Integra’s Chairman On Current Appeal Of National Appraisal Firms As Acquisition Targets

[leasedfee]

The only response we got was that they insisted I be fired. So I was fired.

Lame. I could use stronger words to describe Jones Lang's weak knee behavior, but the moderator would zap my language. Jones Lang could've simply taken you off the assignment. My mentoring/owner MAI always defended and stood by us when a value did not please a client. When I co-managed a staff I stood by my staff appraisers too, unless we found a material error. Clients are so fickle or unethical that they don't deserve kowtowing. In a conference call, I had a senior reviewer trying to bully my appraiser. This banker woman had sat in front of me in AI's Member's Ethics and Professional Practice. Though she was only an affiliate member of AI, she had considered going for the MAI. In the conference call, even though we had conceded some minor technical modeling points, finally I said some strongly chosen words at her in the conference call. I knew we'd never hear from that client again. Big national firm hear this: You can choose to be a cuckolded sellout and drive a fancy car, or you can be an Ubermensch and take pride in your talents. It is a choice.

 

[PL1957]

Big national firm hear this: You can choose to be a cuckolded sellout and drive a fancy car, or you can be an Ubermensch and take pride in your talents. It is a choice.

Interesting how much animosity there is toward national firms ... it's reminiscent of the AI envy often seen on these forums.

Having worked for big firms and boutique shops, I've seen the gamut. National firms have a place in this professional. They do some things very well. Boutique firms also do some things very well. Quality work is not the exclusive property of either.

People make work decisions based on many factors- denigrating their professionalism because of their place of employment is beneath you.

 

[leasedfee]

Interesting how much animosity there is toward national firms ... it's reminiscent of the AI envy often seen on these forums.

From time to time, I get engaged to do Std. 3 Reviews of national firm's appraisals. Reports I've seen range from rank incompetency that a 7 year old wouldn't make (not immaterial stuff either, like misidentifying the "building materials or whatever") to pure manipulation/spin. Guess you're right, there is animosity. Not envy though. PL1957, how (or why) are these reports getting past the signing MAI?

 

[PL1957]

From time to time, I get engaged to do Std. 3 Reviews of national firm's appraisals. Reports I've seen range from rank incompetency that a 7 year old wouldn't make (not immaterial stuff either, like misidentifying the "building materials or whatever") to pure manipulation/spin. Guess you're right, there is animosity. Not envy though. PL1957, how (or why) are these reports getting past the signing MAI?

I'll file this post next to the ones that say the worst reports anyone has ever seen come from MAIs.

 

[Michigan CG]

I appreciate that IRR, et al., has a global brand and standardized product but my impression is that they're more of a confederation of medium size shops throughout the country. They have the constant need to train and C&W suffers from MAIs rubber stamping green appraisers.

I am familiar with IRR and I agree that their business model appears (to me) to be a confederation of medium sized shops. There is another company that does both residential and commercial that I can't think of at the moment that almost seems to be a franchise type of company. I know of Cushman and Wakefield but don't really know much about them.

My original question was about the large national firms staffing up and where do the appraisers go when the work either slows down or the work load becomes too much. I still don't get the staffing up approach if the amount of work is finite. A guy working at a national firm is required to take AI classes and I can't imagine that the lowest "quality" appraiser is worse in skills than the typical self-employed CG like myself. Maybe some are lazy and bad hires but they have the advantage of a lot of support and training from MAIs in those large national offices. I would think that the mentoring would be exceptional.

 

[Michigan CG]

I sometimes get "Dear appraiser" letters from Colliers International or Valbridge Property Advisors and get the feeling that they are just dragging the net for any living, breathing certified general appraiser in the state registry.

Interesting, I have never gotten a letter from any commercial firm looking to recruit me but have gotten some from the likes of William Fall Group and similar quality (cough, cough) companies to be a staff appraiser for residential work. Locationally, I would think that I would be a prime candidate as I live proximate to Ann Arbor, Detroit and Toledo.

