|
Explain your business to us? How did you get started purchasing & developing real estate? What motivated you?
I am a Chartered Accountant and I articled at a small downtown firm led by an excellent tax practitioner. I then moved to one of the larger firms and my primary responsibility was a group of companies in New Brunswick. It was a large conglomerate which was involved in the steel fabrication business, the frozen food warehouse business and fish & lobster packing. I spent approximately 70% of my time concentrated on that group.
In addition, I worked on a variety of other accounts. One of those accounts was a privately owned real estate developer that owned and operated a number of apartment buildings and shopping centres. Also I was the field supervisor for the audit of a well known resort hotel.
At that time, Elgin Wolfe and John Rae owned a successful construction company. I met both of them just as they were about to purchase their first building. Elgin and John had created a very successful office interior construction business and they managed the construction of the premier offices in the major towers in Toronto and elsewhere. As with most entrepreneurs, they wanted to grow their business and were venturing out into different avenues. One was the real estate development business.
They called me because they were looking at purchasing a hotel in Florida. Timeshares were just being introduced into the marketplace. Their plan was to convert the hotel into a timeshare property. I had a fairly good background, having worked in a small real estate company as well as my involvement with the resort hotel. We all got to know one another very well working on that particular project. We eventually turned it down but it was a good opportunity for us to work together. We spend 3 or 4 days together, and although they each had very different personalities, both were smart guys and worked hard – and they were a lot of fun at the same time.
We kept in touch over the next year and then finally Elgin and John called me and asked me if I was interested in joining them. At that point I was getting tired of traveling to the East Coast and back in the middle of winter. This was the time for me to make a change and the opportunity looked quite attractive.
I started working for them as they were just getting into the development business. I was the designated Chief Financial Officer, but I was encouraged to become involved in much more than finance. I found it to be much more enjoyable to see the full spectrum of what goes into the development and construction, etc. That was the start of my involvement with the firm.
Back to Top
It must have been beneficial to have Elgin and John’s background in construction and design, with you as more of the numbers/accounting person when taking on projects such as the one in Florida. Would you agree?
Yes, but not only that, I also had the exposure to real estate development with the one client and I had exposure to the resort hotel operations as well. That combined experience was invaluable in that particular transaction. We worked well together, they liked me and I liked them.
Elgin and John were aggressively moving in to try to re-develop older properties on the fringe of downtown Toronto. At the time, that was the game plan. We acquired older industrial buildings around King Street & Don Valley Parkway area. Elgin and John created an innovative model that utilized their high end office construction experience. We were able to create a premier office interior environment in an older building. That was quite different from the majority of people developing or converting old industrial buildings in Toronto. Because we were able to bring in a much higher standard of interior finish, we were able to attract a better quality of tenant. We had a lot of businesses that wanted a high quality office interior environment but they couldn’t afford to be in the high rental areas of the downtown towers.
Back to Top
What was the timeframe on some of the work that you have done?
Throughout the 80’s we developed several buildings in the King Street and Don Valley Parkway area. We also redeveloped the east wing of Union Station. At that time it was owned by The Toronto Terminal Railways. We formed a quasi joint-venture with Toronto Terminals Railway and The Bank of Nova Scotia, the eventual tenant. We sold our interest to The Bank of Nova Scotia in the early 1990’s.
We then acquired a property in downtown Ottawa and eventually sold it to Standard Life. We also developed a shopping centre / office complex in St. Thomas in the US Virgin Islands.
In the late 80’s we were looking for another deal and the property in Buffalo came along. We were approached by a real estate broker from Toronto who was in Niagara-on-the Lake and ran into a broker from Buffalo. He asked if anyone from Toronto would take on this huge old industrial building. We were looking for a deal at that time so Elgin and John went down and looked at the property. It had a great structure and was a very sound building. We also thought it was incredibly priced compared to Toronto properties at the time.
Back to Top
Were there any drawbacks or fears associated with purchasing such a large property?
