Stephen R. Preuss is a Senior Managing Director in the Capital Markets Group of Cushman & Wakefield, where he focuses on investment sales for the New York Metropolitan Area primarily in Queens. We’ve had the honor to get his insights for our latest Expert Interview. During his 19-year career, Stephen has transacted over $2 billion of investment and commercial real estate, selling approximately 300 properties, becoming a top producer in the market in the process.
When it comes to his client approach, Stephen sees each client as a prospective long-term relationship, and builds strong bonds and friendships. He is constantly inspired by the successful, hard-working team he’s gathered around him, and also by his family. Read on to find out how Stephen thinks the uncertainties in the world impact the real estate market in the U.S., his tips to becoming successful in the industry, but also many insights from the Queens market, his main area of expertise.
Q: Tell us a little bit about your background and why you chose a career in real estate.
I started off on Wall Street and then expanded into franchising different businesses. I was exposed to different sides of the real estate industry during these earlier years and I immediately gravitated to it, excelled, and thoroughly enjoyed those interactions. It was a natural progression for me to continue on and focus on commercial & investment real estate in NYC.
Q: What approach do you have when working with clients?
Long-term relationships… I have always looked at each one of my clients as a prospective 10-, 20-, or 30 year relationship and not just as a single transaction. Every year my repeat and referral business has grown due to this mindset in addition to many very strong bonds and friendships I have built.
Q: What are some of the things you do to keep yourself interested, updated and inspired?
I have always been a driven person which is what has allowed me to be a top producer the majority of my 19-year career. In this competitive and high failure business you need to have an internal drive to compete every day at such a high level. It is also very important to surround yourself with successful, hard working, and likeminded people to assist with your maintained level of focus. My inspiration comes from my family as well; a fantastic partner (my wife) and 2 great young boys at home.
Q: How would you describe the real estate market in the U.S. today in terms of trends and challenges?
I see the market in a quality-driven cycle. There are many uncertainties in today’s world, from politics to interest rate pressure to overseas economies etc… but there is an extreme amount of capital that continues to be available to flow through our capital markets. Many investors continue to hedge these uncertainties by chasing the triple A product whether it be their core focus or simply the best asset in their desired neighborhood. That is a large reason we continue to see record or near-record pricing on the most prime assets in the most attractive areas.
Q: What’s the most common problem you see in this industry?
There is a disconnect between buyers and sellers currently. Sellers routinely still think it is 2015/16, which commonly is thought to be the height of the recent market, and buyers are at the other end of the spectrum, discounting pricing and terms greatly as if it were 2009/2010. We are seeing the gap narrow a bit but overall the transaction process has been much more difficult due to an inability to find a happy medium with asset pricing and the structuring of terms which unfortunately has now commonly pushed the cycle of a deal closer to a year on average.
Q: What trends have you noticed in the Queens market during the first months of 2018? Where do you see the market heading over the rest of the year?
Queens is the focus of my business; I have transacted over 250 properties in the borough in excess of 2 billion dollars of value. Queens now has more notoriety and attention than ever – I tend to say we are grabbing some of the shine that Brooklyn has had for the last several years! Although we have seen a bit of a dip in transactional volume (still far less pull-back than most of the boroughs) our price points have continued to rise. This is due to the fact that Queens has a perceived value for prime income producing assets as well as land. We are seeing an influx of new buyers whom traditionally have just focused in Manhattan or Brooklyn now competing with the local / typical Queens buyers. I am extremely bullish about the borough and see further growth opportunities in many of the value metrics and neighborhoods in Queens.
Q: What are some of the innovative and modern techniques and tactics for marketing a property that didn’t exist ten years ago?
The access of information has completely transformed the industry. More than anything else, we are in the information business. You will always notice the top producers in this industry are the most well-informed people in real estate. Most of my conversations during the course of the day are with clients – or potential clients – looking for information, guidance, trends, etc. Furthermore would be the dissemination of information: to circulate an investment opportunity was really only being done by phone or meeting, but now with the widespread use of email and social media you can reach thousands of qualified real estate professionals in a matter of minutes.
Q: What traits and skills do you think are necessary to be able to succeed in this industry?
Focus, persistence, and work habits. Work at work, try and master the ability to get 15+ hours of work done in your 12 hour day… this obviously takes tremendous focus. Persistence is an obvious trait: more than 95% of people fail in this industry, which I would say comes down to work habits, especially in the very early stages of their real estate career.
Q: Do you consider that investing in real estate it is safer than investing in other assets?
Most certainly – it is proven to be, especially in high appreciation areas like NYC and the boroughs. If you are able to purchase a quality asset yielding 5, 6 or sometimes 7% going in with some upside to re-position or improve the property – and then taking into consideration the historical appreciation – it is absolutely and unequivocally the best route for not only income producing but wealth building. The difficulties can be the obvious higher capital barrier of entry with today’s pricing and the management / time-involved quotient. That being said if you have the liquidity and pension for ownership with some type of management role then there is no better option.
Q: Do you have a current listing that you’re particularly excited about?
My team and I currently have over 60 active listings with an aggregate value of over $700,000,000 so there are many of these opportunities that we are greatly excited about. I would take that question further and mention areas in which we have a number of listings that I am excited about. I believe the ‘secondary’ areas in the boroughs are getting more exciting and talked about. In Queens, areas like Jamaica and Greater Flushing, which are outside of the Manhattan skyline, are now getting noticed as neighborhoods that should be evaluated and on everyone’s radar.
Q: What plans do you have for 2018?
My business plan is to continue to grow our #1 market share in the borough of Queens. We are on track to execute over $500,000,000 in transactions in the borough in 2018, which, depending on the overall sales in Queens, could possibly represent approximately 20% of all commercial transactions sold in the borough! This would be a huge feat and would continue to solidify Team Preuss as the capital markets and investment sales authority for the commercial transactions in Queens. This size and reach directly allows us to service our clients in an unmatched way to provide more information and insight and essentially market their assets and achieve our Team Preuss premium.
Q: What would you recommend to someone starting out in the industry?
A couple of basic points are to align yourself with an appropriate team and find a specialization. There is a lot to learn in the business and being part of a high production and reputable team can cut years off your learning curve. I firmly believe it is better to be a specialist in a certain discipline and furthermore a certain area. It may sound like you’re limiting yourself but in actuality it allows you to be more productive and a more essential part of your client’s needs.
Q: Any other insights you’d like to share?
About Stephen Preuss
Stephen is the #1 top producer in Queens and he uses his expertise and accomplishments when he contributes to many major publications such as The Real Deal, The New York Real Estate Journal, Crain’s, Qns.com, FOX, CBS, Newsday, The New Yorker, The New York Post, The New York Times and Real Estate Weekly. Find out more here.
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View Source: https://www.propertyshark.com/Real-Estate-Reports/2018/07/09/stephen-preuss-from-cushman-wakefield-there-is-a-disconnect-between-buyers-and-sellers/