What We Do
One of my agents recently closed a $10 million plus deal in a top co-op. The buyer, a Wall Streeter who had made some unfortunate decisions during the recession a few years back, had accumulated a substantial amount of debt and a certain notoriety. But he had returned to full, multi-million dollar annual earnings with his own business and had the ability to pay all cash for the apartment owing to the recent, very successful sale of a summer house. (I have altered some details in this story to safeguard the buyer’s identity.)
We represented the seller, who badly wanted the price but was anxious about the buyer, of whom he had heard. A discussion with a member of the co-op’s Board of Directors initiated by the buyer’s agent did not yield either a thumbs-up or a thumbs-down, just a suggestion that we proceed and see what would happen. And so we did.
The first financial statement the two agents received for review from the buyer was a disaster: riddled with debt and a lack of clarity about the return to strong earnings, and conveying no sense of confidence regarding future financial stability. We all knew that only a radical revision of the presentation could yield a successful outcome.
Over the next three months, the two agents met multiple times with the buyer’s accountant, reclassified debt (accurately) as corporate rather than personal, clarified the ongoing income stream and its sources, and condensed a 20 page accountant’s explanation of receivables down to two tight, explicit pages offering an easily understandable road map through the complex instruments the buyer and his advisors had put together. The buyer was approved. The deal would NEVER have been consummated without the sophisticated analysis and intervention, not to mention deep knowledge of this building’s Board process, which these agents possessed.
We are not mere door openers, although we do open many doors in every sense of the phrase. Our work, especially in co-ops, requires us to review, revise, and often rewrite reference letters, to take stacks of financial documents and wrestle them into a clear and coherent whole without unanswered questions, and to manage buyers who often feel outraged and violated by both the process and our insistence on clarity and full disclosure. Meanwhile, we are researching who is on the Board, what line of work they are in, and whether anyone the buyer knows also knows a Board member. We choreograph the letters to include information about philanthropy, family, kids, hobbies – all the while trying to make sure the letters are written by people whose names and credentials will resonate with Board members. Since every building has a different ethos, we need to know the personality of the one in which we are selling. And usually we have only a few weeks to put this all together.
Often we must sequence closings to make sure that funds flow as they need to; we help our buyers find financing when banks don’t understand their income or their assets; we accelerate or decelerate closings to accommodate estate and capital gains tax requirements. As we do, we are calming our clients and working to help them adjust to constantly shifting market realities. It’s a fascinating job, with a high level of job satisfaction, but it isn’t easy. We are not replaceable by searching the Internet or using a cool new tech tool, fun and useful though they may be. In New York, everyone believes he or she is an expert in real estate, no matter what they may actually do for a living. But they aren’t. We are!