Own the Block: Peter Haback on Commercial Real Estate, Retail Development & Creating Value

Video Version: https://youtu.be/1LwfZiTTRQ4

As part of the ACHIEVE Summit Series, host Bo Kemp sits down with Peter Haback, who leads the Commercial & Retail Practice at Samara Real Property, for a conversation about the opportunities and challenges shaping today's commercial real estate market, commercial development, and retail real estate.

Peter has spent his career advising developers, commercial real estate investors, municipalities, retailers, and business owners on commercial real estate strategy, retail site selection, redevelopment, commercial leasing, commercial property acquisitions, and commercial real estate investment opportunities. His perspective spans both the public and private sectors, providing a unique understanding of what drives successful commercial corridors, retail development, economic development, and sustainable mixed-use development.

But this conversation is about more than buying buildings.

Bo and Peter explore how commercial real estate, retail real estate, and commercial property investment decisions shape markets, create long-term value, and influence where businesses choose to invest and grow. They discuss what makes a successful commercial corridor, how real estate developers evaluate opportunities, why mixed-use developments, retail centers, and commercial projects continue to evolve, and what commercial real estate investors should understand about today's real estate market trends. The conversation also examines the role of strategic development, public-private partnerships, downtown redevelopment, changing consumer behavior, and the importance of creating places where businesses can thrive.

Whether you're an investor, commercial real estate developer, commercial real estate broker, entrepreneur, or business owner considering commercial property, this episode offers practical insights into evaluating commercial real estate opportunities, understanding commercial real estate market trends, and thinking strategically about commercial property investment and long-term real estate investment.

This episode is about commercial real estate, commercial development, retail strategy, economic development, real estate investing, and creating value through smart commercial real estate decisions.

Because the first million isn't just built by owning property. It's built by understanding how great commercial real estate, retail development, commercial property investment, and strategic commercial development create lasting enterprise value, business growth, and wealth through real estate.

Transcript

SPEAKER_00 0:00

Are you working to go to the clock? Build well at SparkTrank and the topcoat.chicago. Visit toplinedevelopment.org today or sign up for newwork. Stay connected, get resources, and be the first to cure.tv. For entrepreneurs, developers, investors and things workers, come together to connect growth and opportunity. Don't just watch things happen, be a part of it. Join the movement at stoplanddevelopment.org and start building your legacy today. When most people look at a shopping center or commercial corridor, they see buildings. Developers see demographics, traffic patterns, investment strategy, and long-term value creation. Today we're pulling back the curtain on how successful commercial and retail developments are planned, financed, and brought to life. My guest is Peter Havoc, who leads the commercial and retail practice of Samara Real Property. And he's sharing practical insights for investors, entrepreneurs, developers, and anyone interested in the future of commercial real estate. Welcome to own the block.

SPEAKER_01 1:11

Jesse's a neighbor. Yeah. Known him for a while. So for benefit they don't know who Jesse is. Jesse Levine, who uh is uh really Samara Real Property, is Jesse Levine. Yeah. Um the and Samara is uh both a uh uh an owner and developer of real estate, of all different types of real estate, an awful lot of residential, um, fair amount of commercial. Uh the bulk of it today is in Texas, uh primarily in uh Houston, and now a big uh project underway in Austin, um which which is uh at this point residential. Um the uh there will be a little bit of retail, but primarily a residential development in Austin. Um in Houston uh Samara owns about 2,500 uh apartments, workforce housing, uh, and a few hundred thousand feet of uh office and retail mixed use. Um and we also have uh property here in Chicago in the Fulton Market area, a small office building. Um the uh my involvement is really 100% on the commercial side. Um I head up uh our our leasing, whether whether it's office or or uh retail, um and and which is why um I I'm I'm very happy to be up here for for the discussion of own the block.

SPEAKER_00 2:36

Yeah.

SPEAKER_01 2:37

Because that that's really what it's all about in my mind.

SPEAKER_00 2:42

Well, that's an incredible career you've had across a whole series of very large and well-established uh real estate companies, so it gives you some real perspective on things.

SPEAKER_01 2:52

It it does. I mean, I I've been fortunate enough to work all over the country.

