1449: Leaving NYC, Douglas Elliman CEO Dottie Herman Eye On Real Estate

Welcome to the Creating wealth show with Jason Hartman. You're about to learn a new slant on investing, some exciting techniques and fresh new approaches to the world's most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine, self made multimillionaire who's actually been there and done it. He's a successful investor, lender, developer and entrepreneur who's owned properties in 11 states, had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason's footsteps on the road to your financial Independence Day. You really can do it. And now, here's your host, Jason Hartman with the complete solution for real estate investors.

Today we are going to talk about the escape plan being devised, being worked out, something that is being thought about many, many times a day by tens of millions of people. And around the world, maybe billions of people. But guess what? Around the world versus in the United States, there just aren't as many options. Because the US has something unique and it is something it has been criticized for, for decades in it is something that many urban planners dislike, many environmentalists dislike it. But guess what, it's coming back and that is the rise of suburbia. Now it is pretty amazing that you would have the CEO of a major real estate firm talking about how people are leaving really their primary market. And that's exactly what we're talking about today. So this is the escape. There was a movie years ago called Escape from New York. Do you remember seeing that movie? Maybe Escape from New York. It was kind of a sci fi movie and that is what's happening. But it's not just New York. I'm looking in an article right now that says coronavirus hurts LA's density push. So the City of Angels, Los Angeles, where I'm from, where I grew up, there has been a big push toward increased density. And if you don't know about it, check out my shows I've done on UN Agenda 21. This is the opposite of UN Agenda 21. It's the opposite of LA's density push. It's the opposite of New York. It's the opposite of downtown San Diego, Seattle, San Francisco, Chicago, Miami, Boston, a zillion other places, okay, I can't even name them all, but many, many other cities in the US and of course around the world, and that is density. And remember the two danger zones in the world of density, the two biggest factors are, number one, the elevator, number two, mass transit. Those are the danger spots. And long after this virus fades, there will be my prediction be concern about social distancing and about common areas, common transportation, touching things, touching elevator buttons, which by the way is the second germiest place of all. This is long before coronavirus. I read this somewhere. The elevator, the second germiest place of all. And the first is the soap dispenser in the public bathroom. Okay, that is the germiest place of all. So these are the places people are going to want to avoid for either believe decades to come for an entire generation. And the real estate investors who position themselves correctly for this mass migration trend are going to profit handsomely. I just recorded an episode with our investment counselor Doug that we will publish here in the near future. And we really got into a little bit of the math on the cost of living differences for these people who are going to be moving. And it's just hugely significant. It has wide ranging, very positive impacts on the right real estate markets and very negative impacts on those high density markets. We're going to talk about that today with Dottie Herman, the CEO of Douglas Elliman Real Estate. And quite a business success story by the way too. She's just a great lady and I think you'll like hearing her thoughts her story as she comes to us from not in New York City where she lives, but from the Hamptons where many of the rich and fam people have escaped to ride out the pandemic. If you need us, Jason hartman.com or 1-800-hartman and here we go with an interview that will undoubtedly have quite an impact on your thinking.

It's my pleasure to welcome Dottie Herman to the Show. She is CEO of Douglas Elliman and host of ION Real Estate Radio show and Podcast. In June of 2016, Forbes named Dottie Herman America's r self made women in real estate and she has twice been named among the top 100 most influential women in New York City business by Crain's New York Business. Dottie, welcome. How are you?

I'm good, I'm good under the circumstances as best anyone could be since this.

Show'S perennial circumstances are the pandemic and you are currently, you live in New York City but you're currently in the Hamptons, is that correct?

Yes. I left the city when it got really started to get crazy as I think 20,000 people did. So there's a lot of people in the Hamptons that are from the city.

It's, it's a pre season boom in Hampton rental real estate, isn't it? Yes, Usually they're not there until the summer. But is it pretty much 100% occupancy in the Hamptons now?

Yeah, there's a shortage of rentals. People are looking for trying to get rentals and we're scurrying around to get them. But I think a lot of people who rented their properties will not rent them this year because want that backup.

Right.

They don't. Well, they, a lot of people rented them and went to Europe or did something, you know, because they got a lot of money for summer rentals. And this year I think more people stay home.