No I don’t think so. We probably didn’t recognize the difference between Buffalo and Toronto at the time. The building itself was mechanically and electrically very well maintained. It was a great structure.
We were coming out of a very hot Toronto market in the late 80’s and everything seemed to be getting snapped up there. That’s why in the mid 80’s we moved farther into Ottawa and the Virgin Islands etc. This seemed like a good opportunity for us and I don’t think at that time we appreciated the difference between the Toronto market and the Buffalo market. It may have become a little scarier later on.
Back to Top
Tell us a little about the history of the Tri-Main Center.
It's about 650,000 square feet. There are about 85-90 businesses housed as tenants in the building. We initially put a flea market into it and that held for a couple of years. We had some partners but that wasn’t working out so we eventually closed it down. A few things happened in the early 90’s – the real estate market in Toronto collapsed and one of the original founders John Rae died in 1993 of a heart attack. Elgin and I and two other employee/partners (who were in the construction business) took over the operation in the early 90’s. Elgin moved to Buffalo and really created the market for leasing the Tri-Main Center.
Back to Top
I understand that you are a large part of the Art Community in Buffalo, can you talk about your involvement?
One of the early tenants in the building was a woman from New York, Joanna Angie, who decided that Buffalo needed an Arts Community. She originally rented about 15,000 feet from us in the very early days. She almost literally put tape on the floor and would say to an artist that that was their space. She had rented space to about 40 artists and collected the rent each month and paid us. From that she has developed the Buffalo Arts Studio which has grown immensely and has a full range of artists and artist types – from sculptors to traditional artists.
That for us was great. Elgin had the foresight to see what a group of artists could do for the building. They brought a lot of traffic to Tri-Main Center. Also, once the artists were there, it brought architects and engineers and other office users who wanted a unique looking space rather than a corporate looking space.
Back to Top
What has been your biggest challenge to date? Marketing the Tri-Main Center to potential tenants?
The challenge in the early days was that this type of facility didn’t exist in Buffalo. It existed in Toronto and was far more acceptable here. In Buffalo you had a downtown office or you were in the suburbs. There was no in between. There were no converted industrial spaces. Tri-Main Center was probably a pioneer in Buffalo. Some of the early tenants that came in probably felt that they were taking a chance. They might have wondered if we were going to last and if we were going to keep this building going? A lot of people have come and gone in Buffalo, but the good thing was that Elgin lived there and really became a part of the community.
In my view, Elgin really created Tri-Main Center because he was able to instill the confidence in our tenants. As it turned out, our tenants became our largest selling features. A number of tenants have been there over 15 years. The building has been great for a lot of them because it allowed them to grow their businesses in terms of the square footage. Because of the size of the building we have always have some vacancy so that we can accommodate growth and movement. For example, we have a tenant that started with about 1,500 square feet - they supply the packaged products for mini-bars. Now they have about 22,000 square feet. They were able to move to different spaces within the building and they have become quite successful.
Buffalo as a city tends to get a bad rap from people from Toronto. A former local Buffalo TV news-anchor helped create a very negative view of Buffalo. Many Torontonians remember “Fire in Tonawanda – details at eleven” or “Its eleven o’clock – do you know where your children are?” However, Buffalo is a good place to do business for a lot of people. That particular tenant I was speaking of has a major competitor in California and the overhead costs of that competitor and the labour rates are significantly higher than what Buffalo has to offer.
We have a number of tenants that have gone through that growth pattern. That’s great for us because we not only have tenants talking to other people about coming into the building but we have the internal growth as well.
Back to Top
There have been a few articles that describe the Tri-main Center as very unique and beautifully designed. What are your comments?
I met Dr. Henry Taylor, a professor at the Center for Urban Studies, University at Buffalo, several years ago at a function. When I introduced myself and we chatted, he said that he drove by our building every day for years. His house was just south of us and the University is just north. He said he was oblivious as to what was going on in Tri-Main Center. When he finally decided to stop and see the building, he was amazed with the transformation of an old industrial facility into a flourishing and vibrant mixed use commercial community. He said that he now lectures about the building and uses it as an example of urban renewal within the USA. We have really created the market for a mixed use urban commercial re-development and since we have created it there have been some others that have used a similar type of model in other parts of the city which has been very good for Buffalo.
