Merging with another company is as much about the individuals as it is about the assets, said BioMed Realty Trust’s president.
“If we acquired the assets and all the people walked out the door the next day, it would have been an enormous failure,” Kent Griffin said.
Griffin discussed “Real estate done really well” with Dan Broderick, president of Cassidy Turley San Diego and Mark Riedy, executive director of the University of San Diego’s Burnham-Moores Center for Real Estate, at a meeting hosted by ACG San Diego on Tuesday.
Griffin discussed BioMed Realty Trust’s merger with Wexford Science & Technology LLC, a subsidiary of Wexford Equities LLC, which was completed in March 2013. The acquisition was closed earlier than anticipated due to cultural alignment — and 30 of the 31 employees they gained remain on the team.
“We felt very good about the cultural fit,” Griffin said. The two companies had known each other individually for years and had different levels of dialogue. There was an effort upfront to explore the common vision to ensure a strong cultural fit, he said.
Before signing on the final dotted line of the agreement, BioMed Realty Trust (NYSE: BMR) employees met with each of the universities that Wexford served to ensure that the universities saw the value of a combined platform, Griffin said.
“They valued the relationships and wanted to make sure they would still be dealing with the same teammates,” Griffin said. He explained that it was a merger and not just an acquisition of assets — BioMed Realty Trust was committed to bringing the team in and added its balance sheet to provide more staying power than Wexford would have had on its own.
Cassidy Turley has grown from 180 people to 4,000 through acquisitions, Broderick said. Legacy companies built cultures in respective markets over many decades, he said, and added that it’s important in service-oriented businesses to have a strong, healthy culture.
“It can make or break success,” Broderick said. “It takes forever to build a culture and it can very easily be broken. It’s a fragile animal.”
When he first joined Cassidy Turley in 2011, he had to figure out what the culture was — and he did that by connecting with people in the field, putting out surveys and soliciting information for feedback.
He said it comes down to “communication, communication, communication.”
“The old lesson is you have to communicate seven times before people actually listen,” Broderick said. He added that he sometimes feels like a broken record — and he measures that culture is working when he finally hears the message back to him. “When you don’t hear it, no one is talking about it — then it’s not working.”
It was important for Griffin to understand Wexford’s culture and verify it was as it appeared, he said. And the reverse was also true — Wexford’s management team had been exploring other opportunities to merge and was vetting who would be a cultural fit for them and their business.
BioMed Realty Trust and Wexford had a shared vision for the space, they saw opportunities similarly and were excited about the opportunity, Griffin said.
Through meeting with the universities, Wexford was able to see that BioMed Realty thinks about the business, not just the current lease or transaction, Griffin said, and is more long-term relationship oriented than short-term transactional.
“Having a common vision -- that’s the first step to having a strong cultural fit,” Griffin said. “Understand how you do business and how you don’t do business -- it’s only tested bit by bit, and relationship by relationship, and experience by experience.”
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July 1, 2013 -- George Chamberlin speaks with Mark Riedy, executive director at the Burnham-Moores Center for Real Estate at the University of San Diego, and Nick Norris, a U.S. Navy SEAL who recently completed a real estate graduate program at USD. Riedy has helped develop a program at USD to help military members transition to the civilian workforce.
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Jan. 14, 2011 -- Executive Editor George Chamberlin speaks with Mark Riedy, executive director of the Burnham-Moores Center for Real Estate, about the state of San Diego's commercial real estate market.