Property Management Blog
From CNBC.com:Warren Buffett says along with equities, single-family homes are a very attractive investment right now.Appearing live on CNBC's Squawk Box, Buffett tells Becky Quick he'd buy up "a couple hundred thousand" single family homes if it were practical to do so.If held for a long period of time and purchased at low rates, Buffett says houses are even better than stocks. He advises buyers to take out a 30-year mortgage and refinance if rates go down.Buffett revealed that he put 175 million euros into each of eight European stocks on behalf of Berkshire Hathaway at the end of 2011, but did not reveal the names of those stocks." To watch the whole interview on CNBC, CLICK HERE.
FOR IMMEDIATE RELEASESERRUS CAPITAL PARTNERS RECEIVES $10 MILLION UPGRADE IN LINE OF CREDITInnovative Greenville, SC, Real Estate Firm Helps People During Distressed Times GREENVILLE, SC, February 27, 2012— Serrus Capital Partners, an investment firm in Carolina real estate, has received a $10 million upgrade of its credit (LOC) in recognition of its significant accomplishments and business model. Serrus Capital Partners, which has designed a systemic asset-management process that is measurable, scalable and repeatable, will use the line of credit to make further investments in real estate, to support rehabilitation, and to expand its residential activities. “Serrus Capital will use the LOC to help good people during these distressed times,” Leighton Cubbage, Serrus co-founder and Chairman of Serrus Capital Partners. “We will continue to buy properties from individuals and banks, hire people, support local vendors and contractors, pay commissions to real estate folks, and improve neighbourhoods throughout South Carolina.” Sunwest Bank is providing Serrus with the $10 million upgrade to its line of credit. Sunwest Bank, headquartered in Tustin, California, is the premier small- and middle-market business bank in Southern California. “When I think about Serrus, I think about families. Not just the families that you try to help, but the way in which you run your business like a family. It takes integrity, hard work and commitment to what is best for all to be a success,” John R. Houten, executive vice president of Sunwest, told Serrus executives. “As Serrus grows and is able to spread out and do more business, I am confident that Serrus will continue to be successful. I am just proud to be a part of the team. “Serrus Capital’s business model is really a good news model. Many people are skeptical of distressed acquisitions because they do not understand the economic impact they create. A home in distress is detrimental to a neighborhood. It hurts the value of all of the homes surrounding it,” Houten said. “By acquiring the home, fixing it up and leasing/selling to folks who want to better their lives, it makes the community better. I have been most impressed by the commitment to Serrus’ community that it continually has displayed.” Houten’s comments reflect the atypical corporate philosophy of social responsibility of Serrus Capital, which strives to provide jobs and housing that will advance people and communities across South Carolina. “We appreciate not only the investment from Sunwest but also the recognition of the successes of our business model,” Cubbage, a successful serial entrepreneur in telecommunications, technology and real estate, said. “We have strong goals for future growth, and the additional Sunwest funding will help achieve these.” Cubbage envisions continued acquisitions in the Upstate and expanded real estate activities in Asheville, Columbia and Charleston. “We look with great promise to expand into these communities,” Cubbage said. “Real estate is all local, and the future looks opportune all along the interstate corridors of I-85 and I-26.” Serrus Capital Partners makes acquisitions of undervalued and non-traditional housing. The goal of the business model, which blends expertise, scalable processes and technology into a powerful investment tool, is to purchase and rehabilitate properties that have had prices depressed by the Recession. Serrus then sells the properties or holds them as rentals. Serrus, which started with properties in primarily in Greenville, Spartanburg, Anderson, and Pickens counties, initially acquired almost 130 residences through individual and block investments. Through another investment, Serrus Partners also purchased a block of 29 high-rise, luxury condominiums in Columbia’s prestigious Carolina Walk, stutter steps away from tailgating and thrilling football at the University of South Carolina. Serrus co-founder and CEO Steve Mudge, a veteran executive from Marriott International, Ritz-Carlton and Centex Homes, said the recognition of the Company’s successful business model. ““Serrus Capital was able to catch the early wave of real estate investment trusts in January 2009 and become one of the successful ones that became one of the most successful models for transforming undervalued properties into high-value investment opportunities,” Mudge said. “Sound due diligence and tasteful renovation substantially increased home values. Serrus Capital Partners has given new life to these properties and to their new owners, many of which might not qualify for traditional housing loans in this economy.” In another contribution to local economies, he added: “Banks have also benefitted from Serrus Capital, which has removed bankrupt, foreclosed properties from their non-performing real-estate portfolio.” Cubbage and Mudge recently worked with Clemson University to create the highly successful Ecoplosion, a summit designed to focus on ways the Upstate can build an entrepreneurial culture. More than 300 business leaders, entrepreneurs and the community explored entrepreneurship, economic development and real estate at the first Ecoplosion. This now will be an annual event in Greenville. ### About Serrus Capital Partners Serrus Capital Partners is a real estate investment firm has designed a systemic asset-management process that is measurable, scalable and repeatable. The Greenville, SC-based Serrus Partners uses proprietary software to track each step in due diligence and then renovates its acquired properties. It adheres to the highest restoration standards in its efforts to re-develop properties and raise community values. In many cases, Serrus strives to pay cash for properties in order to complete acquisitions within a week. For more information, please visit www.serruscapitalpartners.com. Investor Inquiries: Leighton Cubbage Serrus Capital Partners 864.409.3128 firstname.lastname@example.org Media Inquiries: Reed Byrum Byrum Innovation Group 864.567.7468 email@example.com
