nd year.  Something in my subconcious really started screwing with my mind.  I was having difficulty just in going out to see the companies in my list.  Some days, I would go out and sit in a parking lot and think about what a screw up I was.  I started becoming completely focused on my failure in this role and how I was not cut out for sales and how could anyone do this job and wasn’t I really just pimping out people for tasks that wasn’t prositution, but might as well have been?  The spring was gone from my step.  I struggled to get out of bed in the morning.  My hour drive to the office seemed like 3 hours.  My mind was reeling at the thought of being such a miserable failure.  I couldn’t escape the damaging thoughts that ran my head.  I was failing at a job where others succeeded and in many cases did very well.  How could I be so stupid to take on a job where I could fail?  What was I thinking?  I wasn’t thinking, I was desperate.  Desperation makes people do stupid things.  Wasn’t I desperate now?  Wasn’t I just one day away from being unemployed again?

The damaging thoughts remained in my head until my final day.  My last day was barely memorable.  I remember cleaning out my desk almost ceremoniously but it was just a show since I had been quietly cleaning it out for a couple of weeks so no one would notice I had given up. 

Holy crap I had failed at something again.  And something big.  I had a shot to be really succesful working for another company and I blew it. 

My depressive spiral didn’t end at the exit door to that company.  I was grumpy to my family and always seemed to be on the edge of breaking into yelling fits.  I wasn’t angry with them, but I was angry with myself and I find it very hard to yell at myself.

Back to the unemployment office.  Back on unemployment.  Struggling to get out of bed again.

To complicate matters, the IT bubble was beginning to burst and the company was going through its first series of “right-sizings”.  My team was absorbed into several other teams until finally, I ended up in a division I had no business being in.  I hated their technology.  I hated their arrogance.  And I hated their management.  If ever there was an opportunity to shine in the face of adversity, this was it.  I had a sweet opportunity to really make a name for myself and show how I could take this major swing in my career and rise above it. 

I didn’t take it.

I proceeded to fail to learn the new technology.  I relied on my knowledge of the old systems to keep me afloat.  I relied on my old relationships to keep me in good stead with the company leaders.  I was comfortable and I didn’t want to change.  Ultimately, I butted heads with the management that I didn’t like and it resulted in me making a graceful exit from this company.  I did resign, but my head was scheduled for the chopping block and I knew it. 

Now, timing is everything when it comes to job searches.  I have always been able to find a new job with relative ease due to my expertise and experience.  This time was drastically different.  So many companies were cutting their IT staffs that people with greater skills than mine were having to take menial jobs just to keep working.  I could not find a job and ultimately had to take unemployment just to keep my house and food on the table.  I was not happy about it and unemployment eased the financial pain, but did nothing to help me get a new job.  The job searching tools provided by the unemployment office are all geared toward skilled and unskilled labor and recent college grads.  Their systems were more than overwhelmed by the groundswell of highly experienced, highly technical people looking for highly specialized jobs with highly paying companies.

So I took my unemployment and searched my soul to figure out what to do next.  I was going to rebuild myself and come out of this challenge with a new career that fit my personality and my desires.

Next Issue:  What depths to find ones soul?

I realized in High School that I could absorb information and make very good grades with little effort.  That may have been a function of a rather poor public school education or it could be that I was a genius – I’m guessing the former option is more likely.  I was able to take advanced placement courses in High School and I never shied away from a challenging course and I did pretty well.  I graduated with honors and was then thrown into college.

My college years seemed quite uneventful at the time.  I worked full time and went to school part so it took me all of 7 years to get my bachelor’s degree.  My first couple of semesters at college seemed to challenge me but were nothing I couln’t handle.  Then I entered college calculus.  Derivatives and derivatives of derivatives became a bit more challenging than I was comfortable with.  Pay attention to the word “comfortable” because it is a recurring theme in my struggle.  Calculus kicked my butt and I managed to eke out a passable ‘C’ in the course.  The only other course I struggled with was French which my professor agreed that I spoke very well, I just couldn’t write it accurately and therefore couldn’t pass the test.  Draw your own conclusions about the requirements of precisely written language in a class that merely was required for my degree and not my profession.

So anyhow, I finally graduated from college and already had a full time job.  I had been working full time for years at that point.  I had been rising through the ranks of the IT industry and was putting the pressure on my bosses to make some real money.  I had been in mainframe operations, operations supervisor, and mainframe programming.  Then I began migrating to PCs and developing applications to process our work on a more distributed system…(boring stuff edited out). 

More later…