Tuesday, May 20, 2008

Saluting: Coldwell Banker's Matt Garrison

Fifth in a series of profiles saluting Condo Superstars, agents who ranked in the Top 10 for selling the most Chicago condos in 2007.

He ‘Follows the Market’ to Fame and Fortune

Name: Matt Garrison. Brokerage: Coldwell Banker. Age: 32. Years as Agent: 6 . Transaction Rank: 4 (228 units). Dollar Volume Rank: 5 ($66 million). Condos (of all business): 90%. Source of statistics: MRED, Chicago condos closed in 2007.

After graduating from the University of Illinois, in Champaign, with a major in English Rhetoric in 1998, Matt Garrison landed a job selling transportation logistics to Fortune 500 companies.

Later, bitten by the entrepreneur bug, the Chicago native started an outdoor advertising and media company that sold ads on trucks to McDonald's and others.

When the dot-com technology bubble burst, Matt found himself working for the company that had bought his company. Though he retained part ownership, he wasn’t happy.

Matt considered his options. One was real estate. In 2001, he had bought a four-unit apartment building as an investment. Then a second one. Those investments had led him to get his license as an agent.

What appealed to him about real estate, he recalls, is that being an agent is “one of the purest forms of entrepreneurship. You are your own boss, you don’t have to report to investors and there’s no ceiling on your earnings.”

So in May 2002, with his business partner, Bob Kohler, Matt, 26 and single, left the company to apply his sales and marketing experience to residential real estate. Because he had no experience, Matt joined Coldwell Banker, primarily for its brand recognition.

To differentiate himself in an industry dominated by solo agents, Matt decided to create a sales team, The Matt Garrison Group. In the next 20 months, he hired nine agents.

A year later, in August 2003, Matt got his first big break. Impressed by seeing him in the office next door all the time, RDM Development named Matt the exclusive sales agent for The Venetian (left), an 88-unit condo at 222 W. Division in Old Town.

Matt put together brochures, advertising strategies and handled the listings. The project succeeded and, today, RDM accounts for 40 to 50% of Matt's business. At the end of 2003, Matt’s team had generated $27 million in organic resales.

In 2004, Realtor magazine named Matt one of its “30 Under 30” top agents. At year end, his 10 agents had generated $59 million in sales, which included the first RDM sales.

In 2005, Matt’s group generated $130 million in sales. The Wall Street Journal ranked him in the top 200 agents in the country. Matt began plans to add as many as 50 agents who would generate $1 billion in annual sales.

In 2006, he and his roughly 18 full-time agents sold 796 units, more than any of Coldwell Banker’s 132,000 agents in the world, and 8th in team sales volume, with $155 million.

In 2007, due, Matt says, to the cyclical nature of the industry, the group was down to 300+ units because 2006 had included a major conversion in the suburb Elk Grove Village. Total volume last year was nearly $200 million. Matt ranked fifth in new-construction Chicago condo volume, with $55 million.

In 2007, 60% of his business was new construction, including about 70% conversions. Roughly 90% of his business was condos.

Accounting for many of Matt’s sales in 2007 were two RDM projects: the conversion of 1400 N. Lake Shore from apartments to 398 condo units and the construction of Trio, a 209-unit condo at 650 W. Wayman.

At 1400 N. Lake Shore (left), Matt earned commissions on 82 of 300+ sides. Fifty of his 398 listings closed; he also represented 32 buyers of those 50 units, so he had 32 double bubbles, meaning he received both sides of the commission.

At Trio, he closed 49 of the 209 listings and represented 18 buyers.

Today, Matt’s group consists of 10 agents. The agents do most of the listing presentations and showings on the resale side. On the developer side, he does all presentations and showings. His partner, Bob Kohler, runs day-to-day operations.

Matt’s specialty is working with developers. He analyzes the market, finds the property, acquires it, helps design the initial plan, runs pro formas, finds the right developer, puts the deal together, then markets and sells it. He tells developers, “You’re hiring a marketing department, not just a broker.”

Matt attributes some of his success to this strategy: “Follow the market.” When the residential market weakens, he looks for opportunities in commercial. When the Chicago market slows, he seeks opportunities outside Chicago. When RDM wanted to build a project in Las Vegas, for example, Matt offered to take the lead.

Since 2003, The Matt Garrison Group has generated more than $500 million in residential sales, virtually all of it from condos in Chicago. Matt estimates that he personally generated 80% of those sales.

The group is currently engaged in the marketing of residential development projects valued at more than $500 million.

What is Matt Garrison’s secret? What motivates him? How did he get to the top? What advice does he have for other agents who want to climb into the Top 10? What does he predict for the Chicago condo market?

In an interview in his office in the MB Financial building at 1200 N. Ashland not long ago, Matt answered those questions, and more. In his own words:

How does it feel to be a Top 10 Condo Superstar? It feels great! It’s a competitive market with a lot of very skilled agents. To rank highly is a tremendous honor.

What are your secrets to selling so many condos?

* Motivation: I am always motivated by finding the next deal, and the fear of losing it.

* Strengths: Connecting the dots; capturing opportunities before others do; creative, outside-the-box marketing.

* USP (Unique Selling Proposition): Finding the next deal for the developers instead of waiting for them to bring it to me.

* Sources of revenue: 70% from sellers; 30% buyers; 60% from new construction (developers), 40% resale.

* Role of Internet: Web site generates perhaps 10% of leads, but less than 10% of business. It serves primarily as a marketing tool for our listings.

What is your greatest weakness? I’m not out on the street working with clients as much as some of my competitors are, so I have to rely on my agents for feedback on the market.

How do you enjoy your personal time? That will change soon, as Lisa, my wife of two years, and I are expecting our first child any day.

What advice do you have for agents who want to become Superstars? Get help. Delegate. You need a business system. Invest money. With my second commission check, I hired an assistant.

What is the cost of being a Superstar? Working 70 to 80 hours a week cuts into your personal time.

What do you look for when hiring an agent? Experience, motivation, entrepreneur, likable, self-motivated. I’m not looking to stack agents. Once had 25; now have 10.

Why should buyer/seller work with you? My market knowledge, negotiating and pricing skills and willingness to invest in marketing.

Looking back on 2007:

* Most important decision: When the market died in the fall, we decided to go international. Working with Coldwell Bankers’ Global Referral System, I made trips to London and Dublin and we sold 32 units to overseas buyers. We are continuing that effort in 2008.

* Highest moment: Getting a great new project that I can’t talk about yet.

* Lowest moment: Losing a listing presentation on a major deal.

* Biggest mistake: Not foreseeing issues in capital markets (subprime) and not getting ahead of the curve with preemptive price flexibility.

Looking ahead in 2008:

* Market forecast: Unit sales will be down 30%. Appreciation will be flat. No one can predict a market bottom, but we’re close, so it’s a good time to buy. Long-term, I’m bullish on Chicago condos because of projected job growth, migration of boomers from the suburbs to downtown, not to mention the possibility of getting the 2016 Olympics.

* No. 1 goal: Adapting to market changes and staying ahead of the curve.

* How increase rank: I don’t anticipate increasing my rank in 2008, as we are working on new projects that have yet to come out of the ground and are spending a lot of time working on commercial deals in other asset classes.

* Biggest challenge: Market conditions.

What would you rather be? While I will continue to sell residential and do joint ventures with developers, we are moving into boutique real-estate investment banking, including raising capital, syndication and deal sourcing in a variety of asset classes.

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