Stepping on the Gas
Q&A with Leslie G. Callahan III, CCIM
Considering the fast-paced change faced by commercial real estate professionals in 2022, Leslie G. Callahan III, CCIM, CCIM Institute’s 2022 president, aims to offer steady, sturdy leadership in bringing the organization through what hopes to be the waning COVID-19 pandemic. President of First Colony Financial Corporation in Atlanta, he earned his CCIM designation in 1982. He has worked extensively with the CCIM Georgia Chapter, serving as its president and subsequently on a variety of institute committees, including as the treasurer and chairman of the Finance Committee. Currently, Callahan also serves on the institute’s board of directors and Executive Committee.
We spoke with Callahan about the CRE industry and his goals for CCIM Institute in 2022.
CIRE: Considering the ongoing uncertainty amid the coronavirus pandemic, what do you see as the biggest challenges for commercial real estate in the coming year?
Leslie G. Callahan III, CCIM: The economic reality is changing every hour, but inflation, rising interest rates, and increases in construction costs are going to be part of the discussion in 2022. Even if supply chain issues are addressed, these topics will play a major role in how commercial real estate performs throughout the year.
Recent stimulus bills have put huge amounts of cash into the system. This may be a good time to take a few chips off the table and focus on product types which have good intermediate and long-term prospects like medical, last-mile industrial, and self-storage. Additionally, large amounts of capital are being directed to suburban offices as the next big opportunity, followed by hospitality. It will be an interesting time, as trends that began with the onset of the pandemic will either become more entrenched or start to wane. But throughout it all, the nation as a whole will need to keep an eye on any developing COVID-19 variants, as well as the political environment heading into the midterm elections.
CIRE: How can members leverage CCIM Institute to tackle these upcoming challenges and identify opportunities?
Callahan: The three pillars of CCIM Institute are technology, education, and networking. It is our responsibility to encourage members and potential members to use all our technological tools, not just Site To Do Business. Users and buyers/sellers want sophisticated analysis, and they want it presented in a professional manner. For education, the Ward Center for Real Estate Studies is a key resource in the development of our members. The Development Specialty Track also offers a wide range of novel classes on medical office development and self-storage, for example, at a relatively small cost. Our designation curriculum is available virtually and in person, so practitioners can profit from the ever-changing commercial real estate industry. Finally, CCIM Institute members should take advantage of local chapters and attend our annual governance meetings. These networking avenues, along with social media, can help build your business.
CIRE: What area would you like the institute to focus on this year? And how will this benefit members?
Callahan: The management team and staff are laser focused on the designees and candidates. After all, CCIM Institute is all about the value proposition available to its members and potential members. The more times a member and/or potential member encounters other members, the more chances for growth in productivity and production as measured by dollar volume and earnings. We want to make sure that the proper tools are available — in both good times and bad.
The management team and staff are laser focused on the designees and candidates. After all, CCIM Institute is all about the value proposition available to its members and potential members.
CIRE: It’s been nearly two years of unprecedented turbulence and change. What are some insights you’ve gained in the last year or two that have made you a better CRE professional?
Callahan: In 2020, the byword was “pivot,” referring to working remotely with technology tools. In 2021, the word was “nimble.” In 2022, the interest rate, inflation, and political headwinds (including possible changes to tax policy) are very real. I believe the 2022 byword is “acceleration.” Our members and potential members should find a product type or types well suited to their market, skill set, and resources, and stay focused on execution. When I started as a community shopping center developer in the early 1980s, the goal was to enter into long-term fixed rate leases and let the debt be fully amortized over the lease term or shortly thereafter. There was one flaw — the retailers kept changing store sizes depending on merchandise mix, on-site storage, and method of delivery. In the 1990s, I joked that I was an expert in backfilling big retail boxes. It was just unfortunate that they were the big boxes I had developed.
In the last two years, I have treated every post, newsletter, and email as an opportunity to understand the next trends. Who would have guessed that based upon household formation, we would have a shortage of single-family housing which would quadruple the size of the build-to-rent industry?
I have also come to realize that time is precious. For years, I have spent the first hour of every Saturday morning thinking about the prior week and planning the next. Where am I in each of the deals I have been working on? Where am I in each of the personal relationships which will lead to the success or failure of these deals? How do I refocus and redirect myself and my resources to the coming week and the months and years which will follow? Knowing where you’ve been and being mindful about where you want to go are crucial to success, both professional and personal.
CIRE: Not knowing what 2022 will bring, what is your mindset entering your presidency? What are your hopes for the next 12 months?
Callahan: When the 2022 Strategic Planning Committee was virtually convened in February 2021, we conducted a SWOT analysis (examining strengths, weaknesses, opportunities, and threats) of all the standing committees. We discovered that although 2020 had been unsettling due to COVID-19, most of our members were in good shape, mentally and financially. In May 2021, when we convened in person, we looked at our mission and vision statements and set modest midterm goals for the institute. Some of these goals included new Ward courses under 2021 President Timothy S. Blair, CCIM, some related to the member benefit proposition, and some related to the role of technology.
We now realize that COVID-19 and its variants may be with us for some time. Now is the time to execute in the technology, education, and networking areas. The management and finance teams will continue to meet weekly so that we can be in front of surprises and offer the best commercial real estate products and services available. And when we see something new, we will use our 2021 byword and be nimble. Equally important, we will accelerate, change as necessary, and move forward rapidly — but always while being in touch with the needs of our members.