Commercial Real Estate Today: Andrea Davis of Davis Commercial AZ On 5 Things You Need to Create a Highly Successful Career in the Commercial Real Estate Industry Today
Education and hands-on mentors — you never stop learning in this industry. Start with a strong education and soak up all the knowledge you can from experienced professionals around you, then never stop building on that foundation.
The commercial real estate industry is a dynamic and challenging landscape that offers enormous potential for success. However, it requires a unique blend of skills, knowledge, and aptitude to truly excel. How does one establish themselves in such a competitive field? What does it take to consistently rise to the top in commercial real estate? How does one rise above the headwinds that are challenging the commercial real estate industry today?
In this interview series, we’re seeking to learn from the experiences of those who’ve successfully navigated these challenges. We’re interested in interviewing commercial real estate professionals, brokers, investors, leaders of Real Estate Firms and Real Estate Investment Trusts (REITs), as well as anyone who’s found significant success in this industry.
As part of this series, we had the pleasure of interviewing Andrea Davis, CCIM.
Andrea Davis, CCIM has a 25-year career in commercial real estate and is the owner and designated broker of Davis Commercial AZ, a leading commercial brokerage firm in Scottsdale, Arizona. She discovered her passion for commercial real estate while working as an executive assistant for a developer before transitioning to the brokerage side and eventually launching her own commercial brokerage firm in 2012. An entrepreneur at heart, Davis is also the author of two books geared toward helping new brokers and business owners navigate the complexities of commercial real estate transactions and is passionate about fostering career growth for those new to the industry.
Thank you so much for joining us in this interview series! Before we dive in, our readers would like to learn a bit about your origin story. Can you share with us a bit about your childhood and how you grew up?
I grew up in the Old Line State known for its sumptuous blue crabs and founded as one of the original colonies in 1632 — Maryland. My childhood was spent outside climbing apple trees, exploring the neighboring woods and barefoot. I loved every minute of it! The middle child of five, my siblings and I built grass huts and tree forts seasonally. My sister and I designed homes that bridged streams with glass ceilings to delight in the night sky’s sparkly splendor. On Sundays, the family would explore the new house being built on the street and analyze the weekly progress. Real estate ran in my blood.
Can you share the ‘backstory” of how you decided to pursue a career in commercial real estate?
My career in commercial real estate really chose me. A little more than 25 years ago, I took a break from working as a chef and event planner and I took a job as a server for a high-end restaurant in Scottsdale, Arizona. One night in the middle of the week, a group of 13 golfers who were developers from Canada were dining at one of my tables. By the end of the meal, each one asked if I wanted to come work for them. I put a resume together for the one person who was a local developer and he offered me a position as his executive assistant by the end of the interview. It was a surprising shift for me at that time, considering my previous professional experience as a trained chef and my background in modeling and acting. It was a big change that put me on my path to where I am today.
Can you tell our readers about the most interesting projects you are working on now?
Davis Commercial AZ is working on some very interesting projects that I am excited about. One project is an assemblage of more than 30 acres of raw land for a mixed-use development in Surprise, Arizona. Davis Commercial AZ is representing the buyer and developer of this project. Land acquisitions can take up to 3 years to close due to the complex development process. This acquisition involves nine sellers who have very distinct personalities and differing sales objectives, adding lots of flair to the negotiation process. Another challenge is that the buyer must secure water and sewer from a private operator. Under the supervision of public authorities, private operators build, design and operate public water and sewer systems. This means that even though the project has the full support of the municipality, they have no control over the water rights.
Another exciting deal Davis Commercial AZ is working on is identifying the highest and best use for 150 acres of land with multiple different zoning codes. In the beginning, our goal was to sell off 8 separate entitled sites ranging from one to 20 acres in size. Unfortunately, interest rates rose, and developers stopped buying land. To fend off the impending house of falling cards, we were asked to come up with a new idea for the land use that aligned more favorably with the current zoning codes. Working closely with our client, we collectively decided the best way forward would be to develop some of the prime sites internally based on demand and lack of product; the lack of product being self-storage condos. We are now working to develop 90,000 square feet of self-storage condos on five to seven-acre lots.