SPEAKER_00 2:56

You know, um uh in full disclosure to the team, um Jesse Levine is a colleague of mine. We played football together in high school, um, so I have a whole series of ex-football players uh that I've done work with around the country.

SPEAKER_01 3:10

Um Bo, I'd like to spend some time with you without a mic, with not being mic'd up so I could hear more about Jesse and maybe get some ways to uh to pull an end around. That probably would be funny, yes.

SPEAKER_00 3:22

I know, right? Um in I also should say that we have worked with Samara on looking at a variety of opportunities in the Southland as well. Um and you guys had been a sponsor last year and this year. We're grateful for that. This topic is really to help people think strategically about owning the block. And although your experience has been principally in commercial as you described, the concept of what it means to own the block, and you've done a lot of mixed-use properties as well, is one that people aspire to, but I don't know how many people know, like how do I get to that place. And so if there's I'd love to hear some of the stories about how you started in some markets and grew to own the block.

SPEAKER_01 4:04

And you know, o owning the block is not just about the developer, the landowner, um it it's about the red, it's about the people that that live there or want to live there. Because uh, again, the bulk of my experience really comes from the retail end, but what you were always trying to accomplish was to develop a property, bring in the the the type of tenants who the people that live nearby wanted to shop at, wanted to visit, and because you wanted them to think, this is my mall, this is my strip center. Um and and and as a developer, you really need to be cognizant of the map, about who who who are you attracting, who who are you bringing? Whether you're a residential developer or or you know a warehouse developer, any any type of developer, you have to think of who's that end user, who am I looking for, and owning the block, branding that block, um, marketing it as that type of block that has what you, the end user, want. Uh if it's your home, what do you want? You guys were talking about it at one of the earlier uh um sessions, where it's you know, someone was saying, you know, I don't want to have to go to the next town to get my groceries or to go to the drugstore or or or to get you know my my dinner, um whether it's bring to bring it home or or to dine there. Um and and and so that that's all about what owning the block is.

SPEAKER_00 5:49

You know, it's you bring up something that I've seen, I've I've worked on some large-scale redevelopments, and an interesting one that gets to this issue about how do you match commercial with the residents. I worked on a project in in Tampa, Florida, that was next to the University of South Florida, right there. It was a mall. It was a Debartolo mall that was built in the 80s.

SPEAKER_01 6:10

Uh yeah.

SPEAKER_00 6:10

Um you've probably been in the university mall.

SPEAKER_01 6:12

Yeah.

SPEAKER_00 6:12

Um and it's kind of gone into a different phase, which a lot of malls have, right? And one of the issues is that the what's in the mall services the community that's around that space. Uh-huh. Um, it's not full, but the shops do service that community. So a developer came in to buy the mall and they wanted to redevelop it. But one of the problems was they were worried about gentrification. And in this candidate's case, people use the word gentrification wrong all the time because everyone wants to live in an area that gets nicer, which is essentially what gentrification really means. But what they really mean colloquially is they mean displacement.

SPEAKER_01 6:51

Okay, right.

SPEAKER_00 6:51

And a lot of times people only think about the displacement of people, but not the businesses. And those two things go together, which is the point that you're really making. So we had to go through this whole process of trying to consider how do we essentially find other places for the shops that were inside of that mall to move to and stay in proximity to the community because yeah, we're going to develop the mall, but the neighborhood wasn't going to change quickly. Um and the services that those shops offered were desired by the residents. And I use it as an example to ask the question when you're in the process of buying and you want to transition, either because you're transitioning a different population or you want a different type of uh commercial entity there, how do you think through those issues? How do you how do you how do you stay cognizant of the need to uh mitigate displacement? But how do you make sure that the product that's there services enough of the people that are there and there's enough aspirational project product for the people who are coming?

SPEAKER_01 7:51

That's about the hardest question out there. Okay, good. The um you know from from back when when when malls were at their heyday.

SPEAKER_00 8:08

Yeah.

SPEAKER_01 8:08

Um was that about 1986? Yeah, in that neighborhood. If it was many of them got built because um Sears or Macy's or Penny's or one of those guys would call uh Mel Simon or John Buxbaum and say, you know, our study shows if if you buy me some land uh at at these coordinates, you know, if you can come up with a hundred acres there, we'll come in. Um and and the malls, by and large, were built as fortresses.

