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The 4th New Development Forum held by The Real Deal magazine, led by publisher Amir Korangy packed the house yet again, the second consecutive year the event was hosted at this venue.

Larry Silverstein, the storied developer and owner of the World Trade site, shared insight and his vision for the downtown market. After all, tomorrow is 9/11.

I was initially concerned because most of the panelists have commercial rather than residential real estate backgrounds. But they spoke in the context of both and it was very informative. I did miss Mark Zandi, founder of Economy.com whom I greatly admire for his analytical insights, who had to cancel at the last minute.

Stream of consciousness:

• Amir, you are unable to think small. Congratulations once again for pulling off another one.
• Stuart – I met your parents – don’t worry, I put in a good word.
• Lauren – keep the web site going, but still call.
• Brian – You’ve got the richest voice in business news television and can moderate with the best of them.
• Cathy – the plum color worked – thanks for keeping me in my place.
• Lock & Josh – Offering a great vehicle for listing advertising, better yet, Josh with a tie on (if Lock wore one = end of the world).
• 30 second advertisement onstage before the event showed Bruce at C&W and me 120 times (at last count) on the big screen.
• The best Real Deal bag yet – to replace last year’s model.
• Happy that the audience was very supportive of the opening sponsors.
• 3,000 attendees suggests real estate is not dead in New York, no?
• I ran into my attorney at the show.
• Larry taught us all the importance of cycles and taking the long view – and we knew he was right.
• Larry thinks that luxury development prices, on an average sales price basis, will be higher next year than this year.
• Bob emphasized segmentation and shared a 1% cap rate story. He knows his craft.
• Steven was particularly articulate, being the first to be open about looming problems and answering my question about the new development pipeline.
• Charles recently learned how to calculated IRR but probably has a higher IRR than hedge funds that live and die by formulas like cap rates.
• Barbara continues to radiate – her marketing contrarianism can intrigue.
• Don is looking at a $13M penthouse and was by far the most bullish on Manhattan – it’ll be back in a year?
• Michael Shvo was at the event – he was the main draw card at the 2nd forum held at Cooper Square two years ago. That one sold out too.
• Ran into a former dotcom era real estate development guy who lost millions (of other peoples money) but is doing very well now.
• Paul, with beard, is itching to be a major player again in the brokerage business.
• After asking my question to the panel, 2 people in line behind me told me I asked their question.
• It is apparent that the audience has come to terms with the new market reality.
• Don’t hold your breath, real estate is still first in the New York conversation.

And that’s the real deal.

Tags: Michael Shvo, Amir Korangy

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To expand Lota da Povoa de Varzim em 1960 [Wikipedia]

Motoko Rich’s article Rocking the House to Sell Condos [NYT] explores marketing efforts by The Corcoran Group on behalf of Extell and The Shvo Group on behalf of Leviev Boymelgreen.

For the Avery “Extell is spending more than $500,000 to inaugurate the sale of apartments in the building, due to be completed in the fall of 2007, with a party next Thursday on a strip of grass next to its construction site. Seal will perform there under a tent designed to hold 800 people.”

Disclaimer: I don’t claim to know much about marketing real estate and I don’t do it for a living. I can only offer a layman’s everyday interpretation:

Some thoughts:

• Lavish spending on an opening launch shows weakness.

• Potential buyers might be thinking that they are paying for this.

• It doesn’t attract buyers, just media coverage.

• It smacks of investor speculation seen in other investor-heavy markets like Miami.

• Seal? What about Led Zeppelin? 😉

For 20 Pine Street, Boymelgreen will about $200,000 on the part that is partly a benefit for the New York Academy of Art.

Some thoughts:

• It will attract people that are interested in the arts but how does that translate into sales?

• How is this a different approach than an open house?

• How do I get invited? 😉

At the end of the day, I am sure these efforts will move units and generate interest, after all, these are significant marketing efforts and there is a lot of talent and experience found in these real estate consultant/broker firms.

I am only wary of the message it sends to the market: weakness…which is exactly what these efforts are intended to counteract.

Tags: Michael Shvo, Corcoran

Comments Off on To Market, To Market: Real Estate Marketing Set To Maximum Distortion

Source: ABC

On Friday night, Michael Shvo was profiled in The Real Estate Assassin of New York City [ABC News Nightline] with the tag line Michael Shvo Became the Most Successful Broker in the Big Apple – and Generated a Flood of Controversy Along the Way

Lets Shvo

Shvo’s marketing slogan, has become a verb associated with real estate but cannot be said without sarcasm by many in the real estate community.

In a high density housing market like Manhattan, the competition is fierce and quite often, contrarian marketers will float to the top. This is no guarantee that they will be successful in the long run. Here were or are some of the best:

• Barabara Corcoran — One of the pioneers of real estate marketing who did go the distance was Barbara Corcoran. She formed the Corcoran Group real estate brokerage firm in the early 1980’s and brought new marketing concepts to a pretty boring marketing environment. She was seen as a marketer first and a real estate expert second. She had a reputation for saying anything to get attention for her firm and drove many crazy with the things that she said. She has since sold her firm to NRT and moved on to television but her influence remains.

• Louise Sunshine — who (has literally one of the best last names in marketing) sold her firm to NRT as well, has been one of the most creative marketing minds in the real estate marketing business. She was able to understand the intricacies between the development process and the marketing process of luxury residences in many different markets. She is not without controversy as noted in this recent article [NYT]. I remember once being on a real estate panel with her, hosted by New York University and the New York Times and she arrived about 5 minutes late and left 5 minutes before the panel ended because she was working on several deals. She walks to the beat of her own drum and maybe that’s the point.

• Donald Trump — There is no one like him and no one in New York real estate that is an international household name. He has created a brand that attracts international buyers of New York real estate and has expanded his brand into many other venues. His style is brash and comes from the school that if you say something positive often enough, people will believe it. He has developed a following unmatched by anyone in the business as evidenced the success of his television reality series The Apprentice and his recent appearance and deal with the Learning Annex.

There have been and are many other successful real estate marketers in Manhattan and now there is Michael Shvo. He has made many enemies with his brashness. With three blackberries and two cell phones, love or hate him, the man can sell.

Our first-hand impression_
However, my appraisal firm was assigned to appraise a unit in one of the projects he is currently marketing. The sales representative was unbelievably rude and abrasive…over – the – top. The Shvo agent was not busy yet seemed to thrive on this type of behavior and would _not show my appraiser the unit even though we had made an appointment well in advance. During this interaction, a potential buyer came in who was trying to get information and the sales staff would not help him. The potential buyer eventually gave up. My appraiser finally had to find a construction foreman who provided access to the unit.

To be fair, this was the first and only time that we have inspected this particular project, although I suspect we will be returning soon as the units that are sold get set to close. Hopefully this incident could be the fault of a few poorly trained agents, but thats the rub. The brashness of Shvo doesn’t allow him to be given slack by the real estate community. And to his own admission, he could care less about what anyone thinks. Perhaps thats the key to his success as a salesman.

In a market with limited supply, rapid marketing times and eager buyers, this type of behavior probably doesn’t really matter. Many brokers were order takers until recently. As we enter a market where there is more balance between supply and demand and new developments are the primary source of new supply, I have my doubts about the long-term staying power of in your face selling.

Tags: Michael Shvo, Barbara Corcoran, Corcoran

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