69: Public Investment With Rachel Loeb

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This is Real Estate Investing Live from New York with James Nelson, the principal and head of Avis and Young's Tri State Investment Sales Group. In this program, you'll learn about the world of commercial real estate and find out why it's one of the largest investment opportunities in New York and around the world. Now, here is your host, James Nelson.

Welcome to Real Estate Investing Live from New York. This is your host, James Nelson for episode number 69. And we are cranking. Wow, what a great show last week with Rod Santomosimo. He's a coach, a mentor, an accomplished author, and his latest book, knowing Isn't Doing, will teach you how to put thoughts into action. So I would definitely recommend that you.

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Time for our Investor Spotlight with us today. I'm thrilled to have Rachel Loeb, who's Executive Vice President and COO of the New York City Economic Development Corporation where she oversees and directs the corporation Strategic Strategic Priorities for Real Estate, Asset Management and Planning. Prior to joining the NYC edc, Rachel was Senior Executive Member of Worldwide Group overseeing all aspects and phases of the development process. Before joining wwg, Rachel was a Senior Director of Development for Avalon Bay where she was responsible for the development of over 1400 apartments. And before that she began her career in Ho Chi Minh City, Vietnam where she worked on the Saigon south development in 8,000 acre Newtown community. She's a graduate of Northwestern University and MIT where she earned a Master's in City Planning. Currently she resides in Brooklyn with her husband and two sons. Rachel, welcome. Thank you so much for coming on the show.

Oh, thank you so much for having me. I really appreciate it.

Wonderful. So I had the pleasure of hearing you speak at the Young Men's and Women's Real Estate association panel and I thought you just have such an interesting perspective having worth both in the private and public sector. So I think it'd be great for our audience to hear your story and I definitely want to get to Saigon south and that 8,000 acre new town development because we certainly haven't talked about many projects in that hemisphere. So tell us a little bit about how you got into the business. So you were at Northwestern University and then you went for your Master's in City Planning at mit. So I guess at an early in school did you always were you drawn to real estate? Did you think about architecture planning? What got you excited about the field?

So knowing college, I didn't even really know it existed. I was a history major, U.S. history major, like a contemporary U.S. history major and an Asian studies minor. And it was. And I had done my study abroad. My part of my junior year, I went to Vietnam. That's how I was first introduced to the country. And as a, you know, studying the Vietnam War in particular and women and through a feminist lens. And I wrote my undergraduate thesis on that. And so I was there in 1993 before the embargo was lifted. We didn't have formal relations yet with, with Vietnam. And it was a unique process by which we even got to go there as students. There was like 15American students studying there every year. And it was, you know, I had always had a, like more of a travel bug than anything else and a history bug. And, you know, I grew up in the Midwest, but my grandparents were, you know, owned a travel agency, and they were always going around the world and bringing things back to my sister and me. And I was always looking out where I could go. And so, so when I got back to finish school, I still didn't know what I was going to do. I was interested in education policy. I went and lived in D.C. i took my GREs just because I figured I was smart. As smart as school smart as I would be right after I finished college. And then I said to my family, I'm going backpacking. I'm going back to Vietnam, I'm going to go travel in Asia by myself for a year, and I'll be back in a year. Wow. So that was like.

I can imagine how that conversation went over.

