What Stephen Ross Can Teach You About Real Estate

With over 60 years of experience in the real estate industry, Stephen Ross is undoubtedly a leading figure in the field

He began his career in the development of affordable housing and has since grown his company, Related, into the leading real estate developer in the United States

In todays download, I'd like to share 15 powerful lessons from Ross every real estate investor should know

Let’s get started…

Lesson 1

When things are bad, no one sees the good

When things are good, no one sees the bad

People are poor at seeing outside near term situations

Keep this in mind whenever the economy takes drastic moves (like now)

Lesson 2

Surround yourself with the best talent there is

Ross coined the acronym "PHD" for:

• Poor

• Hungry

• Driven

Look for these criteria when hiring

Lesson 3

Real estate companies need diverse income streams to survive downturns

Ross sold tax credits as another source of income for his real estate development company

Seek other sources of income other than development fees and promotes to sustain through periods of difficulty

Lesson 4

You can't get there alone

Ross' mom lent him $10k to bridge his first year in NYC

His uncle, Max Fisher, was a tremendously successful businessman and later philanthropist

Ross calls him "the most important role model in his life"

Find your crew to enable success

And don't be afraid to ask for help

Lesson 5

Just because you have a place to develop something doesn't mean you should

1. You need to have economics to back a development

2. You need to have jobs existing or a plan to bring jobs to the development

Lesson 6

Think bold

The seminal development of Ross' career was the Time Warner center

He built it without experience in building mixed use sky scrapers

Now, he has undertaken the largest development in the world - Hudson Yards

Ross embodies the motto of thinking bold

Lesson 7

They aren't employees, they are partners

Ross believes in hiring great people and giving them auotonomy to get their job done

One way he does this is by considering them a part of the team, not just a piece

Lesson 8

Money doesn't fix problems, brains do

Ross has seen many issues as his days of New York City real estate developer

The best way to fix hard problems is with smart people, not with throwing more money at it and hoping it gets better

Lesson 9

Be best in class

Ross doesn't just build another project on the block

He builds the absolute best in class buildings

At Hudson Yards, he built best in class office space

Surpirisingly, it has done far better than projected when they began the development

Lesson 10

It is easier to grow if you have done it yourself

Doing a particular job or task creates a dynamic understanding of the difficulties and pain points of the role

Ross did all the jobs early on, which he says has enabled him to hire more efficiently and lead more effectively

Lesson 11

A rising market covers a lot of sins

We are seeing this today

Many people bought bad deals in 2018 or 2019 that turned out to be homeruns (that may not have been in a rising market)

Don't get caught with a bad deal when the tide goes out

Lesson 12

Success breeds success

An early win, no matter how big it is, is the momentum needed to get ahead

Seek early wins and use that momentum into bigger opportunities

Lesson 13

If you know how to execute, you can succeed

Understanding an opportunity is one thing

Taking that knowledge and being able to execute on an idea while empowering other people to accomplish it is a different thing

The better you can excecute the farther you can go

Lesson 14

Incentivize people with equity stakes

Just as Ross enables autonomy and partnership, he incentivizes his people with equity stakes

He believes this creates a more aligned company and increases the chances of success

Lesson 15

If the community does well, you as the developer will do well

A development needs to be in partnership with a city

The best projects make the city better and distinguishes good from great developers

That's all for today friends

If you found value in today's newsletter, it would mean a lot if you shared it with some friends

Thanks for joining me this week,

Jake

PS: reply to this email and let me know what you thought of todays edition. I enjoy hearing from you all!