S.E.C. Real Estate Observer

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Once there were three little pigs, Porky, Petunia, and Polly, trying to make their way in the world of real estate. Porky was always trying to make it big. He wanted the Big Deal! He was easily swayed by every deal. This looks good, this looks better, but this is best (since it is the easiest)—a quick turnaround. Porky’s retirement plan hinged on his success with the lottery. If the Big Deal did not work out, he would pester his friends and colleagues for another one . The jackpot was right around the corner. Porky was a big-picture guy and relied on others for the details. As long as the concept made sense, Porky rarely got into the meat of the transaction. A handwritten contract among partners was sufficient because it was a friendly world, right?

One sunny day, Porky met a newcomer to the ’hood, Mr. Wolf. Mr. Wolf suggested they partner to build the biggest, baddest structure in all the land. Everyone would be envious and would want to buy a piece of the project for a huge profit. Dollar signs filled Porky’s eyes. He had won the lottery! All Porky had to do was agree to whatever Mr. Wolf demanded and they would both be rich, rich, rich. This looked like a “can’t miss” opportunity. Everything was going smoothly until the fateful evening when Mr. Wolf invited Porky to dinner to finalize the details. Porky soon learned that the purpose of the dinner was to dissolve the partnership. As Mr. Wolf placed Porky on the platter, he exclaimed, “I am not a vegetarian.”

Petunia was an angry little pig. You would be, too, if you were a boy named Petunia! Nothing ever seemed to go right for Petunia. Believing that he had done his homework, he always thought somebody else was responsible for the failure of the deal. Petunia ran around telling everyone that it was not his fault. Always trying to dictate the terms of the transaction, he would not listen to suggestions. Then he met Mr. Wolf.

Mr. Wolf told him that he had a plan for the biggest, baddest building in all the land. The only reason he had not successfully completed the project was that he’d had the wrong partner. He assured Petunia that he had ended that relationship. Petunia thought he had finally found his soul mate. He could do no wrong. It was just bad partners. Petunia had the documents reviewed by Mr. Wolf’s attorney, Snidely Whiplash, who assured him this was a “good deal.” The question of for whom it was a good deal never entered Petunia’s mind. He was going to be happy and rich. It soon became apparent that Petunia’s only job was to make sure he put money in the bank to cover all of Mr. Wolf’s bills. It was not long before Petunia decided that his partner was a bad dude, just like all of his other partners. He was going to do something. They agreed to have dinner. When Petunia saw the spit jack over the fire pit and the table set for one, he realized what was on the menu that night. Petunia was really angry at his partner. Before the main course was served, Mr. Wolf shouted, “I love little pigs who think they can be hogs.”

Now, Polly was a down-to-earth little pig. She knew the only way to get rich was to work hard. You had to do your due diligence. “Review all of the details” was her motto. Look for partners you can trust, and listen to their advice. She did not think that the Big Deal was out there waiting for her. There is no easy road to success. As Polly’s fortune began to grow, she met Mr. Wolf. Now, he was presenting the biggest, baddest project in all the land. He had built it in spite of his two previous partners, but he just needed a little help to take it over the top. She insisted that her friend Dudley Do Right inspect the project. She also wanted her attorney, Mr. Perry Mason, to prepare the partnership documents. Mr. Wolf was concerned that he was losing control of the situation. “How about dinner?” he suggested, figuring if he did not get a partner, at least he would have leftovers. “Of course,” Polly replied.

Polly was always prepared. When she arrived at dinner, she was escorted by her good friend Elmer Fudd, whistling the tune “A-hunting we will go…” Mr. Wolf decided it was a good time to leave the ’hood to find unsuspecting partners in other parts of the land. As he was running away, his tail between his legs, he heard Polly proclaim, “I am a vegetarian!”

Moral of the story: Do your homework. If it is “that good,” look deeper for the flaws and incongruities. Document and document again the transactions. Know your partners. The harder you work, the more fortunate you will be. Don’t be a hog, and luck may be on your side!