Justin Altemus is a third-generation broker at The Altemus Company, a boutique commercial/industrial real estate company located on the Westside of Los Angeles since 1946. For over 20 years, Justin has been involved in numerous commercial/industrial lease, sublease, owner-user sale, stabilized/value-add investment sale, land development sale and 1031 Exchange transactions for third parties in and around the Westside and portions of the South Bay.
In addition to the third party brokerage side of the business, through an extensive portfolio of properties under ownership and management of the company, Justin’s day-to-day responsibilities have provided him with a wealth of experience and knowledge in real estate syndication, asset management, property management, financing, construction management, entity formation, investor fund raising and investor relations.
Justin’s success in the industry reflects his approach to business that dates back to a primary reason why AIR CRE was founded by Justin’s grandfather, Jules Altemus and his colleagues.
When Jules Altemus started the organization in 1960, it came out of a need for order, mutual respect, professionalism and building broker relationships among the brokerage community at a time when it was severely lacking. That same core founding principal is just as important today. Justin notes that as commercial real estate brokers, we are in a very unique industry in that we are all competitors and at the same time, we are all partners as well.
It is those broker and partner relationships that are critical in closing transactions and critical for longevity and success in this business.
Q. What would you say is your biggest professional accomplishment? A particular sale or lease?
A. While I could point to some specific sale or lease transactions, I would say my biggest professional accomplishment goes back to the very challenging years in our industry, circa 2008 and 2009. On the ownership/portfolio side of the business, all we were doing all day, every day was dealing with work outs and forbearance plans with many of our tenants – just over 250 at the time. During those years, we were busier than ever and making no money. However, we knew it had to be done to keep all of our properties afloat. I am happy to say, that largely due to good decision making and the fact we did not over leverage our portfolio in the prior economic peak, we came out of that period unscathed. We didn’t lose one property and didn’t pick up the phone once to ask for any partner capital contributions. This was at a time when many very experienced, long time veterans in our industry were losing properties left and right.
At the end of the day, I believe it is much easier to make money in a good economy when the tide is lifting all boats vs. preserving your capital/investment in a downturn when the tide has receded and all of your decisions and moves are much more exposed. While it was a challenging couple of years, I find myself a much more skilled and a better decision maker today because of it.
To use a basketball analogy and a quote from Bobby Knight, “Good basketball always starts with good defense.”
Q. What topic could you spend hours talking about?
A. I grew up in LA as a huge Lakers (Showtime) and Dodgers fan and could spend hours talking about either team, whether it be on the court/field or off. I am fascinated with the business side of sports and find myself very interested and absorbed in off season free agency, trades, understanding the NBA cap rules, etc. as much as the game itself.
I am also a huge history buff and love to talk and listen at length about many different historical events. I consider myself very lucky to have had firsthand conversations with my wife’s grandfather, William Herskovic (who passed in 2006) and her 96-year-old grandmother, Maria Herskovic, who is healthy and sharp as a tack (touch wood). William escaped from a concentration camp in Poland with a diamond in his shoe which he traded for a loaf of bread, fled back to his home in Belgium, and was credited as being one of the first eyewitnesses in exposing what was truly happening in the camps. Maria was not taken by the Nazis, but hid for a long time in the third story of a house in Brussels with many close calls.
The fact that they were both willing to talk and the fact that I was and still am able to hear firsthand accounts of their story is incredible. To this day, Maria says the best day of her life was when Belgium was liberated by the Allied Forces and she joined American Soldiers on top of their Tank rolling down the street throwing Hershey Bars to the thousands of people lining the streets of Brussels.
Q. At what moment did you know you achieved career success in the industry?
A. As it relates to “career success,” in my opinion, that is a hard thing to quantify and something I don’t think a lot about. Perhaps in my mind, if I do define a moment where I have achieved “career success” I’m afraid I will then become complacent and stop trying to become better at what I do and push the envelope every single day.
My day-to-day philosophy at this point in my career is, “you keep your head down, charge forward, and don’t look up.” There will be plenty of time to look up, look back, and reflect on what you have accomplished later in life. However, with that said, while it is not defined as one moment, I do acknowledge and feel very fortunate that I am at a point in my career where I can pick and choose which clients I want to work with and which deals I want to work on. As brokers, given time is all we have and really is our “Cost of Goods,” being able to choose how you spend your time and where you will get your greatest return on that time is critical.
Q. What’s your favorite simple pleasure?
A. Sitting down with my 14-year-old daughter, Sophia, and learning and playing mid-to-late ‘60s and ‘70s era rock songs on the acoustic and electric guitars. This is a passion of mine and the fact that my daughter has taken such a keen interest in everything “vintage,” including her taste in music has been a lot of fun for me and such a great connection for us to share. We have recently been learning and playing “Across the Universe” by the Beatles, “Angie” by The Stones and “Never Going Back Again” by Fleetwood Mac. The last two of which are not easy, but she is determined to master them.
I recently took her to see a Paul McCartney Concert, and she was so engaged the whole time. I think she really understood the historic value of what she was seeing, especially when Ringo filled in on drums at the end of the concert, which I told her would be as close we will ever get to a Beatles reunion.