SPEAKER_00 8:43

Yes.

SPEAKER_01 8:44

Everything was inside facing because the department store was the reason the mall was being built. They were the be-all, end-all, they offered everything to everybody.

SPEAKER_00 8:52

You enter in, you leave through it, you had no choice. All the parking was oriented that way.

SPEAKER_01 8:57

Yep. Um and those malls worked great for 40 years. Um, they no longer work. Most department stores are gone. Um the um and so what you're seeing now is and and and like when I was back in leasing with General Growth, if if someone would have gone to lease committee and and wanted to put a uh a Burlington or a Ross, back then they were called Ross Dress for Less, um, in, they would get like kicked out of the room. Um or if you wanted to bring a Walgreens or a grocer in, that was like, why would I do something like that? That's that's you know anti-ethical to what we do. Um today, that's the tenant you're looking for. Because uh, you know, the the the the Burlingtons and the Rosses and those, those are the ones that everyone's shopping at. The grocery stores and the drug stores are your daily use businesses, which developers, mall developers finally figured out, hmm, how the heck do we get people to come here more than once a month? That's right. So it's like, and now we want to be outward facing because we want to go, hey, you get your took us over here. Um the uh we're we're not trying to keep you out like we like we used to show off our face to people. Now we want to show off our face because it's a pretty face and we want you here. And and so I'm not really I haven't really answered your question. That's all right, we're giving you time. But but um the uh from a developer standpoint um or or someone who's looking to purchase property to to do whatever with, um it it's you know, you look at the land, you look at everything that's around the land, um, and your highway access and and and just everything that's around it, um, which by and large is either your residential population or your other retail or your your uh your warehouse or your you know what whatever's there, and and you start doing some more research on will more of this work? Um if I build housing, will they come? Um to what type of price point do I need? Because, yes, there's gentrification, but you know, um I want to build something where the people that already live in the area can use it, might want to relocate to um because their house is 30 years old, and rather than putting a couple hundred thousand or whatever the number is into into remodeling, hey, let me buy brand new. Um the um and and the same thing if if it's a retail development, you know, it is there a big hole in the market? Am I you know am I the hole in the donut? Um the is there enough residential? Is there enough daytime population? Um that that you know, is my will will people come here at two in the afternoon on a Monday?

SPEAKER_00 11:58

Yes.

SPEAKER_01 11:59

Um the uh are are there enough people? Um if it's for office development, really the same kind of thing. Can I, you know, it it for office you're looking more for for the the infrastructure, is there a train station uh nearby? Are the highways? How how much where do the people live who are gonna work here and how easily can they get to me? Yeah. Um the um if if it's um you know for warehouses, um again, you're looking for proximity to the airport, proximity to to uh to the train lines, proximity to the highways. Yep.

SPEAKER_00 12:31

Um and and and that you also minutes typically you gotta be w from an exit on a highway for anything industrial.

SPEAKER_01 12:39

Yep. So like the site I just looked at earlier today. Perfect. Which looks like I mean, it it's right across the highway from uh very successful industrial development. So it's like just like, wait, this seems to make sense. That's right. Um you know, this is already here. Why can't there be more? And and the first people you want to call are the people that are already on the other side of the street to see if they would reload, or or whether, you know what, that six-year-old facility is way too small for me now. I need twice as much space. Um the um, or hopefully not the reverse, where where you know I'll sublease my million square feet, I just need 200,000. Um the um, but but so I mean that that all goes into it. There's there's so much in every development is different. And and you cannot, I mean, that that was one of the problems with malls, um, because it became a cookie cutter. Um and Lord knows I did enough cookie cutter leasing in my day. Paid for my kids' college tuition.

SPEAKER_00 13:39

Unfortunately, become zombie institutions. Yeah. You know, even if they're around, for the most part, they're the walking dead. There are some exceptions. You know, one that jumps out at me is not in the area is in Metai, Louisiana. Uh-huh. The mall in Metary is actually a very functioning mall. But that's an ex that's an exception as opposed to the rule. We have also the problem, well, first of all, we've had a number of malls in our area that have not only closed but are demolished. And that property and the space is still there, but we've had difficulty figuring out how to reconfigure it into something that could be used. But I've always had this theory that malls have some advantages that are not true for a lot of other pieces of property. They almost are always connected to public transportation, whether it's a bus or train, highway, and all those things, which means that they also typically have better underground infrastructure for power, water, sewer, and everything else. They're actually prime sites to be redeveloped into mixed-use property, right? Absolutely. Why doesn't that happen more? Why is it so difficult to take a strip mall or an existing mall site and redevelop it into a mixed-use property?

