Deer in the Headlights – What Do I Do Now?

Over the last several months, we have seen some of the most dramatic economic changes in many years. First the housing market fell apart. Then the big Wall Street firms started to drop like flies. The lenders, banks, and insurance companies all started having trouble. Now the auto manufacturers are going under. What’s next? I certainly don’t claim to know, but looking at our history might give us some direction — and some reason for optimism.

Several younger brokers have asked me what to do in this environment. At least 50 percent of the brokerage community has never experienced a true downturn — a recession. Sure we have had some bumps in the road. The crash was bad. 9-11 sent us in a tailspin for a short while. But we have “officially” been in a recession for over a year now. And some of these young guys, 30 to 35 years old and younger, don’t know “com‘er from sic’um” to put in Texas vernacular. So, after being bribed by Jackie with her famous caramels to put something down on paper, here is the first seven parts of my twenty-one-point program. Some of these points are strictly business, some are personal, but all should apply to most of us.

1. First, be positive. Don’t focus on the negative. We must recognize what is going on, but is the glass half full or empty? A young broker who markets our retail recently sent me an announcement regarding a pad we just closed with a national restaurant chain. As part of the announcement, he stated, “We made this deal despite the very tough economic conditions.” I immediately went back to him and told him to focus on the good things we have going on with the property — major tenants about to open, a 47-acre hospital about to close, etc. Don’t focus on the bad. Just recognize that it is there. Figure out a way to use it to your advantage.

2. Keep in close touch with your lenders. Keep them informed, especially about anything negative that has happened. And then tell them what is going well in your projects. Lenders always need to know what is going on. Don’t wait on them to ask for your financials — have all docs to the lenders before they are due. Don’t give them a reason to focus on you. You want to be their number one borrower!

3. Keep your partners informed. They need to know the good, the bad, and the ugly. No surprises. Update your marketing and business plans often. It might not need any changes but you need to focus on it regularly. I look at our business plans every quarter — for every deal we have, no matter how small it is. Then tell your partners what you think. And, listen to them. They were smart enough to invest with you. They just might be smart enough to provide you with a good idea.

4. Do not miss the brainstorming sessions at the S.E.C. meetings or at your local marketing meetings. One good idea gained is worth the five days I spend going to a S.E.C. meeting. And I almost always come back with at least one new thought.

5. One thing I am doing right now is calling my old business acquaintances in other businesses and going to lunch. I recently found out something that has already made me money by meeting with one of my old oil and gas partners. Remember, they also want to know what you know. Get out of your rut.

6. Figure out what works in a recession. We know some things do, including sex, booze, education, government spending on infrastructure, religion, and health care, just to name a few. Unless you live in Nevada, you probably want to leave sex alone. Booze —remarkably some bars and sports-themed restaurants see their sales go up during recessions. Higher education — how many middle-aged professionals do you know who are going back to college for an advanced degree right now? I know several. And young people coming out with four-year degrees many times see the tighter job market and decide to pursue more education also (many times at the chagrin of dear old Dad). So campus projects may be an opportunity. Infrastructure — President Elect Obama has made it clear that he wants more spending on infrastructure. How could that affect your industrial clients and properties? Religion — faith-based organizations actually experience higher collections because of increased attendance during downturns even as the dollars per giving unit sometimes decrease. Adversity causes us to go to our knees and turn loose of our dollars. Health Care — hospitals and related services are going to continue to increase in activity as more of us get older. Immediately after boom years, wealthy families give a lot to hospitals, etc. Figure out what works in your market.

7. And last but not least, consider upgrading your own skills during a downturn. Come out of this thing blazing hot. Many of the S.E.C.s and S.E.C. guests are CCIMs but few of us are completely proficient at STDB. Get better at PowerPoint or Excel. Take Trade Tracker seriously. Subscribe to a different kind of magazine than Sports Illustrated or Home Gardens. My personal favorite is The Economist. Take time to learn what is going on in our world.

Next issue:

8. Accountability Partner
9. Stop and Think
10. The Best Loss is the Early Loss
11. Stay in the Fairway
12. Don’t Give Your Time Away for Free
13. Donate Your Time
14. What About the Kids

Remember, if you keep on doing the same old things, you will most likely get the same old results. Yes, we are in a recession. Use it to your advantage.


  1. Good article Bill and SEC!


  2. Bill,

    Thank you for your article. I found myself in the dumps and sat down and made a list of industries that would be in the tank due to the economic downturn and industries that would be thriving. The results pointed out plenty of industries that will benifit, one of them being investment real estate.

    I look forward to your next article.