new office space

The aftershock's of Matt's revelation were felt for a while and manifested themselves in all kinds of unexpected ways. The first, and most important was that now he (we) needed a real office and nothing would do but we get one. Now, it is true that when we worked at the bank together, we used to throw a tennis ball against the wall and trouble shoot problems each other had. We both considered that our most productive time together. We had a partner in an other deal that owned some small office buildings and Matt had, from time to time needled him about making us a deal on some space. 4 or 5 months ago he'd even toured some places but they were either dumps or too nice for us to be able to afford. And since we were living on our savings' accounts, an office seemed like an complete extravagance to me. But Matt had been working from home and as he was moving out he had to have some place to hang his professional hat. When I realized that he was serious this time and that unless I did something in a hurry, we were going to end up in either a dump or someplace too expensive, I got busy. Rather than tend to our business affairs one morning I went on the Internet and found several locations of a service that provides a small office space, a receptionist, a conference room, all Internet accessibility, copier, coffee maker etc. for one very reasonable price. In fact the first place that I looked at was so pretty, cheery and professional that I instantly felt good about it. They required only a very small deposit, offered state of the art facilities and what I liked the best was, we'd be surrounded by professional looking people making a similar economical choice in offices. The hour I was there, someone had ordered a large pizza and was busy offering slices to the others sharing the space. Very friendly.

But I couldn't get Mark to even go look at it. He had made his mind up to move into Buckhead, Atlanta's most fashionable business neighborhood and our "friend" had indeed made us a bargain offer but it was on space they couldn't rent at any price. I felt like we were getting stuck, no - I felt like I was getting stuck. The space came with some used furniture, old carpet but they were willing to repaint in institutional gray. It had no phone system, no pre-wiring for Internet, no technology of any kind and we'd have to answer our own phone and bring our own Mr. Coffee. All I thought the space offered was the chance to get out of Starbucks and begin paying rent. I hated the idea and Jill already nervous about how we were plowing through our savings was flatly opposed to it. But what was I going to do? mark was just as adamant. It's days like these that i want to scream and scream. I was just beginning to feel as though we had a fighting chance to get this business launched and I'd get stressed about money and keeping everybody else from jumping off a bridge that I didn't know where to turn. But, I decided that maybe the professionalizing influence of an office would be what we needed so I went along with it.

A quick eloan cannot save everyone

The day after Christmas I experienced something that, again seemed like a providential nudge. I woke up with the feeling that it was time to act, as opposed to study and think about acting - what I'd been doing virtually since leaving the bank. Intuition told me to take Dallas and not Mark but early as I dared, I called Bill B. the President of First Community Bank that held the note on Belmont Downs and asked him for an appointment to discuss what we had been planning. Tim, the developer had told me terrible stories about this man. Tim, in his defense would think of him as terrible in that his professional life was in the balance as he was in default on a huge loan on which this banker could foreclose anytime he wanted, ruining him. But, we suspected that the bank hadn't foreclosed because the size of the note was so large, relative to their capital base that recognizing such a loss would cripple them. This was something of a Mexican standoff. Bill B was polite on the phone but insisted that I tell him what this was about so, I launched into a summary of 4 months of work like a shaky graduate student at an oral exam. I passed and Dallas and I went to his office that afternoon at 1. Bill B struck an imposing figure. He was 6 feet 8 inches tall and must have weighed 325 lbs, built like a pro tackle. This man was huge, with a deep voice and a disarming directness. He was also preppy, mean and clearly very smart. I would learn later that he had developed a reputation around Atlanta as THE man a Bank Board would bring in to straighten out a poorly run bank. He'd started a half dozen banks himself and was running 3 simultaneously now. But he admitted that Belmont Downs was in the ditch and that, for the life of him he couldn't figure out how to fix it. Our conversation was cordial and he seemed unconvinced but remained open to the possibility that our plan could work. He directed us to go talk with Tim, as he was still the land owner not the bank and make a proposal. We left feeling like we'd gotten a fair hearing, like we'd been well prepared and most important like we had the prospects of an engagement. IF this worked out, it would mean that somebody would actually pay us to help solve their problem and what better test case than this one - the banker that everyone feared/respected. When I got back in my car my hands were shaking. I admit to having been afraid of big Bill but I had been even more afraid of not being bold enough to march into that guy's office and declare that I was smart enough, shrewd enough, skilled enough and tough enough to have stet up my own business to do this for a living. But I had been and it seemed to be working. Once I calmed down, I was elated.