Yeah. And you know, this is before, right? Like cell phones. And I think I, you know, we had email, but kinda. Right. So I think I would call from a random phone and I had no money from a random phone. Every three weeks I would call home just to tell them what country I was in and what I was doing. So I traveled through China and I had friends from college who were living in China. I traveled through India, I traveled down through Malaysia and into Indonesia and Hong Kong. And then my plan was to spend the second six months in Vietnam and then go home. But during my travels, it was there that I kind of discovered cities. I had this love of history and I had love of cities, but I hadn't quite. I was like, oh, what? So interesting. How come this city looks like this? What was the history of it? Why does it feel different? You know, I was first approached this through kind of the colonial lens and an imperialist lens of understanding the history of, you know, of different Cities. And then I realized that depending on who was there and different sort of political economies that actually shaped the cities and how they operated in. And then I learned that there was in fact a field called urban planning and architecture and urban studies. And so when I got to Vietnam, I decided that I just wanted. And this was. Now this is 96, the economy starting to open. Things are happening. They were building their first hotels. I was like, I just want to get around anything that has to do anything with the built environment. Because I find this interesting. And it was literally, the economy was happening all at once. Things were building from the ground up. So I called myself a journalist to sort of get jobs and try to figure out what to do. I rented a room in a house with a family, a Vietnamese family in Saigon. And because I was a journalist, I was hired to go write a story about this joint venture that had been founded by a Taiwanese Vietnamese government joint venture that was doing the first. They had set up the first export processing zone. So this is something that helped like create the Asian Tigers where you. It's a value, it's a tax free zone where you can manufacture goods and export them without taxing the items on that, on that value add. And this way for job creation. So they had brought that from Taiwan and created it and were bringing Japanese companies to do manufacturing. And then they were going to build a new city. And so I sent down there to interview them and lo and behold, this joint venture was going to build an 8,000 acre community. And it was good. Ma? O and Sumero, they had hired them to do the Master plan and Kenzo Tange out of Japan. And I met them and I basically followed up and I said, can I work for you? This is what I want to do. And they didn't have a job, but they needed. Because they were a Vietnamese and Taiwanese joint venture. They actually didn't have a native English speaker on staff. And so I got a job as a marketing person to help do presentations and talk about what this was. When they had native English speakers come and people were starting. Delegations were coming from around the world. So from Australia, from the United States, from England, if they basically weren't from Asia. I learned how to do the presentation and try to solicit investors into this project. So that's how I got that job and worked on it. I mean, I was. When Senator Kerry came over, I was the one who gave him a tour and a presentation of this development opportunity because I was the native English speaker.

This is unbelievable. I mean, so we're talking about a project that's 10 times the size of Central Park. I mean, so you're starting from scratch. There's no infrastructure there, so. No, there's rice paddies, everything in water, electricity, everything. Decide the program. And, you know, seems like it was. The investors were both private and public, so I guess the government was.

The government brought the land.

Right. Bring in the utilities and then how.

No, just the land.

Just the land.

Just the land. And then the Taiwanese investors brought in all the infrastructure, and then they would do not land sales, but ground leases to foreign investors or other investors or themselves to do the vertical development.

So they figured out the zoning. They said, okay, over this plot, we want a hotel and ground lease it. We can't sell it to you, but you can have use for it for the next. Whatever it is, 100 years.

Wow.

So that's the way they brought in foreign capital, is that everyone, rather than have kind of a stake in this big thing they had, you know, they're basically giving away these property rights.

Right? So they. Yeah, so it's like. It's what you would see right? Out in. Not in New York City, but out in the suburbs, like big land developers. Right. They put in the infrastructure and developed the pads, and then it had a master plan and do you want to do a housing development? Do you want to do a retail development? Do you want to do a school? We had foreign schools. You know, the international schools would set up there, built a golf course. Just everything that you build a city from scratch.

Unbelievable. I mean, even in the US and you go over to Europe and you travel and, you know, a lot of the architecture there has been for, you know, hundreds of years. But even in the US it's so rare when you have, you know, an opportunity to start from scratch. Wow. That unbelievable experience. And.

Yeah. What are design guidelines? What does it look like? What's the look and feel? What should the roads be? What? You know, sidewalks, setbacks, everything.

And I'm just still in awe about the fact that you just went over there with backpack with no money and just traveled around for a year. I mean, were you always an independent person? I mean, didn't that have to be a little scary to think about? I'm going to these countries and I don't know anyone, and I got to figure it out. I mean, that would seem very daunting for a lot of people.

Yeah, I mean, I think it was as I growing, you know, my. The curiosity about the other places has been part of our family values. My grandparents are Holocaust survivors. So there's always stories about, you know, Germany and Europe and where they came from and my, as I said, my other grandparents traveling. And I think I just always had it in my DNA. I mean, like, when I applied for colleges, I drew a map of the United States and I drew a big circle like around Kansas City and the whole area. And I said, I'll look at anything outside of this area. I mean, Northwestern was the closest school within my geographic limitations. So I think, you know, and I wanted to go to boarding school. I heard, like, you're never coming home. Can you give us four more years? We know you're never coming back. And so I think it was just always in my DNA. And I, you know, I wanted, for whatever reason, if people went right, I always wanted to go left. If it was, this was the easy way, I always wanted to take it the hard, the harder path. And I mean, I remember I decided before I was going to go traveling by myself. I put myself in training. Like, I go out for dinner by myself, I go to the movies by myself. I, like, figured out how to do things on my own because I knew I was going to be by myself. And I, you know, I just loved it. I was just curious. I just wanted to see the world and figure it out.

