Signature Associates

Interview: Susan Harvey on the unexpected rewards of a real estate career

Susan Harvey never expected to get into the real estate business. She had studied criminal justice at Michigan State University and eventually planned to become a lawyer.  But in the meantime, she needed a job. She got one at a multifamily housing company in East Lansing, working in property management.  She liked it so much she’s been in the real estate business ever since.

“What started as just a job to make some money while I was figuring out what else I was going to do with my life turned into a career that I really enjoyed,” Harvey said.

Today, Harvey has 37 years of experience in real estate and has spent 24 years at Ashley Capital.

Ashley Capital has approximately 25 million square feet in its portfolio throughout the eastern half of the United States. The New-York based firm specializes in the redevelopment of large manufacturing facilities and new construction of distribution facilities. It is a large holder of industrial properties in Michigan.

Harvey works in the Canton Township office among about 30 other employees. She is responsible for all aspects of the Detroit operation including property management, leasing, land acquisitions and development.

Under her leadership, Ashley Capital has a number of notable developments in its portfolio, including the purchase of Hazel Park Raceway in 2018. Ashley Capital constructed two buildings on the site totaling 1.2 million square feet. Between the two buildings, the tenants include companies such as Amazon and LG Electronics. A third building totaling approximately 900,000 square feet is under way and was scheduled to be delivered at the end of 2020.

Last year, the firm made Crain’s list of top industrial leases in southeast Michigan 17 times. The firm held the number two spot for a 6-year deal with Penske Logistics, a wholly owned subsidiary of Penske Truck Leasing Co. Penske is leasing 590,141 square feet at Ashley Capital’s Livonia Distribution Center.

“One of the most fulfilling parts of my job is taking buildings that were sitting idle and being part of a team that transforms them into successful projects that increase the tax base in a community,” Harvey said. “Companies that lease space from us ultimately employ sometimes hundreds of people.”

What drew you to real estate?

When I took my first real estate job, it was certainly not a deliberate intent to get into real estate. I was 23, getting married and just needed a job. My first job was in multifamily real estate. It was a low income housing company. I ended up really enjoying it because of the constant problem-solving nature of the job. I found that I was able to improve the lives of the people that lived in the apartments that we rented out by cracking down really hard on activities that made it an inhospitable place for families. As somebody who wanted to go into criminal justice, constitutional law or civil rights, I’ve always had an inclination toward social service type work. To my surprise, those instincts could be satisfied in the environment of multifamily work.

Were there any early challenges you had to overcome in your career?

Almost always in my career I’ve been the only woman in the room. Industrial real estate is overwhelmingly dominated by men. The younger you are, the more there’s a presumption that you’re not a person of authority in a situation. It’s very common for the other men on the other side of the negotiation to look to my colleagues who are men for the answer or for the approval. They presume I’m there for some other purpose, like note-taking. My theory has always been not to worry about it. The last thing I’m going to do is go into a meeting with some sort of a chip on my shoulder like I have something to prove. Now, society’s certainly changing since I graduated from college. I think those presumptions are starting to finally fade.

What’s your average day-to-day like?

The only thing I’ll know for sure from day to day is that something I didn’t expect to be working on will come up. Maybe somebody calls me and says, “I have this great building I want you to look at” and before you know it I’m driving out to who knows where to look at a building. Honestly, just an incredible range of things. It’s all about problem solving. Then there’s all the challenges that go with maintaining the physical structure of a property: keeping them in good shape, getting tenants, maintaining really good relationships with tenants. Then there’s the legal work involved with leasing and doing the purchase and sale agreements. It really comes down to the fact that there’s no monotony. No two days are the same.

How do you make decisions regarding what real estate properties to pick?

Location is always important. We always want to get properties that are reasonably close to major expressways and interstates. You want the building to be able to be renovated and useful. What that means is in the distribution building business, you want to be able to put a lot of dock doors on a building. You want to have good clear height on a building. You want to be able to divide it up in ways that distribution tenants can use, which are usually nice rectangles. (Ashley Capital) also has to buy it at the right cost so that once you put millions and millions of dollars into the renovation, you can rent it out for a rental rate that’s competitive in that market.

Have you ever made any mistakes when it comes to investing in a property?

We’ve made the mistake of building a building too far from the expressway and it took forever to lease. Separately, when the economy was down, we should have only built one building and leased it up, but we went ahead and built two and sat on vacancy for a few years. That was pretty painful. The construction guys in my group are constantly improving on the details, from the fire suppression systems to how we design buildings. If you were to look back at all the buildings throughout the years, they could tell you how every single building was better than the last one. A lot of the learning comes from mistakes. Our successes and failures.

What’s a project you’re particularly proud of?

In 2007, we bought four and a half million square feet from Steelcase Inc. (a furniture designer and manufacturer) in Grand Rapids. It was an 18-building acquisition over 200 acres. The renovation and the rehabilitation of that campus was a ton of fun and a lot of hard work. The property was (powered) by a central coal-fired plant. That had to be dismantled and every building in the campus had to be fed with utilities. Every building was different, and we had to evaluate how to renovate each one to make it useful and marketable. It was a completely vacant complex and now there’s a couple thousand jobs there. (The complex now includes industrial and office tenants and is still the headquarters for Steelcase on a site adjacent to Ashley Capital’s property.)

How is the company adapting to the coronavirus crisis? How will you handle rent payments if your tenants are unable to pay?

We’re trying to be responsive to tenants whose businesses are being greatly impacted by this and who may need rent relief. To get rent relief, we have to work things out with the lender because we have a mortgage to pay. We have loan covenants and lending restrictions that vary from property to property. We don’t have a one-size-fits-all approach. Regardless, I think we’re adapting really well. We’re on lockdown, but I’m still working as many hours and as hard as I ever have. I’m trying to keep as many deals moving forward as we can. There’s still plenty to be done.

What advice do you have for women who are considering real estate development as a career option?

If you have the basic skills, temperament and personality you should definitely give it a try. There’s a lot of opportunity to have a really interesting career. There’s no boredom in it. The financial rewards are good enough that you should definitely consider it. Real estate is a huge category. In general, if you have a career like I have had, it’s been a wonderful career to be married and raise two daughters while still making it to all of their soccer matches, tennis matches and school plays. I think it’s a tremendous career option.

Posted By: Crain’s Detroit Business on April 12, 2020.  For more information, please click here to read the source article.

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