The follow up meeting with Tim didn't go particularly well. He believed that he now knew what we were going to try to do and he had digested the information from an earlier meeting and clearly had been in the marketplace trying to figure out our strategy and implement it himself. He'd even approached Cherokee County about the possibility of creating an easement on his property and selling that easement to them - something they were considering according to Tim. He directed any further inquiries to his lawyer and told us that unless we wanted to give him a purchase contract in roughly the amount of $10 million dollars he was through talking with us. I felt sorry for him as I drove away from that meeting. I knew that he was desperate and days away from financial ruin. Foresters call it "dead on the stump," a tree still standing but already dead. But upon reflection it occurred to me that it was now or never to act and that if we dithered any longer trying to perfect our process we might loose the first real opportunity that we had. Then I got mad. This twerp who had ruined everything that he had touched in the last 5 years was standing in the way of me feeding my family. OK, maybe I wasn't that melodramatic but I knew that only one of us was going to survive this and that I finally felt ready to press for the engagement. But I had to be smart and act quickly. Intuitively, I called Rick, the accountant that my lawyer, Tony T. had introduced me to. I told him that we had the opening to grab this "consulting engagement" to couch it in accountant's vernacular and pressed him to join us in making the case to the Bank, its Board and their investors - an opportunity I bet he wouldn't pass up as it meant exposure to so many wealthy and influential people. He agreed and we decided to arrange another meeting with Bill B. and this time we would ask for the business.

Possibilities of the conservation easement

Even as I slogged toward the Christmas holidays the business bug kept buzzing around. By now, Dallas, Mark and I had a clear idea about the possibilities at Belmont Downs. We were going to propose to Tim and the First Commitment Bank - the bank that held the $10 million dollar, non-performing note but on which they could not foreclose due to the bank's own solvency problems, that they reserve 10% of the property for exclusive home site but put everything else, all 400 residual acres in a conservation easement, give the easement to a land trust and harvest the tax credits and deductions for use by bank investors who had a vested interest in seeing that the bank stay in business. The problem now became, what land trust? There were lots of them chartered in Georgia but was there a perfect one? The answer came, as so many of the big ones had so far: from a remarkable source. Mark and I were eating breakfast together one rainy morning and I was looking at the survey and the appraisal that Jim Rice had given me. Having had some prior experience with appraisers, I decided to call the guy who had done the work on Belmont Downs and go pick his brain. His name was Dennis and he turned out to be an odd but remarkably articulate fountain of information on easements. he volunteered almost immediately that the Trust for Public Land and their local Director, Ken was who we needed. I liked Dennis right off as he had a big sign beside the door to his very cluttered office that read, "Nobody gets to see the Wizard, Not Nobody, not No How." he was the wizard alright. And man, was he right about Ken. The Trust for Public Land is a huge, old land trust that has as its mission "Land for People." And Ken was a disciple of the religion of conservation but he had a can-do attitude that seemed to suggest that he could think in technicolor. He listened carefully to our plans, made a few thoughtful suggestions and gave us every indication that we could count on this land trust to help execute Belmont Downs and perhaps many more. In his office in downtown Atlanta, I saw for the first time that our process could work, it could work in lots of different settings and circumstances and we could make money helping people with broken land deals either using the equestrian facilities idea or not. The outline of an evolving business was emerging right in front of us.

It seems the right time to say that i am a firm believer in a variation of the Protestant work ethic. My theory goes: work hard at something constructive and something good comes from the effort. it might not be the good you intended, but it'll be good never the less. My idea of starting a business to save broken real estate projects, and community banks in the process was picking up momentum and I was beginning to believe it, despite the fact that we had no proof that it would even work outside a couple of exotic examples

real estate team ASSEMBLE!

As if I needed any more motivation to succeed the incentive stock options that I had earned during my career that were worth $500,000 at the start of the year had fallen to a value of less than $50,000 during the first month that I was thinking about what to do with the rest of my life. I had earned an old fashioned pension too but had no idea if that had any value any more. Facing the loss of most of my retirement assets I resolved that I had everything to gain from succeeding. So, on I marched...

My next call was to a tax lawyer with whom I had worked often, Tony. Tony and I are contemporaries, both from North Carolina and our business relationship had always been super. We have even had a few personal/social outings that were fun as well so I felt like he'd give me the straight scoop on what it was that I was trying. After exchanging voice mails for a week, we finally connected and he was encouraging but deferred to an accountant with whom he worked often who had directly relevant experience. Rick B. is the managing partner of a 180 person accounting firm in Atlanta and he called me back promptly. As it turned out, he had a client several years ago who was developing a 200 acre tract on lake Oconee, about 90 miles from Atlanta. The subdivision was a complete bust so, at Rick B.'s direction he put a conservation easement on all but a hand full of acres, went from 200 building lots to 20 and went through the elaborate process of having the state certify the conservation effort so that he could get the tax benefits designed to encourage land conservation. Additionally, he master planned an inexpensive equestrian facility for the easement property to attract land buyers who enjoyed such amenities. As luck would have it, he sold all of his lots (at a much greater price than he was asking originally) and when combined with the tax benefits that ultimately did come - the venture was a roaring success. Now, three years later the whole transaction is being audited by the IRS but they all feel as though their defense is air tight and they will not only prevail but they'll pave the way for folks like us to similarly succeed. Realizing that having a super qualified resource like Rick B. in my corner, I made plans to cultivate his friendship and get him squarely on our team.

