Q & A with Bellmarc Realty's Neil Binder
May 28, 2009 01:00PM By Jovana Rizzo
Neil Binder
Neil Binder, co-founder of Bellmarc Realty and author of four real estate books, sat down with The Real Deal to talk about the market, cutting costs at the firm to survive the downturn and how a cheating girlfriend got him into the real estate business.
There are tons of predictions about when the market will bottom. Do you have one?
Yes, and mine is the right one. (laughs) It already has. There are three [economic] states that economists talk about: one is an L -- we go down and we stay down, one is a V -- we go down and we pop up and the W -- we go down, we go up, we go down, we go up. I truly believe [this] will be a W.
How are you trying to cut costs?
We closed our main location, we consolidated staff, we repositioned our advertising a little bit and made cuts wherever we could make them and still be able to service customers. Nothing was sacred. I think we were the first ones to get out there and start doing things and everybody said 'Oh, Bellmarc's in trouble, Bellmarc's going down, Bellmarc's bankrupt.' I've been in business 30 years, and for at least 20 of them, someone has told me I'm going bankrupt. We just had our 30th anniversary.
Did you have a party?
We didn't have a party; we don't have enough money.
How did you get involved in real estate?
[When I was in college] I was interested in juvenile justice. I thought I would apply to law school, but I did [poorly] on the boards. Instead, I went to business school at NYU. I ended up working for accounting firm Arthur Andersen, but I was a terrible accountant. I was dating a young lady [Alex] and she said she had a friend [Barry] who was involved in real estate (Binder would not identify the name of the real estate company because Barry still works in the business). He needed someone to oversee management companies, residential properties and put together memorandums for partnerships. On Friday during my first week, Barry said, 'let's go out for a celebratory dinner.' I said, 'I can't do it, I have a date.' He said, 'Does she have a friend? We'll all go out.' So I call Alex, and Barry said, 'Why are you calling Alex?' I said 'I go out with Alex every Friday.' He said 'I go out with Alex every Saturday.'
So you were inadvertently sharing a girlfriend with your boss?
She introduced me to the guy she was cheating on me with! I broke up with her, obviously.
Did you continue to work there?
I worked with him for two years. It was the hardest experience of my life. I came in at four in the morning and left at one [in the morning]. I was learning about all things involved with investments, and during the second year I was buying real estate and overseeing deals.
How did Bellmarc come about?
When I was 26, I wanted to do my own thing. I went to a lunch at the Young Men's[/Women's] Real Estate Association [of New York] and I met my partner Marc [Broxmeyer]. Marc's father was one of the largest owners of real estate in Florida, and Marc started as a porter in a building [there]. He progressed and got to the point where he was pretty much running the company for his father on the management side. But his father was reckless, and the whole house of cards fell down. Marc went back to school … and bought a building on 121st Street in Bell Harbor, Queens. He formulated a company called Bellmarc [Bell from Bell Harbor, Marc from Marc Broxmeyer]. We acquired a building together on [138-11 Beach Channel Drive]. When [my boss Barry] heard I acquired a property, it was not what he wanted me to do, even though I asked permission. So I was out.
You were fired?
Yes. So I bought 50 percent of [Marc's] stock for a dollar, and we became partners. We had a little office [in Greenwich Village] and I said … we have to get people working for us. A friend I knew from NYU was really unhappy at his job in the Brooklyn borough president's office, so I said, why don't you become a real estate broker? I'll teach you.
Is that where your training program began?
Yes, I started doing training because it was the only hook we had to induce people to come. I would just talk, and then I started taping it. But people weren't getting it, and I was pissed off, so I said 'Marc, I'm going to make them take a test.' Each exam must be answered 100 percent right. If you make a mistake, you have to take it again. You only sell here after you get 100 percent right. You can't say to a customer, 'Ask me another question, I didn't get that one right.'
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Comments
Anonymous
wow as soon as he said the market has already bottomed he lost all credibility
Comment #1 Posted By: Anonymous 05/28/09
Anonymous
What he fails to mention is that until job losses get back to under 400K per month, the real estate market is going nowhere but down.
Comment #2 Posted By: Anonymous 05/28/09
Anonymous
Yup- the guy has no idea what he's talking about, #1. Really, these people should stay far away from the media- all of them.
Comment #3 Posted By: Anonymous 05/28/09
Anonymous
nice stories, but just like the rest of us he has no idea what the market will do
Comment #4 Posted By: Anonymous 05/28/09
UrbanDigs
well, is there any record of Neil Binder predicting the downturn to begin with? I mean, way before it happened, like in late 2007 or very early 2008? If so, then he has some cred. If not, well, if he didnt see this coming, how can you call a bottom?
Comment #5 Posted By: UrbanDigs 05/28/09
Anonymous
I love these comments. Yeah, the guy is in business for 30 years. He has 250 agents. He has stayed in business in UP and DOWN markets and survived through it all to be one of the Top 10 firms in NY. Right......He has no idea what he is talking about. You people on this board - Get a life.
Comment #6 Posted By: Anonymous 05/28/09
Anonymous
I know because I was there...... They dont like to predict the downturn as it scares the hell out of their agents. They like to keep insisting that all is peachy even when its not. Sort of a POSITIVE at all cost.
