Browse Tag: commercial caffeinated breakfast

Craig Lindvahl At The Commercial Caffeinated Breakfast

Photo of author and trainer Craig Lindvahl

(Above: Author and trainer Craig Lindvahl)

One of the more storied traditions at the NAR Expo is the Commercial Caffeinated Breakfast, a bright and early gathering of NAR Commercial members to meet, network and learn while the coffee and carbs flow freely. This morning was no exception as commercial folks from around the country closed in on the Rivergate Room at the Morial Convention Center to hear the good news.

The preliminaries included a shout-out to Jean Maday, ‎NAR’s Director of Commercial Real Estate Development & Services on her recent RCE certification. Always a fixture at the Breakfast along with NAR Commercial VP Jan HopeJean took a well-deserved bow for this key milestone in her service to NAR and its commercial membership.

Craig Lindvahl: Things You Wish You Knew Yesterday

Breakfast speaker Craig Lindvahl is an educator, author, filmmaker and passionate advocate for the development of local communities. In his talk to the commercial membership, he laid out the classic problem of talent drain from small towns as younger people (we’ll call them millennials here) look around their communities and conclude that no opportunity for them exists, that any chance to grow lies elsewhere.

In Lindvahl’s view, this isn’t because no local opportunity exists. It’s because it’s hidden to kids.

“Kids aren’t stupid.  They’re ignorant,” quipped Lindvahl to a laugh in the room.  Clarifying, he pointed out that being ignorant is just not knowing, where being stupid is being ignorant on purpose.  And kids, he said, tend to be ignorant about business and economic development going on locally, and about the people that work and build these businesses.

This is to be expected, he said, because schools don’t teach about local business at all, let alone provide any hands-on experience in those businesses that leads to real understanding about the responsibilities that go with entrepreneurship. So Lindvahl stepped up to do just that.  He created CEO, for Creating Entrepreneurial Opportunities, a program of the Midland Institute for Entrepreneurship, at which Craig serves as Executive Director.

In a fascinating run-down of the CEO program, Lindvahl described the process of working with high school juniors and seniors on and in real businesses. Meeting for 90 minutes each day on the site of a real operating business, kids do real work, and make real connections  with real business mentors.  They develop their own business plans — each write two to three plans a year, says Lindvahl — and all for one reason:

“[The kids] come to see their local town as a place of opportunity, not a dead end.”

At the close of the session, NAR Commercial handed out free copies of Craig’s book “Things You Wish You Knew Yesterday” and left the assembled with a lot to think about concerning the role of education, opportunity and business in home-town settings.


Mark Dotzour At NAR Commercial Caffeinated Breakfast

Picture of NAR's Jan Hope and Texas A&M Dr. Mark Dotzour
NAR Commercial Division VP Jan Hope Welcomes Dr. Mark Dotzour

The eggs were scrambled, but may as well have been sunny-side up.  Dr. Mark Dotzour, Chief Economist at Texas A&M University’s Real Estate Center opened more than a few eyes Saturday morning at the NAR Commercial Caffeinated Breakfast with some bold, optimistic statements and solid one-liners in equal measure.

Sponsored by Inland Real Estate Group, REALTORS® Federal Credit Union, the Florida Association of REALTORS® and Xceligent, the Commercial Caffeinated Breakfast kicked off with Dotzour bullish on commercial real estate, bearish on gold and ready to separate the real economic recovery indicators from the fake ones.

Tax credits to buy houses or cars?  Signs of a fake economic recovery, according to Dr. Dotzour.  “When people buy these things because they want to,” is the true mark of recovery, which he believes we are in now.  “For the first time in years, I’m more optimistic than you are,” announced the deadpan-hilarious Texan before spelling out the reasons for the bright outlook.

The housing crisis, which he characterized as a “social experiment that failed miserably” has led to the current state of five years of pent-up demand.  The resistance caused by years of postponing key life events due to the economic downturn – buying, selling, retiring, has come to an end, and most importantly, “Americans have credit capacity again.”

Dotzour took a little time to scoff at commodities and promote real estate.  “Commodities are hedging instruments, not investments,” he said before cautioning that anybody heavily invested in gold should be terrified of the day they read the newspaper headline “Congress balances budget”, suggesting a fit of fiscal responsibility akin to the 1981 Congress would send gold prices tumbling sharply to a multi-year stay at low levels as they did that year.

When Is Credit Coming Back To Commercial Real Estate?

Dotzour addressed the question of lenders having left commercial real estate markets high and dry by raising the structural and technical issues of loan loss guarantees.  After taking care to point out there are “plenty of working, solvent banks”, he reminded that the banking system was widely insolvent, and that portfolios of bad CRE loans are still buried in the system.  Toward the question of when these loans would get flushed out, Doutzur quipped “when is the RTC coming back?”  This reference to the Resolution Trust Corporation, the federal government-owned corporation created to unwind the Savings and Loan crisis in the 1980s, was a way of describing the systemic need for backstop beyond what the FDIC can provide, not unlike that crisis.  While no such organization appears to be in the cards,  Dotzur’s apparent timeframe for this unwinding: “5-8 years”, counting from when the crisis began.

The Deleveraging At Home

A slide showing a chart with a sharp drop at the tail end was ironically Dotzur’s favorite.  Its showed that household debt service payments as a percentage of disposable income had plummeted and was in the 11% range, a value not seen since the 1980.  Dotzour expected this to bottom even further, suggesting the credit capacity of Americans was not only back, it is about to be in better shape than when the 1980s kicked off.

The good doctor had much more to say about the systemic challenges and opportunities coming up in 2013 and beyond.  To get an audio copy of his entire presentation, click over to PlaybackNAR.