When it comes to completing international transactions, tapping into a global network is a definite advantage. Through membership with the Society of Industrial and Office Realtors (SIOR), real estate professionals can form relationships across countries that ensure trustworthy contacts and efficient deals. John Huguenard, SIOR, international director, Industrial Capital Markets at JLL, and I recently discussed his global transaction experience, enhanced both by his employment by a global firm (JLL) and by his SIOR membership.
Q: How have you formed your international relationships, and what part does SIOR play?
John Huguenard, SIOR: When I started out in the Chicago Chapter of SIOR—outside of attending Chapter events and meeting other Chicago SIOR members—I attended the national and international conferences. You meet people from across the U.S. and many other countries at these events, and then you can begin to leverage those connections to complete transactions. When approaching global work, I leverage both my JLL and my SIOR networks.
Q: Can you tell us about an international deal you’ve completed with other SIOR members?
JH: Together with Gerardo Ramírez, SIOR, national director at JLL in Mexico, we brokered the sale of the Verde Northern Mexico Industrial Portfolio, a 5.7 million-square-feet portfolio of 35 properties in Juarez, Tijuana, Reynosa and Chihuahua, Mexico. The seller was based in Canada and the U.S., and the buyer was based in Chicago—thus involving three countries. Having a connection with an SIOR in Mexico was really helpful; we actually won an SIOR award for largest dollar volume transaction investment for this deal.
Q: How did that transaction differ from deals that occur only in the U.S.?
JH: The biggest difference between global deals and those completed exclusively in the U.S. is the timeline. From winning the project to the closing, the deal required almost a year to get done. The deal would probably have taken about 120 days in the U.S., by comparison.
You have to have patience to work globally. When there’s a global component, there’s more complexity, which takes time. The stringent approval process through the Mexican government takes more time than it would in the U.S. Getting debt lined up for the purchase was also trickier—there is only a select group of firms that will both buy and lend in Mexico. Finally, you can’t begin the due diligence process in Mexico until you sign the PSA. In the U.S., due diligence is made available before you choose a buyer or prior to a PSA being executed.
Q: You’ve been in the industry for nearly three decades, and in SIOR for two decades. What has changed the most about deal-making since you joined SIOR?
JH: Speed. Even though a transaction in Mexico still took longer to execute, the overall speed to market and speed of execution has increased over time on the investment side. I didn’t even have a computer when I started in this business, and now every piece of data I could need is accessible within moments. I love that.
Since joining SIOR, and as I’ve progressed in my career, I’ve become less reliant on local business and experienced more collaboration and execution due to my SIOR connections.
Q: What advice would you give to a young broker who is qualified to join SIOR?
JH: By getting involved, you’ll gain a bunch of peers who understand how to execute business, but it really boils down to the relationships. Even for those of us who have access to a global platform like JLL’s, there’s value to the qualified network of SIORs and the perspective that networking brings beyond your own firm—and within it. Attending conferences and connecting with brokers in other markets helps you gain an understanding of how other markets are doing relative to your market and the national economy, and you may learn something from them along the way. Deal-making always comes down to your reputation; finding a mentor through SIOR—like I did—helps you build and maintain a strong reputation both within your own firm, and in the global marketplace.
John Huguenard, SIOR, leads the Industrial Capital Markets practice within the Capital Markets Group of JLL. With more than 29 years of experience in the commercial real estate industry, John specializes in industrial investment sales for institutional and corporate clients as well as private owners of real estate.
About the Author
Daniel Smolensky, SIOR, is the immediate past-president and current membership chair of the Chicago Chapter of the Society of Industrial and Office Realtors (SIOR). He is also Founder and Principal of Taurus Modal Group. Based in Chicago’s River West Taurus Modal Group is a commercial real estate firm focused tenant-rep projects for office and industrial users – www.taurusmodal.com.
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