Willard Jones Real Estate

Everyone is always seeking the next great thing.  The first person brave enough to take a risk in a new environment is often the one who stands to profit the most.  There is no industry where this is more true than real estate.

Much like the stock market, the idea is to buy low and sell high, ideally in the next gentrifying neighborhood.  Over the past few decades in Chicago, there have been numerous dramatic neighborhood transformations that paid off for those willing to bet on them.  For example, River North went from skid row to the one of the most sought-after office markets ever, not to mention the city’s premier entertainment destination.  The West Loop and more recently, the Fulton Market district, experienced a remarkable renaissance from primarily food storage buildings to an exploding area occupied by Google, numerous restaurants and retail establishments and coming soon, McDonald’s corporate headquarters.  The South Loop also deserves a mention for its robust residential growth. What neighborhood is next, you ask?  My money is on Motor Row.

Located in the near south side of Chicago and proximate to McCormick Place, it is easy to see that this area oozes potential. As it currently stands, the neighborhood is relatively quiet with sporadic yet definitive signs of activity.  The streets are lined with classic terra cotta architectural gems that once housed some of the largest and most prestigious automobile sales centers in Chicago.  After time, the area lost its luster and has since struggled to reclaim its prominence in the city’s landscape. In recent years, however, there has been a renewed push to reinvent this neighborhood as an entertainment quarter that will service convention goers as well as South Loop residents.

Mayor Rahm Emanuel sees the Motor Row vision, too. He is intent on building up the area through tax increment financing. Approximately $65 million worth of public infrastructure projects are planned for streetscape improvements, mass transit upgrades, and an expansion of the southern end of Grant Park.

Just a couple years ago, Mayor Emanuel’s vision seemed to be coming together nicely, as some of Chicago’s most prominent restaurateurs signed letters of intent to acquire space.  Hall of Fame rock band Cheap Trick intended to build a music venue and museum at 2245 South Michigan and Pressure Point Recording Studios planned a live music hall two doors down.  The owner of the famed Pfister Hotel in Milwaukee entered into to letter of intent to do a boutique hotel and Teatro Zin Zanni, a Cirque du Soleil-type dinner theater company, did the same at 132 East 23rd Street.  Finally, Broad Shoulders Brewing took a hard look at establishing a microbrewery and tasting room at 2337 South Michigan.  Unfortunately, one by one, each of these plans have fizzled.

Even with the loss of those opportunities, though, the development patterns of River North, West Loop and South Loop offer valuable insights:  Each area thrived at one time, then fell into a dilapidated state, but still maintained easily accessible locations and some desirable buildings from both an architectural and adaptive reuse standpoint.  The neighborhoods benefited from being proximate to other thriving districts and as those continued to grow, developers started expanding boundaries.  Shortly thereafter, property values and traffic increased substantially.

New projects have already trickled into the Motor Row area and are setting the scene for future growth. For example, the CTA’s striking new Cermak Green Line station which opened in 2015 provides easy access to the area. The hope is that the station will help the surrounding neighborhood grow rapidly, similar to the effect the Morgan Station had in the West Loop/Fulton Market neighborhood.

Additional projects under construction include a 1,200 room Marriott Marquis hotel and the McCormick Place Events Center, which will become the new home of DePaul basketball.  Numerous buildings up and down Michigan Avenue are also being renovated in preparation for anticipated leasing activity.

In spite of the grand potential and recent upgrades, Motor Row is still, in some people’s minds, a pipe dream. It is very much a work in progress but with continued economic growth, a vibrant entertainment district nearby (perhaps enhanced by the much-anticipated Chicago casino?), additional residential development in the South Loop, strong convention business and neighborhood investment by the City of Chicago, the vision will start to become reality. Once the first couple of entrepreneurs roll the dice and have some success, it might just get the motors running again.

Whenever one starts a new job, there is always a utopia scenario in one’s mind about how everything should go: Sure, there could be some ups and downs at times, but generally, everything is going to be nothing but seashells and balloons. I worked so hard in college and am so prepared, nothing could possibly go wrong.

