[00:00:09] Speaker A: Hi, I'm John Co, and welcome to Icons of DC area Real Estate, a one on one interview show highlighting the backgrounds and career trajectory of leading luminaries in the Washington, DC area real estate market. The purpose of the show is to highlight their backgrounds and their experiences, and some interesting stories about their current business as well as their past, and to cite some things that you might take away, both from educational standpoint as well as lessons learned in the industry and some amusing and sometimes interesting background stories. So I'm hoping that you will enjoy the show. Before I introduce my guest, I'd like to share that both this podcast and the community I started in 2021, called The Iconic Journey in CRE, is now part of a new nonprofit organization with that same name. The new company will offer opportunities for sponsorship to grow the community both in membership and in programs. It also allows you, as listeners, to show your appreciation for this podcast, which has delivered episodes twice monthly since August 2019. With a charitable contribution, transitioning the community and podcast into the nonprofit organization is underway. The community, which is open to commercial real estate professionals between the ages of 25 and 40 years old, is currently up to 65 members and growing. If you would like to learn more about either joining the community or contributing to the podcast, please reach out directly to me at john at coenterprises coenterprases.com. Separately, my private company, Co Enterprises, now will focus only on advisory work for early stage real estate firms and career counseling. If you have interest in learning more about its services, please review my
[email protected]. Thank you for listening.
[00:02:24] Speaker B: Thank you for joining me for another episode of Icons of DC area Real Estate.
I'm so pleased to share with you the latest episode, where our guest today is Bob Buchanan, the founder and leader of Buchanan Partners. Bob's journey is a fascinating blend of real estate, Navy experiences and public service, and I'm sure you'll find his insights as enlightening as I did. Here are some key takeaways from the conversation. One, the Navy influence on his life and career, and he tells some fascinating stories there. Number two is his real estate journey, which started right out of the Navy through his father's company and then forming his own company and then a successor company after that, the power of partnerships. He had a partnership with Sun Oil Company in his first company, and then had partners, active operating partners with him in his second firm that he still holds today, among others.
Number four, the company culture and crisis management issues. So Bob's company operates like a family owned business, and he values quality and respect among the partners. And it's somewhat analogous, as I suggest, to the JBG companies as they were before they went public.
The other aspect is his public private partnership activity and regional planning activities. And that's when I met Bob and we go into that, he talks about how he developed a relationship from the Dulles Airport Authority and then into regional planning that led to Reality Check. We talk about and into 2030 Group, which he formed as well for the region. Then we talk a little bit about the future generation, the millennials in the future, and what opportunities they have and challenges they have ahead of them. Then finally, his personal reflections about his family and how his wife stuck with him through all the challenges and things that they went through. So without further ado, please enjoy this wide ranging conversation with Bob Buchanan.
[00:04:42] Speaker C: So bob Buchanan. Welcome to Icons of DC area real estate. Thank you for joining me today.
[00:04:47] Speaker D: Good to have a chance to reflect back on a great career and a great location to have that career. And I appreciate the memories you've generated by your questions to want to know where, when and how I was able to do the little that I did.
[00:05:03] Speaker C: Great. So could you describe your role as the founder and leader of Buchanan Partners and your focus day to day?
[00:05:09] Speaker D: Bob well, I'm a third generation I'm a third member of our I'm a third generation developer. My grandfather was more in real estate sales.
My father was a home builder, and in 1963, he was president of the National Association of Homebuilders. And I knew I couldn't match his abilities.
[00:05:35] Speaker C: Was this here in Virginia or Maryland?
[00:05:38] Speaker D: Right here in this district, yes. My grandfather, father, and then I was born here in 1943.
[00:05:45] Speaker C: So okay.
[00:05:45] Speaker D: 80 years later, I'm looking back at some of the things they started, which had been very successful, and the headquarters of the National Association of Homebuilders is here in the District. But my father loved the concept of providing a house that people could live in for generations. So I grew up following him as a little boy, following sitting in the car as he would drive his subdivision and people would come out, talk to him because the turnover rate was nowhere near.
[00:06:17] Speaker C: Where was he building?
[00:06:18] Speaker D: He was building in the suburbs of.
[00:06:21] Speaker C: Washington, basically, mostly Northern Virginia or Maryland or both. Okay.
[00:06:24] Speaker D: From Greenbelt to Alexandria to really everywhere. Everywhere. So I grew up looking at this region as one. And the Potomac River didn't come into my lexicon, so to speak, until much later as the politics changed, as regions and jurisdictions evolved. So Buchanan Company, that I was an evolution of these other companies. And that was a great opportunity for me to, after I served in the Navy, for me to learn. Because unlike most people, when I went to college, I wasn't studying to be a businessman. I wasn't studying to be a home builder.
[00:07:14] Speaker C: You went to Yale University, right?
[00:07:16] Speaker D: To Yale. And my father had said my sophomore year, he said, you're very fortunate to have been to good schools like Yale. You've earned it. You've done well. But upon graduation, I want you to go into public service so you can be with people who are smarter than you. Interesting, that will be a good way for you to learn how to manage, but also learn how to listen to people.
So it turned out I ended up in a program at Yale that you needed to go to like reserve officer candidate, name of the program, but you needed to go to OCS Officer Canada School in the summers and then if you graduated from OCS and you graduated from college, you could get a commission. So part of that program was though if you didn't graduate from either one, you were an enlisted man and that was enough of an incentive that you wanted to make sure you didn't take lightly the military training. And I found I enjoyed the military training and found my father's advice about being with people who were just as smart as me but didn't have that opportunity. I was surrounded with people like that and I ended up serving on an aircraft carrier. And one day we were looking at a film clip on Vietnam. This is 1965 and none of us knew what the hell Vietnam was or where it was or what it could be. And this old warrant chief warrant officer looked at a bunch of us young officers and said, gentlemen, if you want to do anything in this navy career, you better get your ass to Vietnam.
The next day, as I would have it on the PA system, there was announcement of a language aptitude test. And so I took the aptitude test and depending on how you scored, you would be offered language school. And the test was, I think 3 hours. The first hour was you had to memorize a make believe language and the next 2 hours you had to utilize it, be tested in it. And I tested high enough that I was trained in Chinese Mandarin, so I went to Chinese language school, really. And then I had no idea what I was going to do with it until they took the top students in the class and they set us up. We were going to the language school on the east coast and we were driving up to NSA, where we were going to be interviewed for our next tour. On the way up, we're just chattering about what we're going to do, what we would do with the Navy, solved it to use our skills nonstop for 45 minutes. We get to NSA. John, this is truth. We went into three inner sanctums. Finally this three star walks in with a clipboard with our BIOS on it and there are four of us sitting there.
As of now, we're getting a little apprehensive.
[00:10:23] Speaker C: Three star general came in, really, admiral.
[00:10:25] Speaker D: Or admiral, and he basically said, this is what you're going to do, this is what you're going to do. You and you. Are there any questions?
It was so far beyond anything any of us had ever imagined. We said, no. We walked out. We got back in the car. Not a word was said all the way back to where we'd left. I got my car, run home. My wife said, Where are we going? I said, well, we're going to go to southern Japan. Great. Why would they send you to southern Japan if you speak Chinese? I said, Because I'm going to be gone from southern Japan on missions in Southeast Asia three years. I did. Spencers wow. Some of them were in submarines. Some of them were in airplanes.
[00:11:13] Speaker C: Did you get a security clearance then?
[00:11:15] Speaker D: At that time, I had the highest security clearance. It was not just top secret. It was covert. Covert?
[00:11:22] Speaker C: Covert. Wow.
[00:11:24] Speaker D: So we were doing stuff that was you didn't read about it in books, and I never really talked about it.
[00:11:31] Speaker C: So were you affiliated with the CIA at the time, or an SA or Dia or one of the agencies?
[00:11:38] Speaker D: But I reported first to the head of the Navy.
[00:11:44] Speaker C: Naval Intelligence.
[00:11:46] Speaker D: Well, it was someone special in the Navy that oversaw tactical operations in the Pacific.
[00:11:54] Speaker C: So you learned about the inner workings of the Navy at that point then. Right.
[00:11:58] Speaker D: Wow. And so I'll fill you in more on that in a minute. But back to how I got from there to here.
The good news was I was with the best of the best. I mean, we were doing stuff that was unbelievable. And part of it was we were well trained. Part of it was our technology was so good that we were in places.
[00:12:21] Speaker C: That no one so this is LBJ's presidency then. You were during the Vietnam War era, 67 to 70. Okay.
[00:12:31] Speaker D: So it's a little after as well, because Nixon had said, if anybody ever attacks my, I'll get in that and win. So Nixon was also president, of course. Anyway, the training was such that I was officer in charge of a small group of men who were specialists in intelligence and signals and communications.
And we were stamped beyond submarines, and only the best of the submarine commanders were chosen for these missions because you had to be pretty capable, because there was no help in sight. And if you were discovered, what's the.
[00:13:21] Speaker C: Most secret part of the Navy is? The submarine.
[00:13:24] Speaker D: And at one point, if we were discovered and forced to service, initially, they told us I had to kill my men because we were fear of being tortured and telling secrets.
So I'll just give one example of how effective and good and capable we were. And I'm not saying we as individuals, just the Navy and the program.
So about I think it was the 45th reunion at Yale. One of my classmates had a party to introduce his wife. He had divorced and he remarried, and his wife had been a member of the Red Guard. And she had had her parents killed in front of her. And her father was a commandant of a highly secretive Chinese submarine base that no one really knew about. And she described she was telling them about the view from her bedroom overlooking the harbor. And she was going into a lot of things as a young girl, proud of her parents and their stature in life until the Red Guard wiped them out. And I got up and I left the room, and I'm sitting on was.
[00:14:48] Speaker C: This during the Cultural Revolution or about that time of Communist China?
[00:14:52] Speaker D: Yeah, for her.
[00:14:53] Speaker C: Right.
[00:14:54] Speaker D: But the story is much later, she escaped to eventually, and my friend married her and whatever, but anyway, she's telling about how unique her child was, and I got up and left, and my wife came out and said, bob, what's wrong? This is unbelievable. You should be listening everything I said, well, I was afraid I might say something. She didn't describe the view from her room very well, and I didn't think I could keep biting the inside of my mouth.
[00:15:26] Speaker C: Because you knew things that you couldn't say because I was there.
[00:15:33] Speaker D: And she didn't describe what she saw very well. And again, you had to be with captains who were pretty damn gutsy themselves to take you there.
[00:15:41] Speaker C: Right.
[00:15:42] Speaker D: And we had some close calls there's, no question.
[00:15:44] Speaker C: Did you go under the North Pole? Up in the Arctic?
[00:15:48] Speaker D: Okay.
I was stationed in Japan, so we go to the Were.
[00:15:54] Speaker C: Okay, so you weren't you know, the.
[00:15:57] Speaker D: Russians weren't the worst thing that happened to me. And this is back to Nixon. So when the China the North Koreans took the Pueblo oh, yeah, it was a surface ship. Right.
[00:16:16] Speaker C: I remember that.
[00:16:16] Speaker D: Nixon said, no one's going to do that to my Navy launch. So we're on trying to figure out 68, 69.
[00:16:27] Speaker C: Yeah.
