Sperry Van Ness Names President, Targets Growth

Maggiacomo tells GlobeSt.com that a big part of SVN’s focus in 2009 will be on increasing market share by mobilizing the company to work with sellers who are encountering distress. “That’s really where the market is,” he says.

Another goal will be to increase the company’s share of the leasing business. Firms and individuals who succeed in this economic downturn, “will be those who adapt to working with sellers in distress and to diversifying their areas of specialization,” such as an investment sales firm like Sperry Van Ness focusing more on the leasing side of the business, he says.

Maggiacomo points out that Sperry Van Ness started focusing on how to adjust to changing market conditions more than a year ago. “Very early on in this economic crisis, we restructured our organization to provide for operating expense scalability,” the new SVN president explains. “As a result, we have a very healthy business model.”

Another of the company’s initiatives in response to changing market conditions was the formation of the Asset Recovery Team, which combines the expertise of the longstanding Sperry Van Ness Accelerated Marketing Co. Inc. with ART members in offices around the country. Combined with the SVN policy of “sharing fees on a 50-50 basis 100% of the time,” Maggiacomo says, the company’s new initiative offers “significant points of differentiation in the marketplace and positions us to be a leader in the sales of distressed assets.”

Sperry Van Ness will focus on recruiting as one part of its efforts to increase market share, but Maggiacomo emphasizes that the company will not focus unduly on recruiting. “It will be a part of our plan, but we are not going to rely on it heavily,” he says.

In fact, Maggiacomo points out, “Putting too much emphasis on recruiting to navigate through these troubled waters can get you in a lot of trouble.” A new recruit, regardless of past production history, “will cost you money in the short term,” Maggiacomo explains. The new Sperry Van Ness president has extensive experience with recruiting, having served as executive vice president during the company’s rapid expansion. “Headcount growth does not necessarily correlate to revenue growth,” he says. “It takes a strong transactional growth plan, coupled with targeted recruiting growth based on market and specialization.”

At the same time that it is growing, Maggiacomo says, SVN is mindful that the economic downturn has radically changed the commercial real estate landscape. “Gone are the days when a broker could focus on matching equity-laden buyers with willing sellers. There is now a cap gap between the two,” Maggiacomo observes. Today’s successful brokers really must function more as advisers, the term that Sperry Van Ness prefers to describe its brokers.

Thanks to the changing market conditions, Maggiacomo expects to see “a significant reduction in the number of commercial real estate brokers practicing over the next year.” It’s an expectation, he notes, that is shared by many executives in the industry.