SNAPSHOT

The Manager: Ralph Holland
The job: Partner, head of project department covering office and retail leasing services at Forton International. While at Cushman & Wakefield, the world’s largest private real estate advisory firm, Holland has consulted for companies such as Cisco Systems, Lucent Technologies, Gartner Group, Ford, Jaguar, Land Rover, Renault, Lovells, British Airways.
In brief: Forton International JSCo is the commercial real estate spin-off of universal estate agent AG Capital, formerly Address Group. The company offers a full range of services related to commercial real estate.
Forton, operating as an independent company since last year, operates as an associate office of Cushman & Wakefield.

Such mentality is frequently the winning pick, especially in trying situations and no matter the whims of circumstances.

And such unexpected passions are not much of a novelty to Ralph Holland, a former partner of world’s largest private real estate advisory company Cushman & Wakefield (C&W) and a partner at commercial real estate company Forton International. One of many of these unexpected passions turned out to be olive trees. When buying a home in the outskirts of Rome he, by chance, got an entire garden as one of those unexpected “adds-on”. Only later he learned the trees were as fickle and predicated on competent care as to yield no harvest one year and a bonanza the other.

“Olive growing does take some patience,” Holland says, adding that he was pressing his first olive oil this November, after three years of work.

As if success came – he recalls – after he grew passionate about them through training from his gardener and continual learning about olive varieties, the olive business in Italy and worldwide, its history and potential for the future.

Silver rush
And another unexpected passion turned out to be his professional experience in Bulgaria. When four years ago Holland, as an executive working at C&W, met Hristo Iliev, the CEO of Address Group, at the world’s largest real estate convention in Cannes, France, and received what seemed the irresistible offer to develop the commercial real estate spin-off of Address, he had his second thoughts.

Yet on learning that the newly set-up entity had struck a big-size deal for a US pharmaceutical giant in Bulgaria and, therefore, it was as good as to be the associate partner of his then-employer C&W, he took up the challenge.

Ever since he has been working in that difficult market whose boom he depicted as the “silver rush”. When he arrived in Bulgaria, to him this market was just as unexplored as to fortune seekers the lands of the “golden” are. With the market and the newly-born company yet to live through to maturity, it was the passion-building mentality that kept him on board.

As a true Brit that abides by strict rules in doing business, to the principle that preparation saves time as do agendas, their occasional lack thereof has been a trying experience, Holland admits.

Emerging? That’s my fate.
Yet his background in working in emerging markets has been immense and rough times appear to have grown his customary playing field (though he recognises that as he matures he increasingly clings to career prospects in mature markets).

In the late 1990s, Holland was among the first to join the Moscow office of Healey & Baker (H&B), the UK company with a century-old history, later acquired by C&W. Then he witnessed the financial crunch in Russia and then, H&B withdrew. Holland, however, returned in 1999-2000 again as a consultant of C&W, who had decided to venture into this vast market yet again. The strategy of C&W has paid off and now the Moscow office employs 300 individuals, a multi-fold increase to the 15 staff at the outset.

The same was valid for Italy, where C&W has had an office for 15 years now. While to many it might seem surprising, Italy – the macro-economically developed country – and Rome, in particular, was an emerging market in terms of commercial real estate. Holland explained that because of the very fact that Rome was an ancient capital and its subterranean layers suffused with remains, construction of office and retail centres alike had almost stalled because of the extremely cautious policy on building permits.

While the market has taken off ever since, the city administration still runs into this problem. The past summer, Holland recalls of his birthday trip to the city, the digging works for a car park ran into an ancient aqueduct. But as ancient it was, it supplied water to the city fountains. Thus, the car park project ran all Rome fountains dry amid a sultry summer.

This story, replicated time and over again, is a lesson of others’ to tell to Bulgaria, according to Holland. Abuzz with construction projects, Bulgaria’s government, ministry of regional development and municipalities should beware of issuing building permits quickly.

“It’s very important to the sustainable development of Sofia, the other cities, nationwide that municipalities, planning authorities don’t give out permits or re-zone land as easy as some people would like them to, then there would be chaos,” Holland says.

Remains being Rome’s concern, Bulgaria’s is the fact that many projects are not properly thought out or lack the proper design or financing scheme.

“I keep tripping and breaking my ankles on pavements off bright and shining shopping centres,” Holland says of projects with no adjoining infrastructure as part of the plan. “These should all be part of the basics to fall back on in commercial real estate business practice.”

C&W associated office network
And being knowledgeable of the basics distinguishes professionals from beginners. The new ambition of Forton’s being to be recognised as “professionals” as against “brokers” is Holland’s hope for the entire, already “emerged” commercial real estate market in Bulgaria.

The professional streak in Forton has already been created through its association with C&W. While in Moscow, Holland joined the team to mastermind the associate office network idea. The initiative was fundamental to C&W as it coined its strategy for global expansion.

“The associate office network was set up to cover markets that are either too small (Norway), legislatively difficult to operate in (Switzerland) or are still emerging (Turkey, Bulgaria),” Holland says.

To Forton this means big business: C&W refers all its international clients with plans to set foot in Bulgaria to Forton. As does know-how into handling big-size transactions, structuring the business itself and communication with authorities.