Back to Top
Tell us a little about how your role has progressed from when you started with Elgin and John. What do you do on a daily basis & how do you manage your time?
When I first started I saw myself as the accountant or finance guy because of my background. Earlier on, everyone around us worked in construction. When we were first converting the Toronto buildings, our office was in the second building we developed. I would be the only one in the office when people came in to lease space. I had to learn the basics of leasing, construction and selling. Thankfully I was able to absorb some of the things that the construction guys knew and I also took property management courses to prepare myself for these types of situations. I decided that if I was going to be in this business that I needed more professional training.
Initially I was pretty hands on, but over time not only did I concentrate on the financial aspects but I became more involved in the operation of the buildings. That was one thing that changed over the years. In terms of the operation down in Buffalo, we hired Elgin’s son Matt. While I’m more analytical – Matt and Elgin are very much alike in personality and it’s been a great fit for us. He picks up where his dad has left off in terms of dealing with people and that added an extra dimension to our team when he came on board.
Matt started about 6 or 7 years ago. He came at a time when it was really good for us. The three of us are now involved in all the major decisions that happen. One of the things that is very beneficial is the fact that we share everything with one another and we come to a consensus about how we should be dealing with issues.
Back to Top
You mentioned that you have had to learn some of the property management skills, is this something you enjoy doing? What is your passion when it comes to property development?
I think even when I look back in the accounting profession, I look back at the people that I admired most and they were great at dealing with clients.
I can think of one accounting partner that I quite liked and enjoyed working with that was very structured in his approach to clients. He kept a list of his clients on his desk and he had them prioritized. He called one group every week, one group every month and one group he called every 2 or 3 months. It’s something you don’t always associate with the accounting profession.
Although you have to be technically skilled when it comes to accounting, the ability to deal with clients is paramount. Fortunately for me, I had a couple of good mentors in Elgin and John.
Back to Top
What gets you most excited? Is it finding a new property?
I think I enjoy the analysis part of it. I enjoy analyzing a problem and looking at different ways to solve it. That’s part of looking at a new project. I enjoy looking at the potential and also the pitfalls.
Back to Top
What are the most crucial steps you have taken to grow your business? What were your best and worst career decisions?
In terms of the growth of Buffalo, I give the credit to Elgin because he had a good vision for that property and a good feel. We have come to a consensus and we have a pretty common vision of what we want in the building. I believe our growth has been the result of providing good service and providing a facility where people can function and grow their businesses.
The community aspect has been something we have fostered and we work hard at it. We generally know tenants by name and pop in to see them. We have established more than a business relationship with a lot of them as well. That’s something that comes very easily for Elgin whereas I have to work at it a little harder. We have a Christmas Party in the building each year to thank our tenants for their support.
Our success has come from working with existing tenants and following up on our promise to provide a certain service. We make sure we keep to our word. We have instilled that in our staff as well.
In terms of growing our business, we have to recognize that there are other people in the organization that can probably do things better than we can. There are other’s that have better skills in some areas and are probably smarter than I am. I think you have to learn from others, and listen and have an interchange of ideas. That has been probably one of the greatest things for us.
We have great people working for us, they are very dedicated and they take ownership of the building as well. We not only delegate but provide the opportunity for people to take responsibility and get enjoyment from the job itself. We have people that may make more money elsewhere but they wouldn’t have the same sort of job satisfaction. Within certain parameters we allow them to grow themselves. That’s the one thing that is great about us is that everyone contributes to the same goals and we all take ownership of what we’re doing. The people that have an inner drive and want to contribute to the success seem to stay on board the longest.