Fast forward to 20 years later, one realizes the harsh truth all too well.

Though I cannot speak for every profession, my viewpoint has certainly changed in the many years I have been a broker. Read the “rookie vs. ripened” perspectives of a landlord representative and see which one you most identify with:

A broker will email me and politely ask to see 3 spaces.

The broker will email me at 11:30 PM demanding to get into 3 spaces at 8:00 AM the next morning and will be furious if he does not receive a response by 11:33 PM.

We’ll schedule a showing for two days from now so there’s enough time to prepare and the weather forecast is 70 and sunny.

Sure, I will drop everything and accommodate your 1,000 square foot client who needs to see space immediately, even though their occupancy date is 10 months away. Oh, and by the way, thanks for dragging me out in the middle of the Polar Vortex. No problem, I love cold weather. That is why I live in Chicago.

Showing day: the broker and client show up 2 minutes early, just as I finished up prepping the space

Typical. I practically rearrange my schedule overnight, show up early and now they are running 30 minutes late, thereby causing me to be late to my next showing that was scheduled a week ago.

They loved all of the spaces, but settle on one and I receive a follow up email from the broker asking for a proposal the next day.

They hated everything. I knew it.

I present the deal to ownership and they are ecstatic that we finally have interest in this stubborn vacancy that has been challenging to lease.

Seriously, this is really the best deal we can offer.Do you have any conception of the market whatsoever?No wonder this space has been vacant for over a year.

Wow. No changes to the proposal and they’re ready for a lease.

Is this negotiation ever going to end? You received our best and final deal two proposals ago. Take it or leave it. And no, I cannot just arbitrarily change the hours of operation for the HVAC service for a 1,000 square foot tenant in a 300,000 square foot building with a central system.

The attorney looks at the lease, no changes, looks good!

This is going way too smoothly. I am sure the tenant’s attorney will practically rewrite the lease, thereby leading to the owner killing the deal or the tenant backing out because we will not agree to waive the Trial By Jury language.

A lease signed a mere 2 weeks after the point of first contact.

This lease has been out for two months. If you do not sign it by Friday, the deal is off! I really mean it this time!

The tenant sends me a dozen chocolate covered strawberries as a “thank you” for my assistance with the transaction.

It is a miracle that this lease has been signed. So glad to have you in the building. Now I can listen to your complaints about the management every time I see you. Also, thanks again for mentioning the poor elevator service during my showing the other day.

Fast forward one year: they call me saying they need more space; luckily the neighboring tenant has just moved out so the whole floor is available.

The property manager just called. The tenant is 3 months behind in the rent and a 5 day notice has been issued. Yes Mr. Owner, I know it is my fault for bringing you a bad tenant. My crystal ball must have been broken during the negotiation.

They take over the remaining 36,000 SF of space.

The sheriff should be showing up any day to kick the tenant out. Looking forward to showing the same space again!

They love that they can customize the space and send two dozen chocolate covered strawberries.

Did we really let them paint the walls pink? That will make the space so much easier to lease.

The commission check comes with expedited shipping 3 days later.

This lease was signed 6 months ago, the tenant has moved in and is paying rent. My contract says that you are supposed to pay me 30 days following lease signing. What am I missing? Would you let this tenant not pay rent and just smile and look the other way?

I’m still munching on the last chocolate covered strawberry when I decide to do a cold call… and receive a warm response. Actually they’re so glad I called, they were just thinking about moving to a larger office.

I need a drink….

As I mentioned in my previous blog, one of the most critical aspects to succeeding in commercial real estate, or any profession for that matter, is to be on top of all current events. Of course, you cannot simply flip a switch and suddenly become an expert; it takes a sustained devotion to learning as much as possible every chance you get, as demonstrating a working knowledge about your industry will enable you to command instant respect. Here are the most effective methods I’ve found to accomplish this:

1) Faithfully follow all pertinent industry and trade publications on a regular basis. In the world of commercial real estate, this includes Crain’s Chicago Business, GlobeSt.com, Bisnow, CoStar, the Illinois Real Estate Journal, and the Willard Jones Real Estate Weekly Wrap Up just to name a few. Each publication or website contains valuable information on key occurrences such as recent signed leases, buildings selling or going up for sale, people in the industry changing positions and experts sharing predictions and wisdom about various topics.

