by Dan Rafter
The Minneapolis branch of CBRE ranks as the most successful in the Midwest. A big part of this reason? The performance of Tom Holtz, an executive vice president at this office.
Holtz has sold about $10 billion worth of investment properties during his career. That’s called making an impact. And it doesn’t appear that Holtz is ready to slow down any time soon. During his entire career at CBRE, he’s handled some of the biggest investment transactions for single- and multi-tenant office and industrial properties.
And that’s something Holtz plans on continuing. After all, he’s working in the right market for big transactions. The Minneapolis/St. Paul market remains one of the strongest in the Midwest.
“The Minneapolis market is very active today from an investment standpoint,” Holtz said. “But it’s a different market from when I first started. The key difference from 20 to 30 years ago is that Minneapolis is now attracting capital from overseas. In the older days, it would be rare to talk to anybody who had foreign capital attached to an enterprise. Today, in a lot of assignments we are talking to foreign buyers and entities that are partnering with foreign buyers. Minneapolis is clearly on the radar screen of the international investment community.”
Holtz, too, has seen significant changes in the city’s office and industrial markets. Today, most of the development opportunities in these segments are being tackled by large users, Holtz said. There isn’t much spec development.
“If you look at office development, the only development you see going on is for large users like United Health Group and Wells Fargo. It will still be a while before you start seeing any speculative office development. The industrial market has bounced back a little quicker. You are starting to see spec development take place, which will add to the enthusiasm for the Minneapolis market.”
By all measures, Holtz is a commercial real estate success story. But he almost didn’t end up in the field. He started his career in the mid-1970s in commercial banking, working for Norwest Corporation, national bank that in 1998 merged with Wells Fargo & Co.
When Holtz was given some real estate credit to pass out, he realized something: He was intrigued by commercial real estate.
Holtz was having lunch one day with one his mentors, Jim Curry, who in the 1960s developed Pentagon Park in Edina, which is believed to be the first suburban office park in the Twin Cities.
“I remember him telling me that if I liked this real estate business I should pursue it,” Holtz said. “So I did. In 1979 I made the move from commercial banking into commercial real estate, and I’m still here.”
Holtz said that he picked an especially auspicious time to jump into the market. Back in the late 1970s and early 1980s, development in the Twin Cities was booming.
And Holtz discovered that his success was only limited by how hard he was willing to work.
“There was a spirited group of players involved in the commercial real estate business at that time,” Holtz said. “You were able to determine your own future by how hard you were willing to work. I was able to take on risks that were not available to me in the banking business. It was more entrepreneurial than the banking environment.”
Holtz saw just how entrepreneurial the business could be in the early 1980s. That’s when he and Pat Ryan, who is now president and chief executive officer of Ryan Cos. US Inc., worked together to sell a 5-acre parcel of land in Edina to a developer based in Winnipeg. The two helped the developers design the office building that eventually rose on the parcel. They also handled the leasing, leasing 100 percent of the space to AT&T.
They also pre-sold the building to Travelers Insurance. This turned out to be an extremely successful transaction for both Holtz and Ryan.
That one transaction also led to future business for Holtz. The developers went on to form Winnipeg-based Artis REIT. During the last five-and-a-half years, Holtz has sold this REIT $500,000 worth of real estate.
“And it all started with a single deal in the early 1980s,” he said.
Is there a secret to Holtz’s success? Not really. He believes in working hard and putting the needs of his clients first. He also believes in the power of developing long-standing relationships.
This last point, he says, is especially important. It’s easy in this day of Twitter, Facebook and LinkedIn to forget how important face-to-face meetings can be.
“I am a firm believer in the theory of six degrees of separation,” Holtz said. “Commercial real estate is all about relationships. It’s about figuring out how to initiate and create relationships and leverage those into other relationships. A lot of people feel that the computer and technology is going to do everything for them. The reality is that the most successful brokers are the ones who are meeting face-to-face with people and forming new relationships all the time. This is still a people business. Technology is great, but it does not take the place of a great relationship.”