Yeah, I think you're right. Air travel and tourism has just totally collapsed. I think it'll be a while before it comes back after the shutdown lifts. That remains to be seen. Dottie, before we started going on the air today, we were talking about our mutual prediction of a migration trend that we both believe is going to happen. Where people are going potentially leave high density areas either temporarily or maybe even permanently just so they can socially distance and maybe feel safer. Can you elaborate on that for us?

Again, everyone's thoughts are just their opinion. But I've been in the business a long time and I absolutely saw this after 9, 11. I see it now. I see people looking to get out of, you know, cities that are hotspots or where there's a lot of congestion or high, high density to a place where there's less people. And they're. I think they're trying to buy now all over the place. So I think you're going to see that. I also think you're going to see prices drop because of what's happening with the mortgages and the credits and all this stuff. So I think you'll see a few prices drop and I think you're going to see people who have money and cash online going to buy real estate. I do see that.

What did you say just then? You said people that have money are going to buy real estate online. Is that what you said?

Well, no, I think that as this clears up, we expect that real estate nationally will probably drop about 30, 40, maybe even 50% depending on where you are. The first couple, first quarter was great, but you know, once this virus is if you're in New York or in places, well, all over the country, you really can't leave.

Right.

So you're going to see it drop and then you're going to see, based on people's motivation that have to sell. I think you'll see price drops, you know, in. I think you'll see price drops in New York City, but I think you'll see. And you'll see price increases in some of the resort places that they can go to where they're going to buy. And I think that it will, you know, in every almost tragedy. And I think that the real estate is always going to be people have to live somewhere, but I think it will come back differently. And I think you're gonna see also money, people with big money. And if you look at any of the big people that have a lot of real estate, they probably bought, not when it was booming, when nobody else was really buying. So I think you're gonna see a pent up demand probably by the fourth quarter. That's assuming that we get through this. When I think we're gonna get through this. And I think you're gonna see people investing in that. And I also think also because it's fairly safer than the stock market.

Yeah, I am.

You know, the stock market, you really have to know it and be willing to take a lot of big risk.

Dottie, the thing I want to ask you next is you, of course, you're a veteran. You've been doing this a long time, as have I. I mean, I got my license When I was 19, I was first year of college. The old saying in real estate that we both know all too well is that all real estate is local. All real estate is local. And when I look at different markets around the country and around the world, I divide them into three categories, linear, cyclical and hybrid markets, based on how they appreciate and depreciate during bad times and so forth. With that in mind, when you say real estate's going to drop in value because of lending problems and such, do you want to drill down on that a little bit and maybe be more specific on your thoughts there?

Sure. Again, I can't speak for every state, but I think that right now at least, you know, if you're sitting in the Northeast, if you're sitting in New Jersey or sitting in New York, you're sitting in Long island, you're sitting around here. You are nervous. Are you seeing deaths rise? You know, and I think. And we virtually can't show anything. So other than online.

Meaning. Meaning your agents can't show any properties. Got it? Yeah.

Okay. Now you can show it online and that's great for rentals people that. But that's more difficult to show it to buy something online. But I think that as this clears up, there'll be a pent up demand. We have tons of Listings. I think that rentals are strong with people looking for either permanent or temporary places to move out of the city for. And I think that, again, like, do I think New York City will come back? Well, I do. New York City is New York City. It will come back. It's a tough city, but I think it will take a while. I don't think that, as our governor says, I don't think you just turn a key and everything just starts all over again. I think. I also think that when people hear, oh, unemployment's low, jobs are great, the economy's great, they have a mindset, okay, A different mindset that they're going to have now. You know, now they hear how many people lost their jobs. The banks are really double checking credit five times fold because they don't know if somebody has a job now.

The banks are scared they're going to get burned. Yes, yes.

So they're going to be tougher on credit. However, I do think depending on where you are, it'll come back and depending on how long this all takes, because again, remember, New York City was first in. We were just about one of the first ones in. So I don't know how it's going to pan out.

It might be like the old FIFO rule, first in, first out in accounting, right?

Yes. But I do think that people, in times like this, the home where they live becomes even more important to them.