One of the strongest endorsements Serrus Capital Partners will ever get was probably its first when Steve, Tammy, and I went to see C. Dan Joyner. We had become good friends over the years, and we valued his judgment. As C. Dan looked at our plan and examples of our houses, he exclaimed, "Now is the time to buy real estate!" He later agreed to join our first Advisory Board and made a powerful testimony on video about our first fund. One of the video clips was a personal statement from C. Dan about my integrity, and I cherished his faith in me. Take a look at C.Dan's obituary that's attached. What a life! When I was younger, all my thoughts about success were wrapped mainly in material gains and acquisitions. When you knew C. Dan and read about his life, his accomplishments are overwhelming and so significant. Yet his incredible heart and attitude were what made him legendary. After all these years and the enjoyment of his friendship, I will always respect and appreciate all he did for us. But the biggest thing is that I just miss him. And I know that I am certainly not the only one. Here is a part of that video I was talking about where he recounts his life, his profession, and his love for Greenville, SC. Enjoy! Here are the links I spoke about earlier: WYFF.com - CLICK HERE Greenville Online - CLICK HERE
I discovered many years ago that good leadership creates for its followers and its employees an environment that is the perfect balance of empowerment and accountability. You see… empowerment devoid of accountability is anarchy… and accountability devoid of true empowerment and authority is paralysis. The challenge of creating this type of organizational paradigm is greatest when trying to convert from a centralized leadership model to a distributed one when the organization has been ruled for many years by a single, dynamic entrepreneur, many times the founder of the business. I have witnessed many strategic organizational transitions in which the individuals that have been inducted into the new leadership regime have failed to pick up or adopt the mantle of leadership because they simply do not believe that the change in organizational approach is real or they are unsure of their span of influence or control. The result in many cases is a mirage of change that is hollow and bankrupt, resulting in no material improvements in operational and/or financial performance, and worse… a complete stall in leadership development and leadership distribution. As I encountered this reality in a number of companies with whom I have worked, it dawned on me that organizations need a simple conceptual framework that helps newly designated leadership clearly understand the reach of their leadership authority and enables them to more easily gauge which decisions they can and should make unilaterally and which ones demand outside perspective. Faced with that challenge, I crafted a simple 3-step decision-making model that has worked for more than 25 years… and is just as applicable today as it was the day that it was conceived. I call this process the “3-2-1 Decision-making Model”, and it has proven to be simple to understand and just as easy to implement and execute. It goes something like this… 1) When facing any decision, there are three principles that are inviolate. These three principles fall under the jurisdiction of a rule. A rule has hard and fast boundaries, and if you break a rule, you are in peril of losing your job. The three principles and the rule that applies is this: “We will not take any action or engage in any activity that is illegal, immoral, or unethical, or may even be perceived as such.” So if an employee leader is faced with any opportunity or choice that even smells or smacks of illegality, immorality, unethically, the decision-making process is swift and definitive; the answer is always “No.” 2) Our behavior as leaders needs to adhere to two guidelines. Guidelines are a little fuzzier than rules, and they are more open to interpretation, but they are not difficult to understand. In short, a leader’s behavior needs to support our brand values and our brand culture. If it does not, then we confuse the buying public, and we either vacate our brand equity, or worse, we erode it. 3) And lastly, when a decision needs to be made, and it has to be made quickly, there is one decision-making model that helps newly appointed leaders understand the gravity of the decision he/she is facing and the wisdom of making that decision unilaterally, i.e. on his/her own. The question that we teach each leader to ask herself/himself is called “The Four C’s” question, and it reads as follows:
“What is the chance that if I make the wrong choice relative to the decision that I am facing that irreparable or calamitous harm will fall upon… •A Customer •Our Company •A significant Contract •My Confidence
If the chances are slim that a wrong decision will result in a ruinous level of calamity, and the decision falls with that leader’s span of control and/or arena of expertise, then our directive is… “Make the decision!” If the decision proves to be wrong, then that decision has not harmed anything of an irreplaceable or mission-critical nature, and we can recover. And… being wrong relative to a decision of that magnitude actually provides a teaching moment and transports us one step closer to the right direction or answer because it eliminates a wrong one. In short, when making a decision that shows little propensity to destroy one or more of “The Four C’s”, our leaders are fully empowered and supported by executive management regardless of whether the decision proves to be right or wrong. Over many years and in a number of companies, the deployment of this type of decision-making model has resulted in the development of better, wiser, more mature leaders… faster. And that leaves more time for me to accomplish my ultimate business objective… to work myself into irrelevance and obscurity. Here’s to real leadership… leadership that replaces itself… better, faster, stronger. It works. Try it. G. T. “Toby” Stansell