SPEAKER_01 14:52

There's a few reasons. I I think one of the largest is what uh when most of these either large strip centers or malls were built, the way they got built was was uh whether it's the grocer or the department store, the developer would typically sell the land to that anchor tenant. Um and and that anchor and most all these larger developments had reciprocal easement agreements. You might see it as a COREA or just an REA.

SPEAKER_00 15:28

Um just for everybody describe what a Corea and an REA is. So I can't just decide I'm gonna set up a uh, for example, um charging station um in land that has been essentially entitled for both of us to use without your consent.

SPEAKER_01 15:56

Correct. Uh and typically, and Lord knows we tried to do a chunk of that when I was with either General Growth or Westfield, and and with Saritage. Saritage, it was harder with Saritage because when when I was with General Growth or Westfield, um you you had the ability frequently to uh negotiate with the department store to accomplish your goals because what would happen was you you'd go to JCPenney and and say, you know, we want to do a little expansion out here and and and and it's going to encroach on some of the parking that uh is really in your no-build zone. Um and and JCPenney would, you know, or or Sears or whomever would take a look, and what frequently would occur was you'd go to them looking for something to accomplish at one property, and they would come back to you looking for something to accomplish at four different properties. Yeah. Um, you know, well, we want you to look at the.

SPEAKER_00 16:56

I'll give you one prisoner, but you have to, I'll give you four, right?

SPEAKER_01 17:00

Yeah. The um and and so then you'd go back here and say, okay, well you want that then it becomes a a a a hole, just a gigantic I'm I'm watching my language. Um the um because now it just you know uh um turn turns into that that you know that that ball rolling down the hill. Yeah. And it just keeps getting bigger and bigger. Um and before you know it, you're talking like 15 different properties, and it's been a year and a half. Right. Um, if you're lucky. Um in perhaps eventually you accomplish something. Um the uh but and and it's the same at the strip centers where where you know it's Kroger or Marianos or Jewel or whomever. Um and because I don't want you to take away any of my parking, but we have I can put a McDonald's out here. I can I can put a Chase bank out here, and and I can make, you know, $300,000 in a ground lease, or I could sell it for for two or three or whatever millions, um, and and and really make some good money, and all I'm doing is is giving away 15,000, 20,000 foot of dirt. Right. Um, but you can't do it because the the the grocer, whoever your anchor is, and a lot of times too, I mean, uh and you know it's it's Dick Sporting Goods, it's Barnes and Noble, it's it's whoever the bigger users are who by and large want to protect all that parking out in front of them. Um and uh we have this more now in in Houston, too, uh where Houston for whatever reason is and and all of the property we have in Houston is is is in the city itself.

SPEAKER_00 18:42

Yep.

SPEAKER_01 18:44

Houston is much less of a uh a town, there there's a lot less use of Uber.

SPEAKER_00 18:51

Yes. Because everyone drives it.

SPEAKER_01 18:53

Right. And and and so, you know, I'm going, geez, there's plenty of parking here. And the people you're trying to lease to go, there's no parking here. What do you? I said, no, what do you I'll have an Uber drop-off for you? And they go, I don't want no Uber drop-off because nobody's using it. Um and so you it it makes everywhere you go, there there's additional degrees of difficulty. Yeah. And from the developer standpoint, from owning the block, it's figuring out what those degrees of difficulty are and and how you can overcome them that that that gets the developer the ability to accomplish their goal.