I agree. I've been saying that the home has become the center of the universe. Dottie, with that in mind, commercial real estate is going to take a hit, isn't it?

Oh, I think so, for sure. And I think office space, particularly, because, you know, even if you survive this and you have enough cash to go, we're doing everything virtually. So if you, if you are renting, leasing a lot of commercial space to put people at work for you, you're going to say to yourself, hey, wait a second, I just got along for the last couple of months doing everything virtually. Why do I need to have all this space now? Okay, so I think that office space is going to be down because I think people will rent less because they're realizing that they don't really need to have that kind of space. And I also look at trends, and I look at the millennials, which is the largest buying trends for homes. And although, and I'm sure you've heard, like I did, when we were in the 08 or 07 recession, they said, oh, the millennials will never buy homes. They saw their parents lose their value. Well, Millennials want to buy homes and they are the largest buying segment of our population now. And I certainly think they're going to continue to buy. Again, they might not buy in the same way, but right now we're urging everyone to make sure that they don't not pay their mortgage payments. Because we found out that even though your credit score won't go down, it will be hard to borrow. So I think the people that have good credit and can borrow are going to continue to buy outside the city. And the cities that have our hotspots will just take longer to come back or they'll be discounted. So I think you'll be able to get a great deal in the city. Okay. I mean, we're closing deals and we have very high end properties. I mean, we kicking off the Waldorf Astoria now. So you know, I think that.

And then. Wait, that's condo sales in the Waldorf Astoria development, right?

Yes.

And what's the average price for those units?

Oh, you know, it's in the middle. I mean it's like 20, 30. I mean these, it's an icon. They're millions. I mean, I mean you could probably get a small studio for 3 or 4 million. But I mean these are big properties. An icon. It's a name. Everyone knows the Wall of Astoria. And I do think that investors who have money and might not be so anxious to just jump into the stock market will look for deals like that. And I think and families will look to either buy homes or maybe have a bigger home because it is now their safe haven. And when times uncertainty, where things are tough, people want to be in their home. They want to be around people they feel safe with. And I saw after 9, 11, so many people called and said, dottie, can you find me a bigger house or can you find me something that I can have my kids stay in? Also people want to be with their families. And so the baby boomers know that their kids aren't going to come to visit them if they don't have a place that really they like to be at and has enough room. So I think you'll see that. And then you're seeing a shift anyway nationally, you're seeing a shift from in the Northeast. And this has nothing to do with the virus where the baby boomers, as they age, they were like moving to Florida, moving to warmer climates. I think in California they were moving to Vegas.

So you're going to see people move, you're going to see movement. I think it's going to be a pent up demand because we're basically on pause right now. Mm. Yeah, we're still closing deals and depending on the state you're in, but not quite as many because most people are a little nervous to let people in their houses.

Absolutely. Do you think, Dottie, that this is a long term generational shift in the mentality of people? Personally, I think, you know, even after, I mean, we all would love to see a V shaped recovery and after the quarantines are lifted, everything goes back to normal, but I think people for many years to come are going to be somewhat suspicious, germaphobic. You know, when someone sneezes or coughs, people are going to kind of freak out. They're not going to want to be close to each other even after maybe a vaccine. Because there could be another pandemic. Right. And you're never sure that the vaccine will work even if there is one and there's not one. Right, right.

Well, I think you're saying you're calling it. I mean, first of all, there's so many uncertainties because they really don't know, you know, they don't know how you catch it, if you can catch it, if you have it, if you're really, if you're immune to it. They really don't know if you are or you're not. And because of all those uncertainties, I don't see people just rushing out to go to a movie theater or a sports event. I think it's going to take time. I think it's going to take more time than they think. And I think it's a careful balance. I'm not sure how they're going to do it because people that were infected, they say, and again, I'm not a doctor, but they say can be contagious for 14 days after.

Oh, yeah. Some have even said like 37 days, you know, but 14 is the common number. I know that.

Yeah. I think people are going to be leery about. I don't plan. I think that it'll be small get togethers, small gatherings, little house, you know, little groups, you know, having barbecues at their home. I don't, I don't see it coming back right away.