[00:16:28] Speaker D: So we're subtly going in places that we hadn't been trained to go because I didn't speak Korean, and I didn't know anything about the Korean coast. I knew Chinese. I knew Chinese coast. So we were spread thin. And then it got even worse when I was on setups, mostly, but occasionally I'd fly we fly missions along the coast just to test how quickly they could pick up our presence and what kind of signals would come on and then who would communicate with who. So we would learn if we did need to attack, if we did need to protect how strong their coastal defenses were to an airstrike.
Not that we were planning to attack, but we didn't know what the Chinese might do with our presence in Vietnam. And the whole purpose of the submarine being there was the Navy brass did not want the then fourth largest submarine force in the world to slide down, to have one of their subs slide down the coast and put a fish into a destroyer in the Gulf of Topcat. So that was never going to happen. To prevent that from happening, you had to know how good they were, how they did things, and know how to stop them.
Same way I flew. And the flying was fun because you weren't gone for two months. You were back home in a day or two. And we would fly down from take off in Japan and fly along the coast and land in Taiwan, and the next day come back. Well, on one mission when we landed in Taiwan, someone comes out and says, who's the officer in charge to the plane? Mr. Landon. And he gave me a message and said, you're supposed to head back right now, let your chief run your crew, because Lucio says you have a surprise inspection tomorrow, and he can't pass it without you. So I'm on a commercial plane flying back through the night. Meanwhile, my men got up early the next morning. We fly back.
Chinese MiG, I mean, North Korean MiG came out of nowhere and blew them up, and they were in an EC 121. There was a 50th anniversary, but it was 1969. And so obviously, I'm devastated because that's my team, and I'm wondering who I can get, because I know that we're going to be called upon because we were the only ones who had those skills. But I didn't have that deep of a bench to call from. So I'm at the memorial service, and everyone is crying for the loss of life of the young men and my chief and I'm stone faced, looking straight ahead. And my wife, who knows how emotional I am, said, what are you doing? And I said, I'm trying to figure out who I can task to go, because we're going to be sent out somewhere in the next couple of days, and I don't have a clue who is capable.
Three days later, I was on a helicopter with five that I had selected who had never been on a mission before. And we're on a helicopter waiting for a submarine to surface so we could be lowered onto the sub.
And as luck would have it, the pilot helicopter is getting a little nervous because the sub hadn't surfaced where we thought it'd be when he thought it was supposed to. And anyway, finally popped up, and he said, good, because I'm running on fuel. Well, my men was usually, as an officer, the last one to go. Let your men go first. None of the men had ever done this. I had done it, but they were scared to death. We had 70 pounds of equipment on our backs, that kind of stuff.
[00:20:30] Speaker C: You're going down, and we're going down to cable, cable into the submarine, which.
[00:20:35] Speaker D: Is going to submerge as soon as the last guy wow.
So, long story short, I went first and saw how easy it was. They followed. We get on the sub, and the submarine captain walks up to me and says, man, am I glad to see you, because I have no clue what we're supposed to do. But I'm told, you've been on five of these missions, you're the best, and you'll tell me what to do. And I said, Sir, I have no clue.
[00:21:04] Speaker C: Oh, my God.
[00:21:05] Speaker D: He said, well, we're in trouble. He said, because a third of my men, I had to leave on shore because I was told, leave immediately to pick you up. Wow. So we're going to be under men.
Well, the proof of that was at 02:00 a.m. The next morning, many hours later, we're being death charged by destroyers here.
We couldn't keep the bubble. A guy he had on that ship was inexperienced, couldn't keep the bubble. And we got picked up by someone needs to say we got through it, but it was like, wow.
[00:21:44] Speaker C: So you could probably feel the explosions of the depth charges right outside your.
[00:21:49] Speaker D: Oh, you the hall. I was running up to the CEO. I said, what the shit?
I got the con. I shouldn't have put the kid on. It's my fault. I got it. No doubt.
[00:22:02] Speaker C: Wow.
[00:22:03] Speaker D: That's the kind of experience I don't think my father thought I'd have. But it was that exposure to things that were so far removed from most of my friends, my graduating class, only 17% did not go to med school.
[00:22:20] Speaker C: Law school, business school. Right.
[00:22:22] Speaker D: And that 17 did.
[00:22:24] Speaker C: How many went into the military? Very few.
[00:22:26] Speaker D: Probably that many.
[00:22:27] Speaker C: Particularly then because the risks were so high to go to Vietnam.
[00:22:31] Speaker D: Right. But there were some and had been in OCS.
[00:22:37] Speaker C: Right.
[00:22:39] Speaker D: And you bring up a good point because I couldn't go to my fifth because I was over there, but I went to my 10th. I graduated 64, so 74. And nobody was talking about Vietnam. Nobody.
[00:22:59] Speaker C: That was the year Nixon was resigned.
[00:23:02] Speaker D: They were into that big time. No one talked about the impact on our not our class, necessarily, but our generation, because I had experienced in my own neighborhood vilification of anybody who was a Vietnam vet. And it happened to me personally, where some guy just said, I don't want to have anything to do with you. I can't stand, we should have been there. You shouldn't have been there. What's wrong with you? And he's a neighbor, and no one wanted to hear your side of it. Anyway, so I'm talking to my class leaders and saying, you got to start talking about this because it's a part of our society and it's a part of our class and we're going to be facing with it with the trials and tribulations. And anyway, it took them a number of reunions, but they finally started talking about it. But it was tough in the 70s being a Vietnam, I'm telling you.
So I learned. Just never talked about it. So no one ever knew about my they just knew. I'd lived in Japan and I was in the Navy.
[00:24:14] Speaker C: So that experience toughened you quite a bit. I mean, you saw things that very few people see at your age.
[00:24:24] Speaker D: There was one time, John, I said to myself, if we get out of this one, because it was a crazy mess. If we get out of this one, I'm not going to let things bother me.
[00:24:35] Speaker C: No.
[00:24:35] Speaker D: I'm going to take him in stride.
And I think that was probably one of the stronger takeaways. Just relax, take a deep breath, make things rib.
There's got to wait, be away. Just take your time.
[00:24:52] Speaker C: So there's no financial stress you could ever go through that would be greater than what you went through there. Obviously.
[00:25:02] Speaker D: There was financial stress, but in a way, I remember coming back, well, back to my mother for a minute. So it's the end of my tour.
I'm burned out from all these missions.
[00:25:16] Speaker C: My God. Yes.
[00:25:18] Speaker D: Young daughters. I've loved being in Japan. When I was on mission, my wife Sharon said, you're mine. We're going to these pottery villages.
[00:25:28] Speaker C: We're going to enjoy in Japan. In Japan.
[00:25:32] Speaker D: Live the best we can and enjoy this unique experience.
My time's coming up. I'm being approached by CIA, FBI, Navy, you know, whatever, to stay in. And I was torn because I was being offered some pretty high opportunities. And again, I did not want to work for my father, the home builder, because I didn't have any affinity with that. And that was his love and his passion. I didn't have a so.
The phone rings. I answered it's my mom, and she said, well, I think we're proud of all that you did. We're certainly glad you're alive.
What are you planning to do now that your tour is coming to an end, John? I hesitated maybe a second and she said, Good. Your father needs you. Come on home. We need you.
Can't wait to see you.
I came home.
I'm going to these meetings, all these guys, these hot chuck guys in banks and been to financial training and all this. They're speaking in a jargon that I did not understand, did not know. I was afraid to ask questions. I was just quietly listening. That's why fast forward to young people coming into the business today don't have the ability to sit at the table and listen to what is being said because they haven't been at the work. They missed that. So I really got a crash course in development just because my father was turning things over to me and I was having to get permits.
[00:27:23] Speaker C: Sure.
[00:27:23] Speaker D: And that led me to land use.
[00:27:25] Speaker C: Issues and everything, right?
[00:27:26] Speaker D: Exactly. And so that led me eventually to got elected on the Rockville City Council. And because, again, we had a permit that it was a no brainer permit that they were going to review and approve and through the planning commission, rockville Planning Commission and extension of a shopping center. And we were supposed to be on at seven. And the attorneys, the engineers, and I was just going to make a presentation, which I always did, and we got delayed, delayed, delayed. And finally this guy refused to hear us because it was past eleven.
So the next morning come to work and dad says, Great, did you get the permit? I said, no, they didn't even hear our case. What are you talking about? I said, this guy kept delaying it and I wasn't in a position I could argue publicly.
So he said, that's not right. He picks up the phone, he calls his friend, Mayor Tuckman, mayor of Rockville. They had known each other for a long time. And my father, Tuck. This is Buck. What the it's going on with that planning commission? My son was there with all the team for 4 hours and they didn't even give him the courtesy of hearing the case. And Tuck says, you know, Buck, we've got this guy on the council that's been assigned to the planning commission. That's a horse's ass. He's trying to be a power guy. And he says this once too often. We need to have someone replace. You have anybody in mind that I can work with? My father says, I do, I'll have him call you tomorrow.
Great. Dad, who are you going to call with? The mayor?
[00:29:23] Speaker C: You're on the planning commission. There you go.
[00:29:26] Speaker D: So I came in with my business sense and I would say publicly to the staff, we need more oxes. You can't just tell us this is the only position that we should be considering.
But I also wouldn't let the developers get up there and bullshit because a couple of times I say, wait a minute, I think I know the market better. That's not going to work. What are you going to do when this happens? And people would say, Why are you doing that? You're in the business where you should be supporting. I'm like, no, I'm in the business to help this community develop as best as it can. We're not going to have something that's going to fail that I knew it was going to fail and I approved. So I started to earn the trust of the civic leaders who said, well, maybe this guy was so bad.
[00:30:15] Speaker C: So that's the unique experience you had that very few developers have is being on the other side of the table in the approval process, which is interesting.
[00:30:23] Speaker D: And that's what led that's a good summary. And that's what led eventually to my being one of the founders of the partnership, because we had a scenario where the Baltimore had approved this land use revision, master plan revision that allowed no flexibility, and they had pretty good Far requirements, but it was all commercial.
[00:30:50] Speaker C: So this is the county of Arlington's.
[00:30:52] Speaker D: Approval, and they had the RV corridor, right?
[00:30:55] Speaker C: Sure.
[00:30:56] Speaker D: Which they really wanted to they wanted it to be revitalized the county because of the mix of uses.
[00:31:06] Speaker C: Well, this was also Metro.
[00:31:09] Speaker D: So I got involved in working with some of the county commissioners and John Milliken, for instance, was one. And that's where he and I developed, because he was open minded and he was trying to figure out, why isn't this working? And maybe we ought to form a task force to really bring in some of the key people who are developing here, as well as the key people of the community, as well as some of the elected officials and staff.
[00:31:40] Speaker C: So why Boston and not Roslyn or Clarendon or we bought a piece in.
[00:31:45] Speaker D: Boston because my team at sun didn't want to be caught. They loved the idea that it was right off the 66, 66, 1st stop right there from the tower you could see 66. So if you were coming from downtown, you could see the infrastructure, right? If you were coming from out of town to town, you could get in there quick. So they did not want to be caught in the middle of Bolston where there was no visual sense of place.
[00:32:24] Speaker C: Interesting.
