Commercial Investment Real Estate Summer 2020 | Page 20

CCIM Q&A
By Nicholas Leider
SURVIVING AND
THRIVING AMID
DISRUPTION
Blaine Strickland, CCIM
A
40-year veteran of commercial real
estate, Blaine Strickland, CCIM, has
succeeded as a broker, manager, consultant,
and coach. His second book, “Adapt,”
discusses the commercial real estate industry’s
readiness to react and improve amid
disruptive forces in technology, demographics,
and global markets. Published in March,
just as the COVID-19 pandemic slammed
the brakes on the global economy, Strickland’s
work focuses solely on disruptive forces
within commercial real estate, as opposed
to worldwide public health disasters.
We spoke with him about challenges
and opportunities tied to disruption, along
with his personal experience in commercial
real estate.
CIRE: “ADAPT” COVERS PLENTY
OF DISRUPTORS, SOME OF WHICH
ARE ALREADY GAME CHANGERS IN
COMMERCIAL REAL ESTATE. YOU
DISCUSS ONLINE AUCTIONS AS A
POTENTIAL AREA OF OPPORTUNITY.
HOW COULD THE INDUSTRY BEST
LEVERAGE THIS BUSINESS PRACTICE?
BLAINE STRICKLAND, CCIM: In 2012,
I watched two brokers use the Ten-X platform
to sell a neighborhood shopping center.
And I was like, “What? I’ve never seen that.
How can that be?” The real estate was not distressed.
It was a complicated property, with
plenty of tenants along with vacant space. It’s
a complex animal, and yet they pulled it off.
The lenders took the real estate back
and then employed special servicers to dispose
of it. A bank has loan officers and a very
small staff associated with real estate that it
has to take back and continue to own. Banks
want to move that away from themselves as
quickly as possible. Certainty is important
and the auction provides it, because the whole
world knows that the auction is going to occur
on this date. As the seller, it’s pretty exciting
to think, “Wow, it’s 1:30 in the afternoon now,
and my property will be under contract in a
few hours and closed within 30 days.” In the
last 10 years, it has become a more valuable
and legitimate sales strategy for brokers to use
on an everyday basis.
But what would happen if the quarantine
effect lasted another six months? If
tenants can’t make rent and property owners
can’t make their payments, all of a sudden, it’s
like a stranglehold. The banks definitely do
not want to take a bunch of real estate back
at the same time. You could see a situation
evolve where the primary players — the landlords
and lenders — would want that certainty.
Guess what? We’re back in a moment where
certainty becomes extremely important. The
borrower is stuck. They haven’t made payments
in six months but the lender doesn’t
want to take back the property. They could
work together and decide to put the property
in a commercial auction. These kinds of economic
swings could really cause this to be a
very valuable channel. So 10 years ago, it didn’t
seem possible, and now it’s completely viable.
CIRE: ON A MORE PERSONAL NOTE,
YOU’RE THE SECOND IN THREE GEN-
ERATIONS OF CCIM DESIGNEES. WHAT
DOES THAT MEAN, KNOWING THAT THE
BUSINESS THAT YOU HAVE DEDICATE
YOUR LIFE TO IS SOMETHING OF A FAM-
ILY TRADITION THAT YOU SHARE WITH
YOUR FATHER AND YOUR SON?
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COMMERCIAL INVESTMENT REAL ESTATE MAGAZINE
SUMMER 2020