Weekend Home in College Station: What To Buy, And When?

Howdy!


I'm back one last time this semester and I have enjoyed blogging (for the first time ever, I might add) about my real estate interests the last few months.  As I prepare to graduate in May with a Bachelor's degree in finance and move towards beginning the Master of Real Estate program in August, I know I will look back on this class as one that really solidified my decision to pursue a career in Real Estate.

Every member of my immediate family is an Aggie graduate, and from the time my brother started his freshman year here in 2008 up until now, our family has been season ticket holders for Texas A&M Football.  Over the past few  years, the program has soared to new heights and the excitement is at an all-time high here in Aggieland.  That being said, my parents are looking for new real estate investments in the area to help cut down their expenses every fall and also provide a source of steady cash flow as they prepare to retire.  Currently, my parents own an RV and park it near the basketball arena each home football game weekend.  Not only is the initial purchasing costs for the mobile home high, but my parents dish out hefty operating costs each month for parking, maintenance, storage, etc.

Over the past several months, my parents have been looking for properties for sale in the College Station area and have asked for my input in the process.  My expertise on many of the factors is limited, but it's been quite an experience helping them attempt to value these property investments.  Our goal is to find a property that is (a) located in the Southside Historic District near campus, (b) have prospects for extensive renos, and (c) be an ideal size/location that would be appealing for renters.  Issues that we have run across thus far have been the fact that properties in this area, for several reasons, don't last long on the open market.  We believe that with the student growth in the city, coupled with the large amount of developers wanting in on the action, we are competing against folks who are in the know well before us.  These developers know what's selling, when it's selling, and for how much.

Regardless of whether the odds are stacked against us, we still have had the opportunity to pull the trigger and put in offers but have been hesitant to do so.  Some properties seem to be too expensive to do a tear down and rebuild.  Others seem too far from campus with no room for parking, making it unattractive if we were to market to students or family renters.  Another big question is if Bryan/College Station can continue the growth we have seen over the last 3-4 years.

 Properties in the SSHD have seen annual growth in value anywhere from 8 to 20% since 2012.  The prospects look great for a long term investment, as Texas A&M University is planning huge student increases, properties are being developed further and further outward, and the excitement of the university's athletic successes (see Kyle Field, Aggie football and baseball) is higher than ever.  However, it's important to question the popular belief and consider the likelihood of a pullback in the market on the horizon.  My parents have long term interest in whatever property they choose to buy, so this might not be as important of a factor to them as it is to some.  But being sole investors (not looking to partner in the deal), this is still a factor to consider, nonetheless.

I'm very blessed and thankful for them involving me so much during the process, as I have not only enjoyed every minute of it, but I have learned a ton in the process.  With my dad and brother being commercial real estate professionals, there's nobody else I'd rather learn the ropes from.  Whenever my parents come in town, we spend a few hours each day just driving around looking at different properties and weighing our options.  When the family is back home in Houston, I serve as a Realtor of sorts, taking pictures of different houses, walking off property lines and calling brokerage firms to ask for quotes.

Hopefully, in the near future, my parents will decide to close on a deal and I can live in the house during my final semesters of graduate school.  By bringing my friends in to live with me as renters, I can help make the transition seamless for my parents and provide them with some immediate cash flow without having to market or search for potential tenants.  Also, it would be pretty sweet for us to have a weekend house for the next few years so we can hang out in our own place while we watch some Fightin' Texas Aggie football!

Well that's all I've got.  It's been an exciting and helpful semester, and I have enjoyed learning everything that I have over the past few months.  And to Mr. Peterson, thank you for everything you've done for me throughout the semester and I can't wait to take some more of your classes next fall in the Master's Program!


Best,

Austin Decell

Unique Office Buildings and Their Environments

Howdy all!

I'm back again to write one of my final blogs of the semester, and this time I wanted to change up the pace a bit.  During a recent lecture, we spent a lot of time talking about the ever-changing landscape of corporate office space.  Companies today are making a large commitment to improving the overall atmosphere and environment in the office, as well as upgrading the quality of their facilities in the process.  Today, I want to examine some of my favorite examples while also thinking about what my personal ideal office environment would be.

Today, Google is a wonderful example of the "fantasy" workplace so many workers seem to covet. From private sleeping pods and multistory slides, to unlimited gourmet meals and massage parlors, Google's headquarters has it all.  The tech giant has always attracted the most talented and brilliant employees to maintain the firm's global stronghold on the industry, but now it's using its dream office to make sure they stay. Laura Wilken, who works in Google's Real Estate & Workplace Services division, says the company is always trying to "figure out any type of program that will make Googlers happier, healthier and more productive".   Productivity is the driving force behind these changes, and the firm is considered the world's best company to work for, according to Fortune.com.  

