I was incredibly fortunate to attend one of the finest high schools in South Africa. It was an all-boys school and the driving mission of the school was to make men out of boys. Men who held themselves to high standards of integrity. What we learned in class was only half of the experience. The other half was learned on the sports fields. The school was designed to lay down a fundamental groundwork of all things that would instill a high set of values in its students. We were disciplined when we were late, rude, or broke any rules. There was accountability and responsibility that came with being a student of King Edward School, and because of that, every student was proud of their association. King Edward has produced some of the most successful judges, financiers, entrepreneurs, and scientists in the world. It has also produced a long list of some of the greatest athletes, from golf’s Gary Player to the captain of the South African cricket team Graeme Smith, and South African Springbok and greatest player in rugby union history, Brian Habana. The school had a rule that every student had to play two sports, and one of them had to be rugby. As a 13-year-old kid, I never understood why rugby was the required sport, but now I see that rugby exemplified everything that the school stood (and still stands) for, and playing the sport, it gave me first hand exposure and experience to a set of morals and values that are still with me today.
I love rugby because it is a sport that is both complicated and simple at the same time. It looks barbaric but is beautifully elegant. A world-class player needs a combination of brains, instinct, and grit. It is one of those sports that you have to play if you want to fully appreciate and understand its nuances. Most of all, and above any other sport, it takes a true team effort but relies on the heart and soul of each player. Professional rugby players don’t get paid high salaries. They put their bodies on the line, in every game, for the love of the sport and their honor. This honor is largely unspoken but accepted amongst competitors. The rules of engagement rely on a tradition passed down from generation to generation. Play hard, but always play fair. When you are in the scrum, there’s a lot of activity a ref or cameras can’t see. The trust and honor among the players is what keep the engagement civil. These rules of engagement have translated beyond the pitch. For me, as a musician but especially in business this code of ethics and professional conduct has been a guidepost. And I realize that some have it – and some don’t.
This has been a challenging time for all businesses – and particularly small business. Last week, I had to reduce salaries and let go of some incredibly talented and kind people. This was heartbreaking for everyone involved but, I was also pleasantly surprised to receive calls from almost all of my competitors and peers commending me for holding out as long as I did and offering support as they too had to reduce staff and made cuts. It’s been hard on everyone. But I truly appreciated their calls and messages. Because while we might be “opponents” on the field, people like Pam Liebman, Bess Friedman, Scott Durkin, Gary Malin, Fred Peters, Diane Ramirez and Adam Modlin – respect the game. They have been playing this game for a long time. They understand the struggles. They have seen the ups and the downs. They are all players in the scrum. And that makes those who don’t get it stand out all the more.
Our agents have been inundated with messages from one player. Aggressive calls and texts. Trying to capitalize on the injury of others. And it could not have backfired more spectacularly. People found it tackless, heartless and without honor. Even in the cut-throat world of New York City real estate, there are still boundaries and rules of the game.
In rugby, the bully who lacks integrity finds a reckoning in the scrum. Not physically, but by losing respect amongst peers and competitors. It is in these moments where those in the sport will either abandon you and leave you out to dry or rally behind you with every fiber of their body. Now is the time to help each other rise up. How you behave when the game is against you speaks far greater than how you behave when you are up by 60 points. The members of the scrum won’t forget.
May 8, 2020
How Much for a Smile?
One of the first apartments I sold in my career was a beautiful 1850 square ft loft in SoHo. My client, Pat had lived there most of her adult life and was selling her home because she was retiring to Maine to run her publishing company. She had originally purchased the loft for less than $200k and I sold the loft for her for $600k. A 300% return. That same year, in 1996, the DOW Jones Industrial Average was trading at 6000 points. I always loved showing that loft. When you show enough homes, you realize that every home has its own energy. Some people describe this as feng shui, others might describe it as a feeling the space gives you. Pat’s home had a special quality about it and when you walked through the front door, you were bathed in positive energy. The finishes in the loft were very basic but the scale of the rooms, the ceiling height, the size of the windows, the light and air and orientation of the space made the loft feel incredibly special. I always had a smile on my face when I visited Pat. How do you value a home that puts a smile on your face vs a home that doesn’t? There’s no algorithm for that, but it is almost always reflected in the price and velocity of the sale.
