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Commercial Real Estate
Business Observer Friday, Apr. 24, 2020 1 year ago

One That Got Away

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A Tampa broker's experience with a 'heartbreaker' of a deal resonates amid Covid-19's effect on CRE sales.
by: Kevin McQuaid Commercial Real Estate Editor

                Heartbreaker/You stole the love right out my heart. – The Rolling Stones

Thomas Bruubaker initially thought selling a collection of warehouses in Largo for their octogenarian owner would be a relatively simple affair – especially after he had a potential buyer in hand.

The owner and broker of Tam-Bay Commercial Inc., however, found the deal to be anything but. In the end, it was a real heartbreaker – and not just for Brubaker.

Not that it’s any consolation, of course, but Brubaker knows a lot of commercial agents can relate these days, as Covid-19 has either paused or flat out wrecked deals that had seemed solid as rock just a month or two ago.

“I’ve had four deals fall apart since the Covid-19 crisis hit,” Brubaker says. “I lost $85,000 in just one week when deals I’d had in the works went south, and I know a lot of other folks have had the same experience. It’s part of the business, I know, but it’s always brutal, just brutal.”

The Largo deal would end up being especially savage. It began in early 2017, in response to a cold-call letter Brubaker had sent to the owner of 6464 126th Ave.

Brubaker, who has spent more than 30 years in the real estate business and taught classes for the Bob Hogue School of Real Estate on appraisal principals and how to navigate commercial real estate transactions, had made it a regular practice to send property owners aged 60 and over letters, asking them if they wanted to sell and offering his services.

As luck would have it, Gene and Betty Jordan indicated they were ready to part with their property. The owners of Gene’s Welding & Erecting Co. Inc. had owned the site, containing a half-dozen warehouses and an apartment, since the late 1960s.

Gene Jordan, then 88, had built the buildings totaling about 30,000 square feet himself, over the course of a decade. He and his wife lived in the 2,000-square-foot apartment, too.

They were the epitome of emotionally attached.

But the way Gene Jordan saw it, it was easier to divide money than real estate. He had seen or heard of too many fights between children over property, he told Brubaker.

“I want my kids to have Thanksgivings together,” Brubaker recalls Gene Jordan telling him.

So Brubaker put together a presentation book with an evaluation of value on the property and drove over to Gene’s Welding from Tam-Bay’s office in Tampa.

The Jordans weren’t interested in signing a listing agreement or having the property openly marketed, but Gene Jordan told Brubaker that if he could find a buyer willing to pay $2 million he’d take it, Brubaker says.

Over the next year, Brubaker brought four buyers to the Jordans, and in each case, the two sides couldn’t come to terms. But Brubaker stayed in touch, dropping in to say hello when he was in the area and through the occasional phone call.

Around the middle of last year, Brubaker began working with a former financial planner with a relatively rare form of blood and bone cancer. Faced with a terminal illness, he was seeking an income-producing property to help his wife and daughter financially after he passed away.

Brubaker thought of 6464 126th Ave. After Jordan told the broker he wanted to meet the buyer before going forward, Brubaker arranged a meeting. The buyer had one condition: Jordan must not be told of his illness.

The broker was dumbfounded. That information, Brubaker knew from experience, could spur the deal onward. He reluctantly agreed to the request and kept quiet.

The meeting went well, though – so well that the prospective buyer made a $1.8 million offer shortly after. Because the Jordans weren’t digitally savvy, however, that meant Brubaker had to drive a paper copy — complete with a commission stipulation included — to them for their review and signatures.

After some normal back-and-forth, the buyer offered the full $2 million asking price. Brubaker prepared a contract with the buyer’s signatures affixed and drove back up to Largo.

Jordan still wasn’t sure he could let go, though, and wanted a few days to think about it. When Brubaker went back to collect what he expected would be a signed contract, Jordan balked.

Eventually, he accepted the deal. Then he rescinded his acceptance. He went back, then forth. Back and forth. And back and forth again. Brubaker could tell he was struggling over the decision. Months passed.

At last Jordan told Brubaker to drive up again, with another contract of sale. He was finally ready.

Brubaker felt elated as sat behind the wheel. All the months of persistence and patience had paid off.

The deal was a proverbial “win-win,” too: The Jordans would have a nice windfall – not property – to give their children, the buyer would fulfill his goal of providing for his eventual widow and child, and Brubaker would have a $120,000 commission check for his efforts and all the mileage from Tampa to Largo.

When Brubaker arrived, though, he was surprised to find that the Jordans had a visitor – their son’s best friend from childhood. He was even more surprised to learn that the friend had agreed to buy the Jordans’ property and give them a life estate so they could continue living in the apartment if they chose.

The seller told Brubaker he was sorry, but he’d decided to accept the offer. Brubaker wouldn’t be part of the deal and as such, wouldn’t receive a commission.

“I was totally blindsided,” Brubaker says. “I tried to be professional about it. He really did seem sorry. So I shook hands with him and walked away. But I was distraught. That was a really bad day.”

Brubaker didn’t walk away totally empty handed from the ordeal, though.

He eventually helped his ill buyer acquire a medical office building in Tampa, near St. Joseph’s Hospital. The man wouldn’t have much time to relish the purchase, however; he passed away on April 15.

And earlier this year, the Florida Gulfcoast Commercial Association of Realtors awarded Brubaker its annual Pinnacle Award for “Heartbreaker of the Year” – a commemoration of a noteworthy transaction that doesn’t reach fruition.

That cushioned the blow – somewhat. As the months have gone by, too, and brokers of every stripe have had to worry about all of their sales dying, Brubaker has gained a newfound perspective on the award-winning one that got away.

“It’s like I tell my classes: Until closing is done, something always can go wrong.”

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