Comment #7 Posted By: Anonymous 05/28/09
Anonymous
#6, he might be a great guy, but should stay out of the media when consumers who AREN'T buying into his nonsense read this stuff. To call the bottom now, in the face of big declines coming, is irresponsible- buyers aren't stupid, aren't buying into it, and aren't buying from those that are trying to con them into the "bottom."
Comment #8 Posted By: Anonymous 05/28/09
Anonymous
Couldn't handle law, couldn't be an accountant, what the hell could this guy do? So he went where all the remaining schmucks go ... real estate.
Comment #9 Posted By: Anonymous 05/28/09
Anonymous
Neil knows exactly what he's talking about. There is no legitimate "Downturn" in the Manhattan real estate market. There is a hysterical reaction to what has gone down in the finance sector and people are starting to see that it's not as bad as it was made out to be. Banks can't and won't lend. Until banks are relieved of large portions of their troubled assets, they will not take on more risk. The reductions in sales prices (approximately 12%) are reflective of the lack of credit and that's all. When credit is available again, the market will again be brisk with sales. It seems to me that the only people who are claiming this is just the tip of the iceberg are people who can't afford to buy even if prices roll back to the 90s.
Comment #10 Posted By: Anonymous 05/28/09
Anonymous
And who #10 is going to be applying for these mortgages if the financial sector is not doling out multi-million dollar bonusus? Will bus drivers be buying 20 million dollar coops with 20 percent down? Get real..the landscape has changed forever. There's only one way prices can go and that's down.
Comment #11 Posted By: Anonymous 05/28/09
Anonymous
Did #10 read the foreclosure statistics? These things, even if not specific to NYC, affect the entire market. Being able to afford to make a stupid investment is not something to be proud of. Any money you do have is probably a result of other people's stupidity. Good luck trying to continue riding that wave, and sorry that your alleged wealth is quickly evaporating
Comment #12 Posted By: Anonymous 05/28/09
Anonymous
Number 10 has no idea what he or she is talking about. I have been involved in real estate for 15 years as both a Manhattan attorney and commercial mortgage broker. Although I do agree prices will not reach the levels of 2001 or $6-- psf as many predict, there is no doubt prices will stabilize in the $750 to $850 psf range for good product. The bottom line is wealth in Manhattan has changed- decline of WS etc- so prices will go down.
Comment #13 Posted By: Anonymous 05/28/09
Anonymous
#10- No need for boasting about my financial situation but I certainly have the money to buy a Manhattan condo. I choose not to bc at these prices it is simply a bad investment- period. Yes, once credit is available sales will rise- but certainly not at any level to be classified as "brisk".
Comment #14 Posted By: Anonymous 05/28/09
Anonymous
#10 Here. #11, I will start with you. No I don't think bus drivers will be the new customer base for realtors, but here's how to answer your question. Who's buying them now? There have been over 2000 closed sales this year at prices very close to last year. #12, I have been on the advisory side of the real estate business for most of my 23 years in the business and I've always looked at the foreclosures. To answer your question, why don't you go find out how many foreclosures there were in Manhattan in 1999? There will not be that much difference.You're reading figures that lump Queens in with Manhattan and it looks very bad that way. #13, Midtown West is still bringing an average of $1100 a foot, why would you think prime areas would go to $750 to $950? #14, Again, we've had over 2000 closed sales this year with essentially no mortgage money available. Why wouldn't this go very brisk when banks start lending normally again?
Comment #15 Posted By: Anonymous 05/28/09
Anonymous
Considering there were 2,500 condos in contract that should have closed in the first 5 months of the year the fact that only 2,000 total units closed is telling. Of course, most of these 2,500 were put into contract pre-Lehman. Wait until the pre-construction condo data stops skewing the data. Not hard to know what's going on today.
Comment #16 Posted By: Anonymous 05/29/09
Anonymous
#17, What is this pre-construction "skewing the data" business. Look at the closed sales and look at the sales prices. Are you out of your mind, pre-Lehman? These are deals contracting now and selling now. They're not even in new buildings, these are existing properties. The financial sector never made up the market like the financial sector claimed. There's alot of other money out there. Smart investors are grabbing the savings because it's not going any further.
Comment #17 Posted By: Anonymous 05/29/09
Anonymous
Hey #19, Real new yorkers are from Queens, the bronx, BK. He didn't move here after college to act like a new yorker for a few years and live in manhattan. Got to be living here at least 10 years to even start consider yourself a new yorker. How long you been here?
Comment #18 Posted By: Anonymous 05/29/09
Anonymous
10 is a broker!! nuf said
Comment #19 Posted By: Anonymous 05/29/09
Anonymous
#10 is not a broker, he states that pretty clearly to me. I think he's the only one on this board who has any facts to back up his words.
Comment #20 Posted By: Anonymous 05/29/09
Anonymous
the reality is .........NO ONE knows what the future will bring. this could be the tip of iceberg for a long deep decline....or not. no one knows nothin' - that is what I learned from this current economy
Comment #21 Posted By: Anonymous 05/29/09
Milton J
Just a reminder.... Manhattan + Wall Street = High Uncontrollable Prices Manhattan - Wall Street = More Affordable Housing. Its that simple
Comment #22 Posted By: Milton J 05/30/09