Mark Ordover, Active International

Mark Ordover

Real Estate Services

Editors' Note

Mark Ordover has been with Active for 18 years. He is currently responsible for two aspects of Active’s business: sales and global real estate. Prior to joining the firm in 1992, he was in the Investment Banking Division of Bankers Trust. He received his M.B.A. from Columbia Business School.

How did the real estate part of the business develop, and how do you define the overall services you provide?

Active’s real estate business was formally developed less than 10 years ago based on the needs of our clients. With a keen understanding of their needs, we were able to design a solution that has worked very well and has grown considerably.

In 2004, we put a concentrated focus on the real estate business by joining our senior trade professionals with real estate professionals to create a best-in-class service. This allowed us to focus our resources on marketing our service to our current client base as well as to our prospect base. We did a fairly good job of penetrating certain sectors, one of them being the retail space.

Since then, we have executed retail real estate deals in some shape or form with companies like The Kroger Company, Toys “R” Us, Ace Hardware, and Home Depot, where we either bought undeveloped raw land, manufacturing facilities, office buildings, out-parcels, or big box locations. That sector has been a significant factor in propelling our business forward.

In terms of our evolution, with the 2008 financial distress and capital for all types of transactions drying up in the marketplace, buyers and sellers had a big dislocation on pricing, so we were able to further represent our business and complete more transactions.

As a result of the financial crisis, are new opportunities continuing to appear or has the real estate market stabilized?

Lenders are still cautious about putting their capital to work until they are comfortable that their balance sheets are going to withstand further cyclical issues, including a potential double-dip recession.

That said, there is a lot of private money sitting on the sidelines, waiting to get back into the real estate sector.

Given the current economic environment, there are tremendous opportunities for us to use our own capital, whether it’s in the form of long-term media commitments or in the form of cash, to help create solutions for our customers.

For example, we are working with a new prospect that wants to test a new concept store but has been having difficulty getting internal commitment for the resources they need. We’re discussing Active purchasing the land and building out the new concept store using our capital. We would make the property investment and then lease it back to them. This is a great solution for them, because Active will put its own capital at risk in the transaction and they will pay for it through their existing media expenditures with Active. If we can make this happen, we can roll it out to a whole sector of that marketplace where there are many companies looking to do the same thing.

Finally, we have done a number of very large transactions that have required us to go A to Z in terms of handling issues such as environmental analysis, entitlements, auction process, and disposal of assets, which provides a tremendous benefit to the corporations we work with in that they don’t have to employ their own resources to do it.