SPEAKER_00 19:34

So it's interesting. They were talking about underutilized malls and strip malls, which I still think are great areas for mixed-use projects, but there aren't enough examples of them. Um but one of the reasons they're difficult is all of the zoning and permitting that's required to change uh in order to do that. So that's one constraint. When you were describing the experience you just talked about parking, you know, when I um I I I I worked uh for Corey Booker when he first became mayor in Newark, and before um he was elected, I spent a year just studying how do you turn around cities like uh Newark, New Jersey, which is a heavy industrial population, largely minority, a lot of flight that had gone out, uh you know, uh economic issues. Same story that you can tell in a lot of other places around the country. But when we looked at economic development, one of the elements that was actually um the most important was parking. Parking actually was the deciding factor for many instances of whether a deal could happen or not. Whether they could get a variance to the parking requirements for every unit, I have to have two units of parking or one and a half or whatever it may be. Um and I mentioned that just because just like the zoning and permitting to go from an underutilized uh strip mall um is tough, getting the zoning for parking is tough. But the world is changing. And the world is changing rapidly, right? So retail's changed so much that it's really made it almost impossible to have malls in most places. And Uber, which you mentioned, and other forms of transportation are changing so much that the need for parking, even if they're not today obsolete, they will be obsolete in a short period of time. But what is holding up let me say it differently. Are there any communities who've recognized this and are being proactive about addressing the fact that the next 10 to 15 years are going to look different for malls and strip malls and for parking requirements?

SPEAKER_01 21:44

You're starting to see it. Um it it it's you know it it's a very, very slow process. It it because you're you're you're asking people to who who maybe have been doing it for fifty years or Right. However many. Changed her limits.

SPEAKER_00 22:11

She changes my mind all the time.

SPEAKER_01 22:12

Yes, she changed your mind. That's why we're not married anymore. Well, what's what's that old line? You know, I've I've had five great years of marriage. I've been married for 40. We can go on in the other button. But you know, it it's just it's hard. People get set in their ways, and and this is the way we've always done it. Why should I change now? Well, I don't know, because you're only 50% occupied. Right. You know. The um and and so you are starting to see it. You are seeing more and more municipalities trying. It it's still, you know, pulling teeth. Um uh and with with a burnt with a with the broken pliers. Yeah. Um the um but but you are seeing more and more towns. I mean, look like you said, so many of the malls here in in this town. Look at Northbrook Court.

SPEAKER_00 23:10

Yep.

SPEAKER_01 23:11

Um uh which and there's a number of them all over the place really that that were really peripatetic malls from the day they were built. Um Northbrook Court never knew what it wanted to be when it when it was first built, and and even the department store tenants, because you had um Neiman Marcus and IMagnan, no longer, hasn't been around for a long time, was a very high-end mall based out of San Francisco, um the uh as two anchors, and you would Sears and JC Penny. Right. Those are completely different marks. Right. I mean you're you're and and you are in one of the higher income demographics in in the in the Chicagoland area. Um and so like the mall never really figured it out. And uh others were like that, like uh not not Tyson's one, but but Tyson's two or Tyson's Galleria, um, you know, similar. Um the uh there you had a mall with with a couple of good anchors and one bad one, and you had a Ritz-Calton Hotel in the mall.

SPEAKER_00 24:13

You're talking about Tyson's in uh Alexandria, Virginia.

SPEAKER_01 24:16

Yeah, in in yeah, in in um or Crystal City, technically, I guess. Well, or that no, that would be the uh the uh the Simon Mall. The other mall. The out in in Tyson's the um uh and right off the seven and uh whatever the other street is there. Um but um where where you had to now Tyson's Galleria was relatively successful in becoming a a real high-end property.

SPEAKER_00 24:43

But this is for the benefit of everyone who doesn't know, this is right outside of Washington, D.C. It is, I mean, it's so close to DC that you can walk to Washington, right? Um and it's got public transportation that's all centered there. But I lived in that area in the 80s, and it was still farming most of that area. So when they built that mall, it was a big deal. Um people it was a destination to go to. But then they built all around it, which is interesting because that's not what happens in malls out here. They built all of this uh residential around the mall, which really fed the mall, which is the reason it's probably operable today.