Obviously (I think), the benefit of working for a national commercial firm (vs. the residential companies) would be higher pay and the mentoring that comes with it. The residential firms many times have the clueless training the newbie.

 

[PL1957]

Maybe some are lazy and bad hires but they have the advantage of a lot of support and training from MAIs in those large national offices. I would think that the mentoring would be exceptional.

As with anything else, it all depends on what you want to make of it. Over the past week, I sat through a meeting on the Chicago CBD office market that left me marveling at the depth of knowledge present in the room. I listened to a call on the whether rising rates have had a real, quantifiable, effect on values. These added to my knowledge and expertise, and hopefully will come through in my conversations with clients. These opportunities would not have been available if I wasn't with a national firm. The expectations are that our appraisers will take advantage of these opportunities. Many do, but some look for the easy way out. It's human nature and occurs in firms of all sizes.

 

[Michigan CG]

I'll file this post next to the ones that say the worst reports anyone has ever seen come from MAIs.

My first years (before moving to Michigan) were working for an MAI who was honest and ethical. I later learned that his cost approach methods were not exactly correct but that is another story.

I was exposed to many MAI reports and don't remember seeing anything that I would call close to bad. In my nine years in Michigan I am exposed to a lot fewer MAI reports as I am not MAI and my work is mixed (commercial, residential and ag). I still get to see some reports, a couple a year at most, and the majority are very good. I did get to look over some tax appeal work that went through Michigan a few years ago that were horrible and obviously advocating for the client. A few of them had the "DRAFT" background on every page and they reserved the right to change anything in the report; those reports were meant to intimidate the townships IMO.

The worst commercial reports I have seen are mostly from old-time CG appraisers who are not designated and whose work is primarily residential from what I can tell.

 

[Michigan CG]

Interesting how much animosity there is toward national firms ... it's reminiscent of the AI envy often seen on these forums.

I don't have the knowledge to make any judgement of the national firms. I did have one experience with a national firm where they also have brokers and the broker provided a couple lease comps. The broker called my client complaining that I was "bothering" the lease comps asking questions. My client told him I was doing my job verifying the comps.

As to the AI envy and the insults of the designations, that is mostly residential people who IMO are clueless. While I don't get to see a lot of commercial work from other appraisers I do get to see a lot of residential work and it is safe to say here (most residential people don't read commercial threads) that the majority of them could not come close to passing the 7-day SRA class.

IIRC you bought a residential property in Michigan a couple years ago and the residential report was not worth the paper it was written on.

 

[Howard Klahr]

From time to time, I get engaged to do Std. 3 Reviews of national firm's appraisals. Reports I've seen range from rank incompetency that a 7 year old wouldn't make (not immaterial stuff either, like misidentifying the "building materials or whatever") to pure manipulation/spin.

As someone who has worked for many national firms at one point or another as well as having engaged assignments from not only national firms but numerous local and regional firms in addition to having personally done reviews on a very broad range of assignments spanning geographically, across many many property types and different intended uses; I will say that quality varies quite a bit from location to location and often by the actual appraiser doing the assignment no matter what firm they work for. I have found that taking a broad brush approach does not accurately describe the appraisal market any better than using that approach to any other service business or industry. There is good and bad out there with no real guarantees.

The national firms often have a vast amount of resources available in terms or experience, data sources and types of properties. Local and regional firms, however, often do not have sufficient resources to handle assignments comprising multiple property portfolio work from large institutional clients on a timely basis and in a consistent format. There are quality professionals on both ends of this spectrum, present company within this forum included. There are also some really bad reports produced by firms that one would expect to obtain a much better end product even some that specifically specialize in certain property types.

My original question was about the large national firms staffing up and where do the appraisers go when the work either slows down or the work load becomes too much.

Based on my experience at national firms is that during certain periods of peak demand, resources can be and have been allocated among various offices, an option not available to many local operations.