The Origin and Legacy of the Premier Name in New York Real Estate
On September 10, Robert Knakal started a new chapter in his legendary brokerage career in New York City as the Chairman of New York Investment Sales at JLL. Knakal started brokering in 1984 and has sold 1,866 properties over the course of these more than 34 years, with a market value in excess of $18 billion. Today, he sits with us to discuss that career, what he has learned, and how he has been so successful.
Where did you grow up? What was it like there?
I grew up in Maywood, NJ. It’s a small town in Bergen County situated between Hackensack and Paramus.
It was a typical suburban small town where everyone walked to school and rode their bike to the park to play ball after school. The fire department blew the fire whistle at 6 p.m. every evening and that was our signal to get home for dinner. The town was so small that we didn’t have a high school, so we all went to Hackensack High. We were a very tightknit group. In fact, I still have a group of about seven friends who I went to kindergarten with that still play poker together once or twice a year.
What type of ball did you play at the park?
We play just about everything. Basketball, football, and little league baseball. I really loved baseball growing up, and played all the way through college.
Where did you go to college, and what position did you play?
I went to the Wharton School at the University of Pennsylvania and I was a pitcher on the baseball team.
What was it like to live in Philadelphia?
I really enjoyed living in Philly. Coming from Maywood, Philadelphia seemed like an enormous city. But after living in New York City for only a year or so it became apparent that Philadelphia was not as big as I thought it was. I loved everything about Philadelphia, except for the local sports fans. As a lifelong New York Ranger fan, I once mistakenly wore a Rangers jersey to a Flyers game at the Philadelphia Spectrum during my freshman year. I was showered with beer before the game even started.
When did you develop your interest in real estate?
I wanted to be an investment banker when I headed to Wharton and wanted a summer job between freshman and sophomore year that would look good on my resume. I walked into a Coldwell Banker office thinking the place was a bank and they were the only ones hiring college kids for the summer. I took the job and loved it immediately and went back to work for them for my next two summers.
Was that in New York City?
No, the summer jobs were in Hackensack. I started with Coldwell Banker in Manhattan when I got out of school.
What did you like so much about the job that made you come back for subsequent summers?
The office was full of a bunch of young, hard-working people who seemed really happy and were making a lot of money. I tried to get to know as many of those people as possible and learn as much about the business as I could. I loved the fact that they got out of it what they put into it.
What did your dad do for a living?
My father was a high school principal. Fortunately, not the high school that I went to.
When did you meet Paul Massey?
I met Paul my very first day on the job, which was July 16, 1984. He had just started in sales after being in a one-year training program, and our boss told me to follow him around because he could show me where the coffee machine was. There were a ton of office leasing brokers there and three other people that were selling buildings at the time. All of them had over 20 years of experience. It became apparent that those folks were not going to spend a lot of time with us, so on day two we decided to work together as partners and split everything 50-50. It was a very informal start to what would be a partnership that would last over 30 years.
30 years is a long time. What was your partnership like?
It was great. I feel very lucky to have had Paul as my partner. I have probably shared 10,000 meals with him over the years. We are, and will always be, very close friends.
When did you and Paul start Massey Knakal, and when was it sold?
We started the company on November 15, 1988 and sold it to Cushman & Wakefield on December 31, 2014. It was a great experience, but it was extremely difficult, and we did go through some difficult times. We did far too many things by trial-and-error, causing us to make many mistakes. Fortunately, we did not make many of those mistakes more than once.
You sold the business for a reported $100 million. What were some of those difficult times?
Well, we almost went bankrupt three times over the course of those 26 years. The investment sales market in New York City is always cyclical, and when that cycle is headed downward it creates challenging times for a service business. For 23 of those 26 years, we only did building sales. As a one-trick pony, we were very dependent upon sales volumes in the market.
When your contract was up at Cushman & Wakefield, you decided to go to JLL and not start another company. Did you consider starting another firm of your own?
Not really. I considered it very briefly, just as I considered all of my options, including staying at C&W—but starting another firm was not of interest to me. Starting a business requires a lot of administrative work and management, and I realized that my strengths and my passion are in selling. I feel lucky that I am still as passionate about this industry as I was the day I started. I love the brokerage business.
Why did you choose JLL?