The loft was on the market for a very brief time, and I sold it for full asking price. Pat moved to her new home in Maine, and the new owners moved in. They sold the loft ten years later for $1.6M. A 266% return. That same year, in 2006, the DOW Jones Industrial Average was trading at 11400 points. A 190% return during the same time period. The new owners of Pat’s loft lived there for 12 years and eventually sold the home for $2.6M. A 62% return for them. The same day, in 2018, the DOW was trading at 26000 and in the middle of the greatest bull market of our generation. A 228% appreciation during the same period. If the current owners of Pat’s loft called me today to sell it for them, in the midst of this pandemic, I estimate that we would find a buyer relatively quickly for over $3M. 500% above Pat’s original sale. The DOW is currently trading at around 24000 points. 400% above the level it was trading when Pat sold her apartment.
People are continually asking me about the value of their homes relative to their other investments they have made. Markets are impossible to predict and as you can see from the above case study, they don’t always act in tandem. One investment will probably outperform another at different times. When it comes to investing, the principle is simple and timing of your purchase and sale will determine your result. The reasons to invest in the stock market are clearly very different to the reasons you’d buy a home. Now, more than ever, is a time where everyone is looking closely at how much money they have and where they should be putting it. Every penny counts. History has shown us that investing in real estate is sound relative to the performance of the DOW. The big question you have to ask yourself is how much value you are putting on the feeling you get when you walk into a home that puts a smile on your face and makes you feel at peace.
May 15, 2020
The Most Important Room
Over the course of my life, I’ve lived in almost every type of home. A suburban single-family house, a floor through flat, a townhouse, a city studio apartment, a penthouse, a triplex apartment and an industrial loft. In every case, and for over fifty years, all of the kitchens in all of my homes have pretty much been the same. While some were larger than others, and some had fancier appliances than others, all of these kitchens had more similarities than differences. All of my past kitchens, with one exception, were designed for a different time when we used our kitchens and homes in a different way. I have sold thousands of homes and have seen thousands of kitchens. Other than the customized kitchens I’ve seen for the top 1%, there has been very little innovation in the distribution and use of the space.
We spend an inordinate amount of time in them. They are the hearth, heart, and soul of the home. They are where we congregate as a family and share not only our food but our stories and experiences. What we eat and how we eat is deeply rooted in how we express ourselves and our connection to our traditions and culture. It is the place in the home where we come together as a family. Most of my favorite family memories were borne in the kitchens of my past. I remember baking and icing my first chocolate cake (Mrs. Tilley Hyman’s famous secret recipe), with my mother at the age of 7. I ate the whole thing by myself. This past Passover my mother helped me recreate her latke dish for the family over FaceTime. I failed miserably.
Having been in quarantine for the past two months, I’ve used my current kitchen far more than any other in my entire life, and I believe it’s time to rethink the fundamentals of the way the space is distributed. For starters, I think kitchens are way too small. The kitchen should be the largest room in the house, but all too often, it’s the smallest. I’ve had kitchens that were smaller than my bathroom. There has never been enough storage in any of the kitchens in the homes I’ve lived in. I need to be able to store more food. Kitchens should have more refrigerators, freezers, cabinets for food, plates, and utensils. I could use more appliances. I’d love special storage for fresh fruits. A pantry. In half the kitchens I’ve owned, I’ve had to store my pots and pans in the oven. There should be bigger countertops where I can bake and prepare food without moving everything else off it. I’ve never met anyone who said they have enough counter space. Knowing that we spend this amount of time in our kitchens, they should be designed to accommodate more seating. My family would use a well-designed banquette far more than we use our table in the dining room. I would even sacrifice my dining room and part of my living room if I could get everything on my wish list for a better-designed kitchen.
All of these lifestyle changes present an opportunity. I’m looking forward to working alongside architects and developers to create the kitchen of the future and bring it to our projects. I know what’s on my wish list. I’d love to hear what’s on yours.