[00:32:25] Speaker D: And so I showed them two parcels that we were thinking about that I had options on and we ended up buying both of them. But the moral of the story was that's where they wanted to put the office and the others where they wanted to put the residential.
[00:32:42] Speaker C: Interesting.
When did you start your own company, basically?
When did your dad step down and hand you the reins? Basically.
[00:32:55] Speaker D: My mother my mother was really good.
She saw the young bull and the old bull not agreeing on a lot of things. And she turned to my dad once and said, you know, Buck, if you want him to take over the company, which is your only exit, you better start letting him have more of the reins. And if he's going to make mistakes, he's going to make mistakes, but he's never going to run the company and pay you what you think the company is worth unless you give him a chance.
And that was in the mid 70s, so I hadn't been there that long, but I was really interested in the commercial side of things because we had a plan. We had a project in Fairfax that was going nowhere and we have one in Loudon that was going nowhere. We had land in Herndon and I said, I want to build a Flex, can be office, can be a duct or whatever the market's going to let us. But it was beyond Hernand Parkway and I've been told, infrastructure, infrastructure, infrastructure. Be right there on the new road, let's go for it. And my father thought that was ridiculous.
[00:34:20] Speaker C: But some old people said, so 1970 ish 75, mid 70. How did you get there from Rockville. So let's take me on the roads to get there.
[00:34:39] Speaker D: Because the company had business in Virginia that I was assigned to. Me. We had some. Other properties in the District, in Maryland, but they were pretty much not in play. They were income producing, doing as well as they could. But anyway but the new stuff that dad had thought he would be doing was just dormant.
No one would do what to do with it. And it was given to me. And then the piece had heard it. I said, Reston's about to catch on fire. And I used the example of whatever agency moved out there and changed the game in Reston. Whereas land had been appreciated when people saw what they paid and that kind of stuff. So I was due diligence because it was cutting edge stuff. So I had everybody's comps. And I remember the first big project I did for Radar. I went up and made my presentation and I predicted that this office park in Herndon would sell at Guy in Philadelphia said, we have a major office park in the suburbs of Philadelphia. That's not getting $3.50 a foot. You're telling me your thing that in someplace I've never heard of.
The first deal I signed was for 375 a foot, sent it to the head.
[00:36:20] Speaker C: Okay, who were the users at that time?
[00:36:24] Speaker D: People who were coming out of Tyson's who wanted to be closer to the airport. People coming in that wanted to start a business.
We had foreign people that wanted to have an office.
[00:36:40] Speaker C: Because of Dulles.
[00:36:41] Speaker D: Because of Dulles, right.
And it was right there on the toll road right there. Easy visibility, easy access.
[00:36:48] Speaker C: This was before the telecom boom out there too.
[00:36:52] Speaker D: It was dulles, right? And then I got on the Dulles Ford and I saw a chance for the Route 28 district and what that could do better land access. So I was involved in the Route 28. And that's what got me into Loudon because I said, wait a minute, route 28 expanded. All of a sudden it's in Loudoun County. It's Loudon County is viable. So when we bought this property called created Lakeside, but Loudon Tech but Lakeside was open.
It was only three stories. And I regret that they weren't six stories because when we sold those buildings, it was the highest price for Foot commercial office. Foot set a record environment. It's probably still the broker because prices have declined so much. But I have to say so that got me into the Land Development Office park. Whether it was along the toll road or Long Seven or Route 28. And Learner was out there and everybody was seeing the opportunity because of the movement. But nobody was going over the river. No one was going into Maryland. People were coming out from DC.
And Tyson's wasn't a great place to live and work because the traffic wasn't conducive know?
But if you were a big corp, you had to be there because they didn't have anything yet in Reston or Harmonious Accommodation.
[00:38:21] Speaker C: Well, I just interviewed David Orr and he was with lee Samus at the time. So Lee Samus was pretty active doing office parks there, as well as Centennial, of course, Pete Scamardo. And so they were the two Rest In office developers at that time. So I don't know if you work with those guys.
[00:38:42] Speaker D: I really like Pete. We would have parties, we would have get togethers, and we would toast each other for having the luck to be willing to do what we were doing because everybody else was just shaking their head.
I was lucky that I had sun oil. So I had the financing if I believed in it. But as I indicated in the answer to you, I couldn't ever lose. I could always get what I wanted as long as I never failed. So I had to have plan B-C-D-E. If plan A wasn't coming the way I thought, what would I do to improvise? And when Son taught me that, basically my mentor and son, you may be good, you may be infallible, you may be lucky, but if you don't have a fallback someday you're going to be so convinced that you're right and you're not, and you're going to lose.
[00:39:46] Speaker C: Let's peel back to how you developed that relationship with Son.
[00:39:50] Speaker D: So I was introduced to this guy who was looking for a local partner in the DC area because DC, as you said, DC was taken off, the DC area was taken off and Radler was the real estate subsidiary of Sun Oil. And a decision was made that the Sun Company was generating so much cash flow that they wanted to invest it in long term real estate holdings. How could they do that?
Where should they be diversified geographically?
How it's best to know about that other location, or better, have a local partner. Have a local partner who isn't always about themselves, who knows what a partnership could be and will be a good partner. So I was introduced to this guy who had run the manager of all the gasoline stations in this region. So he knew the region. His job was to find somebody who also knew the region because he didn't know anything about real estate. He knew the gas business, gas station business, but nothing about the planning, the architecture, the marketing, that kind of stuff. So we developed a relationship and he taught me about corporate thinking, and I.
[00:41:12] Speaker C: Taught him about location.
[00:41:14] Speaker D: Location and political implications. He had never interacted with the politics.
[00:41:22] Speaker C: It's interesting that oil companies would want to get I mean, I think about Reston Town Center because of Gulf Oil getting there. So they were doing it.
[00:41:34] Speaker D: Exxon was doing it. There were some shell was doing it.
Radner, it ended up being a billion dollars in working assets.
When Son made the decision to get out of the real estate business because it was getting a little dicey in the 90s, they just cut. I was lucky because we had so many big projects that were so good that they said, wait a minute, if you cut, you're going to take too much money off the table because some of these other things you've cut and not gotten your money back. Here's a chance to get your money back. Do you want to do that or not? And my mentor was good to convince the oil company, okay, but you better be winding it down. So that's when I ended up buying those projects.
[00:42:38] Speaker C: Got it.
[00:42:38] Speaker D: Radner. And the Radner guy I was dealing with who replaced my mentor, he looked at me and he said, this isn't official, but they really want out.
You've done great.
Give me a price that you can live with and I will deliver. And I went, I mean, I was thinking about all the what ifs and he said, don't be afraid to give me a price that you don't think is a good price, but I might surprise you.
All right? So I gave him a price and he looked at me and he said, have you figured out this and that? I went, yeah, but I didn't want to push it too hard. He said, push me hard. I want you to succeed, but I also want to be out.
That was because he appreciated my willingness, because I wasn't looking to take advantage of them and I wasn't looking to do anything but make sure those projects were successful. So that's why when Steve, Hubert and Brian came along, I was really ready, willing and able because I just said, I'll buy this. And they came in and said, great, well let's develop.
[00:43:53] Speaker C: What year was this now, Bob?
Early 90s.
Okay, so how did you finance that acquisition?
They took back paper.
[00:44:12] Speaker D: Okay.
[00:44:13] Speaker C: So they did a they accommodated.
[00:44:18] Speaker D: And again, you look at I wasn't never being greedy. And I think maybe sometimes that's worked against me where I could have, should have. But, yeah, I'd rather have people think that I didn't take advantage of them and trust me and give me the benefit of the doubt than being always.
[00:44:45] Speaker C: At the edge and pushing, pushing.
[00:44:50] Speaker D: And I think that stood me instead in what I've been interacting with. Equity partners. And we've had one point, I went up to New York, someone wanted me to meet this guy in New York who had access to all kinds of equity.
And he asked, who were some of your partners? And well, we had Tishman Spire, which was a major New York development. Of course we had some Dutch, we had some Chinese, Taiwanese, and we had some wealthy individuals. No.
Who are you really dealing with? I told you. They said, God, I can't believe it. Some people can only deal with international and can't do the local.
We had a pension plan. You've got pension, you've got academia.
[00:45:40] Speaker C: Full array.
[00:45:41] Speaker D: You've got the full array.
How do you juggle that? I said, I don't know, just what I think my job is, well.
[00:45:53] Speaker C: Interacting with that many different institutional investors, you have to have very good systems, you have to have really good communication skills. I mean, that's not easy.
[00:46:04] Speaker D: And eventually Tishman came one time and know, we're a little embarrassed because they had an Australian investor that they were basically doing and we were outperforming them on our project with them and they know we don't want the Australian investor to we don't want him to go.
[00:46:31] Speaker C: Away because we think that's to Macquarie you don't know.
[00:46:36] Speaker D: Okay.
[00:46:37] Speaker C: Macquarie was a major I just I never met them.
[00:46:42] Speaker D: So I said, OK, let me buy you.
So I started weaning down when it wasn't really working but with the Dutch it was just like there's total trust.
[00:46:54] Speaker C: Yeah. Brian Bennehoff, your partner, told me about your Dutch relationship. It was really strong. I remember strong for 30 years or whatever.
[00:47:05] Speaker D: And then the Chinese, Taiwanese, how did.
[00:47:09] Speaker C: You find these folks? I mean, did they come to you? Yeah, they saw your success in Northern Virginia.
[00:47:19] Speaker D: The Chinese have been investing in this area through one member of the family lived in Baltimore area but was aware of this region and so they liked that sense that family was there. That was a long term commitment by a family that said, we don't know when the Chinese are going to come back and take us over, but we need to have a strong with a presence in the United States where we have one of our members living in that eventuality being from this area didn't know because everybody related to it.
[00:48:03] Speaker C: So what was your investment strategy at that time? I mean, you had your Loudoun projects, you did your Boston developments, you had two major projects there. Then you looked at some things here in Montgomery County as well. So talk about that a little bit.
[00:48:18] Speaker D: Again, what's really ironic is here you're talking to a guy who probably did more suburban office parks than anybody and I'm not bragging, I'm just I started early and I had the Bill Bryant giving calling me, telling me the next best deal. And I had people trusted me that if I thought enough of it to put it under contract they were going to give me a commitment because they wanted me to develop it versus someone they didn't trust.
[00:48:52] Speaker C: Well, the other person that I think of is Henry Long, who was very active out there too. I financed a couple of his buildings.
[00:48:58] Speaker D: He was Fairfax. He was at one end of 28 and I was at the other.
[00:49:02] Speaker C: Right.
[00:49:03] Speaker D: We would get together.
[00:49:04] Speaker C: Right.
[00:49:05] Speaker D: And it was great working with his people.
The irony is, John, that when I was a little boy my dad would take me to his projects and I grew up thinking, wow, I'm so proud of him and look what he's done now. I can't take anybody to a suburban office park that's either failed, thank God I didn't own it when it failed or has had to go through a re, completely reagent. And so I can't point to where I really made my career and say I did that because it's, well, Boston. Boston. Some of the office buildings at Boston for Lakeside's, not bad. But the other thing I'd say that we enjoyed doing was we brought art into the development business because we wanted to create a sense of place. And so we always had good lobby art or good entrance sculpture to create. Okay, this is different.
[00:50:14] Speaker C: So where did that come from?