There were three main reasons. The first was the JLL brand, which is simply outstanding, and the global coverage the company has affords me several advantages. I now have better access to capital across the globe than I ever have before in my career, which is going to help me get more offers on properties and better prices for my clients who are selling buildings. The second is the culture of the firm, which promotes transparency and communication, both of which I think are essential for people to achieve their best results possible. And third is the fact that the company has the best technology I have seen and remains committed to investing in, and enhancing, its suite of technology offerings.
Paul started a new company and another of your former Massey Knakal partners, James Nelson, has started the investment sales group at Avison Young. Do you think there is too much competition in the investment sales space today?
I think when it comes to competition there are two perspectives that you can have. The first is that it is a zero sum game where every piece of business that someone else gets is one that you don’t. The other is that, particularly in New York City, there is more than enough to go around for everybody. There are about 165,000 investment properties in New York, and in an average year there are about 3,800 sales. In some years, this total can be over 5,000. Under these circumstances, you can easily be friendly competitors. There is clearly enough to go around for everybody, and I wish Paul and James great success in their new businesses. Everyone wants to get into investment sales today. It is a great business, and the economics can be very compelling.
The brokerage business seems to be very cutthroat. Are you friendly with investment sales brokers at other firms?
Yes. Because of the nature of co-broking on the sales side of the business, we work together quite a bit. I am friendly with Darcy Stacom and Bill Shanahan at CBRE; Ronnie Cohen, Richie Baxter, and Scott Latham at Colliers; Woody Heller at Savills; Will Silverman at Hodges; Peter Hauspurg and Brian Ezratty, formerly of Eastern; Aaron Jungreis at Rosewood; David Schechtman at Meridian, and several other brokers. I appreciate my relationships and friendships with these folks.
Most market watchers believe you have brokered the sale of more buildings than any other single broker in New York City. Why do you think you have been so successful in your brokerage career?
Well, in this business you are only as good as your last transaction, so I realize that the transaction I’m currently working on is the most important one. Having a great track record is helpful to get in the door but doesn’t ensure success in terms of getting the next transaction done. The track record allows you to use your experience to help you overcome objections and utilize negotiating tactics you have seen and used in the past. Those things help you get that next deal done. Discipline has also been a big part of it. Knowing what to do is not the most important thing. Actually doing what you know you should be doing is the key. A lot of this discipline revolves around time management, planning, setting goals, and being proactive. In this business it is way too easy to simply react to things all day long. Being proactive allows you to get where you want to go. Additionally, my support group of core professionals has been with me for a long time. Led by my partner, Jon Hageman, I could never do what I do without the hard work of all of them.
What instills the sense of discipline that you have?
It is so easy to get pulled in so many directions, so a big part of being disciplined for me is working with a coach to help keep me on track. For over seven years now I have worked with Rod Santomassimo of the Massimo Group and will probably work with him for the rest of my career. Rod makes sure that I am continually forming goals, creating comprehensive plans, and, most importantly, sticking to those plans.
It’s surprising that you would begin using your coach after already having so much experience. What convinced you to try coaching?
I got to know Rod when he was writing his book, Brokers Who Dominate, about top brokers in North America. We did several phone interviews, and I got around to asking him about himself. When he told me he was a broker coach, I had never heard of that before—I didn’t know coaches for brokers even existed. After thinking about it, I realized that professional athletes and even Olympians all have coaches, so I figured I would give it a try. It’s the best thing I’ve ever done for my business.
Are you concerned that technology is a threat to the brokerage business?
I think technology has the potential to change almost everything about so many industries. Commercial real estate, and specifically the brokerage business, is not immune to this reality because it is an analog business in a digital world. The good news is that buildings are not widgets, and because of that I believe there will always be a human element needed in the process. There are some functionalities that technology can replace in the brokerage process that will somewhat marginalize the broker, but I don’t believe that brokers will ever be fully replaced by technology.
So do you view technology as a negative thing?
Not at all. Technology has enabled me to do more and sell more than I would have been able to without it. When I started in 1984 there were no computers on our desks, no cell phones, and no fax machines, so the pace of business was much slower. Interestingly, however, more buildings were sold in the 1980s than in the 1990s, and more in the 90s then in the first decade of this century. Therefore, if trends continue, there will be fewer buildings sold this decade than the last. Technology is empowering people to do more individually, but it is not creating more commerce in a macro sense.
I’ve heard you say that you will never retire. Do you really feel that way?
As I’ve said, I love what I do. I hope to keep doing this for a very long time.