And this is a significant impact on restaurants, concerts, Broadway, weddings, funerals, parties. Mass transit is a huge one. You know, all of these are the risk areas.

Yeah, well, I think that, and again, just my opinion, I think when you look at why, first of all, New York had this virus before, you know, probably in December, but I also think that because I look at California which is a big state. And I say, okay, well, they don't, well, they don't have anywhere near the cases we have, considering they're a big state. We have mass transit and people rely on that in New York City. And you know, that's going to be, you know, hard for people rely on that to get around. So while you have mass transit and such density, I think it's going to be really iffy, people getting back on that train and how they know it's going to be safe.

I agree.

So I think that the recovery rate in areas where you drive will be.

Faster because people, you know, the question is what do we consider high density? And the average square mile in the United States has 87 people per square mile. The average square mile in what's considered the urbanized United States is 283 people per square mile. The average number of people per square mile in New York City is 27,000 people. So isn't that shocking though? I mean, we've been doing a lot of research on this and it's absolutely mind blowing. So I think you can live in a fairly high density area and be comfortable as long as you don't have to be shoved into mass transit or elevators. Those are the two most dangerous spots. Second to that is a crowded restaurant, a crowded Starbucks. That matters too. Even a crowded street scene. But elevators and mass transit are the highest risk environments, if you ask me.

Absolutely. And they were again, they were trying to show that some of the, a lot of the cases were really people that use transit. And now you can't really know for sure where somebody got it. Exactly. But that's one of my feelings that, you know, mass transit is a big thing and I think that people in the city have to rely on that. So, you know, so they're going to, it's going to take them longer. But I do think New York's New York, it will come back. But I also saw like a generational difference that I think is just going to be expedited by this. For example, the millennials really success. When you were a baby boomer, somebody bought a big house. It was on acres of land away from everywhere.

Millennials are different. I don't see that being the same. My mother, I've been trying to get her to sell her house for years. Her house is 9,600 square feet. I say, mom, look, there is no buyer waiting in line for a house like that. Millennials, it just, even if they can afford it, it's not their thing. I just don't envision them being interested in a property like that, do you?

No, I think that what's happened is we're going to expedite really what the millennials want, which is, as you said, they want to be connected.

They're coming up with all these smart cities, so where there's density, but they don't have to rely on mass transit. But they don't want the house. We have them all over Long island, all these, they don't want that. They don't want. They want nice finishes, nice things, but they don't need that big house that you have to drive 2 miles to go to the nearest store and you have to take your kids and drive them all over the place. And they really never wanted to. Look, I grew up working 22 hours a day, okay. I mean, I worked my whole life, day and night. And I see that the millennials, they wanted, hey, they wanted time for their families. They wanted time, they wanted flex time. They'd love to work for the house from their homework.

Right.

I kind of.

They don't. They won't give up as much. They're more spoiled than we were. You know, they're the most catered to generation in human history. I mean, can you blame them for being the way they are? Right? No. So they won't make the trade offs. They just won't do it.

Right. So this, So I think that the all of these teleconferencing and working from home is a trend that would eventually happen. It's just gonna expedite it.

Necessity is the mother of invention. We've only. The pandemic has accelerated adoption. These technologies have been there for 15 plus years. I mean, it's not like Skype is a new thing, but people are finally forced to use it, so now it's different. And now everybody's feeling a sense of comfort with it. That really is a shift. It's a game changer.

I think it's a game changer. And it forced people like myself who like to communicate in person or like by voice. Yesterday I went to a disco party, okay.

On Zoom, right?

It was on Zoom, it said bring your own liquor. And by the way, attire.

Yeah.

Coronavirus chic.

Oh my gosh. What is coronavirus chic?

Well, I guess you had to figure it out, so. Oh boy. And I think that everyone's becoming comfortable with that. And when I think about it, the millennials, like that's. And younger than that, I guess it's generation Y. That's how they communicate. They just they're online all the time, 24 7. And so I think that this is going to be a trend and what I'm really trying to focus people that call me or text me or go on social media and say, daddy, what's going to be, we're always going to have homes. People are always going to have to live somewhere. They're going to buy and sell. I mean that's not going to go away. Will people buy virtually online if they really perfect them and they, and they have the drones that you can see the streets and blocks for thousands of miles? You know, I think that will happen.