[00:50:17] Speaker D: My wife basically had a great business dealing with architects where she would bring in artists to deal with the interior design. But she had a string of great artists that she would commission works for. And I got to meet them and got to go to some other studios. And I'd have to say that some of my greatest pride was getting some of my teams to select the artists that we would commission for a sculpture, for an entrance to an office.
And people would say, you're the guy who knows art. And I said, no, you're the guy who can appreciate what this project needs and what will differentiate it, what will make it special, what will make it special for you. You'd be a part of this. So then I had people coming to the meetings and volunteering, and that created that sense of family. We're all in this together.
[00:51:19] Speaker C: That's interesting.
[00:51:21] Speaker D: It's not going to be Bob choosing for everybody.
[00:51:26] Speaker C: I imagine the architecture community appreciated it.
[00:51:30] Speaker D: Yeah. Yeah, because it was hands on.
In fact, I think I was maddest at myself, who I used to really get into the details and really understand why they were this design. And I let some guy talk me into a system that he didn't understand as well as I thought he did, and I deferred to him. And I ended up having to change that system because it was an HVAC that wasn't working. And I just said, I need people around me who have more expertise, competence.
[00:52:10] Speaker C: Interesting.
[00:52:13] Speaker D: You learn more from your mistakes than you do from your successes.
[00:52:19] Speaker C: So, Bob, tell me a little bit about your company structure. I met your partner, Brian Benninghoff in the early 90s. He talked about kind of your investment strategy at the time. And now you've expanded your company considerably and have nine partners now in your firm, which is interesting. Kind of reminds me a little bit of the JBG model, a little bit. So curious if that is in fact.
[00:52:47] Speaker D: A person rehired not that long ago came from JBG. And she's going to be great. Anyway, I think three things. One, the three of us, steve, Hubert, Brian and myself came together as an opportunity for me to use my ability to have equity partners and know the region.
Three of us brought different specialties. Brian reads a financial statement. Like most of us read a novel. I mean he really understands it, he sees things.
[00:53:20] Speaker C: He's a finance guy.
[00:53:21] Speaker D: He really understands the finance and he's a relationship owner. Steve has background in father is White Hubert doing construction. Steve grew up in the construction world, has an eye for detail and understands the operations far better than many could hope for. And if we were going to be developing, steve was a great source of strength as we were looking at opportunities and architects and engineers and construction contractors and I was more the marketing guy, maybe the big picture guy, maybe the community guy. So as that evolved and we started to do the success and have the successes we had and we got into a mix of uses because we had a willingness and we had the skills to see it through.
Brian became the CEO, steve got more into alternative investments, and I was able to pursue my dream of public private partnerships, community relationships, and eventually started the 2030 Group, which was an effort to bring in business collaboration. Business. Leaders to collaborate, to help define a sense of regionalism so our community, our DMV, could grow and reach its potential versus jurisdictions competing against one another. So that has led me to be here to mentor, be here as a win, what about this or what about that? But the day to day operation is really from the team that we build up over the years and again at me turning 80 and Brian and Steve aren't getting any younger. It was an effort to reach out to more members of the group and bring them in as partners. They were already doing executive level work for projects and or comptroller, et cetera.
That's why we've expanded.
And in this world, actually with the pandemic it's turned out to be a very good thing. We've been lean and mean but the team is very confident and very happy to be entitled to do the things they do and don't have to worry about this old school who hasn't been involved walking around and still having a role in their decision making. Right, that's over.
[00:56:07] Speaker C: Yeah.
Different developers have a style and what they look for and what their lens is for deals and that kind of thing. What would you say is a Buchanan project, if there is such a thing? I mean, as far as looking at opportunities.
[00:56:26] Speaker D: Brian could articulate this better than I, but I think looking at willing to take a risk based on the ability to with the ability to have staying power, knowing that you're going to be trusted and you're going to be given the benefit of the doubt as you try to market and you go through the process, the entitlement process, but more importantly, having the reputation of the successes you've had. There's never been a project that was a fail, a failure. There's never been anybody who didn't comment about our ability to make things happen that maybe others couldn't.
I think you don't want to live on your reputation, but I think it gives you a sense of we may not be as successful because of the market conditions, but we're not going to fail. And we've been able to.
[00:57:29] Speaker C: Give a couple of examples of situations where your unique ability to kind of withstand certain market conditions, other developers may not have been able to handle it.
[00:57:43] Speaker D: Some of it was just the way we bought it. We were able to buy it over a long period of time, accelerate it if market was good, but we had time without being penalized. So I don't want to get into too specifics, but I think being in the business as long as you are, it teaches you to make sure certain things are covered that others like someone used to tell me it's not what's in a contract, it's what's not in the contract.
[00:58:15] Speaker C: Yeah.
[00:58:16] Speaker D: So I think I've learned to ask.
[00:58:19] Speaker C: What about this very good point.
[00:58:23] Speaker D: Again, this sounds terrible, but it's true. Sometimes it's just your intuition.
I can remember meeting a prospective partner on something that we would venture on and he reminded me of someone that I did not like respect at all. And I just said to myself why am I trying so hard to make this work? Better get out before it starts if you have these intuitions about this person.
And so you never know. But I do think it's important to have maybe your safety net is too strong and others think you're spending too much time on that safety net.
[00:59:14] Speaker C: I'll go back to some stressful times in our industry in Washington. So I go back my first real stressful time was 1991. So how did you handle that era as a company? Because you had mostly suburban office at that time which was just shut down completely basically from what I remember.
[00:59:37] Speaker D: Again, if you have strong partners I can remember getting a call from Son rather saying we have partners calling on us, asking us for cash all over the place. When are you going to call? I said, I'm not. He said why? I said, Because remember when we set this up, we had this contingency fund? Well, I haven't used it yet, but if I have to, this is how I will.
I forgot about that. Thank you. That's all I need to know. And he went back and told his boss, don't worry about mechanic, he's way ahead of us. And so then they started calling about well, maybe you ought to take over some of these.
Again, I wasn't out to cream it. I wasn't out to max it. I was out to get what I thought was doable. But in the event something changed, this is how.
[01:00:33] Speaker C: So how did you hold off all these bankers that were calling you all the time saying I got all this money I want to lend because that was the fuel to the fire back then, particularly the SNLs. They were going nuts back in the late eighty S, I think.
[01:00:50] Speaker D: The thing that saved me, I had a bank agree to finance project and I had made a deal. I made a transaction based on the rent that would cover and I called up the representative of the bank to say, well, I just want you to know I appreciate your backing taking this committee, because I just did this transaction based on that. And I just want you to know that market is there and he can't call back and said I left him a message. He called back and said, I was in the board meeting when you called so I couldn't take your call. They turned down your loan. And I went, what? He said, they turned it down. It wasn't a good reason. I wasn't allowed to fight for you. I apologize.
A year later, his boss at that bank came to me and said, we want to invest with you. You've done really well and I'm sorry, I'm going to invest with you. I said, no way, no way.
I was so cautious after that happening that I was always doubting that I would get that approved even though I knew I should get it. I just said, don't be so sure, and basically don't act on it until it's done. So that's what kept me sober, if you will, when other people were jumping in.
[01:02:40] Speaker C: And then of course we had the early 2000s, we had some issues then of course the internet.com bubble and of course 2008.
[01:02:55] Speaker D: The only thing I can say is, remember I told you back in submarines, I said, I'm not going to sweat can.
If I planned it, if I thought it through, if I wasn't greedy, I'll be okay. So people were jumping out of windows and I just said, it's not going to be that bad forever. Just relax and see what opportunities are there.
[01:03:30] Speaker C: I would say that's a great attitude.
[01:03:33] Speaker D: But if I make a mistake, sometimes I'm looking for opportunities before I should be. I e it's like they say, don't try to catch a falling knife. Well, I don't try to catch a falling knife, but one. You say, okay, wow, Market's here.
Some people say, yeah, but it's still not a buying opportunity. Wait till it's there.
Well, at that point you're going to be competing with too many. Maybe now's the time to start seeing.
[01:04:00] Speaker C: If it's well you've been through enough cycles now that you have a better sense of what might be a good buying opportunity than another.
[01:04:10] Speaker D: I can tell you right now, we talked about it earlier.
This may be a time where I have never seen so much uncertainty at so many levels because we're talking about real crisis downtown and I don't know that anything's going to turn that around in the near future.
And the crime thing worries me almost as much as the commercial bust, commercial office bust, because the amount of people getting shot, it's scary because at some point I don't know if we can contain it. All these kids with guns, shooting kids.
[01:04:57] Speaker C: That live in an environment like that, it's hard.
We'll get into a little bit of the district issues here in a bit. Talk a little bit about your company culture. We talked about your partners, the nine partners, and I don't know if they all have different geography, if you do it that way, or if you have different disciplines, pretty much.
[01:05:21] Speaker D: And sometimes it's product. But I mentioned some people think we run it like a family owned business and we're all equals here. And people are here because they're respected for their ability and their work ethic and integrity. And I think the word integrity is important. There's a high sense of integrity here that people are trying to do the right thing for the right reasons.
[01:05:51] Speaker C: Do the partners work together on deals or do you have enough?
[01:05:55] Speaker D: Oh, yeah.
Working groups will be covering things. So we have, for instance, Russ Gustall is very much into the entitlement process and Jimmy very much into the financial stuff. Teresa, the comptroller is looking at the cash flow and the obligations for cash calls.
[01:06:21] Speaker C: What about Bailey?
[01:06:22] Speaker D: Bailey is turn on strong. In fact, if I had to guess, bailey will pick up my role of community involvement more than the rest. She has a big picture.
[01:06:35] Speaker C: This is Bailey Edelson you're talking about, right.
[01:06:40] Speaker D: And she knows the region and I think she's a natural. But we don't want to push too much on her. She's running with a lot of stuff.
We have 7000 units, residential units, either we've done or in process or getting teed up. So we have a lot of long term projects that keep us happy. But if you were to ask Brian, which I do, okay, we've got plenty on our plate, but are you seeing opportunities? And you said that's my biggest concern is if we don't find a couple opportunities in about four years, I'm going to be looking back and saying, why didn't I try harder?
We're good for the time being, but talk about anxiety.
Where will the future jobs be and what will they be?
[01:07:38] Speaker C: Are you guys vertically integrated?
I know you have the development team. Do you have a property management group?
[01:07:47] Speaker D: Yes, we do, but it's not huge. And in some cases some of our equity partners have wanted to build up their property management side and we've let them. So we would phase out because again, Brian doesn't want to have we don't want to fire people that have been with us a long time. On the other hand, if you want to sell that portfolio because that price is never going to be like that again, hopefully those people can go with a portfolio. So that's how he thinks a lot, too.
[01:08:26] Speaker C: Sure.
[01:08:28] Speaker D: Try to compare to everybody, but don't be to the point where you're building the team at the expense of being able to take advantage of what the market can do.
[01:08:38] Speaker C: So you outsource most of your activities construction, property management, all those things, okay?
[01:08:46] Speaker D: And I think, again, who could predict look at the price per foot for an office building is now lower than the price per foot for a flex building is now. The ground price for a data center is higher than the ground price for a trophy office building development type of thing. It's way out of whack. So if you're not flexible and capable of riding out storms and hopefully you haven't bet too much on one sector.
