S.E.C. Real Estate Observer

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An S.E.C. Biography

James A. (“Jim”) Smalley was born and raised on a 900-acre farm outside of Mount Auburn, Iowa, about 20 miles southeast of Waterloo, on April 26, 1930. He lived there with his parents and younger brother. The family raised hogs, cattle, and sheep until his father died unexpectedly when Jim was 15. At that point his mother and the boys moved to town, and Jim worked various jobs–at a rock quarry, as a farmhand, at John Deere Company, and at the Rath Packing Company.

In January, 1948, several months shy of his 18th birthday, Jim joined the Army. His active duty with the U.S. Army would take him to Adak Island in the Aleutian Islands and to Korea, where he received a field commission as a 2nd Lieutenant in 1951, and built roads and airstrips. Jim spent seven years on active duty; he then joined the reserves from which he retired in 1980 as a Lieutenant Colonel. During these 32 years with the Army Corps of Engineers, Jim would attend numerous schools as part of his military education: 5 years in Civil Engineering, 5 years in Command and General Staff College, 2 years in Industrial College of the Armed Forces, and 5 years in Army Logistics.

In 1953 Jim met Lillie, who was working as a civilian secretary to the Commandant of the U.S. Army Transportation School at Fort Eustis, in Newport News, Virginia. Lillie was living on site in a women’s dormitory. As a member of the Corps of Engineers, Jim was called in to assess the situation after the lights went out due to a hurricane. They began seeing each other. She left Fort Eustis to go to Detroit. Jim retired from active duty December 27, 1954, and moved to Detroit to be with Lillie. They were married in 1955.

Jim, with his Corps of Engineers background, found work in construction-running overhead cranes for the Detroit-New York Central Railroad, and operating earth-moving equipment. When the cold Michigan ground froze and it was hard to dig, Jim became a real estate agent in 1956, at first selling homes and land. He soon became the broker for the Rochester, Michigan, office of the company. Jim then purchased Lawson Real Estate in 1957, and became broker of his own firm, with 3 agents.

In 1958 Lillie and Jim became the proud parents of Edwin, who now is a lawyer in Golden, Colorado, and lives there with Lillie and Jim’s grandchildren, Addison, Sarah, and Emily, triplets born in 1998.

In 1962, a real estate friend, John Grimes, S.E.C., of Southfield, Michigan, invited Jim to take a course in Michigan offered through S.E.C., taught by Dick Reno. In 1963 Jim attended his first S.E.C. meeting, and during that same year Jim completed his three-page resume of deals done and became a member. After 41 years, Jim is S.E.C.’s longest serving active dues-paying member.

Over the years Jim has participated in both learning and teaching real estate. In 1978 he became a Certified Residential Specialist (CRS), in 1980 a CCIM, and in 1985 a Certified Residential Broker (CRB). He taught Income Property Analysis at the University of Michigan, and at Oakland University during the 1970’s and 1980’s, and also taught Real Estate Exchanging for Oakland University, as well as GRI 3. In retrospect, Jim thinks he may have spent too much time teaching. Along the way Lillie became Jim’s business partner, specializing in the details learned earlier while working for real estate attorneys. Lillie earned her CRS, GRI, and CCIM designations.

Jim served as Chairman of the NAR Education Committee in 1989 and as an NAR Director for 6 years during the 1980’s. He also served on the S.E.C. Board at various times.

Jim’s real estate accomplishments include awards such as Michigan REALTOR of the Year for 1983, and the Farm and Land Institute’s National Marketer of the Year for 1989.

Jim Smalley has found time in his busy life for religious and civic activities and leadership. He has been involved in the Finance and Fund Raising Committees and as a Trustee of St. Paul’s Methodist Church. He was Vice President of the Rochester Chamber of Commerce in the 1960’s (Lillie served as President in 1980). He was President of the Rochester Rotary Club in 1991, and has 22 years of perfect attendance. Jim is a 32nd degree Mason, and a past president of the Rochester Shrine Club.

In the past, Jim has enjoyed pheasant, duck, and deer hunting, and flying Cessna 150 and 172 planes. He has a 25 foot cabin cruiser on Lake Saint Clair, and enjoys going out a couple of times a week, often fishing for bass, perch, and muskie. He enjoys watching baseball and football, and occasionally visiting casinos.

Since exchanging out of their real estate office in 1991, Jim and Lillie have operated out of their home in Rochester Hills, Michigan, under the names Smalley, Inc. and the J.E.L. Corporation.

Jim’s life goals are to live well, give service to the community, and educate his children and grandchildren.

Jim’s business goal has been to earn money, primarily through buying and holding. His philosophy has been to refinance or exchange, never to sell anything except inventory for cash. He has been involved in motels, lots, Canadian real estate, Wisconsin potato farmland, apartments, industrial property, and California lots and land, as well as buying and selling land contracts as a vehicle for buying and holding paper. He currently owns one rental house in Florida; all his other real estate is within 10 minutes of his home.

His advice to others is: “Do what you say you’ll do.” In other words, follow through on the transaction.

Jim considers his strength to be real estate management, and says that real estate development is his weakness.

Jim’s best moment in real estate was during the 1980’s, when he left his relatively small commission in a 44-unit apartment transaction with 9 partners, and came out with a large amount of cash after two years.

The most significant event of his life, Jim relates, was getting married and having a family.

Jim’s most significant event in S.E.C. was Yvonne Nash’s death. He knew Yvonne and her family very well, and had had dinner with her at an S.E.C. meeting in Chicago the previous night. On the drive back to Detroit he heard on the CB radio that a DC 10 airplane had crashed, and then was shocked to learn that Yvonne had been aboard.

Jim’s most interesting S.E.C. transaction was one involving Kenny Johnson and Madge Davis, in which he exchanged a client’s closed coin laundry property for 300 acres in Oregon, through a 5-legged Section 1031exchange.

Jim Smalley is one of the nicest guys you will ever meet, and it is easy to see how he has been a successful business and civic leader.