Business in transition
And Forton continues its metamorphosis into a company made up of professionals and catering to such. As it has been re-organising its corporate structure to address various segments within the commercial real estate sector and the available services thereof, Holland is now head of the office leasing department.

Concentrating on the specifics of his own department, he says that a team to fine-tune practices for leasing office space is in the making.

“[With this team] we should be designing rockets and not leasing offices,” he said with the playful wink of a person proud of the academic talent around him. “But in this field you need to be that good. Though not intellectuals but business people knowledge helps strike deals.”

His team alone has 15 university degrees. Holland himself has a master’s degree from University College, London in Russian politics, foreign policy and history and another in European real estate.

And education gets the professional tinge while at the company. Himself a member of the Royal Institution of Chartered Surveyors (RICS), Holland will soon have two more people from his team join the UK institution’s list.

Specialisation, according to Holland, should guide the choice of professional training. While the retail team should gain certification from the International Shopping Council and the investment specialists gain the US Certified Commercial Investment Member (CCIM) designation, Holland argues.

Balance, balance, balance
The drive for professionalism does not stop here. The company has been busy restructuring into that seamless and versatile operational entity that could safeguard it against market crises. According to Holland, crises in the real estate sector occur everywhere, his homeland, the UK, included. “Crises occur on a regular or cyclical basis,” Holland said.

He recalled of the crises in the 1970s and the 1980s, when the UK real estate business went on the radical downturn because of oversupply and the respective decline in rental values. Holland also gave examples of the reverse when the market would overheat and push rental values up.

He would not rule out such a scenario for Bulgaria. Therefore, it would be wise for any market player in the “silver rush” Bulgarian market to hedge against a crunch.

Within this context, to balance the business and have all core departments enjoying paramount development was of prime importance.

As paradoxical as it may seem, Holland believes that the catalyst for growth of the commercial real estate market could be a crisis. It would trigger the market player sift-through to the neater and mature market. In a market dealing with large-scale commercial real estate transactions, Holland believes there is room for maximum of five or six players. He named C&W, DTZ and Colliers among the major players. He expects two more European-wide players to join the market in the near future, which are also likely to team up with local companies.

And Forton prepares to stay and operate well in such an environment.

“You can’t put all your eggs in one basket,” Holland says, adding that cyclical nature of the market predisposed toward a variegated spread as the corporate anti-crisis “cushion”.

While now the retail department, dealing with the purchase, sale and leasing of retail space, was living its heyday this year, Holland’s office leasing department was preparing to scoop the bulk of revenues the next. The roller coaster market curve of the individual segments would, thus, even out once assembled into one. This is what the idea of the balance is, according to the expert.

Among the retail department’s portfolio highlights this year is the forward sale of ISU’s Mall of Varna to UK-based Miller Developments.

“[Forton’s retail team has] leased and advised on the forward sale of ISU’s Mall of Varna to UK based Miller Developments and have exclusive mandates to advise on shopping centres in a further six Bulgarian cities and one in the pipeline in Serbia,” Holland says.

Holland’s prime task at present is the Sofia Airport Centre, whose developer is Tishman International. It will be built after the Business Park in Prague and will be built with the support of the same experts.

“On delivery, [this first international grade business park] will change the shape of Bulgaria’s office market,” Holland says.

What about real estate legislation? Is there any?
The changing shape of the local commercial real estate market predicates changes at all levels, changes to legislation included. Responding to the question, he said that Bulgaria was yet to have  clear-cut landlord-leasehold rules. At present, all tenancy agreements were carried out after the Law on Contracts.

He gave the UK as an example. Under its 1994 Leasehold Contract Act, such contracts can be signed for 25 years and are subject to review once every five years. France and Germany also had such pieces of legislation and Holland argues that Bulgaria would shortly follow suit in passing such legislation as the commercial leasing market matures.

Schools Around the World
Holland’s forward-looking thinking is not single-minded. Investing into the future of children is in Holland’s mind when thinking about Forton as a socially responsible business.

“If the butcher, baker and the candlestick pursue a profit for their own selfish ends to feed their own families, then this does create good for the society as they pay taxes,” Holland says. “In itself, selfish pursuit of profit is good. However, I do think firms should invest in their own society.”

In this vein, Holland’s preferred corporate social responsibility of choice is investment into children’s education.

He recalled of the C&W’s Schools Around the World initiative  (http://www.cushmanwakefield.com/satw/) and of his own involvement in it through the adoption of a UK primary school, Lilly & Bailey in London. Then C&W adopted a school with multi-ethnic children, whose parents would be single or with problematic backgrounds.

“Some of these students now attend high school. The teachers also have the ambition that these students will go to the university,” Holland says.

The same initiative is also at the preparatory stage in Bulgaria. With two other colleagues from the retail and office departments, Holland has carried out several meetings on “Bulgarian school adoption”. He hopes the idea will turn into reality shortly as this is yet another idea he is passionate about.

Being passionate is in Holland’s blood. And Holland is passionate about colouring the “olive shades” he’s learned to mix right with the years into Forton’s business palette.