SPEAKER_01 25:20

Yep. Well, and you see, I mean, here, you know, uh you you saw it in Woodfield, where it became and I forget the guy that wrote the book, uh Edge City. Okay. Um which was where some of these malls, whether it was Tyson's Corners um or Woodfield here, or um um oh the one out in uh Orange County, California, uh Seggerstrom's Mall, South Coast Plaza, um, or a few more like that, where where the mall came to farmland, and there was nothing there. Um but but somebody was bright enough to figure, you know, the the old uh what was the line out of that base, you know, if we if if you build it they will come. Yes. Um and sometimes it's successful. We're all familiar with a lot of properties that that uh didn't quite ever happen. Yeah. Um the and a number of properties where it did happen, but it's but they're no longer viable. Yeah. Um the uh but like you said before, the one thing that that most all regional malls had going for them is they were built at a damn good intersection. Yeah. Um and and it may not be a viable mall any longer, but it is viable for something.

SPEAKER_00 26:31

That's right.

SPEAKER_01 26:31

And and and whether that's residential or residential and office, we had, I was telling this story before, we had a mall in uh outside of Salt Lake, Cottonwood Mall, um, and and it was adjacent to a cemetery. And and in my line, which I took a lot of grief for, this was the very beginning of the people were saying, you know, live, work, play for mixed-use destinations, and and being someone who will never be allowed in marketing, um, you know, I said, Well, we got the cemetery here. This will live, work, play, die.

SPEAKER_00 27:06

Yeah, yeah.

SPEAKER_01 27:06

You don't ever have to go. Uh it never happened. Um, but uh, but it it it was all, I mean, that was really when people started, I'm going back now, oh, the better part of 20 years, really, when when people started thinking that, you know, some of these malls were really, they were still doing okay, but you knew that the end was coming, and and it was time to start thinking about what to do. But but back then, you know, you had your municipalities were still totally why would I do anything like that?

SPEAKER_00 27:42

I think what's not always obvious to people is um so if you're a municipality, you um don't have that many levers to control the revenue that you bring in. Um you get a property tax and you can control it by setting a tax rate and and assessment levels. Um depending on where you are, you might share in some sales tax, but that's uh highly suspect. Most of the time that sales tax goes to the state and maybe it trickles down. But the sales tax can matter, and that's why you'll see in our market, um a large number of major corridors have these malls and strip malls because that was one tangible way of feeding the tax revenue directly to the municipality. That's all started to change because the nature of retail has changed. But we have not changed with it. So much like um the issue with parking, you know, there isn't a vision for how retail is gonna change going forward that people are adopting fast enough to address the issues. Interestingly enough, because of the intersections and the infrastructure and a lot of the places that they're malls, you know what really should be there? Industrial sites.

SPEAKER_01 28:54

Yeah, right.

SPEAKER_00 28:54

That's actually the the most logical thing to put there, but most communities won't want to do that because they don't want trucks going through the community.

SPEAKER_01 29:01

Not in my backyard.

SPEAKER_00 29:02

Right. But if you know, if it's not trucks, then you just pay the taxes. So if you're happy paying more taxes, then don't have the industry or redevelop that into some density that's mixed use. Now, um one of the concepts, and I'm just curious to get your uh idea on, we talked about in another one of the segments was the idea of creating kind of its own ecosystem for uh older folks who, you know, some of whom are still independent and want to live in a single family house, some of them want to move to a townhouse, and then some that need fully assisted. Um have you had any experience with any projects like that?

SPEAKER_01 29:38

Um Yes. F I mean fr from uh from the mall standpoint, I mean that's a perfect adjacent use.

SPEAKER_00 29:47

Yes.

SPEAKER_01 29:48

Um, you know, I may only have one department store Lau. Um and and and years and years ago, I at GGP, my old boss, um, you know, his his even back uh while we were still, well, it's probably after the last big mall we built opened, but you know, has at that point said, you know what, no more three, four anchor thing. You only need two.

SPEAKER_00 30:09

Right.

SPEAKER_01 30:10

You you need Target and a Nordstrom. Um that's the only two, you know. That's the only two left. Pretty much. Um because Target's morphed into the grocery store and every and your your daily use stuff. And Nordstrom is still a nice place to go shop if you're looking to buy something nice or whatever. Um and and uh so but but anyway, that was I I apologize for digressing like that. That's all right. Um but but uh senior housing and and and and the various aspects of it, um, because now I've got, I already have the infrastructure, the mall, the retailers, already restaurants. Perhaps I've already put in a grocer, or if I haven't, I'm going to because now, you know, and and if I have my my independent housing, but I can also house those people that need more care.

