A LOOK BACK AT 40 YEARS & LOOKING FORWARD TO THE NEW YEAR
Partner and Mount Everest Scaler
Published November 18, 2017
I was asked to write a few words to inaugurate our new blog. I’m grateful for the opportunity and thought I’d share a few reflections and memories. I joined the company (then called the Don M. Casto Organization) as a young lawyer in 1972. Cousin Frank Benson joined a few years later and we’ve had fun working together for over forty years. I was apprehensive about the move from San Francisco to Columbus, but quickly learned that the real estate business was an enormous amount of fun and much more interesting than the dreary law practice I had in San Francisco (water law – primarily exchanging water rights between rice farmers in the Central Valley). Real estate development, on the other hand, had a high degree of complexity, uncertainty, risk management, financial creativity and the need to work collaboratively with creative people. What a wonderful change!
In 1972 we owned and managed 13 shopping centers comprising five million square feet and two apartment projects, Mayfair and University Arms – together eight hundred units. Our development capability had atrophied and we were doing very little new development.
Fast forward to today. Over 100 properties with over thirty million square feet of retail space, over 5,000 multifamily units, twenty Wendy’s restaurants in the San Francisco Bay Area, three downtown high rise office towers and one large suburban office campus. In addition, we are in active development mode on eight retail projects and over a thousand apartment units and now own or manage property in Florida, North Carolina, South Carolina, Alabama, Georgia and Indiana. Sure, it’s easy to quantify and be satisfied with our growth, but what we should all be proud of is the extraordinary group of real estate professionals who now comprise CASTO.
Sure, it’s easy to quantify and be satisfied with our growth, but what we should all be proud of is the extraordinary group of real estate professionals who now comprise CASTO.
I used to think that the greatest joy I had professionally was chasing deals and working the opportunities through to completion. While that’s still important (and fun) what really gives me joy is working with creative partners, many of whom represent the next generation of our growth and success. More than twenty-five years ago, we changed the organizational structure of the company from a hierarchically managed family enterprise to a more broad-based partnership. That allowed us to source capital for development but, more importantly, it allowed us to access “human capital” – the most critical component of any growth equation. I remember a conversation I had with Tony Martin at that time and he asked me what my long-term goal was. I responded that what I really wanted to accomplish was to build an enterprise that would stand the test of time and would survive me and Frank. Looking around at all of my partners and colleagues, I know now that I have succeeded.
With that in mind, I also remember sharing with my daughter, Kelly, when she joined our company, my secrets for success in our business (forgetting for a moment our late partner Dick Solove’s dicta that the real secret to success in real estate is to live a long time). I was asked to share these as part of this blog and, mindful that it’s a little hokey, here it goes, my four “P”s of real estate:
In this business nothing comes easily and it’s important to not give up without strenuous effort. A countervailing thought is that we need to know when to “fold em.” That’s okay, but we shouldn’t do so until we have exhausted all effort and options.
Really a corollary of “perspicacity.” Successful project development not only requires a lot of effort, it also requires patience – nothing happens very quickly. For example, we’re completing the final phase of Park West Village and we acquired the site and began work a decade ago!
Land acquisition, market analysis, anchor tenant outreach, lease negotiation, zoning, environmental issues, engineering challenges, pro formas and budgeting, finance and construction. Whew! You can’t be happy in this business unless you love puzzles. Each development is a complicated puzzle and each development is an entirely new and different puzzle.
Unquestionably the most important aspect of success in our business. You have to like working with other people, both inside and outside of our company. It’s really a people business.
We hope you’ll stay tuned to our blog, where my colleagues and I will have the opportunity to share with you our thoughts and insights on the real estate industry.
That’s it. I’m really looking forward to the next forty years!