[01:09:23] Speaker C: Well, it's interesting, my conversation with Art Fusillo of Lerner. You mentioned the word out of whack, which I think is an interesting way of looking at things. He started there building regional malls. Okay. Lerner built five regional malls in this area.
Two of those malls are vacant sites right now that have been vacant for ten years or more.
[01:09:51] Speaker D: Hopefully, one will be an FBI site.
[01:09:53] Speaker C: Yeah.
And another one is probably vacating very quickly up in Dulles. It's struggling. Tyson's Two is doing quite well still, although they lost an anchor.
Know, the mall business completely changed in the time that we've been talking, and obviously now the downtown office market is going through it. So the question, it all evolves out of whack when you say that.
[01:10:30] Speaker D: It'S.
[01:10:30] Speaker C: Just the dynamic of real estate in this marketplace, isn't it?
[01:10:36] Speaker D: We're sitting in, arguably, a place that has more energy than any other suburban or urban center that you can think of.
[01:10:46] Speaker C: Maybe there's a couple national Landing might take that on.
[01:10:50] Speaker D: Right, that's a good point. But the dynamics of the residential and to give Montgomery County credit, this fit that master plan where they were trying to create a mix of uses, where they were trying to take advantage of the infrastructure, and it turned out great. Some of it is because you're living close to where people live and want.
[01:11:13] Speaker C: To work that's Bethesda. But let's look at Silver Spring, let's.
[01:11:18] Speaker D: Look at Rockville, let's look at Gaithersburg. Germantown may be coming into its own far more than you think, but that's not the level of sophistication this is. No, you're right. You're absolutely right.
[01:11:32] Speaker C: I mean, Silver Spring is holding its own, but it's not certainly what Doug Duncan had hoped it would know with bringing, you know, and Milk Peterson together to make it happen.
Unfortunately, it just hasn't gelled like it could.
[01:11:54] Speaker D: You know, I used to drive around a lot just to know what was evolving in various jurisdictions and various neighborhoods and stuff.
It still surprises me to see the towers for high rise multifamily.
Those rents aren't going up.
I asked, Why do they do that to them? Well, they had the financing and they thought they could hold on to it for long enough.
[01:12:29] Speaker C: Oliver Carr. Just sold the album here just last couple of weeks. I didn't get the whole number.
[01:12:38] Speaker D: Less than 500 a unit, which surprised me because it's in the heart of everything, of course, and it was a good building.
And Doug's building is not doing all that.
[01:12:52] Speaker C: No, that's an office building, of course, but Oliver's office building leased up.
And of course, Marriott just did a build a suit here downtown, the Marriott headquarters building.
[01:13:07] Speaker D: Which Marriott? I think it's to some degree Marriott.
I was on the rockville economic development thing assigned to make that Marriott thing happen. Don't let them get away. And I got to give Marriott credit. They really did a hell of a job. They transformed the skyline up with us in my mind, because you go up Wisconsin Avenue, when you look towards that's the state.
[01:13:42] Speaker C: Well, I think I'll give Oliver Carr credit, too. I mean, his project Wilson and elements equally as magnificent.
[01:13:51] Speaker D: But the Marriott name is an anchor.
[01:13:55] Speaker C: Oh, no question.
[01:13:57] Speaker D: And they did it right with kick out of this. So Ike has a business advisory group that he's trying to get the public private thing, and he has Lily Chi, who's now a delegate in charge of economic development. So I was working with them, and I wasn't really worried about them going to Willow, Virginia. I was really worried about them maybe going to the district because they were looking for where their people were coming from, and they wanted to be where they had access to the where were.
[01:14:40] Speaker C: They looking in the district to go? Just out of curiosity, they had near.
[01:14:44] Speaker D: The district line, they had a couple of options.
[01:14:46] Speaker C: People like Friendship Heights area. Yeah.
[01:14:49] Speaker D: So I went to the first hearing, and Lily is doing the presentation, and I could tell they weren't know this is how great Benway County is. This is where we and I just said, Lily, if you don't mind, I'm going to interrupt you. I said, I'm a landlord. I'd like to treat this meeting as one of my meetings with a prospective tenant. And although I'm not the landlord that you ever would have nor have I ever have a tenant like you, the first thing I would do is what are your issues that we need to address? And the whole Marriott team put down there and looked at me and said, thank you. We have a parking problem.
What do you mean, a parking problem? We have a number of people who drive to where we are now, but we know that in the future, we'll be hiring people who will take Metro to come. But what do we do for the first part when those people that we don't want to leave us are still going to have to drop? And we have 1000 parking spaces at our campus here.
So we need a flexible parking garage plan.
Long story short, that's what made the deal.
We gave them spaces for the first five years or something.
[01:16:14] Speaker C: Well, yeah, that garage across the street.
[01:16:16] Speaker D: There, we had them to go to. There was a tip or whatever it's called.
Those things were built for certain people to have parking. So we had to expand some of that in the short term, give Car some of their parking with the idea that that would go down and car wouldn't be obligated for it.
And then the county would pick that up and just hope that the general public use would take care of it. Anyway, it was interesting to see how important it was for the public sector to have that private mindset. And I think that's what I tried to bring to the you know, when we were at the signing, official ribbon cutting sign, the Marriott people said it all was based on that one conversation. We went back and told whoever it.
[01:17:23] Speaker C: Was Arnie Sorensen at the time.
[01:17:26] Speaker D: I don't know if it was Arnie anyway, he hadn't died yet. Right. But anyway, we said, County's going to make this happen.
This is where they can this is where the parking is.
[01:17:37] Speaker C: I'm guessing that Arnie made the final decision to come to Bethesda.
[01:17:42] Speaker D: Yeah, but it wouldn't have happened.
Well, it might have happened, but it would have been a lot longer and drawn out, and this way it was over.
And I told his dao, really good, man. I'm drawing a blank.
Make it happen, do whatever.
I was pretty pitted when it came down to seeing people that he could trust back in.
[01:18:21] Speaker C: So the first time you and I spoke was 2004, roughly, I think the first time we met when at a Uli function of some sort.
And Len Forkus at that time was the head of Uli Washington. And we were all talking about regionalism at the time and figuring out ways to do this. And so we devised this program called Reality Check. And Reality Check became really an interesting mantra that Uli Washington had to bring all the jurisdictions together in the region under one roof for a day to have a conversation about where's the growth going to occur in this area, because we all knew that was coming. And you mentioned Stephen Fuller, who was the George Mason planning guru, who was kind of the growth and the prescient person who saw the regional growth. And we were trying to manage the growth, and where would we see this? So we built these large maps of the region, and we used Legos, and we had Legos with different colors on the map to talk about density and infrastructure and all these different segments, residential, commercial and all that. And we sat there for a couple of hours playing this game.
And these were tables of about 16, as I recall. And I think there are about 15 tables of 16 people, which included a mix of business people, government officials, community leaders, advocates for growth, and advocates for no growth. And it was a whole mix of land use people. It was one of the most fascinating experiments I'd ever seen in real estate for a day long event. And the University of Maryland brought in their professors to do a computerized modeling of this whole thing. And we had a report the same day from the results of taking all these detailed statistics and we got a report out of it, which was very interesting. So you and I were involved in the planning of this with Len's leadership and it was an interesting experience and I know that you have experience before that in regionalism, but you were one of the main people behind this whole thought process. So maybe you can explain further on how this all evolved and what happened from it.
[01:20:50] Speaker D: You did a good job of teeing it up and I'll just take it from the participation at my table and the discussion and how it was not an AHA moment but definitely poignant moment.
So I was at a table that had majority of people from Prince George's County and people were trying, as you said, where can growth happen, why will growth happen and what do we need to do to ensure it happens? Well, is there infrastructure there? It was mostly about do we have the zoning and the infrastructure and what are the trends? And as we talked more and more, as you said, we were putting blocks where we thought things would be. And the people at my table were pushing suburban Maryland, especially Prince George's County, as more nodes. And I finally one guy started putting a peg out there and I put my hand on top of his and I said, I'm sorry, I'm a developer. I would never develop there.
And he said, Why? I said, Because the school system and the crime system has a reputation that guys like me don't even want to think about whether I could get permits, whether I could get the pricing. I don't see demand.
I said, the problem here is no one's talking about where will be communities, where there's demand and why.
And I think we need to have that conversation. And for me it starts with the school and it starts with the sense of pride in the community. And I'm sorry, but this node is where you want to change things, but you're not going to change it through this process.
Total silence. And finally one guy coughed and said he's a planning commission, head of the planning commission. He said, unfortunately, you've said what all of us know, but did you want to say? And then we got back to where we were making more meaningful decisions as to where the future could be.
[01:23:09] Speaker C: We need more and more of those kinds of conversations, especially now. Yeah, and that was almost 20 years.
[01:23:17] Speaker D: Ago now I will tell you when we have those conversations.
I think I would be remiss if I didn't say to my Montgomery County counterparts.
We used to have a school system.
We don't anymore. The crime in our schools, the scores at our schools, the image of our schools has changed in the last ten.
[01:23:47] Speaker C: Years, deteriorated quite a bit.
[01:23:50] Speaker D: Right. And not for the good. And so our ability to pound the table and say, yeah, Montgomery will always have this and we can always count on it, don't do that.
[01:24:05] Speaker C: So talk about the evolution after that. I mean, you formed the 2030 Group. Talk about how that all evolved and how this regionalism idea developed back then and then, maybe how it's devolved since then. And the Pandemic certainly had a big part of that. But talk about kind of the growth and then the decline a little bit maybe, of that.
[01:24:28] Speaker D: Well, I don't know if we talked about my participation, if we talked on tape about my participating on the Washington Airports Task Force.
[01:24:37] Speaker C: No, you haven't yet.
[01:24:39] Speaker D: When I started developing along the Dallas Corridor, it was obvious that I needed to understand the big picture more. So I joined in the mid eighty s. I joined the Washington Air Force Task Force that was composed of Northern Virginia regional leaders that were trying to establish Dulles as a viable asset to their community because it had been the white elephant. It had had all this big promise of great capability, but no one was using it. It was too far out. There was nothing around it.
Ground access to Dulles was via the Dulles Access Road, which didn't have any reason for you to be going out there unless you were just going to Dulles. And Dulles, frankly, didn't have the selection of flights because they didn't have the demand. So how do you make Dulles into the asset? You could.
[01:25:36] Speaker C: The only thing that had was the Concorde, when I would remember it had great vistas.
[01:25:43] Speaker D: You didn't have to worry about too many planes coming down the river at once.
[01:25:46] Speaker C: Right.
[01:25:47] Speaker D: So that got me into a group of gentlemen and women who were regional leaders, some transportation experts, but more regional leaders of what can we do for Northern Virginia? And Toad Hazel was among them, sid Dewberry, other leaders that were very much involved in knowledge of how things would happen, knowledge of what was on the plans. And one thing led to another.
I repeated this to you earlier.
The board was so strong that I learned how things could really get done and who could make them happen. And the board was comprised of not only leaders of this region, but leaders in Richmond that would come up to see how the state would benefit from Dulles being more viable. So there was a meeting one day after 911 and all the airports had been shut down, and we had a meeting on a Sunday at the Marriott Alley, Dulles. And the board came up and one gentleman named Jim Wheat came up from Richmond and he was blind, and he came in late to the meeting and chauffeured up. But people needed to hear from him because he was underwriting so many of the bonds for the state of Virginia.