SPEAKER_00 31:01

Right.

SPEAKER_01 31:02

Um it it it's you know I've got now because from from that mall owner's perspective, I've now added that built-in customer base. Um and by adding that, I also create more some different retail needs to take care of that customer. You see now again, years back, you know, didn't want that Walgreens in the mall. They were there, and then you kicked them out back in in 82. Um and now, you know, you you'd kill to bring them back. Um the or your your doctor's offices, your medical offices, your your your you know, your your um your your just your independent your care um I'm drawing a blank on the right. Physical therapy, yep, all all of this. Um and because again, in addition to the people that are living there, you also have that pretty easy to get to destination. That's right. And and the more reasons I can give people for coming to where I'm at, you know, is that much better for everybody. And again, it's not just retail or the mall or or the other mixed use there. It's the same thing with that industrial use, yeah. Um and and that residential and that office use. People, users, not just people, but but users want to be amongst similar users. Um and and so it all builds the synergy uh and and the synergistic uses, whether whether, you know, I don't the uh Amazon is more than happy to be next to uh you know anybody. Yeah. Um because they are everything to everybody. Um you know, try try getting away from calling them every from from going on your phone every day to order something. Um the um but it it it's I mean that that's all part of owning that block.

SPEAKER_00 33:04

Well how have you uh seen any good examples of people who have gone from not being a general growth or a Samara, but being kind of you know Bocamp real estate actually successfully going from a store to maybe it's a strip mall to it's the entire block. And what have you seen are kind of the steps to go from one thing to the next to the next?

SPEAKER_01 33:33

Um you know it it's uh it's some of what we're trying to accomplish with Samara. Yeah. Um and like in in this one area uh in Houston on on White Oak Street, excuse me, where we own oh about 30,000 feet of uh of single story retail. Um and we have been trying to purchase additional um buildings on the block. And we and we own uh the hard corner, which we haven't built on yet, which we now have plans for, a 24,000 square foot little retail building with some rooftop parking. Um and and but what we're also trying to do is work with the city to uh you're all probably familiar with the big uh Fulton market sign that's uh and and we want to get Houston to brand the White Oak District. Allow us to put a sign over White Oak over the street, not gonna disturb anybody. You know, I can put it in the in the in the greengrass that we already own on both sides of the street. Um the won't impact a thing. City, of course, why would we do this? Um the I don't know, so we could pay more taxes? Right. Um the um and uh it's but but that's all part of it's creating more of a district. Uh uh in our case, a retail district. We were looking, we wanted to build uh a high-rise on on the corner that we own a residential high-rise, but the market's just not there.

SPEAKER_00 35:13

Oh, I was gonna say, because in Texas they have no permitting, and so do anything. Um so that I was gonna say, I was I thought you were gonna say that was the problem.

SPEAKER_01 35:20

No, no, no. They I mean that all that is year years and years ago, I I was doing some consulting uh and uh down in Houston and it was for a high-end steakhouse.

SPEAKER_00 35:32

Um, probably next to like a tire shop, which was next to like a barn, which was next to I mean like it's crazy.

SPEAKER_01 35:39

Bail bonds actually was the but on the other side of the site was Tiffany's. Right. I mean, it's just like what Yeah, right. How did you get there? Um the, you know, and and you're going, so what's this? Um the uh right and you'll you'll see, you know, million and a half dollar condos next to a dilapidated warehouse. Um the and and you would like to buy that warehouse, but somebody already figures what it's worth, so you um but anyway. Um but so that it it's really building that block, it's it's about branding, it's about realizing who what is who's gonna come in that will also work with what's already here. How can I not displace? How can I, you know, if if in income levels are not as important uh as knowing who your customer is or will be and and and what their wants and needs are so that you can play to that to that need, to that requirement. I I I've got the people already living here. I'm not looking for the guy who would the who's earning 300K a year. My customer is the guy earning 60, 70, 80 a year, or the or the two or the two-income household making 120 who who you know used to be smack dab in the middle of middle class and are now having trouble paying their monthly bills.

