The Leader - May/June 2008 - (Page 52)

We lls F a r G o ’ s s a n Fr a n cisco spa ce str a teGY: Dav i D ne ls o n’ s cYcle -p ro o Fi nG Make s Fo r i Mp re s s i v e c BD p o rt F o l io p l aY Get tHe nuMBers riGHt to Win trust Wells Fargo exemplifies the rise of corporate real estate as a driver of the corporate enterprise, to the extent that it’s fair to say, inside the bank, CRE is changing the nature of the business itself – through reliable forecasting. That can’t happen without a key attribute that CRE has earned: trust in the C-Suite and across the business lines. “We’re fortunate at Wells Fargo to have senior management and a board of directors who know CRE,” asserts Don Dana, Executive Vice President at Wells Fargo and a long-time presence in advising its leadership on the commercial markets. A track record of “good decisions” gives Dana’s, and by extension David Nelson’s, top stakeholders a level of confidence in CRE that only comes with consistency, accuracy and managing expectations. As Senior VP of Real Estate, David directly oversees a broad and talented internal team but Dana is the bridge to the company’s leadership. Both executives are well groomed and reflect the positioning of today’s best CRE executives, as characterized by deep CRE knowledge but complemented by wider business acumen. Dana ran a private real estate business practice and has a number of years on the lending side of the industry. He’s also advised outside interests like pension and investment funds. His view is well informed from a market and management perspective. Dana holds a law degree, a Masters degree in Financial Services, has done continuing graduate-level work at Harvard Business School, and has been with Wells Fargo for 20 years. Dana relates that “most of my senior team has been with me for 10 or more years. Get good people and retain them.” Together with the extensive in-house and selective outsourced talent they draw from, both executives pronounce the power of CRE with the informed prescience of accomplished wealth managers or investors. “I view real estate as an asset as seen on the balance sheet,” Dana imparts. “Whatever decisions you made five years ago, would you assume they’re equally valid today? No. You’d really question their wisdom. The same is true here at Wells Fargo. The more cycles go up and down, the more valuable a good real estate advisor becomes.” One example, recalls Dana, were the “truck loads” of landlords seen in the early 1990’s. Service provider consolidation has left comparatively few today. “This changes the dynamics even though the square footage and the commercial portfolio are still there,” he notes. “This is where CRE plays a role, to understand important moves like how much to capitalize our assets, and how to reliably forecast.” DON DANA CAREER TIPS On trust If the board and senior management don’t trust you, nothing else will flow. Never dilute or take chances with that. Whether it’s a good or bad answer, it has to be the right answer. Over-promising on delivery dates or sale prices is tempting but it’s always a mistake. On CRE’s rule of thumb It’s not location, location, location for CRE. It’s the numbers, numbers, numbers. Your major value to senior management is being right with the numbers. To the extent you make a mistake, they will never forget or forgive wrong numbers. Sometimes it’s pretty, sometimes it’s not. But it’s got to be honest. An important take-away from this case is that the lack of portfolio flexibility “can cost CRE dearly,” as Nelson cautions. That level of flexibility, in fact, extends out from 2008 – 2020 with a series of termination options on the portfolio. “That’s powerful stuff,” Nelson insists. “When you have a mortgage crisis (like right now), you have the ability to downsize.” Nelson confides that misjudging the ability to exit from long-term leases and the under-utilization of leasing options is more of a ‘make-or-break’ issue for CRE professionals than even paying too much per square foot or locking into too much space. Another key take-away pertinent to all CRE’s that Nelson shared: “Always make every transaction a ‘win-win’ for the bank, the brokers, investors, owners, internal clients, senior management and, of course, the board and shareholders.” tH e le aDe r 52 MaY / j u n e 2008

Table of Contents Feed for the Digital Edition of The Leader - May/June 2008

The Leader - May/June 2008 Leadership Contents Message from the CEO Real Estate in the News Green Real Estate Work Without Boundries Building Flexibility Into the Business Strategy Multi-Generational Work-Force Design Work Force Longevity Analysis Wells Fargo's David Nelson Pennsylvania's Michael Rossman Globalization 2.0 Site Selection Consultant Directory The New York Report: A Core of Traditional and State-of-the-Art Opportunities Discovery Forum Findings Industry Tracker Young Leader Career Development Effective Leadership Economic Development in the News A Look Ahead In Our Next Issue Calendar of Seminars Index of Advertisers Executive Development Spotlight

The Leader - May/June 2008

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