One of the most satisfying moments came as a result of a difficult financing issue. I was driving into the building one morning and I thought of an off the wall, very unique way of solving the issue. I told Elgin and we both laughed because it seemed so crazy. It actually ended up working out and it was really great. It’s that problem solving that gets me going. If I can find a unique way to solve a problem I find it very satisfying.
The most disappointing moment was when Elgin and I were forced to buy out another partner that we had worked with for a long time. It was during the very tough days of the early 90’s when the real estate market in Toronto had collapsed. That individual and I had worked together fairly closely and unfortunately he didn’t share the vision that Elgin and I had moving forward. It was disappointing that it didn’t work out.
Back to Top
How do you manage your fears and what is your greatest fear?
I guess my greatest fear would be something we can’t control. In the early 80’s the interest rates were at 19% and 20% and that made life very difficult. Another example is in the early 90’s when the Toronto real estate market collapsed. That was very difficult to work through. There was nothing that you could do to anticipate or control it. It’s almost like the housing crisis in the U.S. Very few people saw the enormity of that type of problem. That’s the type of thing that sits in the back of your mind that would give the most concern. You try to anticipate what is going to happen, analyze situations and evaluate risk, but there are certain monumental events, at times, that you can’t control.
As an entrepreneur you have to be able to manage and assess risk, but sometimes it is beyond your control.
Back to Top
You have made some very wise decisions so far which is evident because of the success and longevity you have had. Can you comment?
In terms of relationships, one of things that I’ve always tried to do was to establish a good relationship with anyone I’ve dealt with from a financial institution. There are people that I’ve dealt with 15-20 years ago, that I still talk to on a regular basis.
Not everything is going to work exactly how you want it to but at least with those relationships they know that you are committed and you’re not going to leave them high and dry. You have to follow through as best you can.
Elgin and I have worked so long together that we have a very blended relationship. We operate as a team and I’m very fortunate for that.
Back to Top
To what or whom do you attribute your success to?
I’ve been very lucky to have been in the right place at the right time. I’m not saying I haven’t worked very hard to get to where I am today. However, I feel very privileged and lucky be have had the opportunity to be part of a successful business team.
I feel fortunate in certain parts of my career to have the ability to do other things and become much more of a generalist. I was not just slotted into that cubby hole financial role. I still have financial responsibilities, but I also enjoy the broader scope that I’ve been given.
Back to Top
In one word, characterize your life as an entrepreneur.
I think I’ve become a generalist. I have had to learn to do a lot of things and that scope has allowed me to add value to the organization.
Back to Top
How do you balance your professional life and your personal/family life? Do you find it difficult?
In terms of balance I have been very fortunate. I have a great wife, who I’ve been married to for almost 35 years. We have two wonderful daughters. At times when I would have to spend extra time at work, which I did a lot of at times, she was great to balance our home life with the kids.
Looking back now, I would probably do some things a little differently but we always took holidays together and enjoyed a good relationship with our two daughters.
Back to Top
Do you have any hobbies outside of work? Are you a golfer like Bill?
He’s better than I am. I enjoy golf. My wife enjoys playing golf as well. I periodically work on my family tree and am interested in genealogy. One of my daughters has helped me with some of the research as well. I don't have a lot of hobbies. I just enjoy life at home. I have a very comfortable home with good neighbors and we enjoy entertaining as well.
Back to Top
You covered some of the sacrifices you have made with your family life to be an entrepreneur, are there any other sacrifices you have made?
When you're working for yourself, I think you have to open yourself up to responsibility. When you're running a business, you're responsible for a number of families that work for you. You’re not only making things work for yourself, but others around you as well.
In Buffalo, we have 15 families who depend on us for their well-being and living. In the back of my mind I always think about the responsibility I have to them as well. I have to make decisions that are not going to cause them a lot of grief.
Back to Top
If you were to start over in another business, what would it be and why? Would you have stayed in the financial industry or would you have pursued something completely different?
II think that training to become a Chartered Accountant was a great background for me to get started. It provided me with the basis to be able to move into other areas which I enjoy.
