By THERESA TORSETH
The Human Factor, we will explore the people side of real estate. Through a series of interviews with CRE industry leaders conducted by 20-year executive search veteran Theresa Torseth, you will hear how its people—their values, culture and ideas—shape companies and successes.
Pat Callahan, CEO of Urban Renaissance Group and Touchstone, starts off the series by talking about the values he put in place from day one, and the single most important attribute to which he contributes URG’s success.
Theresa Torseth:
When most people think of Urban Renaissance Group, they think of real estate assets. Let’s talk today about URG’s human assets. Did you consciously put certain values or cultural elements into place at the start, or did they emerge over time?
Pat Callahan:
We’ve been intentional from the beginning about defining our culture. One of the best things about founding a company is that you get to write the values statement in the beginning, and we’ve been consistent with those values.
The first and most important value is integrity. That’s been at the forefront of everything in our culture. There are four values that we created and have relied on from the beginning, and they boil down to: integrity, respect, place and prosperity.
Those four things really pull our company together, and we recruit and retain based on those things. As we became larger, it was easier to focus heavily on values, skills and potential, because we now have the capacity to deploy extensive learning and development in the right people. But you can’t train values and initiative. People have it or they don’t. Our focus on being intentional about culture has increased over the last ten years since we started. As you grow, it’s important to preserve that.
Theresa Torseth:
Now that you have your core people in place who can help train skills in others, how do you actually vet people to ensure you’re hiring those who share your values?
Pat Callahan:
Well it’s certainly more than the interview process. It’s checking references, maybe skills testing, looking at a person’s body of work. In today’s world, the stuff you’ve done in your career is pretty visible. What have you done within those companies?
But it’s not easy to hire. I think it’s one of the most difficult things. Our approach is to have people interview with a lot of different folks within our company, and maybe put a little pressure on them in the interview to articulate what they’re all about. But it’s hard. Unlike ten years ago, we actually have a human resources function that screens people and develops a queue, or “interview loop.” It can be a long process, but we take it seriously.
Frankly a lot of our recruiting is word of mouth, which begins with our own employees who articulate how much they enjoy working at URG or Touchstone. Nobody knows what it takes to be successful at URG better than our own people. Nobody knows what it feels like to be a part of this work family better than they do.
Theresa Torseth:
When you’re interviewing, is there a specific question that you like to ask that really helps to get down to that item of integrity or initiative?
Pat Callahan:
I think those things are best sorted out by open-ended questions and seeing where the person interviewing takes them. It is really not being too specific necessarily in your questions in that context, but allowing the person to speak a little bit. We want to hire the whole person, not just their basic ability.
Theresa Torseth:
Once on board, is there a way that you consciously spur that sense of initiative within your team?
Pat Callahan:
There are a couple elements. One, we allow all of our team members to challenge the status quo. Part of our value of respect is that we’re allowed to debate the results. We’re allowed to debate the process of achieving those results and that’s empowering. If someone can tell me, “Hey Pat, I think we should do this a different way going forward,” and they feel completely comfortable in arguing for it, that inherently encourages initiative. I think we’re all aware of companies that are very authoritative-based where things like that don’t happen.
Another way that we encourage initiative is that we focus more on the results than the process, meaning people can make some choices on how they accomplish a task. There are certain routine matters for which we have clearly defined procedures, but for less routine items, we let people follow their path to the results that we’re trying to achieve. You can’t do that without a profound level of trust and respect. Procedure doesn’t nurture culture, but trust and respect certainly do.
Theresa Torseth:
Policies and procedures are easier to mandate and duplicate than culture, especially when people are farther away, and you don’t have daily contact with them. How do you see keeping that same culture as your company continues to expand geographically?
Pat Callahan:
First, for the routine matters, it is important to have procedures that are freeing to people.
We should be able to manage those routine things very efficiently. That allows people the time, then, to think about the non-routine opportunities that might be out there. If you’re not wasting a lot of time on routine stuff, you have more time to take initiative.
Secondly, keeping the cultural aspects alive still means we have a lot of in-person contact. Given our size—160 people now—we can still do that. We have an office in Denver, and it’s a relatively small office right now, but we travel there often. And it’s not just me; it’s multiple members of the team traveling there and visa versa. Last time I was there, we included an evening out. That creates a mutual connection and sets the tone that everybody’s rolling up their sleeves and making sure that Denver is successful, and that we’ll continue to grow there.
Theresa Torseth:
I was thinking back to when you started the company. We were just about to enter a recession.
Pat Callahan:
Right. I wish I had known it at the time. (laughing)
Theresa Torseth:
Is there advice that you would give to someone who is trying to start or expand their company’s team now in a talent-scarce market versus when you started? At that time we were going into the recession and there were a lot of people willing to take a look at a different career opportunity or make a move to a new company. Now, it’s a very different market.
Pat Callahan:
That’s a good question. Let me talk a little bit about what we did when we started that I think works and then address the difference that exists today. It is clear in retrospect that the human talent that joined the enterprise early on made all the difference. I was in a unique position, coming out of my years at Equity Office Properties, to have had a lot of work experience with a number of people in town. We were able to put together a team of people that had a proven track record and that had already demonstrated that they could work together and that they trusted one another. That’s probably the most important thing. There was a cohesive working team from the very beginning that in their belly wanted to succeed—together.
It was never about individual success; it was about a team’s success early on.
During the recession, the ability to expand that team was enhanced because people were willing to take risks during that time period. We literally had a few people work themselves into a permanent position. We basically said, “Hey, if we can acquire this asset, then you have a job—so help us acquire it!” That is something that would not easily happen now because there are so many job opportunities out there.
Today, it’s important to recruit for long-term success. We are looking for people who really believe in the things that we want to do, and who really want to be part of the team. If those two things are present, then there’s good reason to talk, but obviously this is an environment where employees can just job hop around, because there’s so much demand. That’s not what we’re interested in. Very little has changed from our core team. Many of the people who we brought in the first five years are still with us. Our founding values are deeply infused in our culture today because of that core team and the people we have hired.
Theresa Torseth:
You’ve mentioned integrity, trust and initiative. What do you think is the the single biggest human factor that is going to impact the success or failure of Urban Renaissance Group and Touchstone in the future?
Pat Callahan:
You know it all comes down to effective teams, and you can’t have an effective team without that background of trust. Trust allows you to debate results. Trust allows you to focus on the team outcome versus the individual outcomes. So you have to start with trust as the basis. It sounds simple but it isn’t. You have to be competent, reliable and genuinely sincere if you’re going to be trusted. We have been incredibly lucky to find and keep really amazing people.
We’re in a situation where keeping our talented people is really important because there is a shared vision. There is a lot of trust. We have built an effective team. So keeping it together and continuing to reinforce the values and the goals are important. We are called Urban Renaissance Group for a reason.
Urban Renaissance Group is about creating transformational events in the urban environment. That’s putting yourself out there with a bold statement, and I think that’s a unifying factor for the whole company. And Touchstone’s objectives as a company are in alignment with URG’s.
So if you are willing to be an effective team member and trust one another and share the aspirational goals of the company, that’s a great combination.
Theresa Torseth:
You are clearly on the right track. Here’s to your continued success!
