Friday, June 27, 2008

Collateral Damage

The meltdown of residential real estate in the past two years has largely been the story of financial shenanigans in the mortgage business and troubled homeowners who, as a result of rising rates and falling values, have gotten upside down on their mortgage.

But there is collateral damage to this meltdown as well. Plumbers, electricians, dry wall guys and brick layers are all feeling the pinch.

Today I was reminded that realtors have taken a pretty big hit as well. Approximately three years ago this summer I was involved in the development and leasing of a building called Stevens Forest Green in the Hillcroft Executive Park in Columbia. That summer I negotiated a lease with Keller Williams Select Realtors for 7,000 square feet on the ground floor. This was a new office and a new venture for the veteran real estate brokers who were running this franchise, Randall Nash and Jim Fischetti.

Randall and Jim outfitted the office nicely. They had big plans to fill the space with high production agents.

One year later, the partnership that I was involved with sold the building to Core Plus Properties in Stamford, Connecticut. The sales price of the building briefly held a Columbia record for a Class A office project. The new guys got rid of me and so I lost touch with the project.
Today I drove by and decided to stop in and see how the building was holding up. The Keller Williams Select Realtors office was shuttered. The gold letters of the sign behind the reception desk were peeled off.

Timing was probably the killer here. This office opened just as the residential real estate market peaked and most likely did not have enough time to secure a firm footing before the bottom dropped out.

I’m sure that Randall and Jim are doing fine. They have both been around long enough to have seen a big slump before. Nonetheless I am sure that closing this office in less than three years was not easy to do. I wish them well.

Hope springs eternal in Columbia however. As I drove away from my old building I passed by the HT Brown Century 21 offices on Stevens Forest Road. They had this sandwich board sign out by the curb.


Elvis said...

The best advice I ever got was when I was nineteen and my boss at Precision Tools in Memphis told me to "shake a leg." Now, it never did me any good as a delivery truck driver, but it worked out just fine for my other career.