The Corcoran Group’s CEO on markets, mortgages, moneymaking, Manhattan and Manolos.
by Mary Lowengard
You’re now in your ninth year as CEO of the Corcoran Group. But 2008 looks like a tough one. What’s your strategy for keeping Corcoran afloat?
I’ve been answering that “bubble question” for five years running. Last year was our best year ever. But we took steps in case the markets do soften. We’ve done lots of training, we’re shifting into the condo market and we’re courting foreign buyers and working hard at developing our presence. If 2008 turns out to be a tough year, the fact that we’ve expanded our reach should help.
Break down the elements of your job. How much of your day is administrative, financial, marketing — and how much is fun?
There’s more administration than I care for. I do my best to delegate when I get bogged down. I spend a lot of time with developers and my on-site marketing team. In the past few years I’ve spent a lot of time on acquisitions. What I love most are the deals. I’ve been called a deal junkie, and it’s absolutely true.
What it is about dealmaking that you like?
It keeps me fresh and in touch with the current psychology of the market. It also keeps me close to the brokers, and I love the action.
How is the current mortgage crisis affecting your business?
We haven’t been touched. We’re anticipating that the huge hits the Wall Street firms are getting will take some people out of the market. But the flip side is that the weakness of the dollar abroad is driving more foreign buyers here. I think we dodged the bullet this time, but a deeper recession with more layoffs and potential uncertainty about the election could put some pause into the market.
How is the New York real-estate market different from that of the rest of the United States — or the world?
It has a much greater concentration of wealth. People choose to live here. It’s the capital of the world. It’s exciting. Manhattan is filled with luxury everywhere you turn. With an average [apartment] price of well over $1 million, it’s truly out of the ordinary.
Is New York being taken over by condo-buying foreigners?
It’s great for the culture of New York to have a dynamic group of international citizens here. It’s not going to destabilize the city culture. There’s no single buyer mentality in Manhattan.
You helped negotiate the deal to sell Corcoran to NRT, then a Cendant subsidiary. NRT has since been taken private again. How has the corporate culture changed at Corcoran since it was sold in 2001?
We recently cut out the free bottled water because we’re trying to go green. Otherwise, we haven’t changed much.
What’s your take on the financial model for residential real-estate transactions? In the Internet age, what value does an agent actually offer?
When the market was hot, people thought they could bypass brokers. But it’s always a mistake. A good broker adds value to your transaction. Experts help you achieve your goals in buying or selling. It’s not a coincidence that discount brokers have never been able to get a foothold in the New York market.
Real estate seems to be skewed toward women in both its employee base and its leadership. Why?
Years ago it was indeed predominantly women. But now it has become a more glamorous and accepted profession. It’s much less a second career choice. And now more men are coming into the business. When she departed in 2004, Barbara Corcoran left some big shoes for you to fill. What kind of shoes are you planning to leave? Manolos.