Jeff Rowlett, along with the support of his team is among the top investment brokers at Marcus & Millichap. Over the years Jeff has honed his skills and developed a niche, concentrating on Net-Lease assets and multi-tenant retail assets throughout the Midwest and Nationally. Jeff has worked at two of the top commercial real estate brokerage firms and been pursed by many other top CRE Firms. Jeff’s exposure to these top commercial real estate brokerage companies has given him a unique peek behind the curtains at some of the major firms and allowed him to see which corporate structure and culture worked best for his style of brokerage and most importantly, for his clients.
LD: What career path did you want to take when you were in college?
JR: Surprisingly I have a degree in Kinesiology, Sports Medicine with an emphasis in Cardiac Rehab and my goal was to become an Athletic Trainer in the NFL.
LD: What events in your career path brought you to your current position at Marcus & Millichap?
JR: Looking back I can only say that I was guided into my current career path and I had little if anything to do with it. One of my clients that I was working with in athletic training introduced me to a family friend that happened to be one of the top investment brokers at Marcus & Millichap and one thing lead to another. I didn’t even know what commercial real estate investment sales meant at that time, but it intrigued me. Marcus & Millichap has a great platform and training program, so I jumped in headfirst and never looked back.
LD: Can you tell us a little what your “average” week of work is like?
JR: My average week consists of hours upon hours of time on the phone or meeting with clients to discuss their commercial real estate needs and if or how my team might be able to help them. This is a relationship business, so the more people you know in the business, and specifically, the more people you can help to solve a problem for, the more valuable you will be. The remainder of my time is spent organizing, tracking escrows, completing proposals and working on mentoring and building my team. I have a never-ending thirst for knowledge, so I invest a lot of time reading and listening to podcast while on the road and always advancing to get better at serving my clients and growing as a person.
LD: Majority of your listings/ sales are in the secondary markets; what are some of the differences you see in investment opportunities in Primary Markets versus investments in Secondary or Tertiary Markets?
JR: Well we have the unique advantage of working in both primary and secondary markets. I live in the suburbs of Chicago, which is where I spent the first 8 years of my career learning and doing deals. Over the past 5 years I have developed a team based out of Milwaukee, so we do a lot of transactions in the Midwest and also our single tenant business, which is a nationwide practice. There are similarities for both markets; location and tenant credit rating are always factors, but the differences are the buyer pools for various markets. The assets in secondary markets have experienced much more attention from out of area buyers the last couple of years because of the limited new construction and limited supply of quality assets for sale. For the secondary markets we see more offer activity from local buyers that know and understand the area well, but we still sell good majority of these properties to buyers from outside the market or state. The primary markets see activity from local & regional buyers, syndicators and institutional buyers alike. Pricing and cap rates for the assets of course vary as well.
LD: In 2015 – 2017 there is an estimated $601 Billion of CMBS maturities hitting the market. What impacts do you think this will have on the market (listings coming to market, demand for debt, debt available, cap rate expectations, etc.)?
JR: The Fed’s decision last week to hold rates is further evidence that we have some time left in this current cycle and cap rates may even continue to compress for Class A assets. Low interest rates, steady NOI growth, and competitive yields are supporting investment in all categories of commercial properties. Transactions in 2015 are on course to exceed pre-recession peak levels, and most property sectors continue to see inflows of equity and disciplined underwriting by debt providers. With positive economic trends boosting property performance, commercial real estate remains a favored asset class for investors.
LD: All property types have their own cyclical natures for a number of different reasons. Can you tell us a little bit about the cyclical nature in the STNL market?
JR: An STNL property, as an asset class is actually a relatively new category for investors. The sector now even has subcategories such as Dollar Stores, Automotive users, Banks, Drug Stores, Fast Food and QSR restaurants, etc. These properties are very popular among 1031 exchange buyers because of the nature of the long lease terms and limited (if any) landlord management responsibilities. When the recession hit in 2008 these assets became even more favorable due to the predictable cash flow and low price points, which allowed investors to continue buying even with constraints in the capital markets. There seems to be no end to buyer’s appetite for STNL properties right now and for the foreseeable future. Fluctuations in interest rates will have an impact on cap rates and spreads eventually once inflation starts to kick in.
LD: Everyone has a few transactions that stand out in the careers. What is one deal thus far in your career that stands out to you and what is the significance to that deal?
JR: Your first deal is probably the one you will never forget. There is so much excitement and you are so focused on doing everything right and pleasing your client, so I will never forget the first one. It was a CVS anchored shopping center property in central Illinois and the sellers were a local family and they had worked so hard their entire lives to develop properties and build a portfolio that supported the family financially. It was so gratifying to help them maximize the value and sell at a price that was several hundred thousand dollars above the previous offers they had received before we listed the property. I will always remember that first deal and that they were the first client to hire me and give me a shot.
LD: What advice would you give a young Jeff Rowlett just out of college and starting his professional career?
JR: I mentor new agents to this day. I just started mentoring an agent this past week and have mentored roughly 10 or so agents over the years to help them start their careers. This is something that keeps me humble and grounded in the fundamentals of our business. I advise them to practice and become excellent in the fundamentals; develop a discipline in doing the key factors of goal setting, planning, tracking your activities, prospecting (yes, cold calling is still the MAIN driver of success), and working your plan very hard the first 3-5yrs. Brokerage is fun, but it’s hard work, and there are NO shortcuts. As soon as you get traction, get some help and hire an assistant. I still work with a coach and read to get better every day.
LD: What advice have you received that has been instrumental in your success?
JR: I was fortunate to start my career at Marcus & Millichap where the training and platform is so strong. I have had a lot of great mentors to watch and learn from and some that have invested in me. I was always willing to do the hard work and when I was told, “do this and you will succeed”, I just did it until it paid off. My regional managers and private coaches that I’ve hired have always taught me to be disciplined and do the right things, like continual learning, prospecting for new business every week, and setting goals. It certainly helps that I have a great team that supports me and great clients that see the value we bring to them! I am excited for the future and the next phase of my career.