However, I am most excited about the release of my second book, “Simply Own It! The American Dream.” The book is a practical, 9-step guide geared toward helping individuals realize financial sovereignty through commercial real estate investments. Drawing from my more than 25 years of experience representing buyers, as well as buying my own properties, I wanted to give readers the tools and knowledge they need to achieve commercial real estate ownership and build financial wealth. Young commercial real estate brokers and business owners swear by the value of my first book, “SimpLEASEity,” and I am happy to finally extend that value beyond leasing and into purchasing commercial real estate.
Is there a particular person who you are grateful for who helped get you to where you are? Can you share a story about that?
One person I am particularly grateful for is Guy Scott. He is the developer who took a risk on a waitress/actor/model/chef, offering me the job as an executive assistant at his big-time development company. After my first three months on the job, Guy could not imagine running his operation without me. We made a great team, and he was a valuable mentor. Twenty years later, I am still building on the knowledge I learned from him.
As with any career path, the commercial real estate industry comes with its own set of challenges. Can you elaborate on some of the significant challenges you faced in your career and how you managed to overcome them?
One of the hardest challenges I had to navigate when I switched from development to commercial real estate brokerage was not having a mentor. I had to learn everything the hard way and it took me twice as long as it should have to start producing and making money. Fortunately, I have tenacity. When a goal is set, I’m like the energizer bunny and I keep going until the job is done. This is the same challenge most young professionals face today, and it is why I made Davis Commercial AZ a place for those individuals to learn and grow to their maximum potential in a safe environment.
Another challenge I had to overcome was the fact that commercial real estate has always been a male-dominated field. Being a woman in this industry 25 years ago was interesting to say the least. Fortunately, I grew up with 3 brothers and I figured if I could be respected by them, I could certainly earn the respect of my male peers. I believe the universe provides what we need in life to succeed. For me, it was 3 brothers and the thick skin to survive in commercial real estate.
What are the 3 things that most excite you about the industry now? Why?
- The most exciting part of being a commercial real estate broker is helping clients accomplish their goal(s). Whether it is a first-time lease, a building acquisition or disposition, investing in commercial real estate or working alongside a developer to take a project from concept to completion, every deal I work for my clients opens doors to bright, new possibilities.
- This industry keeps me on my toes because no two deals are alike. Every deal is brand new and has its own set of complex issues to resolve. Finding the best way to overcome each obstacle is one of my favorite parts of the job. I love to make the impossible happen.
- Lastly, with each economic shift or disaster, there is always a silver lining. I like to find and act on that silver lining.
What are the 3 things that concern you about the industry? Why? What should be done to address and alleviate those concerns?
- My main concern about the commercial real estate industry is that the average broker is about to retire, and we don’t have the youth to replace them. We need more young brokers in commercial real estate. Established brokers can help with this by educating them and helping them through the difficult learning curve.
- My second concern is the potential replacement of AI to assist buyers and tenants in their commercial real estate needs. A property is a living breathing entity that changes with time. I’m not sure how an AI will be able to advise a buyer or tenant on a complex real estate transaction that has multiple levels of negotiations. Additionally, seldom is one transaction a carbon copy of another.
- My third is the trend to deregulate zoning within city limits. Without municipality zoning codes anything can be built anywhere. Just imagine this, a cannabis facility next to a preschool. Yeah, that works! (I’m being facetious, of course.)
If you had the power to put in place 3 changes to improve or reform the industry, what would you suggest? Please share stories or examples, if possible.
First, I would separate residential real estate licenses from commercial real estate licenses. Residential transactions are very different from commercial transactions. Too often residential agents try to work on commercial deals and make a mess for their client because they don’t understand the complexity of the transaction.
Second, I would institute a program for new brokers to have money while they are learning the trade, which takes two or more years. I envision a program similar to a student loan with a low interest rate that is paid back after “x” period of time.
Third, I’d like all commercial agents and brokers to function under the same code of ethics. Some areas of the business that I might find shady may be common practice in other firms or parts of the country.
For a young person who would like to eventually make a career in commercial real estate, which skills and subjects do they need to learn?
