The following Q&A was completed as part of our conversational Commercial Real Estate FAQ Interview Series, we hope you find it helpful.
When one looks at a team at a real estate development firm, conducting due diligence will take quite a bit of thorough effort. The most important thing to look for in the team, however, is integrity, and how that firm handles deals that don’t go well, how they conduct their business, and what their reputation is like in the space. When you find a firm with integrity, you know that you can expect a bright future out of that partnership.
Richard Wilson: And when you’re looking at conducting due diligence on real estate investment firms or debting them, people always say “Well, the team is most important. It’s all about the team and the trust of the team.” But what’s the most important thing that you look for in the team? You mentioned track record, performance through different economic cycles, is there something unusual you look for? Or something counterintuitive? Or is this really hitting your jump shots and not rushing and skipping steps?
Dr. Forrest Bryant: Yeah, yeah, probably nothing earth shattering here. Just sponsor integrity, you know? If you’ve been doing it a long time with a good track record, with a good reputation, and how did you handle something that didn’t go well? You know, that’ll tell me most of what we need to know.
Richard: Right, okay.