2) Read the local newspapers. Whether it is online or good, old fashion hard copies, publications like the Chicago Tribune, Chicago Sun Times, DNA Info and all neighborhood and suburban newspapers contain valuable information on local events that might impact the real estate industry.

3) Attend seminars and conference events whenever possible. There is no denying that some of these events might not be overly stimulating, but there is some intrinsic benefit in listening to expert speakers in your field share their opinions and theories. These events are also good forums to meet new people who might be willing to share information.

4) Network with fellow industry members. Grab a cup of coffee, a quick lunch or a drink after work and pick the brain of your fellow industry members. Everyone has their own, unique take on market conditions and their own special tidbits of knowledge that they are willing to share. The more people you know, the more useful information you will acquire.

5) Research, research, research. The internet is your friend. Use it to acquire as much background information as possible before going into a meeting, talking to someone on the phone or sending an email. This is a quick and easy tool to building up your genius.

6) Continuing Education. Sure, most real estate brokers and managing brokers dread having to do this every two years. However, it is a necessary evil. It is important to have an all encompassing knowledge of the rules, codes and ethics that govern the industry of choice; this provides a basic roadmap for advising clients.

7) Get out there and do your job. Just in the course of your daily travels, you are likely to pick up on helpful details that will make it easier to do your job more effectively. It is surprising how much you can learn during the course of a random conversation with one of your industry brethren.

After being in any profession for a period of time and especially after having some success, it is human nature to become stubborn and feel like you know everything. That could not be further from the truth. Embrace learning and realize that it never stops. The world is constantly changing and clients want to be up on all of the most recent trends and breakthroughs. The more knowledgeable you demonstrate yourself to be, the better the opportunity you will have to impress people and pick up new business, or maintain existing accounts, in the process.

No matter how much experience you may have, walking into a meeting with the ability to demonstrate a strong working knowledge of your field will allow you to command instant respect. Once that happens, your chances for success increase tenfold.

I have lost count of the instances I have pondered the questions, “Why am I doing this?” or “What was I thinking getting into this business?” or “There has to be an easier way to make a living, right”? Then, the next day (if not sooner), something happens and puts me at ease, causing me to say, “Oh, that is why I do this.”

Presidents Day 2016 marked my 20 year anniversary in the commercial real estate industry. Looking back, it is nothing short of a miracle that I have lasted this long. There have been so many ups and downs that it is a wonder I am still standing.

I am frequently asked to speak with college students or recent graduates who are considering the commercial real estate profession as a career. The one thing I always endeavor to do is be brutally honest as to what they are getting themselves into, as I wish someone would have done for me. What was described to me 20 years ago sounded like nothing short of paradise: You make a ton of money, work flexible hours, go out for fancy lunches and golf outings, and did I mention the money? As a 22-year-old right out of school, how could I resist? After a few months in the business, however, I learned the cold, hard truth.

As I reflected on my journey to date, I decided to put together a list of some of the most important things I have learned over the years that have helped me get this far:

1) Have a very thick skin. You will fail many more times than you will succeed. People will slam the phone down on you mid-sentence, refuse to meet with you, question your knowledge and be generally rude or inconsiderate. Let it bounce right off and move on to the next opportunity; these incidents do subside over time.

2) Use everything as a learning experience. Just when you think you have seen it all, you quickly learn that is not the case. Never stop building upon your base of knowledge. Nothing is ever a waste of time and what causes you to fail in one instance might be directly responsible for your next moment of success.

3) Never get too high or too low. When something good happens, sadly, something negative is probably lurking right around the corner. Fortunately, the opposite is true as well. Always keep on an even keel and focus on the big picture.

4) Be prepared to work extremely hard and make sacrifices. This is not a 9:00 a.m. to 5:00 p.m. job and if you try to make it one, you will fail. There will be plenty of 12+ hour days and weekends that you will need to work in order to succeed.

