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.’