I think it'll be, I think it'll be more rapidly adopted. You know, it's moving faster, that's all.

Yeah, yeah. And as they perfect it where you can touch things and you can feel things and you can see the heights and then they have. Because I always would tell people, never buy something. You didn't see the street it's on or you know, with the drones you can see all that. So I think that'll start to really take on more than it has it took on for rentals, but not so.

Much with buying, meaning that buying is a bigger decision. So people are, they really want to go and see it in person. That's what you're saying, right?

Yeah. Well, you're, you're, you look, you're, you've been in this your whole life. I've been in my whole life and I, you know, I tend to tell people, listen, you need to see what houses are to, next door to it. You need to see what streets are next door. You need to see if the block is a well kept street. I mean that's all going to affect value.

And for reference, you know, in your case, you're mostly selling very high end properties. So they're very expensive. So big decision.

Yeah, well, I mean, look, if you have big developments where, you know, not so much in New York, but you have them in the country where there's hundreds and hundreds of the same home.

Right.

All right. And those homes, maybe somebody redid their kitchen and maybe somebody decorated a better and somebody has a basement and someone doesn't. But those are generally all the same homes.

They're suburban tract homes.

Yeah, yeah. Those are easier to buy online in my opinion.

Yeah, right.

If you know the development.

Absolutely.

So, you know, I think it, but I do think the trend will myself. I mean everything I've been buying online and I would always say to my daughter, well, listen, I'm not buying clothes online I want to see how it looks on me. I want to see. And you, you know, all of a sudden. So I think we're all doing this now and everyone's getting comfortable with it. And so I think people need to have to look at how is business going to come back and how is it going to be different. And I think you're going to have to tweak things a bit. But as far as real estate, I don't say this because I'm in real estate. I just. When I started real estate, I was probably in my early 20s, I worked for Merrill lynch, who had just started a real estate division, a national real estate division. And I never forget my interview. And they said to me, daddy, you know, you seem like you're really a business cracker Jack, you're going to do great business. But if you really want to make money and you really want to acquire wealth, you need to own real estate.

Yeah, of course. That's the way to go.

I believe that. Okay. I believe that to this day, I believe that as. As long as you are able to hold it, you buy, properly buy and hold. If you look at some of the biggest self made millionaires, that's what they made it in. And I look at now these clients that have tons of money, that's the sport for them. I mean, so I think that.

Tell us what you mean by that. That's a sport for them.

Well, because they don't. It's not a necessity. It's not like they're half. You know, when you sell something and you sold your home or you move out of your apartment, you have to move someplace else. You need to find a home. They have homes, they have multiple homes.

And they love them. And half of them don't live in them. And even in the city where there's apartments, a lot of the hotels are hotel condos. So, you know, I happen to live in one. And half the people that live in the condos aren't even from this country.

Right.

Okay. So, you know, I do think that, and I think I always tell people real estate's not like a stock where, you know, you can buy a stock and overnight it just drops to nothing. Where real estate generally doesn't do that.

It gives you. Real estate, gives you time to think because it's a very. There's a lot of friction in the real estate market and in a real estate transaction and it slows the volatility, which I think is a good thing. You know, people say, you know, the Wall street people and you're certainly close to Wall Street. I'm sure you have more than enough Wall Street. You know, they say, well, I love stocks because I can go online and trade it with a click of the mouse. I have liquidity. And they think that's a benefit. I think it's a nightmare. I think that's the worst feature of stocks. The liquidity creates volatility. Real estate is slow to react. You can hear terrible news. You can hear 9, 11, you can hear pandemic, you can hear whatever on the news. And you can think of what should my strategy be. You can be rational. But with stocks, it'll happen before you turn your head. A flash crash.