5) All deals are unique. This is part of what makes the industry so fresh and interesting all of the time. Treat every situation individually. While you certainly can–and should–learn from past experiences and use them as a guide, always be open minded and flexible to trying different approaches.

6) Adapt to changes and embrace new technology. When I first started, not only were there no cell phones, I did not even have a computer. When the BlackBerry first appeared, I thought it was the greatest invention ever. Change is constant and it’s important to make an effort to keep up with the times. Being receptive to change can ultimately make your job easier.

7) Follow the Golden Rule and treat everyone with respect, no matter the size of the transaction. Work just as hard for a client looking for 500 square feet as you would for a client looking for 50,000 square feet. You never know if they may grow in the future or who else they may know in need of real estate services. Referrals are a strong source of new business in commercial real estate. Regardless, everyone deserves the same level of respect; at the end of the day, all you have is your reputation. If you provide good service to everyone, you can never go wrong.

8) Become an expert on the real estate market. Having extensive knowledge of what is happening will enable you to command immediate respect when meeting prospects for the first time. When competing for business, people will usually see right through you if you are trying to wing it.

9) Always put the interest of your client above your own personal gain. We all want to make as much money as possible, but never at the expense of doing our job well.

10) At all times, be brutally honest. The truth always comes out. If you lie and try to make up for it later on, the pain of trying to clean up the mess is tenfold.

11) Prepare ahead of time and anticipate. Always take the time to research who you are meeting and try to envision all possible scenarios in advance. When you are informed, your presentation will be that much better.

Undoubtedly, this is a very challenging industry to succeed in long term. It is competitive, cutthroat, grueling, fascinating, stimulating and rewarding all at the same time. Of course, following these steps will not guarantee success, but each of them continue to serve me well and help me endure. It will be interesting to see what other tips I pick up during the next 20 years. Be on the lookout for a follow up blog then.

It is a building that epitomizes Chicago: innovative with a touch of charm, yet tough, solid, resilient and built to last. Constructed in 1874 right after the Great Chicago Fire, the Washington Block building a t 40 North Wells Street is an architectural gem that oozes creativity with its soaring ceilings, bank vaults, fireplaces and an impressive hardwood spiral staircase with a skylight above that floods the common corridors with natural light.

Furthermore, public transportation is literally at the front doorstep and a healthy supply of pigeons call the cast iron fire escape which blankets the limestone facade their home, while the strategically placed fake owls incessantly tries to scare them all away.

To an individual walking down Washington Street on the way to City Hall or standing on the Washington/Wells L platform waiting for the Brown Line to arrive, the adjacent 40 North Wells building is an old, nondescript and slightly worn down low rise office building with a bar and 7-Eleven on the ground floor. However, diving deeper into the history of the Washington Block, one learns of its documented significance in Chicago history, which then leads to wonderment of what else really happened here during its 142 year history.

Designed by Frederick and Edward Baumann, 40 North Wells was designated as a Chicago Landmark in 1997. At the time of construction, this 5-story edifice was one of the tallest buildings in the city and is a rare example of isolated pier foundation, which uses several separate foundations at each load-bearing point underground to create a more permanent and robust foundation. This base allowed it to be erected on soft, compressible soil, instead of solid bedrock previously seen as a prerequisite. This technique played a key role in the subsequent creation of skyscrapers in Chicago and throughout the country.

Washington Block was originally created for prestigious companies wanting to office near the rapidly emerging LaSalle Street financial district. However, once the L was placed next to the building, the upscale tenants found the building undesirable and more budget-minded firms occupied the property from that point forward.

In a building of this vintage in such a vibrant location, there is no telling what has transpired over the years at Washington Block.

The saying, “if these walls could talk” had to be created for this very building. For example, is it really far-fetched to picture some of the legendary Chicago mobsters maintaining offices in the building? Given the vaults on each floor, maybe 40 North Wells is where Al Capone’s secret tombs were once located.