Amazing. And that experience, that perspective that you brought, which now even, you know, today, I'm sure there's still times when you're thinking about maybe a new area that, you know, you go back to those early days and how do other, not just how has this been accomplished in the US but in other countries. And I love how you found your passion that you could study and get a degree in city planning. So for our listeners, what would a master's in city planning look like? Was that an intensive? Was it a two year, four year. What's involved in that degree?

Well, it's a two year program and there's lots of different variations on a theme. So you really need to find the thing that speaks to the school or the program that speaks to you. And again, I was fortunate enough that the gentleman who was the master planner for Saigon south, who was from som, was really thoughtful and took time to explain to me. He's like, well, what do you want to do when you grow up? Because you got to pick the right place, you know, he's like, do you want to be the person drawing trees on a piece of paper or telling someone where to draw trees? And I said, oh, I want to be the telling person. Because first of all, I know I can't draw and I'm not that diligent, I don't care that much. And I like the other side better in a more holistic view. And so he was like, okay, then don't look at these kinds of schools, look at that kind of school. So some are more technical, some have a more environmental planning lens, some have a more social policy lens. So there's many different kinds of, of schools. And part of the reason I chose MIT or it was my first choice and I was fortunate enough to get in there is that I was, you know, intrigued by one. I thought I was going to go back overseas and it has a big, it had a big international population as part of the student body. Like a third came and these were going to be the leaders of their countries and planning and stuff. So I was, and did a lot of foreign study projects. So I was attracted by that. But I also, I knew I was interested also in urban development in cities. And I wanted a, I didn't just want to be a technical planner, I didn't just want to be an mba. I wanted a real cross disciplinary. So I like the approach to that school. So it was land use law, it was finance, it was the history of cities and really understanding and I think even today, now more and you know, on the issues that we're going today, understanding the history of, of inequity and how that is structural and not just circumstance and how do we combat that? Taking design classes, but not all design classes. So I can read drawings, I can read planning drawings, but I'm not good at it at all. And I just like the, I think because I have an interest in everything. I like the cross disciplinary aspect of this program, of this, this kind of study rather than doing one thing singularly. And it wasn't necessarily, I didn't know for sure I was going to go into development, but I didn't want to foreclose that because I like the three dimensionality of the work and not just the two dimensional aspect of planning.

Well, it sounds like it certainly worked out and this might be a tough question given your path and experience, but for our listeners who want to get into development because the traditional course would probably be, you know, go and get your real estate master's, right? So it sounds like you did get a blend of that where you, you got some of the financial underwriting but you know, you had to choose between the city planning or, you know, real estate masters or ideally would you try to get both? I mean what, what would be the advice you would give for someone looking to get into development on where to get higher education.

So I don't know if it really matters, right. Because there's usually a couple different aspects. I say two or three different. Three components. I would say to development. One, obviously, the financial aspect. Two is the. Is the. Is understanding how buildings are put together. So there's. And really, if you're into it, you know how buildings come together. So understanding the technical. And the third aspect, which I wish I had more training in actually is law. Right. So much of what we do are contracts, whether it be contracts with the bank or contracts with your joint venture partner or contracts to purchase land or contracts with your construction manager. And what those words means and implication, or if you're doing a condo, your condo sales. So that part of it is so important too. And if you look at the real estate development proposal, I would say there's a huge component of people who've come from a legal background and they bring a whole bunch to the table. And so there's always those three components. And I always, when I tell people it's like when you come to a job like a development manager job, it's sort of good to have. No one's expecting you to have strength in all three, but to have two out of the three is, I think, really important. And you'll get fluency in the others as you work your way up. But, you know, at least have two. You know, at least know that. You know, I remember my job interview at Avalon Bay was, you know, they pulled out a set of drawings and said, can you read floor plans? You know, can you walk me through this? Because we build buildings. And one of my colleagues, she came when she joined, you know, we were sort of at the same level. She was a lawyer and had finance, but she couldn't read drawings. I wasn't a lawyer, but I could do finance and I could be drawing. So, you know, you. So there's. I don't think there's one best way to get at it. It's just. Do you love it? Is it interesting? And what piques your interest to pull you in?

