This essay by Chuck Dannis, an adjunct professor in SMU's Cox School of Business, appeared in the July 11, 2011, edition of D Magazine's Real Points real estate section.
July 11, 2011
I am gearing up to start my 24th year of teaching real estate at Southern Methodist University’s Cox School of Business. It’s time to update lectures, line up guest speakers, and start visiting with students about what they might like to do when they graduate. Because most of my students are seniors, their future career plans—for them and their parents!—are first and foremost on their minds. As I start this process, I have begun to realize what an incredible opportunity these students have in front of them, if they ultimately chose a career in real estate, especially here in Texas. Here’s where I’m headed with this premise, and what I think I will share with them during our first class.
• The United States is coming out of what arguably may be the worst real estate collapse in a generation. The decline in values was fast, deep, and spared few. But that was then and this is now: Money is coming back in droves—both debt and equity. Sure, deals are tough to make and the days of high leverage have waned, but the market has clearly turned around. Real estate is still on sale and investors throughout the world like what they see.
• It is a tenant rep’s dream out there—retail, office, industrial, take your pick. When the U.S. economy lost some 8 million jobs, building vacancies shot up everywhere, virtually overnight. Landlords are begging for tenants and will readily pay dearly for those brokers who can lead any healthy tenant through the door. Except in select submarkets, double-digit vacancies and soft rents should keep hard-working tenant reps in strong demand over the next several years.
• This generation is smart, connected, technically armed and, from my perspective (that is, at SMU Cox), have a great sense of community. These students just seem to want to “do the right thing.” They will be involved in the social fabric of the neighborhoods in which they live. They will think green and sustainable. They will earn enough money to make them happy, but it will not be No. 1 on their to do list. To put this personal observation into real estate terms, students today just seem to have “a sense of place.”
• And speaking of place, I am also immensely grateful I am writing this blog at my desk in Dallas. From the Super Bowl, our NBA Championship, and the World Series, to being in a job-creating machine like Texas, with the third highest concentration of Fortune 500 companies in the nation—Dallas is on a roll. From a pure real estate perspective, no matter how you look at our area, the triangle created by Dallas-Fort Worth/Houston/San Antonio is about as close to being the center of free world capitalism as one can get. Students who once thought of their time at SMU as a temporary stop-over, now consider Texas as the best place for them to get the career they want.
I am genuinely excited about the beginning of this semester because I see such great opportunities for these students entering the real estate market, at this time, in Dallas. In fact, for some of these students, this just might be as good as it gets.
Chuck Dannis is co-founder of Crosson Dannis Inc., which provides real estate appraisal and consultation services for many of the nation’s largest real estate lenders and owners.