In my experience, there is no better way to demonstrate our serious capacity than to introduce Rick B. to the richest guy I knew. That guy was Rick S. I met Richard S. several years ago and had been moderately successful in getting him to move his investment management relationship to me. Rick S. was 63, had grown up in California where he was a practicing accountant - a "good fact" in the grand scheme. He had worked for one of the state's largest audit houses then left to start his own firm. he built that into a regional player in California finance in the 1970's. During this time his wife had bought a dress shop that was struggling financially. he assumed control of it and when they sold "it" 6 or 7 years later they had 240 retail stores on the west coast. In the late '70's Rick S. sold all of his interests and started developing real estate. Well capitalized, he survived the recession of the early 80's and had the foresight to buy lots of property in the then depressed part of north Dallas, Texas. In the mid '80's when the oil patch was beginning to boom he sold his properties without developing a single one! He took his second fortune and bought then depressed real estate in north Atlanta where he built over a thousand homes and 10 million square feet of industrial space.When he and I met he was worth $100 million and looking for the next thing. He liked my idea but needed confirmation. I was willing to bet that Rick B. would be a credible source of such confirmation and would be interested in meeting such a successful prospective client. My hunch was right and they hit it off beautifully. I now had a confederacy with Dallas, Chuck, Tony, and two different Rick's. I was a long way from imagining how to make money at this but it certainly felt as though I was on to something.

Banks aren't the only ones in trouble...

It was a hot Thursday afternoon in mid August, 2008 when I was scheduled to meet with the President of our division. I cant remember his name now but he'd come down from New York to personally meet with each of the business development people in the Atlanta office because the market and our sales performance had been bad all year. It seems important to point out that I was in my 18Th year as a business developer for the Wealth Management area of a Bank and I had become a Senior Vice President and a Team leader precisely because I knew what I was doing. But that afternoon, I was to be in the hot seat - like everyone else.

I should have known something was up when I reported to the conference room and the HMFIC wasn't there but in his place was my social climbing, weasel supervisor and the Chief Operating Officer, a thin, insecure woman who had consistently impressed me regarding how little she actually knew about operations. Grim faced, they stopped me from making my well rehearsed sales report and told me right away that they had bad news. Bad new for me, anyway. The sub-prime mortgage crisis had slashed 30% from their stock price and the Chairman, making a statement to Wall Street had decided to let 10% of the company go. I was being laid off, sacrificed to the God of expense ratio management. I had loyally worked every day for 18 years being the best I could be. I had attended every training option, I had cross sold every stupid new product and I had allowed myself to think that I was entitled to the relative prosperity I had come to enjoy. I thought that I had tenure. I was wrong. In the time it took to make coffee, I was escorted back to my desk, given 2 minutes to collect the personal things that I could carry and shown the door. It happened too fast for it to even sink in.

I resolved to take a month off before beginning the job search just to give myself time to grieve and secretly, take all of the time I wanted to feel sorry for myself. The indignity that I felt was crushing. I admit that I had been feeling really unenthusiastic about my job for a while, though I might have rather left on my terms not theirs. But, the fools that were blaming the office's poor performance on me had also given me a month's pay so I was going to take that month at their expense and relax. As it turns out, two huge things happened in the following days to change my plans entirely. One global and one personal.

At roughly the same time, the banking industry in the US was melting down. The sub prime problems caused an avalanche of bank failures as the stock prices of nearly all of the banks in the country collapsed. Clearly, there wasn't going to be a bank job available for me to try for. My professional life line was being severed. Facing the terror of starting over at 50 years old was something I wasn't sure that I even had in me. Second, on day 2 of my forced sabbatical my phone rang and it was a former client that I'd befriended. I'll tell you more about him in a minute but he went to some effort to find my home phone number so as to be able to tell me that he liked and admired me and wondered if I'd be open to helping him launch a business that he was planning. I liked him too and began to wonder if starting a business, even in the worst economy in 50 years was absolutely the best way to keep from becoming completely depressed. I agreed to consider it.