Greg Barrack
Real 695
Green Law/Will Smith Write-Up
When to start)
Will spoke to the importance of picking a place. On his search for the best location to start his career he
saw Irvine as the most central location to people and businesses in southern California. This is calculated
by its proximity to San Diego and Los Angeles, while simultaneously located in the heart of orange
county’s business district.
Throughout the presentation Will expressed that he views real estate as an empty box. It is your job to
maximize the area of the box and subdivide it into different spaces that optimize the tenant mix. Land
sells by the acre, meaning that when you are in the land business you have more room to subdivide the
square footage. The entitlement process is the factor that enables you to look at the property in terms
of square footage as opposed to acreage.
Investors)
When looking at the differences between the institutional investors and family offices there are key
differences that would merit a preference. Institutional investors, like John Murray, must invest money.
If he does not expel X amount of capital, he does not meet the requirements of his job. His risk tolerance
is lower, and he will require much more information and due diligence during the process. Typically, 50%
of a deal type must align with their accounting books and style and the other 50% is concerned with the
returns of the deal. Investment through family offices can bear more risk typically and have a faster
process to close. However, a family office is more difficult to keep on the hook. They can back out of a
deal at any moment and not have to answer to anyone. Keep in mind that there are always black swan
events that happen in the market and there is no way to avoid that. In the case of recession, it is
important to rely on your network to help you get through the tough times. Weather with investors or
office culture remember: How much risk do you want to take, what do you want your environment to
look like. Do you want your relationship with people to be purely business, heavily incorporate personal
life, or a mix of both. You must be able to flip the switch in your own personal life separating business.
Remember to communicate well and often with everyone.
Developmental steps for Will)
Just like many of the entrepreneurial speakers we have spoken with they all had to start small. With
hard work and a bit of luck they were able to compound their growth and double down every chance
they could. Like Krotts, Will got to a point in his early stages where he needed to make an appearance
for himself. During one of the most pivotal moments in his career Will decided to double down on his
office to “impress” investors. Although he didn’t necessarily have all the pieces together yet, he
presented a very professional looking environment to the institutional investor group Guggenheim. By
doing so, will was able to secure capital for a deal that launched his career forward. After this he made
an agreement with the Guggenheim group that he would hammer deals with them and not any other
investment groups. This built trust and established credibility in the market.
Picking a Partner)
Ideally you want your partner to have complimentary skill sets to you. Hypothetically you would want
one person who is analytical and conservative, combined with a deal guy who is optimistic and wants to
push through adversity. This creates a good balance of the opposites that give the company an even
keel. Remember that the important components of any real estate firm are: Buying, Selling, Owning, and
Operating. You need people on your team that specialize in each area, while also educated on the goals
and directions of the complementary subsets.