Wonderful. That's really, really helpful. So tell us about Avalon Bay. So that was after you graduated. So now you have your master's, You've been to Vietnam, now you're a senior director for development for Avalon Bay. So what was your responsibilities there?

So we. So. So I was a development manager in the beginning. And. And really, you know, we have a. The way Avalon Bay is structured, which I think you know, for someone who wants to come in and learn the development business, it's really great because you have, you know, some places will have developers and then they have the finance people and they have operations, and the two don't necessarily talk to each other. But Here you had 360 responsibility from site selection, you know, working the head of the unit and the head of the department is the one really finding the sites. But, you know, from site selection and permitting and acquisition and taking it down, but you're not handing it off yet. You are not finished. Your job is not complete until that building is full of residents. And so to be able to be responsible from. Does this site work for our program? Right. Is this going to. We know what our business model is. We know how it works. We know how we make money. Is this site going to bring us that value? And then working with your colleagues on the construction team and on the operations side to really, like, make that program fit on this footprint and then understand, you know, and then you have aesthetic responsibilities and marketing responsibilities. So you're doing the contract. What I loved about it is I'm doing contracts in the morning and then I'm picking out carpet designs in the afternoon. And then you're figuring out what your kitchen tiles are looking like and you're doing underwriting. And. And so for someone like me who likes it all, you really are getting satisfied in that left brain, right brain side of it. But it better work out because you're responsible for the whole thing. You don't hand it off until it's 95% occupied. And that's stabilization. And that's when it really transitions to the ops, you know, the OPS team. But you are partner to partner with your construction colleagues and with the OP team and everybody to get it to that point, to get it to what you know, and. And prove to the executive committee that you said you were going to make this yield and this kind of return and drive it there. And so you get a real. It's a wonderful place to learn how to do development and how to do multifamily housing in particular.

I would certainly say so. And able to see it through the arc of the development because, you know, as the analysts and doing the numbers, you make projections. But then when you have to actually go out and be responsible for sourcing that and finding out, you know, was your budget accurate and to be able to really see that side of the equation, I would imagine that for future projects where, you know, okay, we were a little too aggressive on this. We did More time here. So that that really makes a ton of sense.

Is also being taught how a job site works and how it should feel. And that is, it's not theoretical. It's like you get the flow of how a job should work. And so I can walk a job now and I've had this situation and I just know how a multifamily job should work, how it feels, how many people like at this stage, what should the buzz be like on the side? And if you don't see that, you can start to feel when a job is sideways. And that's excellent training too.

Outstanding. So were your projects as of right. Did you have any early interaction where you were trying to get a project permitted, where you started getting interface with the municipalities? Because you're clearly setting the stage for your position today.

One of the things when I joined so Fred Harris, who ran the New York City office, who came from very much a public private background, had worked for the MTA running real estate for them. And his business model for Avalon to get in to break into the New York City was to actually do those public private partnerships to win RFPs, to do deals that before a lot of companies stayed away from because they wanted to own the fee title. So we did ground leases. We said, okay, what is Avalon's comparative advantage is that we have a huge balance corporate balance sheet, so we can guarantee leases. So how do we use that to our competitive advantage? If you're talking to the state or the city or family, we did a lot of deals both down on Christie street, down on Houston that was winning an RFP from the city, a three phase deal.

I was very pioneering at the time. Now it's one of the trendiest neighborhoods.

People thought we were crazy.

Yeah, you got Whole Foods only to go there, right?

