James (Jim) Provost is the Owner and Managing Partner of Commercial Management Group, Inc. of Austin, Texas. The company specializes in retail commercial development.
Jim began his career by learning his trade working in construction. At age twenty-eight he founded his first company and shortly after launched a successful business renovating, building, selling or renting in the residential multi-family market. After ten years of doing business in that market, Jim sold the residential end of the business in favor of doing business in the retail commercial real estate industry.
He sourced retail shopping centers and began a property management and real estate investment company. He transformed shopping centers and began marketing campaigns to lease the vacant space with a wide variety of tenants.
Jim acquired vast industry experience over the years. His expertise includes management, acquisitions/dispositions, leasing, financing, and redevelopment, he was able to land development contracts with companies such as McDonald’s as well as Panera Bread. Jim would identify the location, purchase the property build to specifications, and either lease it or sell the building off.
James Provost has built his business with honor and integrity. He seeks to negotiate win-win contracts. As a result, he manages to compete with real estate investment trusts that are traded on the New York Stock Exchange. This is an enormous accomplishment under any circumstance. When a business achieves that prominence, you can be sure that they have arrived.
How did you get started in this business?
My first business was started renovating, building, and selling residential real estate. After a few years, I sold the residential side of the business in favor of doing business in the retail commercial real estate industry. I began to find retail locations or properties to renovate. We purchase shopping centers, which are larger projects. My ideal purchase is to find a large multi-tenant property where I can rent to multifaceted tenants. Constructing the buildings are a lot more fun. The income from retail tenants is much higher and more reliable in the retail market.
How do you make money?
I make money on the sale of each of the shopping centers. There is also tenant income.
How long did it take for you to become profitable, when you were starting out, was there ever a time you doubted it would work? If so, how did you handle that?
I was profitable immediately. We started purchasing retail shopping centers in 2004. During the real estate market crash in 2008, I was a bit nervous that tenants would not be able to pay the rent I required. But I was minimally affected while doing business in the retail market. We never lost any properties or were never in danger of losing any properties. Not a lot of people in the industry at that time can say that.
How did you get your first customer?
When we first buy the shopping centers tenants are occupying many of the spaces. We renovate and rebuild the unused space. Then, do a lot of cold calling on retailers to find new tenants to fill the space.
What is one marketing strategy (other than referrals) that you’re using that works really well to generate new business?
One of the marketing strategies that I have used that has worked quite well is when we have leveraged relationships with brokers. They are always on the look-out for properties of interest. They have brought us several properties that had the potential opportunity to develop and lease. For example, brokers may find a piece of land that we might be interested in leasing to a national food company or perhaps a bank. We will enter into a contract and I will either lease or sell the property.
What is the toughest decision you’ve had to make in the last few months?
To walk away from a purchase after investing a significant amount of time and money in pursuit of purchasing. Sometimes the best deals you make are the ones you don’t do.
What do you think it is that makes you successful?
I believe my strengths leading to the success of the company begin with my work ethic and respect for others. When you treat others fairly, good things can happen. When negotiating contracts, I always try my best to create win-win situations.
What has been your most satisfying moment in business?
I feel very proud of the position my company holds within the financial industry. I require financing for many very large projects. I deal with financial firms on Wall Street for a good portion of my financing. They approve loans for businesses after strict scrutiny. Financial firms require a certain amount of evidence that the loan will be repaid. For example, we did a refinancing of a property a few years ago. Both the lender and their legal team remarked about how well I do with the operations of the business and our track record of success on each property. The lenders provide a published report that is presented to investors on wall street. The report is a compilation of the aspects of the strength of a business. They take the mortgages and bundle them to be sold as a package to investors on Wall Street. We are listed as a borrower in the report. We are acknowledged as a good risk. It amazes me because, in the big scheme of things, we are a very small business competing against real estate investment trusts that are traded on the New York Stock Exchange. Our lenders were very impressed with what we have achieved. When you get to that point, it makes you feel like you have arrived!
What does the future hold for your business? What are you most excited about?
I would like to see continued growth. My son has begun working with us. I look forward to continued success with the business. I could retire right now but I love what I do. I’d like to find a balance in life. I have to learn to discipline myself to disconnect from my work life. I have to learn how to take time away and do some fishing or golfing or just to go play! Instead of playing I end up taking on projects that I don’t have to take on. But, they are fun to do. A good friend from Dallas and I meet at least once a month. We both grew a management company early in our careers. I sold my company to my top employees when I knew that life was not for me. I wanted to do exactly what I do now. My friend recently sold his business to a national real estate company, but now he is still investing in homes. We joke about the fact that we keep taking on projects, instead of relaxing a bit. But we have acknowledged the fact that the work keeps us going.
What business books have inspired you?
The Art of the Deal by Donald Trump. It teaches great negotiation skills and creating win-win situations. The other book is Covey’s Seven Habits of Highly Effective People. It teaches people to be present in a conversation and be a good listener. Another good book is Rich Dad Poor Dad. It teaches you to invest the money where you receive a return on your investment, rather than the bigger house or the better car. After your investment pays, use that money to get the bigger house or car. It is a good read.
What advice would you give to your younger self?
I worked for a construction company when I first started out. I was twenty-eight when I started my first company. I should have gotten involved in commercial retail real estate much sooner. But I believe everything happens for a reason.
Are you willing to be a mentor? If so, how should someone contact you?
I would consider mentoring an ambitious apprentice. Contact can be made through the Commercial Management Group website.