While this "Disneyland" office would certainly pique my interest in taking my talents to the Silicon Valley workforce, my opinion is that the employees are treated a bit too much like children.  Nutrabolt, a sports training and supplement company based here in Bryan, is the real dream office for an active, sports enthusiast like myself.  One of my room mates, who is a current employee with Nutrabolt and has taken me to hang out and "play" up at the building several times.  This state-of-the-art facility is beautiful and comes with all the bells and whistles: full locker room, sauna, steam room, cold and hot tubs, full weightlifting and cardio gyms, rooftop putting green, basketball court, kitchen, pool and shuffleboard tables, and much, much more.  

However, that's merely the additional facilities that come with their spectacular office space.  Both stories of the office building utilize an open, collaborative design with fantastic architecture and modern furniture.  The walls are built out of whiteboards to allow for novel concepts and ideas to be shared among anyone at any time.  Comfortable bean bags and lounge chairs are littered throughout the office to provide employees with areas to relax and work in peace.  Every desk is in plain view of every other team member's desk in a particular department.  It truly is a sight to behold.

I think this style of environment would be very suitable to my personality.  I enjoy being around other people and collaborating, working hard in a comfortable setting, and I definitely wouldn't mind enjoying a nice game of pool or shooting some hoops as a nice break every now and then.  I'm a fast paced worker who loves teaming up with others to accomplish challenging tasks.  Both Nutrabolt ( with their top notch athletic facilities, fun amenities and convenient location) and Google (beautiful location, incredible perks and challenging work) are both amazing work environments in my opinion.  Hopefully one I'll be able to enjoy a corporate culture similar to what these two firms have incorporated into their businesses. 

Google Headquarters, Mountain View, CA:

Nutrabolt Headquarters, Bryan, TX:

Former Hometown Mayor Fails to Deliver On Big Promise

http://www.houstonchronicle.com/news/houston-texas/houston/article/Texas-developer-delivered-heartbreak-and-6134920.php?t=329927798e&cmpid=fb-premium#photo-7658905

"Texas developer delivered 'heartbreak and desperation' with unmet expectations"

In a recent lecture in our FINC 371 class, we spoke in depth about the fiduciary duty a service provider has to their client.  This topic came to mind once again a few days later, as I read an particularly interesting article in the Houston Chronicle about developer/businessman, David Wallace.  I was raised in Sugar Land, Texas and had met Wallace on several different occasions while he served as mayor from 2002 to 2008.  When I read about his real estate ventures, I was astounded at his inability to see his projects all the way through.  Look no further than Joplin, Missouri.

In May of 2011, an EF5 tornado ripped through the town of Joplin, killing 158 people, injuring over 1,000 more and causing roughly $2.8 billion in damages.  The town was devastated and was looking for extreme aid in the recovery process.  In comes Wallace Bajjali Development Partners, a real estate development firm that focused in large-scale municipal investments that was created by David Wallace and Costa Bajjali.  They had been praised for big-name projects around the Sugar Land area and across Texas, which was partly the reason Wallace had won the election for Mayor in 2002.

Wallace Bajjali LP was hired by the city of Joplin to lead an $800 million redevelopment effort that promised a shin city full of beautiful new residential and retail properties.  However, Joplinites soon learned the hard way what Sugar Land natives had known all along: David Wallace and his partner were not what they made themselves out to be.  When all was said and done, Wallace and Bajjali had left town with $1.7 million in fees and a $5 million private loan.  The partners had failed to build a single property.  By the time 2014 rolled around, Joplin officials couldn't get a hold of Wallace or Bajjli at all, as they learned that the company had closed its doors and the two businessmen were MIA.

The "slick-tongued salesmen" had pulled off similar tricks in the past, as developments in Waco and Amarillo had also been played on big stage.  Joplin officials said they had heard rumors of Wallace's past projects, but were completely swayed by Wallace's slick and convincing sales pitch.  As of today, Wallace is being sued by two former employees in Joplin for fraud and breach on contract. The city continues to rebuild and believes it will eventually be better off now that Wallace is no longer in the picture.

This story was difficult for me to read, as I feel that Wallace's actions have tainted the reputation of my beloved hometown of Sugar Land.  This is an incredible city that was once voted the 3rd Best City to Live in the U.S. by Money Magazine.  So much culture, history and livelihood was once credited to a man that I look up to as a kid.  Wallace was always so genuine and welcoming to me and my family during the times that I met him, making it so disappointing to now know that his genuineness was merely a deceitful facade. I know that the city of Sugar Land is now in better hands and I hope justice is found for both Joplin and Wallace himself.

The article was a great example of how important trust, loyalty and commitment are in massive real estate investments such as the Joplin deal.  The city not only lost a large sum of money in the faulty business of Wallace Bajjali, but they also faced a serious setback due to the time lost in the process.  It's so vitally important to do your due diligence and thoroughly check your client's background when making an expensive investment, and Joplin failed to sift through Wallace's smooth lingo and fancy renderings.