Under the guise of an insurance company, maybe John Dillinger and his gang of renegades developed their plan here for the St. Valentine’s Day Massacre. With the proximity to City Hall and other government offices, it is all too easy to envision an endless number of politicians negotiating secret deals in their cavernous offices, both of the legal and illegal variety. Brilliant ideas might have been created that led to millions of dollars of profit, while others not quite as successful which may have ruined careers. Lifelong friendships may have ensued, while eternal feuds might have been developed. Lives may have been consummated, while some may have come to an end in this very building. The possibilities are truly endless.

One of the grand things about Chicago is that no matter how big or small, every building has a story to tell. The many secrets of 40 North Wells may never come out, and that is okay. Sometimes, it is more fun to leave things to the imagination. One thing I know for sure is that when my firm shows space at our newest listing, we will have no shortage of tales to pass on to prospective tenants, who will hopefully buy into the aura that is the Washington Block.

So much of Chicago’s history is centered around folklore. Tales such as Ms. O’Leary’s cow causing the Great Chicago Fire, the famed Billy Goat curse being responsible for the Cubs’ decades of futility and Al Capone’s secret vaults are cited so frequently that many have come to take these as fact. Of course, no one knows what is and is not the truth, but these anecdotes are certainly fun to share.

Personally, my favorite Chicago legend is that of the Cow Path located in the 100 West Monroe Building. To get the entire history of how this came to be, one must go back to the year 1833.

Still nearly four years away from officially being chartered as a city, Chicago consisted of a sparsely populated rural territory with approximately 350 inhabitants. Fresh off a stint as a carpenter involved in the construction of the Erie Canal, one of the region’s early settlers, Willard Jones, migrated from New York and decided to set down roots. For a mere $200, he purchased several plots of land in the area that today comprises the Central Loop business district of downtown Chicago. Willard proceeded to construct a farm and successfully operated it on this terrain for a number of years.

Chicago was incorporated as a city on March 4, 1837. As the population started to grow and early industry emerged, real estate began to gain in value as early developers looked for ways to utilize land in ways more profitable than agriculture. In response to this phenomena, Willard Jones began selling off parcels of his terrain in 1844 in the surrounding vicinity of what today encompasses Clark Street on the east, LaSalle Street on the west, Monroe Street on the south and Washington Street on the north. On this land, some of the original commercial properties in downtown Chicago were eventually erected and this ultimately planted the seeds for the birth of the Loop business district.

Willard Jones continued to operate a smaller version of his farm in the vicinity of the present day intersection of Clark and Monroe. Amidst the new developments, he needed to maintain a dedicated path for his cows to access a nearby pasture. Therefore, when he sold off these plots of land, he included in the sales deed an easement for cow access. No construction was permitted which would obstruct this “cow path” in any way. As downtown Chicago began to develop over the upcoming decades, the easement was held legally binding by the Illinois Supreme Court in 1925.

When the 22-story office tower known as 100 West Monroe was built on this landsite in 1927, architect Frank Chase had to create an 18-foot high tunnel at the base of the western end of the building, which would be more than adequate in size for cows and any other farm animals who might be strolling through the Loop at any given moment.

In 1937, to celebrate this unique attribute, Mayor Edward Kelly affixed a plaque on this portion of the building which read as follows: “Historic Cow Path: This areaway 10 x 177 x 18 feet is reserved forever as a cow path by the terms of the deed of Willard Jones in 1844, when he sold portions of the surrounding property. Erected by Chicago’s Charter Jubilee and Authenticated by the Chicago Historical Society, 1937.”

While the plaque is long gone and unaccounted for, this unique bit of Chicago history still exists today. However, in 1969 when the Two First National Plaza Building was erected at 20 South Clark, it blocked off the northern end of the cow path. The Chicago Historical Society and Chicago Title and Trust ruled this as being legal and no one ever challenged it in court.

I liked this tale so much that I decided to name my company after it, Willard Jones Real Estate. Given Willard’s role as one of the pioneers and founding fathers of downtown Chicago commercial real, it seemed like an appropriate tribute. Is the story really true? I will leave that for others to determine.