A new essay is up at Net Gain Real Estate.
A common thread runs through everything spoken and written about the real estate industry, from conversations to specialized seminars, and it addresses these questions. (1) Who is lending and what is the cost? (2) Who is buying or selling, and what are the price, the capitalization rate, cost per foot, etc. (3) What legal entities, tax laws, etc. apply? Consequently, most of the materials produced by the real estate industry focus on these three areas. Conspicuously absent from most of the conversations and presentations are analyses of management skills, approaches, and techniques.
As a result of this environment, real estate owners and asset managers have (1) a transactional mentality and (2) a desire for maximum leverage. This type of thinking has led real estate executives to focus on promotion not management.
Real estate executives who focus on promotion (a mentality shared with many politicians) move the efforts of their company away from identifying issues and planning and controlling products. Because they have lost an important aspect of management in the ability to develop options or alternatives, their companies cannot improve the quality of their products or maximize their results.