And there's so many new companies coming out where you can buy real estate and they'll take a percentage of it, they'll own it, and you can pay. You can buy them over 20 years. You can take equity loans, and I don't suggest that you mortgage the home to death, but if you have equity, you can make some of that equity work if you choose to and you don't go crazy. I just believe that it's a much safer investment if you know what you're doing and if you buy right. And I always tell people, you don't have to be like you. Stocks, I think you really have to know. But real estate, if you generally, I take, you know, you can go on any of the sites and see what's selling and see what's sold and see what the average prices are there and drive around the neighborhood. And I just think over the long term that real estate is what most people really can understand. And I do think that it's always going to be here and, you know, it's not. People have to live somewhere. So. And I think that, you know, if you know the market and it's easy to find that out now, you know, you can go to any site and find out all the comparable properties, when they sold, how much they sold for. So. And again, you know, my name is really Dorothy, so I hate the name. And I. My mom died when I was young, so I couldn't answer why she named me that, but I had to assume that she was watching the wizard of Oz.

Yes, that's what I was going to think.

So, as Dorothy said, there's no place like home. And whether your home is a small little apartment, whether it's a small house, a big house, people's home is their castle.

Absolutely. Well, Dottie, it's been great talking with you. I want to ask you just one brief Question before I let you go. And it's not about the real estate market or anything. And I know we could talk for hours about this, I'm sure, but just quickly share with us some of the secrets of your success. I mean, you are CEO of a huge, very successful real estate company. And that doesn't happen by accident. I'm sure you've been compared to Barbara Corcoran, but you've probably got some amazing success hacks that you've figured out along the way, right?

If I can give your listeners any of my advice, I always tell people, don't be afraid to fail and don't be afraid of the word no. And when I was in my 20s, I worked for Merrill Lynch. I loved Merrill Lynch. And then they decided they didn't want to be in the real estate company business anymore. They were done. They didn't wanna be in that. So they sold us a Prudential. And Prudential said, listen, you know, we think real estate is local. We don't wanna be a national real estate company. So we're gonna franchise. All of you know, we're gonna franchise the Northeast, we'll franchise Northern California, Southern California. And I was, you know, in my mid-20s, I had no money. And someone said to me, dottie, why don't you just buy it? I said, because I have no money. P.S. to make a long story short, I wrote a letter. I was young, and when you're young, you don't think of all the things that won't happen. I wrote a letter. I have investors, I have venture capital, and I want to buy these 36 offices on Long island, which is where I lived. To make a long story short, I ended up buying them. No money down, no personal guarantees. And then after 9 11, and this is honestly the truth, I had. After 9 11, I. With a partner Cold called and Douglas Elliman. I called the guy. It wasn't for sale. It was. The man that had. It was a public company called Insignature Insignia, and it was run by Andrew Farkas. And I. We called him, we said, like I said, would you sell your company? And he said, For 75 million, I will. And that was from Cold calling. Okay? Because I learned that in my early days of sale. And I called up Prudential and I said, listen, we can buy a company in New York City. I had good relationships with them. And so I always, you know, and they wanted me to win. And we were. It was right after 9 11. So that next year in the city, we were an orange Alert, red alert, you know. And the banker said, sweetie, am I crazy lending you this money? And I said, listen, if they hit New York again, it's all over. And besides, I'm going to have arrows Hamptons that way. And truthfully, I borrowed $73 million after 9 11.

Isn't that amazing? Wow.

And the lesson I learned because I don't have the money and I didn't have the money and I. And nobody in their right mind would think that I could ever get the money is if you don't ask, you'll never know. And the worst that somebody can say is no.

Right? Right. What year did you buy the 36 offices?

Oh, I was probably in my early to mid-20s, probably in the 80s at some time.

And so with those, you said you bought them with nothing down. Were they seller financed? Is that how you did it?

No, I bought them no money down. I borrowed it all from Prudential. I borrowed about $27 million. And I borrowed, borrowed maybe 4 or 5 million in working capital. And what did you do before that?

You were an agent. You went from an agent to 36 offices?

No, I worked for Merrill.

Okay.

