Times like these reward those who are nimble (Def: agile, fast, and light in movement; able to think quickly and cleverly). And we are seeing more proof of this every week. Having personally been involved in the opportunities created by the US savings and loan crisis almost twenty years ago, I can attest that in most cases those individuals and companies that were nimble did very well.
While there are some deals today targeting portfolios of distressed assets, there are not as many as investors originally believed, nor is there the plethora of distressed opportunities that existed during the RTC days. However, those who are clever and can adapt their strategy to the situations that present themselves (or that they are able to create) will continue to thrive in any type of economic conditions.
In the mid-1990s, Tishman Speyer was able to buy a large chunk of Rockeller Center because they put the time into the due diligence over the Christmas holidays (when other prospective bidders were drinking eggnog) and were able to find what I call “opportunity income” that the previous owners had overlooked.
Felix: opportunity knocks
DRA Advisors and Walton Street Capital, while maintaining conservative approaches, have been nimble enough to make some of the more creative deals in the past few years. DRA took private two REITs – Capital Automotive REIT and CRT Properties. They've also structured several joint ventures. Walton Street has also been nimble in creating opportunities in Mexico and now in India. How do they do it? By taking advantage of sellers' strategic or financial motivations, investing in markets or properties that are perceived as out of favor by other investors and leveraging industry relationships with both private and public joint venture partners to access deals.
A lot of people I know took longer-than-usual vacations this summer (well, I have to clarify that by saying it was longer than most typical US summer vacations – meaning two weeks vs. one week). And I know that more people than usual truly unplugged during their vacation seeking some relief from the stress which had permeated their workdays, especially for the past year.
But taking time to detach is a good thing because when you come back you'll see, just like in the soap operas, that not much has changed, the characters are still pretty much the same and you don't miss a beat in picking up the story. So, maybe after your break you come back with a different set of eyes and a different way of looking at things and you start thinking differently. And maybe this difference is not so much a lightning bolt but a more subtle, more clever way as it were of approaching the same business and industry and conditions you left before your vacation.
And maybe, just maybe, it involves going back and listening to your clients, your investors, your network of industry friends and acquaintances and seeing how they're thinking. We aren't all cut of the same cloth and everyone has their own style, but I strongly feel that communication and collaboration are the door openers to opportunity and that being nimble may be something we can all do if we just open our minds, relax and float downstream. There are opportunities for each of us that exist beneath and beyond conventional thinking and self-imposed limits.