Dave Wallace smiles ruefully. Over the past year, he laments, his golf handicap has suffered to the tune of six points, a consequence of the time he has stolen from an avocation avidly pursued in the past to build the New York State Association of Commercial Realtors.
Owner of Rochester’s Re/Max First and NYSCAR’s first president, Wallace has spent much of the last year consulting with a dozen or so like-minded commercial brokers from around the state as well as with officials of the Albany-based New York Association of Realtors Inc. to plan the new group’s launch last month.
The fledgling NYSCAR is New York’s first professional organization devoted solely to commercial real estate sales. Wallace, its guiding genius, hopes to attract 400 to 600 commercial brokers and others–such as real estate lawyers, and building managers and owners–to its ranks this year.
A mid-life convert to the profession himself, Wallace sometimes speaks with a convert’s fervor of the need for commercial brokers to have a group of their own.
Commercial work is enough unlike residential real estate so as to constitute a separate profession, he says, ticking off the ways in which it differs.
Commercial deals are more complicated. They require more detailed business knowledge. Negotiations are trickier. Deals typically take twice as long to close as residential ones.
Yet, Wallace says, commercial brokers for years have had to fit themselves into professional groups designed mainly for residential realty.
Twenty-three groups like NYSCAR, known as commercial overlay boards, have been established in other states since 1991. Like NYSCAR, all were organized under the umbrella of NYSAR’s parent, the National Association of Realtors Inc.
Such Realtor organizations were first established in the early part of this century, and since have become so identified with the profession that the very name Realtor now is in popular use as a generic denoting brokers and agents.
The vast majority of residential brokers and agents are members of statewide Realtor groups such as NYSAR, which in turn are organized into local real estate boards such as the Greater Rochester Association of Realtors Inc.
At the same time, Wallace says, a large segment of the commercial community, seeing little that applies specifically to them in Realtor groups, are not affiliated with any professional organization. The unaffiliated commercial brokers and agents are one of his main targets for NYSCAR membership.
Like its parent, NYSCAR will provide a mix of benefits to lure members, Wallace says. The commercial group is setting up a computerized property listing system similar to NYSAR’s Multiple Listing Service, for example.
He also hopes NYSCAR will be a vehicle through which the commercial realty community will self-regulate, bringing itself to a higher set of professional norms. Realtor groups, for instance, have been instrumental in setting up agency disclosure rules in New York and other states. Such rules demand that agents tell prospects they are working for the seller and thus are bound to do what is in the seller’s best interests.
While New York’s regulations demand such revelations of commercial and residential agents alike, only residential agents have to put them in writing. Wallace thinks commercial specialists likewise should have to put their disclosures on paper.
In an article he wrote last year for a professional journal advocating the change, he states three reasons for tightening commercial disclosure rules: “It’s the law. It’s the law. It’s the law.”
That Wallace would be an activist for such disclosure is not surprising since he specializes in tenant/buyer representation. While buyers’ agents over the past few years have become increasingly common in residential realty, buyer/tenant agents in commercial sales still are a relative rarity.
“I don’t know of any others, at least not in the Rochester area,” says Thomas Schnorr, owner of the Re/Max Wharton residential brokerage and a partner in Wallace’s Re/Max First. The two agencies share a Pittsford office suite, but Schnorr says he limits his involvement in the commercial firm to administration.
Wallace’s concentration on developing a niche market in commercial buyer/tenant agency enabled his partner to take the commercial brokerage from a standing start in 1992 to a position of prominence. The agency ranked fourth among the area’s leading commercial brokerages on the Rochester Business Journal’s 1995 list.
Wallace says the specialty grew out of his own pre-broker life as a not-always-successful real estate investor.
“I think my own experience gives me a perspective that can be really helpful to investors,” he adds.
Wallace, 48, took up commercial real estate only six years ago, when he was at the tail end of a self-described mid-life crisis. His real estate experience, however, stretches back to the 1970s.
A native of the Thousand Islands region, Wallace in 1969 graduated from Clarkson College in Potsdam with a bachelor’s degree in industrial management.
After two years of active duty as a U.S. Army captain serving in Washington state and Korea in fulfillment of his college ROTC obligation, he landed a sales job with the American Can Co. in Fairport. A year later Wallace moved to a position with Kraft Foods Inc. in Rochester.
In 1976, he moved again to the Pittsburgh-based All-Pack Inc., where he rose to manage the firm’s New York state sales operations before leaving in 1987.
At that point, Wallace says, he was taking stock of his life and career.
“I was successful to a point at All-Pack, but it wasn’t fulfilling,” he recalls. “I enjoyed real estate, and I started to think it was time for a career change.”
Part of Wallace’s dissatisfaction with his first career path concerned the amount of out-of-town travel it demanded. He had married his present wife, Ann, in 1979. By 1987, the couple were parents of three children–daughters now 14 and 12, and a son now 10. The job, he says, was cutting into his family time.
While he was rising in the world of packaging sales, Wallace was building a parallel career as a real estate investor, and doing pretty well at it.
Through the early and mid-1980s, he bought and sold residential properties in the Park Avenue area. Wallace got out of that market just before it crashed in 1986, when federal tax-law changes cooled what had been a super-heated real estate market.
In 1985, he and a partner invested in 150 high-end residential units in the Syracuse area. After the 1986 tax-law rewrite, Wallace bought his partner out, and spent the next three years liquidating the investment.
His next venture, a Utica-area motel and fine-dining restaurant complex, Wallace now says, was his biggest mistake.
“I didn’t really know anything about that business. I was trying to manage the thing long distance, and financially it was not doing that well. I don’t know what I was thinking,” he says, throwing up his hands. “I guess it was my mid-life crisis.”
During this period, Wallace, at the urging of his wife–now a counselor at Rochester’s Career Development Services and then a board member of the agency’s precursor, the Women’s Career Center–consulted with a Women’s Career Center counselor. A battery of aptitude tests, he says, showed him to be ideally suited for either of two careers–army officer or commercial real estate sales. He picked real estate.
It took Wallace a year to extricate himself, at a loss, from the Utica venture. After getting his feet wet in commercial realty working with a Syracuse-area commercial broker, he started working for Schnorr in 1990.
Wallace calls his start in the business “slow.” It took him months to close his first deal, he says, and two years to get comfortable in his new profession.
Schnorr tempers his partner’s self-deprecation.
“Dave had a tough start,” he concedes.
But Wallace, Schnorr adds, entered the business during one of its slowest periods, a time when the office market was at a standstill and new commercial construction was virtually unheard of.
“In all, he’s done extremely well, and in a large part because he’s focused on a badly needed specialty. Having been an investor, Dave has a unique knowledge, and he’s used that very creatively.”
As to Wallace’s more recent role as an organizer and industry crusader, Schnorr also approves. Because there are far fewer commercial specialists, that branch of realty has been more professionally fragmented than residential. The statewide overlay board, he believes, will pull it together.
Wallace, who enters on his presidency of the newly formed organization as outgoing 1995 president of NYSAR’s Commercial and Investment division, hints that his organizing career could be in hiatus as of 1997.
“I don’t know,” he says, sighing. “Maybe I could get my golf game back in shape.”