David Podmore

By Jean Sorensen

Three of Vancouver’s real estate legends recently told a packed ballroom at the 2011 Vancouver Real Estate Forum some of the secrets of their success. Panellists Dave Podmore, Robert Lee and Michael Audain told of incidents that shaped their careers and business outlook.  

“When an opportunity presents itself, definitely don’t do too much analyzing – take it,” said Dave Podmore, chairman and CEO of Concert Properties Ltd. in Vancouver. For Podmore, opportunity came knocking in l980 when he was worked for the City of Edmonton as manager of community planning. He had dealt with Narod Construction.  Alvin Narod called to say that they were starting BC Place development for the EXPO 86 World Far and they needed someone with planning, design and engineering experience. Podmore flew to Vancouver the next day, met with Narod for a few hours and was encouraged to call his wife to look for a house the next day. Within a month, Podmore had purchased a new home and relocated to Vancouver. It was the turning point of his career.  

But when EXPO 86 ended “we were all out of a job,” said Podmore. An associate told him to call Jack Poole, a man who could use his talents. “He said go see him immediately.”  But Podmore procrastinated for six months, carrying the phone number in his wallet. He finally realized he liked working with an organization rather than on his own, and placed the call. “I’ve been waiting for your call,” said Poole, and that launched his career with a “fabulous partner” and co-founder of Concert Properties. (Poole, who chaired the 2010 Vancouver Organizing Committee for the 2010 Winter Olympics, died a day after the flame was lit in Greece).

Michael Audain

Michael Audain is chairman and founder of Polygon Homes, which has built more than 18,000 homes in B.C.’s Lower Mainland. He said the point that price is not everything was driven home one winter. While he was at the San Diego zoo “watching the gorillas” he received a phone call. He was told there were two problems with a building. Apparently the City of Vancouver had deemed one of company’s buildings to be “structurally under designed” and considered it a “dangerous building”. The second problem – it was snowing heavily.

“My response was you better get shovelling,” he said. He hopped a jet the next day to return and commence a costly retrofit to bring the building up to standard. “We had hired a rogue engineer,” he said, adding it was someone who had not worked in B.C. before. He had given the cheapest quote. “Whether it is in construction or a building trade, it doesn’t pay to always take the cheapest,” he said. “It was a great lesson learned.”

Realtor and developer Robert Lee spoke about the experience early in his career of investing in a building in Montreal valued at $85 million. “In the l970s, the banks were easy and interest rates were reasonable,” he said, adding that he was also on a bank board of directors, so when he was approached to bring the deal to the bank, he did. At that time banks were willing to finance 100 per cent of the deal. By l982, the building was one-third vacant and interest rates had skyrocketed to 23 per cent. Lee said he “didn’t have the money to pay the bank the interest” required. Business partners offered a bridge loan and Lee eventually ended up selling off some assets to repay his debt. It taught him to never take a short-term view of interest rates for a long-term investment. “Even in our family,” he said, “we take a l0-year view of rates.” He said, “Make sure you don’t over-leverage and you have some cash flow to pay if the interest rates rise.” 

Robert Lee

Another lesson learned by Lee was staying the course of a proposal to reach the long-term objective. Lee started as a broker working with many Hong Kong buyers and eventually accumulated capital to invest and found Prospero International Realty, where he is now chairman. His success in real estate over the years landed him on the University of B.C. board of governors and he was able to convince UBC to use 20 acres of its land for a housing development with leasehold on the land.  Only after spending $5 million to place roads and infrastructure was the first phase of Hampton Place put to tender.

“But, no one tendered,” said Lee. The university considered going freehold title rather than lease. “But the university would not get the revenue stream forever from leasing the lands,” he said. He called a business acquaintance in Hong Kong and said he needed him to spend the $8 million for the first phase of buildings. It happened and the sale of those buildings raised $81 million for UBC. It also allowed the university to continue generating revenue off the lands when the leases expired. Other developments followed and Lee is credited with developing a community with sales that have generated $650 million for the university.

Listen to the “tom-toms” is the final piece of advice from Podmore. After connecting with Poole in 1987, the pair put together the Vancouver Land Corporation to develop the False Creek lands surrounding the EXPO site. A group of investors, each putting up $1 million, was proposed in a public offering. The proposal set out to the B.C. government had a First Nations component and provided non-market housing and other aspects that would benefit the community. Podmore said one of the “saddest” calls he received was being told that Concord Pacific had won the contract. (In retrospect, Podmore said, “They have done a good job.”) He said that the consortium of investors putting up $1 million each was “the Achilles heel” of the project because “there was scepticism that a public offering of this size would work.” 

Podmore said he should have learned from this scepticism when the proposal was first presented.  “I learned not to take something for granted,” he said. “Listen to what the tom-toms are saying about you.”