BIGGEST RISK with Richard Crouch

Commercial Real Estate Pro Network

J Darrin Gross

I'd like to ask you, Richard Crouch, what is the BIGGEST RISK?

Richard Crouch

I would say, and there are a few concepts within this, but I would say probably the biggest risk is not having the self awareness to recognize your own limitations. And what I mean by that is, there are a couple ways that this can play out. Certainly when transactional volume is humming along at a steady pace, commercial real estate attorneys are very busy. And this could probably apply to a number of professions. But sometimes the pace at which we must work, particularly with the mindset, the time kills, deals, and that's the mindset that we we live by. But sometimes that pace can preclude extensive deliberation on important sophisticated matters. And so I would say one of the ways to mitigate that risk is obviously you have to review every deal. on a case by case basis, no two deals are exactly the same. But you do need to have certain preventative measures in place to basically back check yourself, basically have certain things, whether they be templates, templates, checklists, and so on, where on every deal, although some issues will leak out more than others, that you're basically looking at every single issue, that could be an issue, and disclosing that to the client. And if the instruments or the language of the deal, address it, you tell the client, how they address it, if they don't address it, you reveal that to them as well. And that's something that, from a practice management standpoint, definitely improves the consistency and the reliability of our product and our clients ability to rely on that. Some of the other things in terms of just recognizing your own limitations is, you're only one person and you can't do it all yourself. Sometimes it's a function of physical time, you can't do it. Sometimes it's an issue of being cost effective. And using perhaps a, a less season but more affordable attorney on your team to help you review certain documents or prepare certain documents. So that's a that's a critical component, as well as basically being able to look at your team, surrounding yourself with people you trust. In fact, these may be people that in some aspects, they have strengths scenario there that are stronger than your own, and being able to rely on them, pinpoint their strengths, have them work well together, so that you have some redundancy on deals that increase basically responsiveness, the maintains the quality of the deal, and keeps you cost effective, as well. And also, and I guess the last thing, in terms of how limitations can be a risk is not being able to delegate when you should, and I know this dovetails maybe with the with the prior principles, but it does basically limit your bandwidth and your ability to expand your own business and your own practice by not being able to trust those that you've trained around you and grown around you to basically have the same the same skills that you've learned as well. So those those are the general risks. One that I encounter. And those are some things that over almost two, two dozen years of practicing, that we put in place to really mitigate those at least as an attorney.

Now for our clients, I would say probably the biggest risk is similar to what I was saying before is being too hasty. to land the deal, get the deal, finish the deal. Without properly properly documenting what happens when things go wrong?

I'd say that's probably the biggest issue. And sometimes we see this with less experienced syndicators is they're so eager to get the deal, they haven't really thought through how they're going to get it financed, or how they're going to raise the equity. And so oftentimes, there's a bit of a scramble there. So that's another thing where, in terms of being prospective, and forward looking, it's helpful to not lose sight of those and more important things, because without the equity and without the financing, it's it's definitely very difficult to actually get the deal done.

So there's some of the things that we basically highlight for our clients to be to be mindful of, and again, to just always be always be transparent and honest. And I say this quote, often that a, an honest man doesn't have to remember what he said. And I think that's very good. Good and very good tip for anybody who's particularly handling other people's money to live by.