Pay It Forward: "Don’t Fall In Love With The Real Estate"
It’s extremely fulfilling to work for a mission-driven company that is creating housing in markets that desperately need it.
Sean Burton, Cityview, Los Angeles, CA.
Sean Burton has been with Cityview since 2003. Prior to joining Cityview, Sean was vice president of corporate business development and strategy at Warner Bros. Before that, he was an attorney in the real estate and corporate groups at O’Melveny & Myers, LLP and also served in the White House during the Clinton Administration.
Position: CEO.
Area of expertise or focus: Vertically integrated real estate investment management and development focused on workforce and attainable housing in high-growth markets in the Western U.S.
What has been your biggest challenge in your particular role/? How have you overcome those obstacles? The biggest challenge for me is how to strategically scale our business. The early stages of our company focused on building a strong team, creating systematic processes and procedures, and effectively executing on our business strategy. We’ve done that, and as a midsized firm, we are now focused on how to grow and continue scaling strategically.
In order to scale capital on pace with our deal flow, we continue to invest in institutional flagship funds and create large JV and platform relationships. While we are narrow in our focus on multifamily, we have a lot of depth in that focus. We are fully vertically integrated, including in-house development, construction management, entitlement, asset management and property management, and cover all areas of the multifamily spectrum – from development to value-add to core. A lot of investors feel like they need to choose whether to go with a core, value-add or development-focused firm, but we do it all in the multifamily markets we serve, which we believe allows us to develop deep block-by-block expertise and use our knowledge across product types to find and execute on good real estate deals.
What about your current role/position at the company are you most happy with? It’s extremely fulfilling to work for a mission-driven company that is creating housing in markets that desperately need it while striving to deliver solid returns for investors. We build and improve market-rate and workforce housing that makes a real difference for communities and do so in a way that provides lasting value for our investors.
My brother is a firefighter, and it’s meaningful to spend my days striving to drive the returns that create a safe and secure retirement for him and so many others through the public pension systems.
What is the best piece of advice you have received that has helped you succeed in your industry? The best piece of advice I received is that you don’t have to be all things to all people. We maintain a high level of expertise by being multifamily sharp shooters with a strong deal flow, and the key to our success is lining up what we provide with the right sources of capital. Our vertical integration allows us to be a one-stop-shop for all things multifamily in the Western U.S. while providing a deep and nuanced expertise that is hard to achieve without focused discipline.
Do you have any advice specifically for the next generation? I would advise the next generation to do the work, learn every aspect of the business, ask a lot of questions and read every document. Put your head down and immerse yourself in the work without worrying constantly about promoting yourself or the next step in your career. People recognize great talent, and when you focus on doing the work well and driving results for the company and investors, opportunities will follow.
Would you advise any younger person to begin a career in CRE? Absolutely, it’s a great career. In fact, my own son is pursuing a career in CRE and I am excited for him to embark on this journey. I enjoy the tangible nature of the business. It is a solid career that is meeting a real need and can be a very secure one if you stick to the fundamentals. People will always need a place to live, which makes multifamily an especially appealing product type and career path.
When I was starting out, I was advised to work for a public homebuilder, as land was plentiful in the suburbs, there was public funding, and it was easy to control costs with a one-size-fits-all product type. I chose instead to pursue the development and renovation of more complicated projects in cities where people want to live and work. This work was more interesting, more challenging and more rewarding for me and is a business model with so much continued growth and opportunity.
Historically the multifamily space hasn’t been as innovative as some other asset classes, but there is a lot of room for creativity with new building techniques and technologies. For example, modular – which we used on our Union Flats project in Oakland – has the potential to bring projects to market faster and more affordably. There is a lot of opportunity for innovation in the value-add space as well. In our VIVE LA portfolio, we purchased a large number of smaller, undermanaged properties in a few key neighborhoods under one brand, which created more opportunities in the community and in our portfolio.
Please share with us the best lessons learned or a surprising component of your unique journey. I’ve learned there is no substitute for staying close to the real estate. The vertical integration of our firm, which allows us to oversee development, acquisitions, entitlement, construction management, asset management and property management, gives us a deep understanding of the multifamily space. These in-house capabilities allow us to closely monitor the market and evolve our strategy quickly and effectively as residents’ wants and needs change.
Please share any particular initiatives that you are working on. One of our recent internal initiatives that adds immense value for our team is Cityview’s Leadership Academy. We partner with a Harvard business professor to lead a curriculum that focuses on leadership, operational excellence and person development. Additional tailored third-party training is available to all team members, with a focus on developing critical thinking skills and navigating business challenges. We are in the knowledge business, and this training is helping to create the next generation of our firm’s leaders.
In your opinion, what takeaways did we learn from the COVID crisis? Our team learned that there is no substitute for rolling up your sleeves and ensuring you stay on top of every aspect of the business that’s in your control. Throughout the pandemic, we reached out to every single one of our residents to keep them apprised of the new initiatives we were putting in place at our properties, as well as the ways we were keeping them safe while still providing the services they needed. We put programs in place for those who weren’t able to pay and proactively worked with residents to assist them through the process. As a result, we maintained a very strong collection rate.
What three words, phrases, statements or mantras would you use to describe your work mindset? The three mantras that have always served me well are put in the work, always put your investors first and don’t fall in love with the real estate.
As a junior staffer at the White House, I learned that the best way to prove yourself was to stay focused and do the work. That is advice that I have given my children as they are close to graduating from college and thinking about their first professional jobs and junior people I talk to who are in the early stages of their careers. There is no substitute for staying focused and doing good work. That is the best way to learn and prove yourself. You are not going to move the up the ladder right away, so having the right expectation allows you to get the most out of those early training years and prove that you are someone people want to work alongside as you progress in your career.
During the Great Financial Crisis, I learned that if you always put your investors’ interests first, the company and the team will do just fine. I am not afraid to have hard conversations and be transparent and up front with our investors. Anytime in my career when I have had to have a tough investor conversation, I do so from a place that investors respect and appreciate because they know I am putting their interests first and that allows us to implement effective solutions and come out stronger.
From one of our smartest investors, I learned not to fall in love with the real estate. This is something I learned early in my career as an acquisitions person and something I tell our team regularly. You cannot fall in love with the real estate in a way that doesn’t allow you to look at the numbers and evaluate the deal objectively. Things come up during negotiations and during due diligence and you constantly have to be reevaluating to make sure the deal makes sense and not allow emotions or inertia to otherwise drive you into a deal.