SPEAKER_00 37:21

Um You know, it's funny, uh the I was describing to you that property in South Florida, uh or uh in Tampa rather, um, that was near the University of South Florida. And one of the interesting things in that neighborhood, there's a lot, there's a disproportionate number of three things churches, uh bail bonds and pawn shops, um, and you know, uh cash checking places, right? And now there's a need for that in the in the that particular neighborhood. And so displacing all of them, which is what some people wanted that were going to redevelop that mall, was actually not appropriate for the neighborhood. The neighborhood actually needs some of those. Maybe they don't need as many, but they need needed some of them. And so we were trying to think how do we achieve both the growth but not displace those. So the idea we came up with, which I was not privy to execute, was to take one of the corridors where there had been dilapidated houses and redevelopment into mixed-use projects that had commercial on the bottom and flats on the top. And we have a number of communities here, and we've talked about this for Wood Street in Harvey, um, which is one of the municipalities here, where they could benefit by creating a new retail corridor that has mixed use uh commercial on the bottom, but housing on the top to help to create the density to support that. I'm curious if you've seen any examples where people have kind of redeveloped corridors like that.

SPEAKER_01 38:55

Uh successfully. Absolutely. And and I'll I'll digress and tell a a short story. Please. Um General Growth used to own Watertower Place.

SPEAKER_00 39:06

Okay.

SPEAKER_01 39:07

Um It's in redevelopment needs now. Mm-hmm had one of the condos up above, uh, and his wife, you know, would tell their, oh, we have condo, we have a full floor of Watertower Place. And and the line back from the neighbors from their old friends was, oh, so you still live above the store.

SPEAKER_00 39:30

Right.

SPEAKER_01 39:31

Um the um but uh you are seeing more and more of that now because it it it it make it makes too much sense. It makes too much sense. Um and and and you're right, you go to a town and and they need to increase their tax base, you know, uh and and haven't figured out how to do it. And if if you can go and say, look, these numbers work. And now a developer has to, because I remember, you know, not that many years ago, where if it wasn't a double-digit return, you just nothing. But but now you you know you'd you'd bend over backwards, oh it's a seven percent return? Yeah, yeah. So you'd be happy with a you know five, five and a half or six.

SPEAKER_00 40:15

Um the I'm gonna use that line when I talk to some of these investors.

SPEAKER_01 40:19

The uh so it it it's you know uh and and deals make deals.

unknown 40:28

Yeah.

SPEAKER_01 40:28

So if you get the first one done, yeah, you can do the next. It it's all I mean that that's building that block. Yeah. It's it's expanding that block. Um and in in and and making it that much more desirable for whether it's industrial or or office or or retail or residential, that much more desirable for people want to want to be there because there's more to do, there's less need for me. The reason those edge towns, those edge cities came about, but people, you could you could talk to a boatload of people who live in Schomburg and you ask them when's the last time you were downtown, and by downtown meaning the Chicago, they're gonna say, uh, well, you know, I took the kids to the circus there back in uh uh 98. Yeah. Um the um but because they don't have to do it. There's theater out there now. There's other there's other venues where where you can get the cultural um aspects that that you know you couldn't get before. That's right. Um because the the the there were enough people, there were enough businesses, there was enough of a uh of a base, I guess, um for for you not to need to go that far from home. Um because now your your office, which maybe when you first moved out there, you had to take the train. If I don't even, was there a train station in Schomburg? Yeah. Um the um, you know, I remember it was the land beyond O'Hare. Um uh in and but you know, you had to go downtown, and what a slog. Oh my god. Um but so now, oh, the company moved out to Schomburg, or at least right by O'Hare, so it's a 15-minute drive.

SPEAKER_00 42:24

Things are changing. Um you can take, and I've done this, drone helicopters from Chicago to Schaumburg and back. And there's a drone helicopter that goes to Tinley Park out here and back. That's not available to everybody yet, but that's where the future is going. Quick question. If nothing changes in your life for the next five years, are you okay with that? If the answer is no, you don't need more motivation. You need a new design. I created the Life Design Masterclass for people like you, high achievers who feel stuck, but know they're meant for more. In 60 minutes, I'll walk you through a step by step blueprint to realign your money, your time, and your purpose. Go to lifedesign.com, that's lifes.com, and grab your spot today.