- Communication skills
- Phone skills
- Finance and Excel spreadsheet expertise
- Knowledge of contracts
- Manners and proper etiquette
Here is the main question of the interview. Please share the “Five Things You Need To Create A Highly Successful Career In The Commercial Real Estate Industry”? If you can, please share a story or an example for each.
1 . Education and hands-on mentors — you never stop learning in this industry. Start with a strong education and soak up all the knowledge you can from experienced professionals around you, then never stop building on that foundation.
2 . Grit and perseverance — it takes a while to reap the benefits of a career in commercial real estate, but if you stick it out, the outcome is worth it.
3 . Well-rounded life experience — you will be working with people from all walks of life. Knowing how to communicate with stakeholders and apply experience from outside the classroom is what makes a great broker.
4 . The gift of gab and a sense of humor! Talking is one of the main things we do — if you can strike up an engaging conversation, you will be able to make more business connections than you know what to do with.
5 . A knack for negotiation — don’t be afraid to ask for what your client wants. You never get the things you don’t ask for, so be willing to ask questions and then find reasonable solutions for all parties.
What do you believe makes your commercial real estate company distinctive? Could you share an anecdote about that?
Davis Commercial AZ is unique in the fact that we foster an environment of encouragement for young brokers or individuals looking to switch careers. Commercial real estate can be a cut-throat industry, but we see the bigger picture. We need more young professionals to enter the field, and they need a hand up. We also pride ourselves on our service and the fact that we truly care about our clients. We develop relationships built on trust and communication and work to find the best business solutions for our clients no matter the circumstances.
What is your favorite “Life Lesson Quote”? Can you share a story or explain how it has relevance in your own life?
“Walk your talk. Mean what you say and be willing to admit when you make a mistake.”
We found the perfect investment property for a client, negotiated the deal, put it in escrow and closed, only to discover that the new tenant had three months of rent abatement. There were many difficult components to the deal, including having to complete the project prior to closing. This was done during the pandemic, adding yet another level of complication to the deal. The attorney, the client and I missed the free rent at the beginning of the lease. This reduced the buyer’s overall net operating income for one year and threw off our desired cap rate. In other words, the buyer lost over $30,000 on the deal. We discovered it after the property transferred title to the new owner, our client. We had no leverage with the seller to demand he compensate us for the free rent. I had to call my client and fess up that we missed the free rent that was written in the lease. It was written in an unusual area of the lease, and we didn’t catch it. Additionally, the estoppel certificate that identified the three free months of rent was mixed in with the closing documents sent via DocuSign early on during the pandemic and neither the attorney nor myself were copied on the documents prior to having the buyer sign. Long story short, the attorney and I split the cost of the ‘free rent’ to pay back our buyer in order to save face for future transactions. This little hiccup cost me about $20,000 of my commission. Yes, it hurt, yet we were able to retain the client because of our transparency.
As a person of influence, if you could start a movement that would bring the most amount of good to the most amount of people, what would that be?
Our industry needs young people to fill the shoes of the old-timers who are soon to retire or pass away. One of the main challenges firms have recruiting new people is because there is typically a three to five-year learning curve before a broker truly starts earning a good living. It is a commissioned business and can take time to learn and develop client relations. During this timeframe, especially the first two years, the young broker makes very little money. In today’s economic environment, they just can’t survive on what they make as a beginning broker without some help and that can be frustrating and dissuade great candidates from entering the field.
I’d like to create a non-profit fund that provides motivated and promising individuals financial support while they are learning the profession. It would be similar to a school loan or scholarship. I envision an organization funded by CRE individuals, private companies and/or industry organizations. Young brokers could be granted or borrow “x” dollars at a low interest rate. They would have up to 3 years before they would start to pay back the low-interest loan to the foundation. This would enable young/new brokers time to learn and develop their professional skills, gain confidence in closing transactions and provide the financial footing they need to achieve success. The foundation will also help the industry provide a career path to attract new talent.
This was very inspiring. Thank you so much for joining us!
Commercial Real Estate Today: Andrea Davis of Davis Commercial AZ On 5 Things You Need to Create a… was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.