I meet with a group of former accounting colleagues at an annual golf tournament. The diversity of their careers is amazing. Although, I did not stay in public accounting, the training I received would have allowed me many career options.
Back to Top
What is next for your business? Where do you see yourself in 10 years? Are you still hosting Tri-mania – a celebration for Buffalo’s ever-expanding arts scene?
This year Tri-Mania was on March 26th. It’s usually held every three of years. In the past I’ve always been away on the Tri-Mania weekend because it was held earlier in March during the school break. (My wife was a teacher). We flew back from Florida specifically to be there this year because we had never been to it before!
In the future I see myself taking a step back and it’s great because Matt will take over an ever increasing role. Our intention is to have the business turned over to him. I would like to see to see myself in more of an advisory role.
I think I will keep working. I may work 4 days a week but I don’t see myself not working.
Back to Top
What advice would you give an entrepreneur starting out today?
Be prepared to work much harder than you ever thought you would have to work before. The business is always going around in your mind. When I’m in Florida walking on the beach – my wife will ask me if I’m thinking about the business.
It’s a full-time occupation. You can’t let it eat you up but you constantly think about it. When you’re away from it, those are the times you can reflect on the business.
Another piece of advice is to listen to others. Don’t be the guy that ignores everything. Don’t be afraid to ask questions. Ask as many dumb questions as you can because you will end up with the answer to your question.
Also don’t be too arrogant. You have to have a certain confidence but you also have to be able to treat people really well – employees or customers. You will receive the benefit of your actions ten fold.
Back to Top
How do you give back to the community either professionally or personally?
With respect to the Buffalo Arts Community, we certainly help to subsidize some of their costs. A large part of their space is leased at below market rental rates.
In terms of the ballet, we are attempting to assist that program as well. We are hoping to get a better funding model in place by meeting with the director and the board members to discuss options. We have been fairly liberal in dealing with the rent issues that they have as well.
We support other organizations as well. There is a grassroots organization called “Fathers” which was founded by a couple of ordinary African-American men that provide mentoring to young children and teenagers in the African-American community. Their organization is within close proximity to us as well. One of them was a firefighter and another worked for GM and they all had very ordinary backgrounds. They are quite involved in the community and we are very supportive of them. They do things for the community and they don’t get very much publicity and they also don’t have a structured bureaucracy as well. They provide toys for 1,000 – 2,000 needy kids over Christmas. We do provide financial support but as well if they require space at times for different things that they may need – we donate that space as well.
We also have a number of non-profits held in the building. We have the Aspire Group which was formerly the Cerebral Palsy Association of Western New York. We also have about half a dozen Not-for-Profit groups in the building. We just leased a space to an organization called Journey’s End. They provide services to refugees and they have a contract with the federal government to assist refugees with regards to housing and employment.
Back to Top
Why have you chosen to work with Bill Poole and The Haunn Group?
It probably took me a longer time to get to know Bill. Bill and Elgin were introduced through Elgin’s brother-in-law. I knew him for a number of years indirectly but I really didn’t work with him until later. It took awhile for me to get to know him. When I did, I came to understand his knowledge of the industry and products. He has been able to identify issues in our organization. Bill sort of grew on me. We didn’t have an instant relationship as friends or clients. Bill has the knowledge to identify a problem and suggest a solution rather than just sell you a product. He evaluates and cares about your entire situation. In fact, he pushes us to make certain changes – changes that Elgin and I probably just try to avoid most of the time.
Bill has integrity, knowledge and he cares for his clients. Those are the qualities that attracted me to him. He’s a good guy, but there are a lot of good guys out there. Bill knows his stuff and that’s what makes him different. He works hard at being well educated when it comes to his business. Also, he has developed a group of people, who are experts in their fields that he can bring in talk about certain issues. He introduced me to a lawyer that I use personally.
He’s not afraid to tell you if you’re wrong about something, and that’s worth while.
Back to Top
|
