This article originally appeared in Commercial Executive Magazine
In the realm of competitive volleyball, a winning point typically depends on a good pass, great set and a kill. For Ted Liles, Principal of Industrial Services at Cresa Global, Inc., that winning point came during his senior year at California State University, Long Beach. "I found myself getting burned out playing collegiate volleyball, and knew I was not going to pursue a professional volleyball career overseas," he says. "When I made the decision, I inquired with the booster foundation to see if there were internship opportunities at a commercial real estate firm. Doug Shea, friend and mentor, was a huge supporter of the volleyball program and managed INCO Commercial. He took me under his wing to start learning the business."
Starting Points
Cresa, an industry leader in tenant representation, serves over 2,000 clients within an ecosystem of 80 global offices and 1,000 team members. Liles, an expert in transportation, logistics, and transaction management who also Co-Chairs Cresa's North American Industrial Team sees extraordinary opportunity in the market. "Industrial has been such a growth sector over the past several years, and it is exciting to be a part of a segment of the economy that has been on fire - it has been a wild ride," he says.
Background
While Doug Shea may have opened the door to CRE for Liles, his first introduction came years earlier. "Real estate is in my family, and it has always been something I found interesting. My father is a master plan developer in Vail, Arizona and my mother is a residential real estate agent," he says. "I realized that while I enjoyed being exposed to real estate at a younger age and the lifestyle it can provide, I did not much care for the personal nuances in residential real estate. I found CRE intriguing because the real estate serves a function for a company's growth."
Industrial
With the office, brick-and-mortar retail and hospitality segments under stress from COVID-19 concerns, industrial has been the clear winner as e-commerce sales have accelerated since March 2020. According to the U.S. Department of Commerce, a quarter-by-quarter analysis of online shopping reveals a 44.5% increase in activity in Quarter 2, 2020, as compared to Quarter 2 in 2019. Likewise, Quarter 3 of 2020 pushed web sales ahead by 36.7%, as compared to Quarter 3 of 2019. "Due to social distancing, stay-at-home orders, and people wanting to be safer, online consumer spending has increased dramatically, resulting in an explosion of e-commerce," he says. "This has not only dramatically increased demand for all kinds of industrial facilities - distribution center, warehouse, etc. - it has also increased the demand for the ancillary businesses that service those facilities."
Logistics, infrastructure and last-mile delivery certainly have boosted the industrial space, but a renaissance in manufacturing has also propelled the space in recent years. "The resurgence of manufacturing is under way, and it is great to see products being manufactured again in Arizona and the United States," he says.
Tenant Representation
According to the Certified Commercial Investment Member (CCIM) Institute, between 3% and 10% of commercial brokers practice solely in the tenant representation space. Liles, a distinguished member of the Society of Industrial and Office Realtors (SIOR), takes his commitment to tenant representation seriously. "There is no conflict of interest. I know my fiduciary obligation is serving my client exclusively, which is important to me and a differentiator in the CRE business," he says. "In addition, the market is changing so rapidly, and a tenant rep advisor can help occupiers strategize their real estate, create leverage in a landlord's market, navigate the many pitfalls in a deal while mitigating issues that can be costly during occupancy."
Opportunity
With the CRE industrial sector booming, Liles is extremely optimistic about the future for his clients in the Valley and across the country. "Most people do not realize it, but industrial real estate is a core component of what keeps the economy ticking, and how the people get goods across the United States. I am grateful to play a role in that process and to be able to help companies figure out how to use real estate to their advantage," he says. "It is not just real estate either. That is a piece of the puzzle, but I also get to help companies look at the bigger picture - supply chains, manufacturing, distribution. It is all fascinating."
For Liles, success at Cresa emanates from a strong work ethic, collaboration, dedication to clients and a commitment to continuous improvement. "I pride myself on being the first person in the office each day and sticking to my daily and weekly schedule," he says. "I am also incredibly thankful for my team (Marissa Dichiara and Cody Folts) and have been impressed how consistently they step up to help our team achieve our goals."
Personal
As 2020 closes, Liles takes time to reflect on a period unlike any other. "March through May were some of the most challenging days of my career and personal life. Deals were imploding or getting pushed with little money coming in," he says. "Additionally, when you are confined to a small home with a working spouse and young children needing to do schooling from home, focused worktime is a challenge and work/family/life balance doesn't exist."
Future
With the Valley economy resilient, Liles is excited at the prospects for many spikes in the tenant space in 2021. "I do not see any signs of industrial slowing locally or nationally," he says.