In this interview with NAI Elliott’s founder, Lou Elliott, we explore the evolution of Portland’s commercial real estate industry over the past 50 years and how the importance of personal connections remains as vital as ever. Lou shares how new brokers can build relationships in today’s market and discusses the factors that have contributed to NAI Elliott’s longevity and success, including a strong commitment to integrity and maintaining client trust.
What did the commercial real estate industry look like when you started your career in 1972?
In the early 1970s, anything sold here was essentially sold by mom-and-pop operators. The leasing and sales were all amongst local people, and the requirements of a real estate manager were pretty general; you needed to go out and patch a roof, keep a parking lot in order and more or less keep the books. There were no national retailers, no institutional lenders.
Starting in the In the ’80s, California had national tenants looking for ways to grow. They came here, and the developers came with them and brought a much different level of sophistication for leasing and management. By the mid-’80s, this area had been “discovered” and the world changed for the real estate industry in significant ways.
What’s one of the biggest changes from then until now?
In the beginning of my career, everything was based upon relationships with the people you were working with, and they were easy because you could walk into a store and meet the person who made the decisions. That began to morph as national tenants came in. Suddenly you were dealing with national real estate agents or remote asset managers, and the relationships were not nearly as close or easy.
Personal relationships are more difficult today, but they’re still absolutely fundamental. You just simply have to know who your owner is and who your tenants are, and to the extent that you can, have relationships with folks.
How should a new broker approach building relationships today?
On the leasing side, it’s best to connect with somebody who’s been in the business. Have them teach you the ropes and help you develop relationships with their current clientele. Certainly, you could just go door to door and knock, but having an in with somebody who already has a book of business is a really good way to start.
Management is harder to start from scratch because you need to have a team assembled to run systems that are far more sophisticated than they were 20 or 30 years ago. But there are always exceptions. Say a firm has some competent investment or leasing brokers. That can lead to a request from a client to provide management services, and if you have that kind of relationship, they may be a little more tolerant as you gear up and learn new skills.
That’s the way the Elliott leasing department began, in reverse: When we were managing property exclusively, owners began to ask us if we would take on the leasing component and eventually the investment side. If you’re being asked to do it, that makes it a heck of a lot easier, because the relationship is already there.
The industry has evolved substantially in the last 50 years. What do you hope you’ve contributed?
Our contribution has been the effort of all our staff together. We somehow managed to keep the doors open through feast and famine. I think we have a good reputation for being honest and secure and confident, and for having integrity. We’ve got many clients that are now 30-year clients, and they rely on that.
From your perspective, what are the factors that have kept NAI Elliott around?
We were very fortunate to have a group of leaders who were really critical to our being able to perform at a high level. People refer to the so-called “Elliott way”—if you read our manifesto, that’s the way we approach the business and it’s very different than most. For example, we’ve never said, “Let’s get control of that client so we can rent all their space and sell their property when it’s done.” Yes, we’d like to be vertically integrated, but the concept of trying to control a client is adverse to our philosophy. We serve the client, and that approach is really important.
Secondly, we saw many companies in the management business, in particular, rely much more heavily on the brokerage side of the business than the management side. Management was sort of an afterthought. When there was a downturn in brokerage, you were out of business, and many smaller companies have suffered from that over the years. We had a base of management, which was a base of strong relationships—and for a long, long time, relationships with local owners. That helped us sustain the company relative to our competition.
Now that the company has NAI Global affiliates and other relationships all around the world, has it adjusted its approach?
I mentioned our manifesto. When it comes to understanding us as a company, that’s a reliable and accurate document. It was very carefully put together. But we did modify it once when we joined the NAI Global network eight years ago. In our first manifesto, one of the key components was “We’re not suits.” At the time, there was an emphasis on bringing in remote asset management for ownership, and everybody wanted to be a “suit.” We did not. We could do professional work as well as anyone in the country, but we wanted to focus on local people.
We eliminated that phrase in our new manifesto. We didn’t say that we were suits, but we acknowledged that we have institutional clients and 324 other affiliates that look to us. We might have to wear suits every once in a while. It’s not a difference in philosophy, but it’s a difference in presentation.
As you look back at your career and this business you’ve built, what’s something you’re proud of?
Since 1972, we’ve never missed a payroll. Did we scrounge to make them a few times? Absolutely, but we never missed one. I’m proud of what thousands in the company have achieved over these years. I get credit for everybody else’s work, and I acknowledge that often. And I’m very proud of Jordan. I think he’s going to be a tremendous leader for the company. The day he came to NAI Elliott was a great day for us, and I’m very proud of his ability and what he’s achieved so far.
What do you expect and hope for the future?
There was a sea change in the industry over my little period of existence in it. I don’t have a clear idea of what will change next, but it certainly will change. We have the “Amazon effect,” the effects of the pandemic, and the whole concept of remote and hybrid employment. I don’t know how much can be outsourced to the rest of the world. And I don’t have a clue what’s going to happen with AI.
I think for the foreseeable future, there will still be human beings making decisions. If you can get to those people and have any kind of relationship with them, then there’s a place for you.
Do you have any closing words for our readers?
To be successful in this business and to enjoy it, you need to have personal relationships with your coworkers, the tenants and owners you work with, and of course, all the vendors. The work we do requires all those parties, and there are many of them. Establishing good, strong personal relationships with those who you work with is very, very important.