Q. If you had the opportunity to take a year sabbatical to live for one year in a foreign country, all expenses paid and no limitations from daily life, in order to improve yourself – where would you go and why?
A. Maybe it wouldn’t be for a year and I don’t know exactly where it would be in the world, but I would like to spend time in a place where when I came back home, I would have a much greater appreciation for the luxuries that we all take for granted here at home. When we live so long in our “bubble” we lose our frame of reference as to how the rest of the world lives. I was listening to a sermon a few years ago and something stuck with me that I remember today. I was told the next time I am in horrible traffic and complaining about being late or not being able to get where I need to go, flip a switch in my mind and instead of fussing and complaining, remember how lucky I am to actually have a car to drive. Easier said than done, but it is important and it’s really all about perspective.
Q. Other than your cell phone or computer, what technology could you absolutely not live without?
A. I don’t know if you would consider this technology today, but I think one of the best man-made inventions in the last century is central HVAC. When it is hot and especially humid, I become very irritable, grouchy and a complete curmudgeon. If you don’t believe me, just ask my wife.
Q. Do you have a particular business of life motto?
A. I always come back to the saying, “We have two ears and one mouth so that we can listen twice as much as we speak.” I think we all want to speak and interject our thoughts so much in life that we constantly interrupt each other and truly forget how to listen. Also, I think it is so important to actively listen and truly understand, instead of just listening while mainly thinking about what we are going to say next. If you’re not listening and really understanding, you’re not learning.
Q. What does a typical work day look like for you?
A. On a typical day, I am up about 6:15 AM – 6:30 AM to get ready to take both of my daughters to the 7:10 AM bus for school. As much as we try to leave extra early so I can spend some quality time in the car with them talking while we wait for the bus, the reality is we typically leave around 7:06 AM for a very “CALM” (sense the sarcasm?) ride to the bus, especially when we are stopped by the Metro crossing. To my credit, I will say in 3 years, we have not missed one bus, however, I have cut off the bus driver on more than one occasion as he was about to pull away.
From there, I get my coffee and head in to work to start my day.
I find that my time in the office before 8:30 AM or 9:00 AM without phone or e-mail interruptions is crucial in setting the tone for having a productive day. Much of my work day is spent on the phone, in meetings, or on e-mail communicating with clients, brokers, and tenants within our portfolio and our investors.
At any one time, we may have two to three purchase or refinance loans in process within our portfolio, so there is a lot of work on that front as well, working closely between our mortgage broker and attorney.
About half of the week, I will eat lunch in the office, and the other half I will set-up lunch appointments; whether it be with an existing contact to nurture a relationship or with a new contact to help build a new relationship.
If I have to be out of the office at meetings or showing property, I definitely try to plan between 10:30 AM and 2:00 PM since the traffic makes it very challenging otherwise, even if I am only travelling 1-2 miles around the Westside.
Much of my afternoon is spent in the same way as the morning. I then typically get home between 6:30 PM and 7:00 PM in time to either go out for dinner or have a nice family dinner at home and spend some great quality “unplugged” time with my wife and kids.
Q. What’s the craziest lead you’ve ever chased successfully or example of a gigantic risk paying off?
A. Don’t think I would consider this a huge risk, however, about 15 years ago, we were referred to a client who owned a large building/parcel of land leased to a large credit automotive dealership tenant. There were issues regarding the lease that the client needed consulting on for which we decided not to take any compensation.
This went on for quite a while with hours and hours of our time invested in assisting this client not knowing if we would ever receive a dime of compensation. We were risking our time but knew we were really helping this client out and if nothing else, investing in the relationship.
Turns out that about a year later, they brought us in as their broker to negotiate a new 10-year lease extension with this tenant. About 8 years after that, we ended up representing the ownership in a $6.5MM sale of the property to the tenant. Given our client wanted to defer the majority of their capital gain taxes, we then represented them (and co-invested with them) in a 1031 exchange property in a $6MM SoCal Net leased industrial property.
What started out as a free consulting assignment, turned into commission on a 10-year lease and $12.5MM in sale consideration.
Q. What sage advice would you have for anyone starting out in the industry?
A. I know this may be a cliché, but I would tell them that above and beyond the commercial real estate business, you are really in the long-term relationship business whether it be with clients, your fellow brokers, or other colleagues in the industry. Focus on different ways to build and nurture as many relationships as you can, even if a return is not imminent. If your primary focus is truly that relationship and you have built up a solid network, the return/commissions will follow given enough patience.
This business is a marathon, not a sprint.
In combination with that, find a good mentor or teacher and learn as much as you can as quickly as you can about the market, the players in the market, the boilerplate of all of the CRE Forms, etc. This is not something you can tap dance around and it is evident to any client when you really know what you are talking about. As brokers, we are all dealing with the same inventory out there, but what differentiates you from the next broker is your command of the knowledge within the industry.
Knowledge equals confidence, and confidence equals success.
Finally, be conservative with your spending habits when you close deals. The broker that is driving a brand-new, high-end sports car immediately after he or she closes a deal probably won’t be a broker for very long.
It is always important to remember, you are only as good as your last deal.
Contact: Justin Altemus