Yeah, yeah, Whole Foods and all that. Yeah. And then. But also in Queens West. So we did. Which is in the Long Island City waterfront. Right. Like we were the second building that was built on the Queens west waterfront in the third building and sort of working on those. And those are, you know, those were dirty with like really complicated remediation and doing brownfields programs with the state. And that was a Queens. That was a ESD program. So again that lease negotiating pilot payments. Lease payments. I did a project at St. John the Divine, not government, but again a nonprofit and sort of there aligning interests and understand through a competitive RFP process that had historic preservation issues, city councils, public, you know, that is. It's a private institution that belongs to the city of New York So how do you make sure that you're putting a development there that is sensitive and appropriate through the political lens and all sorts of things, and has affordable housing and everybody has an opinion. So that was so very much early on, doing a lot of projects that were requiring rezonings and public approvals.

And did that carry on and maybe talk about your move to Worldwide, Was that an opportunity for you to continue to grow?

Yeah, I mean, you know, I had an amazing seven year run at Avalon Bay and was fortunate to sort of be able to work through the recession and learn a lot through that, through the workouts through there. But I sort of took pause and said, okay, what do I know how to do? If I look at myself as a360 whole developer, what haven't I had to do? Well, I don't have to raise debt, I don't have to raise equity, and I only do one, basically one type of development. And so I could either go down that path and sort of like double down on being a reit, you know, multifamily developer. And I said, no, I need to, I need more experience, I want more skills, I want to be a real developer in the sense that I got to go find the money. And also, instead of, as I mentioned before, you know, at Avalon, you're a program looking for the right site. I wanted to find a right site and figure out what the best program is, what's the highest and best use for that site, rather than always being, you know, a 400 unit multifamily looking for a good piece of dirt. And so, you know, Worldwide was this small boutique family company that was quiet but did big projects, big complicated projects, really smart people, but lean and mean. So also you had to do it. You got to do everything. So finding equity partners, working with the CFO to like really negotiate the debt with the lenders. And then it wasn't like each product, each building had a brand. You got to create it whole cloth. So what is the vision for this building? What do I want it to be? Hiring in the right team to help come up with it and really not being constrained by a brand already really being able to create the brand for each project. And then because they're, you know, we're old, they had all these random assets too, so you would pick up things. So I had a sports authority, they had a sports authority that used to be one of their original Volkswagen dealerships on Northern Boulevard. Twenty years had passed and the lease was up for, you know, the option period. And so no one wanted to do with it. So I was like, I'll go do it. I'll go figure it out. And ended up negotiating with them to try to take back part of the site because they had this huge, empty parking lot. Like, what else can we do with it? Then they went bankrupt, and then I got to learn all about bankruptcy. I went to bankruptcy court so we could try to get the lease back so that we, you know, someone else wouldn't buy the lease out from under us, and then we could actually control our asset and control the site and figure it out. Did a bunch of air rights. I did the best sale of my life on 60th street, where I sold this incredible site across from Bloomingdale's at the peak of the market after doing some really fun assemblages. So it was just entrepreneurial and fun.

That sounds like amazing experience. After that. Did you ever think about going off on your own now that you had the skills to develop?

Yeah, for sure. It's crossed my mind. And that was part of the impetus of having to do that, to, like, change and make sure I had more experiences. I think that I probably suffered a little bit from female imposter syndrome, where, you know, I say, well, how can I go and do that? I haven't done this yet. You know, there's a little bit of a. Like, a checklist. Like, I need more experience. I need more experience. I need more experience before I can go and do this on my own and not having that, like, chutzpah and that self that some of my peers of the male persuasion, like, I'll figure it out. I think I didn't give myself enough credit for that, but that I. So that was in my mind. But I also had always been interested in public service. And so when I was thinking about what to do next, it just so happened that this opportunity presented itself at edc.

Wonderful. So for our audience, if you could just give us an overview of the New York City Economic Development Corporation. What do they do and what's their mandate?