[01:27:16] Speaker C: And he was first securities.
[01:27:18] Speaker D: First securities, right. So as he came into the room, the discussion was, how can we get the airports reopened? Because it's killing us. With the airports being shut down after 911. Because the Secret Service was talking about permanently closing either Dulles or Reagan because there was too much traffic coming down the Potomac River that could be diverted, air traffic to bomb the White House.
When Mr. Wheat heard that, he sat down next to me and he said, wow, I came at the right time. It's obvious to me someone needs to talk to Daddy Rabbit. And everyone nodded their heads, and I had no clue. I was the youngest in the room by many years. And I said, excuse me, Mr. Reed, who is Daddy Rabbit? He said, well, son, that's the man who lives at 1600 Pennsylvania Avenue. He's the only one that can turn the Secret Service around, and someone needs to call him. Well, needless to say, someone from that group did make that call. And President Bush reversed the decision to close the Air Force, and they opened immediately. So having been exposed to that level of big picture level of regional, in this case, transportation, but regional priorities and with people who were into the economic development opportunities to help grow the job growth. I was learning so much about economic development that I didn't realize not just where were good markets and why, but what made those markets viable in the long run. So that led to my getting more involved in public private partnerships where they were looking to take on a specific task to make either a community or a market more viable. And that led to eventually, me being the first chair of a Montgomery County economic development Corporation in Montgomery County that was set up to try to create a stimulus for job growth in an area that had never thought they needed it. They thought people would just come to Montgomery because the school system was so good or the communities were so safe and well built and they had been collected economic development. So I saw economic development, my knowledge of economic development as a catalyst for my ability to be able to speak to groups about where we are. You mentioned Steve Fuller used to come out with trends for our growth, our job growth, and what sectors and what price range and what this could mean for housing demand or office space demand. And to me, it's almost an economic necessity to have these conversations if you're going to have a community that is going to be competitive. And one of the problems we have had and still do have is we've been known as a federal city. The government has been the enabler for us to have the growth we've had up to now. But now the government is not part of that growth. That government is diming that growth by not coming back to work and not showing any inclination of what their role is in the greater Washington area, not just for ridership on the Metro transit system, but generating the energy that's needed downtown. So it's a matter of economic development that we need to understand better and who can and who will understand those provisions.
One, to address the necessary challenges and then make the appropriate and implement the appropriate actions to solve.
[01:31:16] Speaker C: Getting back to the 2030 Group, which I know you founded, was the impetus from Reality Check, the origin of that? Or was it another impetus, do you think?
[01:31:27] Speaker D: Till sent Steve Fuller to my office saying, talk to Buchanan. We need to have a regional group look at some of our transportation priorities because none of the jurisdictions are interacting with one another and they're creating roads that don't intersect, that don't dead end rather than tie in. And Maryland and Virginia need to cross the Potomac Ocean in a more meaningful way. And the District's got to be at the table because all of this has to be seen as a community that has flexibility, has mobility, and we're being proactive about it. And that led to Steve and me realizing that if we got together a group of regional business leaders from around the region that were talking about creating that sense and awareness of regionalism, that that would be a start.
And we had our greatest moment when Amazon was looking to create HQ Two, headquarters number two, and they went out to a number of jurisdictions or regions in the country and we decided we're going to compete as a region versus Maryland versus Virginia Fairfax versus Montgomery Arlington. We're going to act as a region. And I give credit to Chuck Dean, who's COG's executive director at the time. I was meeting with him and he offered to fund 2030, offered to help fund it a regional marketing program that each of the jurisdictions could use. But it also showed that the whole was greater than the sum of the parts because many of us did not live in the jurisdiction we worked in. And so we needed to address our commuting needs, which led to the Metro Now coalition forming to be using HQ Two as a catalyst. Metro now, which is led by Tony Williams, former mayor, to put pressure on the public officials to dedicate annual funding for Metro. Metro up to that point had had to go hand in hand every year to ask for funding for what their needs were. They had no strategic plan. Everything was tactical, no overall strategic thinking. Metro now forced the public to realize they got to change that if they want to attract an Amazon to come to this area because they needed more ability to commute. And I think that plus the knowledge of relevant workforce development came out of regional thinking where we had a study that showed us that 95 acted as a dividing line between in our region. If you were east of 95, chances were you didn't have much workforce opportunities. You had to migrate to the west side of 95, whether you were in Maryland or Virginia, to see those opportunities. So how can we create more workforce areas where they can be trained, retrained, as the case may be, without having to travel too far from home? And how do we build that workforce up? Because up to then, we had been so focused on the highly skilled workforce that we were proud of that they were here because of the government and government jobs opportunities, that we weren't looking at the workforce that was less skilled but didn't want to move. And we're filling up many needed jobs, but we weren't training them as those jobs were being taken over by robotics or consolidation. So 2030 was very involved in looking at the political needs for just taking transportation, transportation to be a regional focus.
And that led to a number of good decisions that would not have happened otherwise.
[01:35:52] Speaker C: And then you had to terminate it. Why?
[01:35:55] Speaker D: We were getting old.
The mission had been, we need to create a sense of regionalism. We have our mission, let the next gen come in.
Unfortunately, the region has gone from being very successful, acting as a region, to now we're back into our silos because of the pandemic. No one is collaborating like we used to, and I don't know what it's going to take for us to do what we all know needs to be addressed. We talked about housing affordability, we talked about crime and safety. And now that you have the DC need to reinvent itself, and how can that everybody knows we're being proactive.
[01:36:43] Speaker C: So I'm going to ask my next question, which basically addresses that. How do you see regional leaders addressing various challenges, including, one, decline of office occupancy and demand, including the federal government's slow return. Two, affordable housing. We mentioned that. Three, metro's decline and other infrastructure improvements needed to keep the region thriving. Four, the increased social issues of crime and divisiveness. And finally, five, marshaling the influence of various forces to address these challenges.
[01:37:17] Speaker D: That's an exceptional list of challenges. I will only say I use the word housing affordability because when you just say affordable housing to most business leaders, that's for the UN or underemployed. Understood. But housing affordability, right?
[01:37:37] Speaker C: Yeah.
[01:37:39] Speaker D: The answer to your question is, unfortunately, with the exception of a couple of initiatives, and I'll just cite Tony Williams again at Federal City Council, really looking at Metro now, looking at they're approaching a financial cliff cris. And how are we addressing it? Because the riporship isn't going up to sustain it and people don't want to just continue to fund it if there's no real change in its operations. I e 70% of metro costs are administrative labor.
When are we going to put everything on the table and say, we can't continue with the compact that was created 50 years ago, with the way it evolved?
We can't expect the business community to endorse bailing out metro unless metro is willing to take a hard look at the need for a strategic plan that's viable. So that discussion is happening behind closed doors.
Unfortunately, I don't know that there's a political will to put everything on the table when it comes to that compact, because people are still nervous in many parts of this region about impact on labor. But as a business person, if you're not putting everything on the table, you're not going to be in that business very long.
When it comes to housing affordability, I am deeply distressed that nobody has put the appropriate pressure on the elected officials to actually change the way they do the.
[01:39:31] Speaker C: Approval land use issues.
[01:39:36] Speaker D: It is almost a sin to think of not changing the four to seven year entitlement process with all the costs, with the cost of time, with the cost of endless studies, et cetera, that will never change the affordability issue unless people take a drastic look at what must be done. And in some cases, it's blamed, well, we don't have the land. Well, even if you had the land, that's not the issue. The issue is almost the entitlement process is just a non stubborn. A couple of other things you mentioned what groups can and should step up. Uli, you mentioned earlier, has been very strong.
I've been surprised that they haven't been real proactive about looking at how our region has changed.
[01:40:36] Speaker C: You talked about maturity earlier. I think we're in a transition generationally right now in this region. Gen x is a small group on a relative basis. So there are two big blocks. There's us, the boomers, and then there's our children, who are the millennials, at least my children are. And so the transition of getting the millennials motivated. And one of the things about millennials that are very interesting and I really noticed this because I counsel a lot of them, I have a group of 60 that they're very experience oriented. What do I mean by that?
When they come someplace, they want something that's going to get their attention, and that really they're really attention driven. I mean, this whole internet thing, you have to keep their attention. And how do you keep their attention in real estate?
[01:41:30] Speaker A: If you're not thinking about the experience.
[01:41:34] Speaker C: Of being at a place, you're not alive, you're not going to live, you're not going to make it, I don't believe. What do you think about that?
[01:41:49] Speaker D: You go there for the stimulation, not just the food.
[01:41:55] Speaker C: You're going there for the whole package placemaking.
Jodie McClain, who runs eden's, her projects are know, sensual. I don't know how to put that. But you feel something when you're there. Pike and Rose, you walk in through it's. This feeling that you get right here on Bethesda Row there's Vibrancy.
[01:42:20] Speaker D: So the question is we have these pockets, but who can and will articulate why some pockets are not successful and why others are and who will pay attention to it. And I unfortunately don't see it from the public sector.
Maybe there's not enough people in the public sector who have meaningful jobs, so they're just to serve their community, but they're not coming from a base of knowledge.
And I know we're in a town that's totally dominated by the gridlock on Capitol Hill and so maybe there's this feeling that nothing's going to change anyway. I don't know. But that's my biggest angst is the lack of outreach, the lack of the next gen to step up. And like my mom used to tell me, there's no fool like an old fool. Here I am, 80 and I'm still pounding the table and I don't think I'll stop until someone comes along and says, I'll do what needs to be done.
And maybe it's well, you're on the.
[01:43:42] Speaker C: Federal city council, right? So there are some new younger members.
[01:43:47] Speaker D: Yeah.
[01:43:47] Speaker C: I mean, do you see some leadership.
[01:43:50] Speaker D: Emerging there that might yes, but in a way Tony's, they're turning it over to Tony to run with it.
[01:44:03] Speaker C: Tony's no young guy either young guy.
[01:44:05] Speaker D: Plus he spreads know, and there's only so much he can take on. And this Metro now thing is a big challenge because it's hard to get the business community involved when they don't see how it's going to sustain itself.
You don't have the ridership, period.
[01:44:30] Speaker C: Well, if the federal government is not going to the office, I mean, federal workers were probably a third at least of the users of Metro was designed.
[01:44:40] Speaker D: For the federal government getting the federal employee wherever that employee was going to go.
[01:44:47] Speaker C: Right.
[01:44:48] Speaker D: So you have a system doesn't function what was designed to function. That design needs to be revisited. And then you have ridership that doesn't show any indication of coming back. And then you have labor costs that gave themselves a 10% raise or something crazy last year.
[01:45:13] Speaker C: So in my experience, when you have cataclysmic change like this, things emerge that you don't expect.
I'll be hypothetical and I'll let you react to know the land value is going to drop low enough in downtown Washington to the point where you're going to see demolition of buildings. You're going to see a renaissance in essence coming. I grew up in Detroit, Michigan. Detroit, Michigan went about as low as you could possibly go where they were tearing down whole neighborhoods.
