Leadership Matters in Real Estate

What element is key to real estate project success? Strong leadership.

Oct 01, 2024

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Leaders stand up and speak their mind. Image source: ChatGPT

Leadership is not about directing others; it is about inspiring them to go above and beyond.

I’ve had the privilege to lead teams to championships, business victories, and to suffer and learn from defeat. My journey in building teams started early, with one constant in my life: basketball.

When you play informal pick-up basketball, you have to select team members. For me, this started when I was around nine years old. As I grew, my leadership journey evolved, moving from early success in high school, through challenges and defeats in college, to eventual success again in the professional world. I built teams and products on Wall Street in the FinTech space, and later transitioned to design, construction, and leading teams on large- and medium-sized development projects.

Over the course of these experiences, I’ve learned a few things about success, leadership, and building teams.

If you are an Emerging Sponsor, in a way, you are selecting a team for your pick-up game as you get new projects off the ground. You may not have access to the absolute best engineers, attorneys, or architects at first. That’s ok, you just need to find the best people you can with a focus on filling gaps in your own experience or knowledge.

Why Leadership Matters Today More Than Ever

Leadership is of paramount importance, not when everything is going smoothly, but when markets are volatile and economic uncertainty is high. That’s a perfect description of today’s environment.

We are in a challenging economic situation where markets are interest rates are headed lower, and the economy may, or may not, be headed higher. Drilling down further certain product types and geographies will out-perform over the next 5 years given vastly different leadership, policies, and demographics.

Emerging Sponsors looking to build their business today face a myriad of challenges. Those who successfully navigate the pitfalls to build a stable and growing business will set themselves up for long term growth and prosperity.

The most important leadership characteristic for emerging sponsors is to create an investment thesis people can rally around. This attracts partners and capital.

Effective leadership begins with a vision that creates hope and belief.

Vision

In business, a vision is a company’s desired future state. The vision should be:

Inspirational
Specific
Brief
Aligned with your corporate identity

As a business leader, your responsibility is clearly defining and communicating that vision. To gain buy-in, share the vision with your team, and even before that, use it to attract talented individuals who share your priorities. The first step is to identify what matters most to you, write it down, and then engage your executive team for feedback. This process strengthens the vision through collaboration and critical thinking.

“Leadership is the art of getting someone else to do something you want done because he wants to do it.” – Dwight D. Eisenhower

Team Building

Once your company or project group has a vision, it’s time to build a team around that message. Here are the key steps:

Identify the roles needed to achieve your vision.
Recruit talent that aligns with your vision. Don't settle for mediocrity—just like in pick-up basketball, your team is only as strong as its weakest link. Hire 10-out-of-10 people.
Prioritize diversity in skills and experiences to ensure your team is equipped to tackle various challenges.

Your team will succeed with the best people, aligned expectations, and a shared vision for the future.

Empathy

Always lead with empathy. When making decisions, consider how they will impact your team members. Empathy builds loyalty and fosters a collaborative, motivated work environment. Leaders who act with empathy outperform those who don’t because they not only believe in their vision, but also in the success of their team.

“The superior human being will always see the light in someone and choose to encourage that light instead of dimming it.” – Derek Hough

Execution

Execution is often the hardest part of leadership. It requires consistency, adaptability, and steadfastness. These traits are essential but challenging to maintain, especially when managing a team. How do you overcome this?

Recruit the best people
Be fair and honest
Be reliable and consistent

Five Keys to Successful Execution:

Reliability – Do what you say you will.
Optimism – Inspire hope and enthusiasm.
Consistency – Maintain focus and effort over time.
Metric assessment – Reflect on outcomes and learn from them.
Adaptability – Make continuous process improvements to benefit from the compounding experience of your team.

“The best executive is the one who has sense enough to pick good men to do what he wants done, and self-restraint enough to keep from meddling with them while they do it.” – Theodore Roosevelt

Character

Character is the foundation of leadership. People follow those they like and trust. To ensure your actions are aligned with good character, ask yourself, “Would my grandmother approve of this?” The “Grandmother Test” is a simple way to apply old-fashioned common sense and integrity.

Character also builds reputation. Whether you like it or not, everyone has a reputation. Be known for acting with integrity in all business dealings, and people will follow your lead.

“Nearly all men can stand adversity, but if you want to test a man's character, give him power.” – Abraham Lincoln

Treat others in a way you would want to be treated. If you can hold your head high, look yourself in the mirror each morning, you likely possess the character to lead others.

Courage

Courage is the ability to act or speak up when necessary, especially in uncertain times. In a volatile business environment, those who act with courage often gain the advantage.

In chess, a concept known as gaining “The Initiative”— forces your opponent to respond to your moves. This often leads to favorable positions and, ultimately, victory. In business, taking bold action requires courage, and those who act when others hesitate often achieve first-mover advantage.

“A leader is one who knows the way, goes the way, and shows the way.” – John C. Maxwell

Leadership in business is a balance of empathy and decisiveness, integrity and action. Those who can build strong teams, solve problems, and act with courage in the face of uncertainty are the ones who inspire true success.

Cheers to your future leadership success!

John

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