So New York City Economic Development Corporation is unique amongst economic development corporations around the country because we do a lot of everything, you know, a lot of cities and states. It's, you know, just incentive programs or sort of job programs. But. But we're actually set up strategically as a nonprofit with a contract to the city of New York to not only think about how to grow, you know, our mission is to grow strong neighborhoods and create good jobs. But through this unique relationship, we're actually financially independent, sort of financially independent. We have a contract with the city of New York to administer and manage real estate on behalf of the city. So we're actually one of the largest landlords. We manage over 60 million square feet on behalf of the city of New York. Everything from the leases under the. A lot of them are ground leases. So the leases under the airports, to the Manhattan cruise terminals, to the leases under 42nd street, we have space leases at Brooklyn Army Terminal, where we manage that whole asset, the food distribution center up in the Bronx, a whole, you know, whole Metro Tech, the leases, all the leases under Metro Tech in downtown Brooklyn, north shore of Staten island, all those redevelopments. So anytime we do a deal that goes into a lease, the lease isn't administered by our asset management group, but we also do capital projects. We on a normal year have about $8 billion of capital work on behalf, whether it be on projects that were directly related to or other projects that the city would like us to take on. We have our real estate team that does public private transactions where we take undervalued pieces of property and either reason them ourselves or work with a private party to rezone them and then sort of use that value creation to meet policy objectives and create jobs and generate activity. And we have our own planning arms, so we sort of work also. We think about transportation planning, what is inclusive economic planning look like, and supporting land use. And then we have a whole policy side of the shop that thinks about jobs of the future. So where should the economy be going? Where could it be going? Where is it going? And how do we help New York City get there? So whether it be in cybersecurity jobs and creating partnerships and training programs and to help bring people into this area, or life sciences, which we've been working on for the last 10 years, and Covid and all this is really bearing fruit and we're going to continue to push on that to Cornell Tech. That was an idea before diversifying away from just finance and bringing tech also into the economy. So we supporting fashion, so supporting the traditional economies as well as thinking about new things. So we're. It's hard for people to appreciate the diversity of the things that we can do. And the geniuses who set us up originally sort of figured out that if you can create this organism that has its own kind of contracting, its own procurement, we can be nimble and responsive and work a little bit differently than city government.

I know when I heard you speak before, I was so amazed with the, the breadth and what the EDC does. I mean, I feel like I Only knew one small component. So it's really interesting how basically a partner act on behalf of the city, not just to stimulate new economic development, but to also, you know, oversee projects and you know, across the city. So just to get a little more specific so our audience can understand and I'm glad you brought the Cornell Tech campus up and maybe you could give a little bit more of an example there of how the EDC was involved because my understanding is you've got Roosevelt island there, which was underutilized under the Bloomberg administration. Clearly they were very pro tech and looking to attract this talent. So was the EDC responsible for the master plan of what you wanted to see done there? And then you had, because you had private developers. When Marianne Gilmartin came on the show, she actually spoke, I believe the Forest City was involved in the element or oversight of either part of that project or the whole. So again, what was EDC's role throughout that project?

So if you use Cornell Tech or you use Essex Street Crossing, that is a joint venture between L and M and Taconic and bfc, if you use, well, let's use those two as an example. Right here are large pieces of underutilized real estate and that are embed Essex Crossing embedded in a community and sitting there forever like that was a relic of unfortunate urban renewal when they cleared all these tenements and then never did anything with it, which has its own story or Roosevelt island which had been. Those had mental hospitals there that had fallen into disrepair and other hospital uses there. And so these are sort of city assets that are sitting foul. And so in both cases the city will say, okay, we want, this is not good. What policy? We want to create a vision. And so we're going to say in each case, what is our vision for this, these sites? In the case of Rota, Rhode island it was, you know, we create this new campus of applied sciences to stimulate growth and investment of this field. And we want to bring in an academic, world class academic institutions and we want to bring in developers to do this. And we are, here's our policy objectives, here's our goals and we're going to lay that all out in an RFP and then we're going to bring to the table land and then you private sector marry up with institutions and then come and respond and tell us and basically compete and tell us why we should pick you. Because you're going to either bring revenue and policy hopefully to the both, you know, we're going to pick the ones that meet that objective and in the case of Essex street, marketing was here's like all these underutilized sites. We want a new Essex market. We want this much affordable housing. We want this much community use. We set out the program, we have a competitive rfp. People respond, and then it's a negotiation. We usually negotiate really hard because we have really talented real estate professionals and then get to an agreement. And then we want the city's bringing something, usually the land, and we want them to invest the private capital and we can trade off on policy for value.

And how do you measure your success at the end of the project? So for a developer, it might be profit, dollars and cents. I mean, for you, is it. Is it job creation? I mean, what are the metrics to know that you were successful?