These are interesting times in which we find ourselves in South Carolina relative to education, industry growth, and employment. On one hand, unemployment has remained at or near a double-digit metric for quite some time, and yet we find many job postings that remain unanswered and position openings unfilled due to the lack of a qualified workforce. Such a phenomenon causes many of us to regularly point the verbal finger of blame at various classic institutions and infrastructure that have historically been lightning rods for such criticism. At various times, we have all surmised that such a reality must somehow be the direct result of a cataclysmic failure of our education system, workforce development initiatives, social programs… or a combination of the above. However… I don’t think that is the case. I would like to submit that what we are seeing today relative to unemployment in SC is to a significant degree the result of an education system and a commercial/industrial environment that have innocently proceeded along their own paths without the elevated degree of coordination, collaboration, and cooperation that is required to keep any two trading partners in sync in today’s fast-paced world. For years, both education and industry operated primarily in a push, Make-To-Stock mode. By that, I mean, education systems have produced for countless years a steady inventory of accountants, attorneys, teachers, engineers, etc… by and large the volume of which has been determined by the interests and focus of the school and the student. And as I read what I just wrote, on the surface… that seems OK to me. In the same manner, industry produced goods and services in the same way, producing to a forecast a predetermined volume of every size, shape, and color of product in hopes that market research was accurate and that what was produced would be snapped off the shelves and out of the showroom. From my perspective, industry woke up first, adopting lean, just-in-time, demand-pull production philosophies and principles that enabled it to be more responsive to shorter product lifecycles, rapidly-changing technological advancement, and fickle consumers. By exponentially reducing production line set-up/changeover times and adopting “postponement” strategies that let producers wait until the last minute to put the finishing touches on product, global output began to more closely mimic demand, thus reducing waste and SLOB (SLow and OBsolete) inventory. If one of the primary success metrics of our education system is the measure of its ability to equip students that are readily received and adopted by commerce and industry, then education systems must parrot the philosophical and physical improvements adopted by their industry partners. There are at least five high-impact, fast-growth industry clusters in South Carolina that have been identified and agreed-upon by a large percentage of the economic development organizations operating under various banners throughout the state. These focus industries are aviation/aerospace, automotive, advanced materials, biosciences, and energy… or more specifically… green energy. The support thrown behind these five industries was not generated on a whim, but instead was based upon the results of research and the evidence of measurable momentum and traction already exhibited by these industries within our state boundaries. That being the case, I would certainly think that we need to systematically query leadership within these five industries (and possibly others) to understand and record the talent, skills, degrees, and certifications that they seek and the roles and professions that they need to fill… both now and in the future. It logically follows that our education curriculums, programs, and degrees need to be constructed to produce output… i.e. graduates… that are well-equipped and qualified to fill the positions and roles that these industries must staff. There are a number of pilot education programs operating in this state that are already putting this real-world model to the test and into practice. One such example is the Medical Experience (MedEx) Academy operating under the guidance of the Greenville Hospital System (GHS). The MedEx Academy initiative (under the direction of Brenda Thames of GHS) exposes students to the biosciences arena and elements of the health care industry very early in their education process. As the student progresses through primary and secondary education, he/she experiences increasing opportunities to learn about the biosciences discipline and health care opportunities because he/she is provided exposure to such information and education within the public education system. The concept embodied by the GHS MedEx Academy represents a somewhat softer approach than has historically been the model in some European countries, making this model very adaptable to the other high-impact, fast growth industries that we have identified. In short, this approach does not dictate, drive, or direct students early in their education journey toward specific trades, industries, or professions, but instead exposes students to industry/career information and material in a way that is inviting and engaging and creates an environment through which students might be drawn toward an industry or role based upon their innate talents, interests, inclinations, and intellect. The requirements that shape the education-commerce continuum are dynamic and ever-changing, and an approach such as the one promoted here will require regular tune-ups and adjustments in order to remain relevant and effective. But I do know that a precedent exists that we have already touched upon. When the manufacturing industry process model changed from a primarily “push” model to a “pull” model, production began to more closely mirror demand. I know that we are dealing with human lives in this instance, and I do not want to diminish the sanctity of human life by describing or denoting life or an educated individual as some sort of “product”, but it is clear that some of the same principles apply between the two models. The situation demands that we do something. Not just something different… but something better. G. T. “Toby” Stansell