Industry Insight Q&A with Matthews™ Vice President Jake Baratz

     1. How did you start your career in CRE brokerage?

I grew up interning for my father on the floor of the Chicago Stock Exchange and always knew I wanted to leverage my financial background and communication skills to work in the Finance and Sales world. When I graduated from the University of Arizona, I started working for one of the country’s most active net lease investment teams at Marcus & Millichap.

    2. What trends are you predicting in net lease retail for 2023?

We’re starting to experience some of the more opportunistic single-tenant buyers shifting their focus from freestanding single tenant net lease (STNL) assets into multi-tenant, PAD-style deals. These multi-tenant assets offer investors many of the same benefits of STNL deals – with long-term leases & strong credit profiles. But the assets often have stronger cash flow and some value-add potential through rental growth or lease-up. They are an excellent option for the traditional single tenant investor looking to maintain yield right now.

     3. What advice are you giving buyers and sellers to navigate the current market?

So, we’ve definitely experienced a slowdown in the net lease retail market in the face of rising interest rates over the last few months. In saying that, there are still plenty of transactions happening, particularly in high-growth markets like Phoenix, where we have tremendous population and economic growth and have become a destination for tourism and world-class events like the Super Bowl and Phoenix Open. We expect that this positive growth and attention on Phoenix will continue to generate investment activity and offer positive returns to investors from all over the country who park their capital in Phoenix during this period of uncertainty.

We’re recommending that all of our clients use this period to connect with a trusted real estate advisor. Now is the time to evaluate and analyze the status of their current portfolio and any opportunities to buy new assets or position their existing assets for recapitalization based on changes in the current market relative to what we’ve experienced in the last few years.

     4. What top three skills have you learned throughout your real estate career that helped you be where you are today?

The three most important skills I have learned during my career are strong communication skills – the foundation of building meaningful relationships with clients and understanding their real estate needs, shrewd negotiation skills, and my market expertise, an essential piece in speaking confidently to clients.

     5. What would you categorize as a defining moment in your commercial real estate career?

The defining moment in my real estate career is honestly joining Matthews. After a decade in the business, I have been a part of more than $2B in transactional volume, and combining my personal track record with the Matthews platform has proven to be an essential step in my career growth.

     6. What advice would you give young or new agents as they start their careers?

My biggest advice to young agents would be to stay genuine to who you are – I have found that most young agents tend to represent themselves as something other than themselves. Focus on becoming a true professional, understanding your market and becoming a valuable part of your client’s business, while still being true to who you are. The relationships and businesses will build themselves.

      7. What experiences, setbacks, or challenges have been the most instrumental to your growth?

As is true with any sales job, failures are really just learning opportunities, and we try to focus on where we can improve every step of the way. Over the course of the last decade, there have been plenty of deals that didn’t cross the finish line or listings won by other brokers. Still, every one of them has proven to be a true learning experience that has made me a better broker and further improved my understanding of the business.

      8. How have you built successful relationships in the industry?

The most important part of building successful relationships for me is being a true advisor and trying to understand our clients’ sensitivities to offer the best solutions. It’s also imperative that I am always genuine and upfront with my clients, a crucial step in effectively communicating throughout the entire sales cycle.

      9. Is there anything else you would like to add regarding the current state of net lease retail?

Definitely, even though the current state and short-term outlook for the market are in a different place than where we were just 6-9 months ago, the net lease market isn’t as much “doom and gloom” as many people would make you think – particularly here in the Phoenix MSA, there are still plenty of active buyers and transactions are still happening. Now is an excellent time to sit down with a trusted real estate advisor to understand how a changing market has affected your portfolio’s value and work on how to best position yourself for the next few years.