Right. So my hope is Washington doesn't drop that low. Some areas are still, you know, the ballpark. Those areas are still pretty vibrant and the wharf that project and there's still a lot of young people in the city that work and the question. Know, when you look at downtown Washington, it's the law firms, the associations that are in the CBD, and then there are several government tenants on the perimeter of that.
So I talked to my friend Steve Lusgarden earlier this week actually, who used to be run Blake Real Estate, which is one of the largest landlords in downtown Washington. And he did say that some Class B tenants are renewing there, which I was surprised because he said no, retail, retail cannot survive. He said you can't find a sandwich shop anywhere to go in downtown Washington right now.
[01:46:50] Speaker D: And the law firms are also cutting.
[01:46:53] Speaker C: They're not if they're renewing, they're much less space than what they had.
[01:47:04] Speaker D: A couple of things we talk about quantum computing emerging as a potential good thing if it chooses to make this their center worldwide.
[01:47:19] Speaker C: But that will be in the Dullest corridor more than likely, right?
[01:47:23] Speaker D: Don't know. I mean, just the region will benefit from that would be a help. I think as we look at the need for the government to be modernized, I think we're going to see some improvements. We're already the center of the data center world, of course, and that is going to continue to grow. Where and how so? I see certain things that are strengths.
They don't necessarily come with all the bells and whistles that we need. I. E. Data centers don't have a huge employment no factor. No one really understands what quantum computing could be, how it would be perceived, and where it could be located. Is it in the Dulles Quarter or is it downtown?
[01:48:23] Speaker C: Well, obviously the biggest trend right now is AI and the LLMs and how much power those drive and the cloud space that they need for that kind of activity is just spectacular.
[01:48:37] Speaker D: And I think if you could develop housing affordability, you have a huge demand because people have been migrating from this area to West Virginia, for lack of a better word, remote locations in our jurisdictions where it's cheaper to live. If they were to come back, that would be a very good sign. But it takes time. And right now there's nothing immediate in the housing residential world that I see as an indication of being able to control our own destiny.
[01:49:20] Speaker C: So it's going to take emergence of some things we may not even be able to see yet and the next generation to take the initiative, it seems to me. Right.
[01:49:32] Speaker D: And I've said in my pleas for collaboration to the younger generation, you guys have to live with some pretty tough decisions. You better be the ones making it. Don't ask me to make it based on the best I can do because I don't have to live with it. But if you have to live with that decision, you're going to make sure it's as good as it can be. And that's unfortunately, we don't have that pressure being felt that they need. To be proactive. They need to be making the decisions to really, truly show this, enable this region to be perceived as competitive, desirable, a good place to live in, work well.
[01:50:17] Speaker C: In this building sits the largest public real estate company in the Washington region, and they're led by a fellow by the name of Matt Kelly, who I interviewed for the podcast, and his episode is number one. And what he went through, doing the transition of merging with Tornado and then Amazon HQ Two makes him pretty much, in my mind, one of the two or three business leaders in this region.
So can Matt lead us out of this? And is he the right guy to be that person to lead us through? Because he's leading the largest economic development thrust in the region right now.
[01:51:01] Speaker D: And it may well be because I'm in a group that they try to schedule around his availability and he has some real schedule issues. And it may well be that his effort to try to put out the fires raging in his buildings downtown that he doesn't have the time to well.
[01:51:25] Speaker C: Not only that, his company right now.
[01:51:27] Speaker D: Right.
So he's going through a lot. And how long it takes him to stabilize, how long it takes him to feel comfortable enough to devote his energies to doing for the region what he did for his own company, we don't know. But he certainly has the credibility, he certainly has the ability, and it's just does he have the availability?
[01:51:58] Speaker C: Well, he's a good friend.
It's amazing what you just said with his time, because I called him this is about six months ago, I said, how about we sit for coffee sometime? He immediately said yes, because he knows that I talk to a lot of people. And I assembled him gary Rappaport, Ray Ritchie, Diane Hoskins, and Tombazuto in a forum at the end of 2021, the end of 2020 and the end of 2021, I had them both come back to give the state of the market, and they each talked about it. It was fascinating.
And other than you, maybe. Those are five of the leading people in this region as far as I'm concerned, as far as the different disciplines represent a lot of sectors, and they were just stumbling. In 2021, things felt better, and we thought that we could see the light on the horizon, but it seems like we're stagnating.
[01:53:11] Speaker D: I don't know.
Same thing is a pretty strong word, I would say we're in limbo.
Maybe you're right. We've been in limbo so long, we're now stagnating. Probably right. And I don't know what's going to change it. I really don't.
It used to be I always looked at Cobra Day as, okay, summer's over, we're back to school. Let's hit it. And my calendar would be reflective of that.
Same old, same old. Nothing's changed that much. Now there are more in person meetings, but I have just as many virtual meetings as I have now in person meetings. And people are given the option. And more often than not, some are in person at the meeting. Some will show up and others will call in.
[01:54:00] Speaker C: So when I do these interviews, most people assume that I'm going to do it virtually. I said, no, my preference is to do it in person. And there's real reasons why, because I can see people's expressions, their reaction to things, and I can lead the conversation in a way that I think makes sense when you're in person.
[01:54:20] Speaker D: One thing we haven't talked about, but I think is going to happen. I've been close again. Steve Fuller and I go way back.
Prior to even 2030, I can remember not being able to get an equity partner to commit until they had seen a Steve Fuller report on the impact of the region on this project that they were considering. So Steve and I go way back.
I called Steve and told him that since his retirement, there is no credible sense of where we really are. So it's hard to gather the troops for command performance, for whatever, unless they really understand the depth.
And it may not be as bad as I think, or it may be worse.
[01:55:17] Speaker C: It's a very good point.
[01:55:18] Speaker D: So Steve has then reached out to the dean of the Shah School of Puppet Policy and they're working on an effort to fund a kind of a process, one, getting people together that will be able to comment and appreciate fact that a study will be done. And these people would hopefully be some of the leaders who would then be out promoting the need for change. And it starts with you need to know what the situation is and what can change and what can't and what are we going to do about it? So this process may take six to nine months, but it's just at the beginning stage.
[01:56:06] Speaker C: So who's leading the center for Regional Analysis now?
[01:56:11] Speaker D: Terry Clower. But Terry is more academic and has not been able to fill the shoes steep.
And he now realizes that that gap exists and he wants to be more viable. He's going to have an event in October to talk about the region, to talk about the things he sees, knowing that that's part of this rollout. And I say, coming from Mason, one of the things I'm proudest of is my affiliation with Mason over the years because they have gone from that community college on steroids to their enrollment now is over 40,000.
[01:56:57] Speaker C: They're the largest in the state, and.
[01:56:59] Speaker D: They'Re doing good things and coming again. I've reached out to Steve and Mark Roselle, the Dean of Trustville, to go to Grave Washington. If Greg Washington, president of George Mason, could reach out to his counterpart at the University of Maryland, who he's very close to, and their counterpart at GW and got those three academic institutions to think regionally and call for action then we're dealing from a level of credibility. You don't want to be feathering your own nest and people having the ability to do the analysis.
[01:57:43] Speaker C: The deans of all the universities should be involved in this. This is really important.
[01:57:48] Speaker D: If you get it too big then everybody gets politicized.
So the hope is the core group representing the three jurisdictions will say okay we're behind this and this is what we're going to support and that will lead those individuals associated with Maryland GW.
Mason just starting her own.
[01:58:11] Speaker C: Well there's a legacy for you Bob, if you can do that. Get those people together and say, okay, here are the statistical basis of what we're talking about. And get the decision makers, the people that lead Lockheed Martin, the largest employers in the region, giant Food, whoever, the largest employers are, because you have to get them in the room to make the investments that we need in the private sector that pays for the public sector. The tax base goes away unless we have the incentives to do it. I mean you have to think big. You have to think the big picture. You have to look at it from almost like a godlike perspective to see what it looks like.
[01:59:04] Speaker D: Why it's easiest maybe at this point to get academic because another thing that people don't realize is one of our strengths has been as an attractive region to attract potential workforce has been our university system. Yes and people come here and we want them to stay.
[01:59:24] Speaker C: Yeah we've got some great universities here, great universities.
[01:59:27] Speaker D: And one of the highlights about Mesa is a higher percentage of their graduates stay than anywhere else by a huge factor and many of them are coming from the other side of the track so to speak, but have gotten so elevated through their Mason education that they are taking down good jobs. So academic we shouldn't just talk about the public and private sector. We got an academic factor that needs to be involved.
[01:59:58] Speaker C: So did you have any academic leaders in the 2030 group at any time?
[02:00:02] Speaker D: Steve Fuller would come a lot attend and he would be my quote well the president of Mason was always involved.
[02:00:10] Speaker C: But no other university was involved.
That's shocking. You would think that georgetown GW.
[02:00:18] Speaker D: Mason American the thing that made Mason what it was in my humble opinion, the reason I was affiliated with them as much as I did was they knew what made them different was the ability to bridge academia and the business community and they weren't afraid to do it.
In my tribute to Till Hazel I made the comment and President Greg Washington came up to me and thanked me for saying it because he had never heard of me before. But I said you might have thought you were a big developer in Northern Virginia. You might have thought you were a major player in Northern virginia, but if you weren't affiliated with Mason in one way or another or had been asked to be part of the Mason leadership, you wouldn't know what you're talking about. It's interesting because Till recognized the need for local education to rot. And Northern Virginia didn't have a college per se. It was it was in downtown or it was in Maryland, but it wasn't in Fairfax.
UVA now has satellites and all this and all that.
[02:01:34] Speaker C: You didn't have Virginia Tech or UVA up.
[02:01:37] Speaker D: Right, right. So Till said, if we're going to be the region we think we are, northern Virginia, we have to have a viable university. So that's how Mason got going. And then Till determine who Mason needed that could help Mason be more viable.
And I'll never forget being asked, and this person who's a good man I won't name, he came and said, it's been determined that we need you at Mason. And I said, Why? What are my skills for?
Said, you know more about the community around Mason. Mason needs to know what you're thinking and why and what's working and what's not working and where they need maybe have satellite.
Yeah. Yeah.
[02:02:33] Speaker C: Well, what you're telling me again is that the center of the universe in Washington is moving.
Mean, it's probably almost out to Dulles Airport now. It's beyond Tyson's Corner going west.
So Reston might be the center of the universe for the Washington area right now as far as economic development go.
[02:02:59] Speaker D: Drive the toll road, you'll see some pretty fancy buildings I know popped up there.
[02:03:04] Speaker C: I interviewed Chris Clementi, and what he's doing at Preston Station is spectacular and starting another phase. Oh, I know.
[02:03:11] Speaker D: Yeah.
[02:03:12] Speaker C: Well, he's assembled 13, 14 million density that he's only got maybe not even a third built yet. So it's quite something.
[02:03:23] Speaker D: Every time we go to Dulles, I'm awed by how much activity is going on there versus I can go out 270 and see nothing other than where.
[02:03:32] Speaker C: We'Re sitting in Bethesda. That's the only other economic development engine in the entire region, frankly, right now. I mean, Friendship Heights just got wiped out. Basically.
[02:03:43] Speaker D: The only thing is with the HQ two campus going to the airport, I.
[02:03:48] Speaker C: See some oh, well, there's tons of activity there. Right.
