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Broker of the Year: First Impressions
Demand is rarely a challenge for broker David Stevens. Supply is the problem.
By David R. Corder
Associate Editor
David Stevens made a good first impression on the decision-makers at Toll Brothers Inc.
The Philadelphia area-based luxury homebuilder first picked the principal partner at Naples-based Grubb & Ellis IPC to handle leasing of the 70,000-square-foot Naples Lakes Shopping Center at Collier Boulevard and Rattlesnake Hammock Road. The decision was mutually beneficial. "We helped them get some national tenants," Stevens says. "We were quite pleased. Prior to them getting a certificate of occupancy we had the whole center leased. It was an introduction to a relationship."
Next the luxury homebuilder offered Stevens a contract to sell the Publix-anchored retail center. In May, with Stevens help, the homebuilder sold the retail center for $10.05 million to a Fort Lauderdale-based investment group.
As part of the professional relationship, Stevens also brokered the acquisition of 400 acres of land for the firm's Belle Lago single-family community on Koreshan Road in south-central Lee County.
Stevens' work earned him recognition as a runner-up for Gulf Coast Business Review's 2003 Commercial Real Estate Broker of the Year.
Sales success is all about relationship building, says Stevens, who formed Investment Properties Corp. in Naples right after he earned a bachelor's degree in real estate finance in 1983 from the University of Florida. Ten years later he merged IPC with John R. Wood Inc. Nine years later, he and partners - Craig Timmins and Bill Gonnering - spun off of John R. Wood in a friendly divestiture and merged Investment Properties Corp. with Grubb & Ellis.
"I noticed a trend this year in long-time (Naples) property owners choosing to sell their properties," Stevens says. "So what's happening, in the case of a couple notable shopping centers, we did the leasing and had a long-term relationships with the owners. Then they decided to liquidate their assets."
In one instance, Stevens had developed a 13-year relationship with one shopping center owner. In another case, Stevens represented the owner for eight years. "We've had clients who have had properties for a number of years and have chosen this environment in which to sell their properties," he says. "That has led to highly productive sales."
Last year, for instance, Stevens produced from $65 million to $70 million in total volume of sales. That's about the same volume of sales he produced in 2001. This year he expects to produce about $80 million in total volume of sales. He also attributes his success to a multidisciplinary approach to sales and leasing of commercial properties.
"I think that's the key," he says about his market strategy. "Colleagues of mine (who specialize) may have up and down years, with some of the up years so admirable that sometimes I would like to trade places with them. There are times when a particular part of our business is hot."
For instance, Stevens says, the Naples area has become a desirable destination for institutional, syndicated and private investments. As the stock market softened, Naples commercial real estate became even more desirable.
"But simultaneously, you have investors looking for large commercial tracts," he says. "I've been able to hone the cycle, if one segment grows cold. And office leasing is a particularly cold discipline because of the noticeable loss of demand. If you're going to bank on office leasing income you're going to have a down year. So I focus on income-producing properties, retail and residential. My success is the ability to work in several different areas at the same time."
While demand is considerable, Stevens acknowledges it's not so easy to supply it. "The hard part is finding the property," he says. "I can't tell you how many times a day I get calls from people who want to invest. Having lived here for 35 years and doing this kind of work the past 20 years, you develop a network of contacts to figure out a way to find out who is ready to sell and at the right time."
And apparently the time may be right for many long-time property owners, Stevens says. He attributes his suspicion to an all-time low capitalization rate on the region's income-producing properties, particularly retail centers. The cap rate determines the present value of an income property. "That translates into the highest price for these types of properties," he says. "People are not flocking to the stock markets. Plus you have historic lows in the interest rates. So you have hyperdemand for this type of property."
Stevens says property owners are comparing the potential property sales opportunities with their long-term liabilities - roofing and heating, ventilation and air-conditioning costs, for instance.
"It sounds more complicated than it is," Stevens says. "If you can develop the skill in finding property, and finding sellers willing to part with the product, it's not hard to find buyers to step in," he says. "So if you just focus on supply, demand is at your fingertips."
David Stevens
Title: Principal partner, Grubb & Ellis IPC, Naples.
Age: 41
Hometown: Naples
Personal: Married to Debra for 15 years. They have three daughters, Jamie, 21, Kayley, 12, Cassidy, 10.
Education: B.S., real estate finance, 1983, University of Florida. After college, he formed Investment Properties Corp., a Naples firm that merged with John R. Wood Inc. and became its commercial real estate division. In 1999, Stevens and his partners - Craig Timmins and Bill Gonnering - spun off of John R. Wood in a friendly divestiture and merged Investment Properties Corp. with Grubb & Ellis.
Mantra: "Try to promote the highest level of trustworthiness. Treat people in a noncompetitive, noncombative manner."
Favorite book: "Bonfire of the Vanities," by Tom Wolfe.
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