I was an agent when I was in college. Then I worked for Merrill Lynch. When they were first opening real estate, they were the first ones to open a national real estate company. And at that time, they wanted to get higher margins from their clients. So if they sold them a stock, then they could sell them a mortgage and then sell them a house. And I learned so much from them because they were. If you go back to the 80s or early 80s, when I started real estate, real estate was basically a local business. There was no national companies. There might have been century 21, which was a franchise. That was it. Merrill was the first, first national real estate company. I worked for Merrill, and I was very lucky. I consider them part of the reason I was so successful. I was able to see real estate in a much bigger way. And I was exposed to national real estate. And so I would say, well, this is not going to work, and it won't work in New York, but it would. And they were very big on investing in the people that they felt had talents. And so they invested. And I was a great student and I wanted to learn. And when they sold the company at Merrill, which I cried because I loved working for them, when they sold it to Prudential, Prudential did not want to have a national company. They wanted to franchise it. And so that's when being very young and someone said, well, why don't you buy it? And I said, well, I don't have the money. And they said, well, just say that you do. I said, yeah, that's a good idea. So I wrote them a letter and then they of course came and I had to tell them the truth, but I had convinced them. And we had 36 offices on Long island at the time and in the Hamptons. And so, you know, the whole company was behind me and I was probably the youngest person in the company. But I said, I'm going to do this. I'm going to buy this company being P.S.

There you go.

They left it to me.

So just to get the story straight, it was the 36 offices. You borrowed $27 million for that. And then right after 9 11, you borrowed $75 million to buy what? What did you.

Douglas Elliman.

And how many offices by that time.

I had a partner.

How many offices?

Douglas Elliman was. Well, it seems like not a lot because they had, I mean maybe 15 offices in the city, but they were the number one broker in the city.

Okay.

And they weren't for sale. It wasn't that I knew that the company was for sale. We just used my selling skills that I learned 20 million years ago.

Right, yeah.

Just called.

And that was pretty much after 9 11. So to get someone to lend us money was a big thing. But I had a good relationship with Meryl, I mean with Prudential and so I think that that also helps.

Right? Yeah. Excellent.

And then Douglas Elvin was a large company and Prudential said, listen, we'll lend you the money, but then we would just be a banker and. But if we have a little equity then we will want to see you grow. So I ended up with myself and a very strong, influential man, Howard Lauber, who, who was already very successful by Douglas Ellerman. And Prudential was in it at that time until they got out of the real estate business about seven years ago. So it was a great story. And I think I came from an average middle class family and I just think that I learned so much and I learned so much about not being afraid to ask and not being afraid to fail. And I have a big sign on in my office if I ever get there again that says, you know, failure is success turned inside out and if you're afraid to fail, you'll never succeed.

Absolutely.

So it's a great story. It's almost like a Cinderella story. Yeah, it really is.

Congratulations. That's great.

Thank you.

Behind every success there is a trail of misses and Broken hearts and dreams that didn't come true and things that didn't work out. I remember years ago when I was very young and, and back then, the industry wasn't as mature as it is now. And I remember I had this big year And I sold 78 houses, and everybody thought that was a huge deal.

That is huge.

Yeah, but now it's not as big a deal because there are real, like, business people in real estate now. Back then it was, you know, you know how it was. You were there, right? Yeah. And so, you know, I remember I was speaking once at age 24, you know, board of Realtors office. They asked me to speak and I said, you know, the thing none of you saw is the 120 listings I lost to get the 78 that sold. And, you know, all the listing appointments I went on where people rejected me, and I just was willing to just keep going. And that's the story of everybody who's successful, pretty much.

Well, you know, it's funny you should say that, because that's what I tell the agents when I'll say to them, well, if you think about the top people, they lose more deals because they have more deals. They lose more listings because they go try to get more. I said, but you don't hear them talk about all their losses. You hear them. You know, and I always tell people, if things aren't good, just brush yourself off. Get out of the office for a day or two and come back. But I do have to say that, you know, you're writing a book. I can't wait to read it. I love the business. I never intended to be in this business. I thought I'd be a teacher. But I love the business. I think it's a great profession. And I do say working with professionals and understanding, you don't have to be a big investor. You can really get into the business. My first house was probably like the smallest house I've ever saw. I bought it with three friends. So I just think that it's a great thing and I can't wait to read your book and I hope you'll keep me posted.

All right, well, thanks so much, Dottie. It was a pleasure having you on the show. You've got a great story and some great insights into the market and the migration trends we talked about. Give out your website. Dottieherman.com dottieherman.com Dottie, thanks so much for joining us.

Thanks, and be safe.

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