Fourth of July, Investing, and Sam Zell
Steve Nabity
Want To Invest In Real Estate But Don't Know Where To Start?
Quote of the Month
“Taking risks and making mistakes is the only way to grow. The key is to learn from those mistakes and never make the same one twice.” – Sam Zell
I hope everyone had a happy and fun 4th of July holiday. The 4th of July is a powerful symbol of the American spirit – freedom, liberty, and self-governance. It serves as a reminder of the profound sacrifices made by our Founding Fathers and the individuals who fought for our independence. This day encapsulates the essence of our national identity and the enduring values that have shaped and defined America throughout its history. The 4th of July is a testament to the spirit of our nation, an eternal beacon that illuminates our path toward a brighter future.
My father-in-law flew in WWII. He always shared profound wisdom, but one thing stands out above the rest. He told me that in life, I need only to invest in three things: my faith in Jesus Christ, my family memories, and my education. These are the only things in life that no one – no person or government – can take away from me.
I recently read in the newspaper that Sam Zell passed away on May 18, 2023. I’ve always heard about Sam as an investing trailblazer in offices, apartments, REITs, and companies, and his legacy lives on in commercial real estate investing today. I never had a chance to meet him, but I heard incredible stories. So on this 4th of July weekend, I downloaded his book “Am I Being Too Subtle?” and sat by the pool consuming his stories and, in some cases, seeing myself in them.
Sam’s family was from Poland. At that time, Germany and Russia were fighting with each other and Poland was caught between them. His dad warned their relatives to leave the country immediately as sooner or later, both would invade Poland. The relatives wouldn’t listen to his advice and gave their own reasons for staying. The morning after Sam’s dad took his family out of the country, Germany invaded. Only two members of the relatives who stayed behind survived.
After a two-year journey through five countries, they finally made it to Chicago, IL. And two years later, Sam was born, and the rest is history.
I want to highlight some of Sam’s life and business principles. Unconventional to some and entertaining to others, nevertheless, there is something worth learning from Sam and his crazy journey that applies today.
Risk
Zell’s motto was to “embrace risk for exceptional rewards.” He advocated for calculated risk-taking, viewing it as an opportunity rather than a threat. By analyzing potential risks and rewards, individuals can make informed decisions that yield remarkable outcomes in both business and life. Zell’s philosophy emphasized the importance of stepping outside one’s comfort zone and being comfortable with uncertainty to achieve success.
Building a Team
“Building great teams is not about finding individuals who are perfect, but rather about assembling a diverse group of talented people who complement each other’s strengths and weaknesses. It’s about fostering an environment of open communication, trust, and collaboration. By empowering team members to take ownership of their roles and encouraging innovation, we can unlock the full potential of our collective intelligence and achieve extraordinary results together.”
Constantly Learning
“Learning is a lifelong journey, and I embrace it wholeheartedly. I believe in the power of curiosity, an intellectual curiosity that fuels personal and professional growth. To stay ahead in an ever-changing world, I prioritize learning from every experience, seeking out new knowledge, and challenging my assumptions. Constant learning expands my horizons, enhances my decision-making, and helps me adapt to new opportunities. It is the key to staying relevant, innovative, and achieving long-term success.”
Being Your Own Person
“My motto is to be unapologetically myself and follow my own path. I believe in taking calculated risks, challenging the status quo, and questioning conventional wisdom. By staying true to my values and instincts, I have been able to make unique and successful decisions. Being my own person means embracing authenticity, resilience, and the willingness to stand alone when necessary. It’s about forging my own destiny and creating a legacy that reflects my true self.”(Sam wore jeans and colored overalls, while others wore suits. He wasn’t going to change to be who he wasn’t.)
Want To Invest In Real Estate But Don't Know Where To Start?
Grave Dancer
“Embrace opportunities where others see challenges. As a ‘grave dancer,’ I thrive in the face of adversity, seeking out undervalued or distressed assets that others overlook. By taking calculated risks and applying my expertise, I have the ability to revitalize and unlock the potential of these opportunities. Through strategic investments and innovative thinking, I aim to create value and generate substantial returns, even in the most challenging circumstances.”
Where to Look?
“If everyone is going left, look right.” Sam encouraged people to explore alternative directions and consider unconventional opportunities by looking in the opposite direction and challenging the prevailing wisdom (Perhaps something he learned from his father’s own experience leaving Poland).
I could go on and on listing Sam’s wisdom, but I’ll let you enjoy the book for yourself. The main thing I want to highlight is that there are uncertainties and opportunities on the horizon for every real estate investor (e.g. interest rates, government regulations, finding and keeping talented people, etc). The key will be to manage the risks, calculate the returns, evaluate your team and leadership style, and invest your time in things that matter – like the ones my father-in-law suggested.