[02:03:52] Speaker D: Of course, that would be the third one. I don't know anywhere else.
[02:03:57] Speaker C: There were a lot of cranes and residential in the Noma area and in the ballpark, but things know that's slowing down quite a bit. It's interesting.
Hopefully evolution will occur and we'll be able to withstand this other thing.
[02:04:17] Speaker D: Cris, you didn't mention, but a lot of our bigger developers have grown outside this area.
[02:04:26] Speaker C: Oh, yeah.
[02:04:27] Speaker D: In the last 510 years, they've gone.
[02:04:29] Speaker C: To the Carolinas, gone to.
[02:04:33] Speaker D: Pennsylvania, Carolinas, wherever.
And their heart is there, not here. Their base may still be here because of their senior employees, but their growth and their future is not here. And I think you saw that in.
[02:04:53] Speaker C: Well, MRP is doing things elsewhere.
Acreage is going down there. I mean there's several major developers that are making big investments. FCP there's several people making investments outside the region. Well I mean economics tells you what are you going to go look for where deals are going to happen. Right? Yeah.
[02:05:17] Speaker D: You're looking at why people you're looking at you're looking at areas where people said we want to be competitive.
We'll make things happen here.
You don't see that.
[02:05:37] Speaker C: So we need to shake up the complacency somehow. Right?
So how do we do that? That's the big challenge.
[02:05:45] Speaker D: False sense of complacency that's for sure. Especially in Montgomery County. Give you a perfect example. Montgomery county prides itself on their low unemployment rate. Well the reason they have a low unemployment rate is because the base is so small because people have left but no one takes them to task for that and they're bragging about it. But I just say I would never use that. I think I could get away with it but Montgomery has gotten away with too much bullshit. And then the rent control discussion, I'll send that to you. It will make you sick.
[02:06:28] Speaker C: It's sad.
[02:06:29] Speaker D: How can they possibly be how could you want to come here and invest when you're seeing the dichotomy between the public sector and the private sector?
[02:06:41] Speaker C: It makes no sense.
They don't understand what pays their salaries. And the federal tax base that to.
[02:06:51] Speaker D: Me is going to be the biggest come up because it was brought up by the people who signed that letter to the mayor and council several months ago, six months ago whenever it was. The real estate tax base is based on income.
[02:07:04] Speaker C: That's right.
[02:07:05] Speaker D: Ain't no income in these vacant B and C buildings and A buildings that are showing vacancies.
Where's your budget? How are you reflecting this into your budget?
[02:07:20] Speaker C: You would think that the governor of Maryland would come down here and say, guys let's get going here.
[02:07:28] Speaker D: Virginia has this budget surplus. Maryland has a budget surplus.
Stimulus monies.
[02:07:34] Speaker C: Yeah well they don't think long term. That's the problem.
Yeah. Well let's make it the more pleasant topic and let's move to your priorities among family work and giving back.
[02:07:46] Speaker D: Bob. Well we got two great grandkids so.
[02:07:51] Speaker C: That makes you think you're the first one. First my first guest to have great grandchildren.
[02:07:58] Speaker D: As they say, if you marry young, your kids marry young and their kids marry young.
[02:08:03] Speaker C: There you go.
[02:08:04] Speaker D: You have a chance when you see the energy and you see the future and you think, oh this is going to be so different from what we experienced because they're going to grow up with an iPhone or something in their ear telling them an AI apple's coming.
[02:08:27] Speaker C: Out with a new headset. That's just unbelievable. What it's going to be? It's AR accentuated reality or whatever it's called or something like that.
[02:08:40] Speaker D: So they're going to have far more understanding of what can be and they're going to be pushing that envelope at much younger age type of thing. But they got climate change, they've got carryover from whatever this pandemic and social.
[02:09:02] Speaker C: Issues in this country, social issues are.
[02:09:06] Speaker D: So if you haven't interviewed her, you should. Her name is Second.
She's head of United Way in DC and she talks about Alice lives here. Alice is an acronym for you're employed. You have a car, you have a house. But you're one surprise away from not making ends meet. And that apparently they did an analysis and that between the people at the poverty level and the people living in Alice scenario, that's over 80% of our population that are really on the edge or under the edge. Yeah.
[02:09:52] Speaker C: If there was a medical emergency in the family or something happens.
[02:09:59] Speaker D: That situation is getting worse. As you look at our health care system, the costs, as you're looking at inflation, the costs of today energy prices are gone up anyway, I'm very concerned, very concerned about the loss of what we knew as a middle class and how we all thought we had a chance. And if you were educated and you worked hard and you behaved yourself, you did have a chance. I don't know what those chances are.
[02:10:36] Speaker C: Well, the question is, you've got this technology thing that's taking us of different directions that are exciting and enthusiastic. The question is where there's more idle time for people because there's just less to do.
But then the other side of the coin is can the infrastructure unless it's being paid attention to, you won't have idle time because you need to address it. Somebody's got to fix the infrastructure behind everything.
[02:11:09] Speaker D: Virtual working. You have a different mindset as to what the job is right. And what your obligations are.
[02:11:16] Speaker C: Right. Well, that's what immigration has taken care of for the last 2030 years.
And we have an immigration issue now, too, because of some of the bad side of what's coming into the market. From an immigration standpoint. Yes.
[02:11:33] Speaker D: You heard the mayor of New York.
[02:11:35] Speaker C: Overwhelmed.
[02:11:36] Speaker D: 10,000 a month.
[02:11:39] Speaker C: Yeah. And so that means cultural change.
So there's a lot of change. Yeah. It's an interesting world coming ahead.
[02:11:48] Speaker D: I think it can be and should be a great world. But I fear climate change is going to force decisions before people are ready to make them. And it should. I mean, this emissions control should be a higher priority than it is and that's going to change job situations. So the short term is going to be tougher.
[02:12:15] Speaker C: Well, I think our technology growth may be headed off by this because then at some point, the energy to do the technology we want is not going to be you're not going to be able to generate it quickly enough to be able to keep up with the technology growth. So that's going to be an interesting question too.
[02:12:34] Speaker D: Over time. One thing I'd also mention just virtue of where you may want to put it in at the appropriate place.
Did we talk about the bike and Fairfax of how that book came out? Kind of no symbolized for me, the environment that I was able to develop, what I did. And I was mentioned in the book, not my real estate career, but 2030. But The Fight for Fairbacks was the quintessential book about how North Virginia became what it became, and it talks about Till being the first among equals, but how they just determined you need it today. A group of business leaders, and they also had political ties with Richmond and places. And Dwight talks about we were Republicans and Democrats, but we knew we needed both if we were going to have.
[02:13:32] Speaker C: The political who was the political leader in Northern Virginia? Was Jerry Connolly the guy or who.
[02:13:39] Speaker D: Was it that you a series of them. But they all knew that this group weren't feathering their own nests. They were trying to build an environment that would be representative of what they thought it could be. That's why they put money into Mason. That's why they petitioned to get the infrastructure that was needed.
They weren't for development for development's sake, but the right kind of development, bringing in the right kind of companies to say, yes, this is a community that believes in itself and is willing to fight to make things happen that wouldn't happen otherwise. And so, I mean, I would go I would go to meet with some of these guys for whatever and be assigned tasks based on their knowledge of what I could do that they couldn't do.
They were selfless. They were just trying to build the best community they could and you get in that environment.
And the only reason I bring up this book is because it described as well as it did and no other.
I don't think you can understand this region without reading how it came together.
[02:15:08] Speaker C: Well, let me go to a question that I ask two final questions that I ask every guest, and this is particularly apt today. What advice would you give your 25 year old self today? Well, if you were 25 today, what advice would you like to have here?
[02:15:28] Speaker D: I think the advice that I've always lived with, and I would definitely emphasize it get in the ring. Don't be afraid to get in the ring. And once you're in the ring, get back in the ring once you get thrown out because you're going to get thrown out.
Don't be afraid, but learn what made you get thrown out and don't make that mistake again. But if people know that you're not going to be intimidated and you're committed, they will respect and give you the vampire down. But if every time you lose, you go into a shell, then they're going to go, okay, so get in the ring. In the first place. Stay in the ring as best you can and when you can't, figure out why and don't make that mistake again. Get back in.
[02:16:19] Speaker C: Well you right out of college were thrown into the ring and you were thrown into a ring that was a heavyweight battle right up front, which is quite something. I mean you had an early experience that gave you a lot of I.
[02:16:37] Speaker D: Was with people who were in the ring too.
They were also volunteering dedicating. So I didn't feel I was by myself. And it encouraged me to say, okay I can remember being with people and just know no one's done this before. Who's up? And they're like, well if you're in, I'm in.
Then I caught that spirit. I remember with Dwight Hubert we were going to do a project that hadn't been done before. And he said, well you guys have talked enough about all the bad things. I'm only going to be in this thing or are we going to go home?
And I looked at him and said, you want to make this happen don't you? He said, damn right. I've been listening for 2 hours. Let's go. I said let's go. But it was that attitude of okay we understand all the bad things. We understand whatever got it. Now are we going to do it or not?
[02:17:33] Speaker C: Well that's the mindset that we need right now. Not only in this region but in this country.
[02:17:38] Speaker D: Right.
So when you're around that, that's what you seek in people you're doing business with because that's going to make a difference. That mindset. That's a good point.
[02:17:52] Speaker C: So if you could post a statement on a billboard on the Capitol beltway for millions to see, what would it say Bob?
[02:17:58] Speaker D: Well I don't know that I like my answer. I said if you're lucky enough to read this, enjoy the ride and keep going. Realize how lucky you are and enjoy the ride. I think I said this earlier. Maybe I didn't, but if I had to do it over again I wish I could bring more humor to the table. I'm pretty serious and I'm not as humorous as I respect in others their ability to laugh things. But I also think that I'm so driven that I don't step back and say, wow you are so damn lucky to be in the position you're in.
Don't take advantage of it. Just enjoy my wife constantly.
She brings that factor to me, which is the enjoyment.
[02:18:53] Speaker C: You're blessed.
[02:18:54] Speaker D: I'm blessed. Right. I'm blessed to have a wife who left Oklahoma to get exposed to New York City because she just knew she couldn't live her life that she thought she could in Oklahoma. So she was willing to go to the big city and from there she went to East Africa.
What are you doing? She was working on a program that was precursor to Crossroads Africa and precursor to the Peace Corps. It was called Crossroads Africa. But here's someone how do you even think about going to a place that is so remote? And she said, why not?
[02:19:37] Speaker C: And then you say, Guess what? We're going to Japan.
[02:19:40] Speaker D: Yeah, I know, but I don't think I could have done that with an excitement and anticipation if I hadn't had someone like her who was saying, and she was better than this, than me. And she picked up Japanese, and we did very well traveling people, the Japanese would be very quick to judge that. You were a foreigner, you didn't know their language, and they weren't going to mess with you. But they would hear us speaking and they turn around and come back.
[02:20:18] Speaker C: And you were trying.
[02:20:21] Speaker D: But we were better than trying. We could hold. She could hold her own.
[02:20:27] Speaker C: Well, you had the Mandarin background, too.
Well, Bob, thanks very much. This has been a pretty wide ranging conversation, and I really appreciate it.
[02:20:44] Speaker D: I look forward to the podcast.