Well, so first, I think everybody should. I mean, I think, you know this, right, you're in real estate that sometimes when you get to a groundbreaking or ribbon cutting, there's like this collective amnesia of like, of course it happened and how hard it was to get to that point and how many millions of like, roadblocks could have derailed the effort, but for like, just the collective effort and the right people working on the right project at the right time and being at the helm and just having sort of tenacity. So I think that's one thing. It's like, so did we actually get to closing is like, yay. You know, we've gotten to this point as a measure of success because so many things could have just stopped it. And usually these things take a decade often or more to almost sometimes even get to that first point. So that's, to me, is one measure of success, is just getting to that point. And then, yes, we do look at, and we set this up clearly is job creation, right? Both permanent and temporary jobs. So how many permanent jobs are being created? How many temporary jobs are being created? So construction. And as I said, depending on each project, we have a policy, objectives. So sometimes it might lean more heavily towards affordable housing, sometimes it might lead toward, you know, did this institution create these new academic centers or did it create affordable spaces for startup tech companies? Or. And what do we want to get out of that? Or did we preserve a historic market like Essex Market and make sure that the vendors that have been there for 40 years have below market rates and they're going to be protected and not pushed out? So success is measured. Yes. Jobs, yes. Economic investment, yes. Impact. But also it depends on the project and what the objective is on that project.

That's great. Thank you so much for Sharing that. What would you say to someone looking to get into real estate? And we have a lot of. A lot of our listeners are still in college and they're wondering about how to break into the business. And I'm sure a lot of people think about real estate and they think, oh, I want to be that big condo developer who's selling out projects. But what would you say the appeal would be for working in the public sector, getting that experience? What would you say to that?

So the one thing about the public sector that I don't know if people appreciate enough is how much responsibility you're given at a very. Without a lot of experience. So you can really get a lot of nitty gritty detail experience. Experience. Particularly if you're just speaking about real estate or in our asset management team. I mean, you're just out of graduate school and you're at the table with related. And like the senior managers are related or, you know, name Brookfield. Name your company who all these major tent landlords on the other side, who are our tenants or our partners, and you're on the other side working with them. So you have a lot of responsibility, you get a ton of exposure and you get to learn so much about the city. This is a big city with a lot of stuff, and people don't appreciate how much it takes to make it operate. I mean, where all the wheels are and understanding what makes it all happen. And. And so when you come to the other side, you have this incredible understanding of what is land, you know, what is a ulurp, how does it work? How do you deal? I mean, so much of what we do is politics. So you get to work with some of the people, sharpest minds. I mean, some of my colleagues are the sharpest minds of understanding. Like, what is that council person thinking? What is on the mayor? And how do we work that? How do we understand what they need? How do we translate this project into something that the community can understand and that will accept and want and that is a benefit to them. Or how do we listen? How do we. How do you shut up and actually learn to listen? And so you're going to get all that experience as well as really good financial underwriting and legal, all the legal skills, because it's all contracts. But you're also going to get all this other stuff through osmosis that is really important to do real estate development, that you'll understand how the sauce is, you know, how it's made.

That's great to hear that. That makes tremendous sense. And Again, thinking back to that interview I did with Mary Ann Gilmartin. She came out of the public sector and she was at the table with Bruce Ratner and he reached out to her afterwards and said, look, you got to come work with our team because you understand, you know, that that side and you have to, you know, public private partnerships are truly embracing and knowing what both sides bring to the table. So I think that's really great advice. What would you say to now this is for our more experienced listeners out there who've been doing projects and they want to take a look at larger scale projects or they might need the city as a partner because I think a lot of private developers, not to generalize, they might think, oh, the city is that roadblock. They're the ones that can make things difficult and getting approvals and that just means it's going to take so much longer. So I'd rather just stay in my lane and not invite the public into the process because that just is, you know, more trouble. What would you say to that developer and why, you know, they should consider, you know, partnering with the city.

So if the city's putting in its effort and its money and its time behind something, it means it really cares about it, right? So in one sense you are, you, you're aligned in that. And so if we're a joint venture partner on something or you're my tenant and I'm the city and you're having trouble getting some permits, believe me, we're going to be aligned and trying to help get that smooth and figure out the way forward and share with you our advice, our counsel, if you have an as of right project, I guess if your question is, is why would you take an azerite project and come and bring it to the city or you know, involve the public sector, I guess it depends, right? People coming to us all the time for IDA benefits or support because they want to do something a little bit different and they have an idea and maybe it doesn't fit within the box, but working together we can, if we're aligned and there's some policy initiative that we want to achieve again, we're going to figure out how we can do that together. So we don't have all the ideas, we don't pretend to have all the ideas. We actually want partnership and we want more, you know, we want investment. So we're going to be pretty straightforward to say like, no, we can help, we can't help you here, but. Or yes, we can. I think this is a great idea.

Yeah. I could personally attest to the benefits. I was marketing a 10 acre site up in the Bronx and I went to the Bronx EDC to say, look, we've got land. You know, what are your ideas? What do you think could happen here? And you know, the amount of, first of all, to give the lay of the land. Because when you go to that organization, you see all the pieces, you see everything that's happening. They knew the new businesses and they said, hey, you know, there's this new microbrewery, they're looking to expand. You should speak to them, you know, really pro business saying, hey, how can we help you be successful? So it's just, you know, I really recommend. Yeah.

And we're even like, one of the things we're really focused on now is making sure our partnerships team, which does support business attraction, is really seen as a partner. Like, we want to help people, you know, do you have a tenant you're trying to recruit? Let us tell you, we have all that information. We can tell you about the workforce, we can tell you about the community, we can tell you about the opportunities. We can, you know, and so we're really, we're actually trying to be very much more proactive to say, let us be your partner to help you do your job. Because we want people to invest in New York City. So we're actually trying to, to do that because, you know, we call it like Brooker plus.

Absolutely. Well, we really appreciate everything that you're doing for the city and to give back. And we only have a couple minutes left. So just a parting question, and for those again who are looking to get into the game, what would be your advice? What would you say? Your. What was the key to your success to get you to where you are today?

That's a good question. I don't know if there's ever a key, but I think one is just having a general curiosity. You know, the great thing about real estate and planning or whatever it is, is that you can never stop learning. And there's so many different, different ways to grow and learn and be enthusiastic about an opportunity in front of you. So I think just being generally curious, I think the other thing is leaning in and saying, like, sometimes taking the crappy project that nobody wants is the one that turns out to be. If you can make, you know, diamond out of a piece of coal, it creates things. So if other people don't want it, take it. Because one, people appreciate it, and two, you never know what you can make out of it. And people remember that So I mean, that sports authority deal like that is a perfect example of taking the scraps at lunch and turning it into something. We ended up selling it at the end. Just going on that journey was great. And then third is, like I said in the beginning, people are going right, go left because it makes you different and there's a lot of the same out there and you don't need, I don't think you should go through life having a checklist of like, even though I said I feel like I need to have a checklist of my own, but I'm trying to break that rule. And so, you know, just be honest to who you are as an individual and what interests you and you don't. Someone tells you you need to do this and then you do this and then you do this and this is how you're going to be a successful real estate developer. I wholesale reject that. I didn't go to business school, I didn't follow any normal things and it worked out. So, you know, just be nice to people, keep your relationships network, talk to people and they all come back together.

That's wonderful. That is incredible advice. Rachel. You've got such a amazing story. Really appreciate your coming on the show today and sharing it with our listeners.

Oh, thank you so much James. I appreciate it. Thanks for thinking of me.

Of course. Thank you again. And this is your host, James Nelson of Real Estate Investing Live from New York. If you haven't already, please subscribe to the show, leave your ratings, I love your feedback. And while you're at it, connect with me at my handle, James Nelson nyc. You can link in with me, send me questions you have, follow me on Instagram and even feel free. If you've got some questions thoughts about this interview, you can email me@jamesperiodnelsonavisonyoung.com so until next week, thank you again.

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Thank you for tuning in this week to real Estate Investors Investing live from New York. Please join your host, James Nelson for another program next Tuesday at 7pm in New York, 4pm Pacific Time on the Voice America Business Channel. All shows are rebroadcast on Wednesday mornings at 7:00am Eastern Time and 4:00am Pacific Time, as well as always on Demand. We'll talk again next week.

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