Pioneering Networker

Kranzco Acquisition Nixed

Gerry Finn’s Credo

Jeff Finn the Successor

Competition from Colliers

Corrections or additions?

From Route 130, a Global Real Estate Reach

This story by Barbara Fox was published in U.S. 1 Newspaper on March 31, 1999. All rights reserved.

Don’t tell a Finn that something won’t work. You just

may find yourself eating crow.

That happened in the ’60s in East Windsor, when township fathers opposed

a new way to cluster apartment buildings to offer mixed uses within

the same zone. They lost: Gerald C. Finn developed Twin Rivers, a

pioneering Planned Unit Development and was named "builder of

the year" at a 1968 convention in the Houston Astrodome.

And in the late 1970s, when a Fortune 500 bigwig pooh-poohed the very

notion of a network of far-flung brokers, Finn began to build just

that. From a headquarters near Route 130 in Hightstown, New America

International now operates a 150-member network of independently owned

real estate brokers and serves 200 national and international markets.

Gerry Finn was two decades ahead of his time. When that time did come,

when other brokers coalesced into mega networks, he was already there

and had staked out a singular plan. And though he had to step aside

and watch another builder construct his Twin Rivers project, he is

hanging on to this one. At 68, he has a son, 36-year-old Jeffrey M.

Finn, who as president and COO is building the concept and the company.

"Wanting to give up is not in my lexicon," says Gerry Finn.

"and I hope not in my kids’ lexicons. But I wouldn’t have kept

it up if I didn’t have a son interested in it. You need to have the

longevity of management and a succession plan."

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Pioneering Networker

It was 1978 when Gerry Finn encountered the executive who scoffed

at his idea of creating a integrated interwoven team of brokers throughout

the country. Now trade magazines laud him for having pioneered the

idea of offering clients a single source of contact for multiple real

estate assignments.

Some who tried to play catch-up have encountered their own Twin River-style

Waterloos. "People have tried," says Jeff Finn. "They

have typically evolved from being a broker to building a national

organization similar to ours, but they never got to critical mass,

and they ran out of capital and went back to local brokerage."

The difference between NAI and everybody else, says Finn, is that

NAI does major account management. "Our competitors focus on local

deals versus service delivery and long-term relationships. We do not

do brokerage: We manage the brokerage process. We drive our own volume

of business by managing the major accounts."

"We have not set up branch offices that are part of a bureaucratic

system," he says, "but have tapped into the entrepreneurial

nature of brokers to tie into independent companies that are deeply

rooted in the local marketplace, and put that into an organized model.

With our technology and staffing we can effectively develop and manage

business to ensure consistent delivery of service."

Just this year NAI has added a new and very familiar name: Fennelly

Associates (see story, page 57). "Whatever business is going to

be done in the Princeton area," says Jeff Finn, "Jerry Fennelly

is going to handle it for us. He has been trained, certified, and

is online to handle it in a very efficient way. We are not focused

solely on helping Jerry Fennelly gaining local market share but in

providing global services to local clients."

Such accounts as International Paper, Pepsi-Cola, Hertz, and Bestfoods

use NAI as an external real estate department, picking up the slack

when the workload gets too large to be handled in house.

About 40 people are employed at the headquarters in Hightstown. With

Amoco NAI is working with 300 projects simultaneously online, managing

all the steps, to make sure all services are being performed. It has

two people doing nothing but taking care of 100 United States Postal

Service projects, which has chosen NAI as its major service provider.

They work with a proprietary leading-edge computer program. "One

of my early ideas was to try to create a marketplace within NAI that

made buying or selling real estate as efficient as buying or selling

stock," says Jeff Finn. At his instigation the firm developed

the program, now on a web-based platform, called REALTrack Transaction

Management System. NAI bought a small software company, which had

a real estate database management system, to launch the global system.

The database has one full-time programmer and one developer, plus

outside consultants. The brokers themselves update the system with

new information, but a team of transaction managers keeps the database

accurate and clean.

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Kranzco Acquisition Nixed

Though it is difficult to put a price tag on NAI, Gerry Finn reckons

it to be worth perhaps $30 million. "It depends how you evaluate

it. Our systems and processes and our contracts could be worth $100

million. It’s a strange business. No one has ever done this before."

In real estate, as on Wall Street, even the downturns can be an opportunity.

Last August the Finns announced plans to be acquired by a Real Estate

Investment Trust (REIT). Then the REIT market turned to mush, and

that plan was abandoned. But now the REITs (including the would-be

suitor, Kranzco Realty Trust) need to sell some of their properties

and are therefore some of NAI’s current best customers.

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Gerry Finn’s Credo

Gerry Finn’s father, an advertising man for a department

store in Trenton, taught that if you make up your mind to do something,

you can do it. But he died when Gerry was 16, and the motto had a

severe test. "I was about to go to college, and I really wanted

to go to an Ivy League school, but we didn’t have the money,"

says Finn. He served in the Army at the Pentagon during the Korean

War and accumulated credits from Rutgers, correspondence courses,

and Rider, though he never received a diploma.

During that period he met and married his wife Norma: They had three

children in the ’50s (one who died in infancy, a son who is an attorney,

and a daughter who is a nurse) and Jeff was born in 1962.

When he came up with the Twin Rivers idea, people called him a fool.

"I took all the money I was making on a number of building projects

and wanted to build a new town, something very different and very

exciting that would set a standard for America. Every builder in New

Jersey was laughing at me," says Gerry Finn. "They said it

would never never happen. It looked like it wasn’t going to, but we

stuck with it." Twin Rivers was a planned unit development, an

attempt to create a community with houses and mixed uses in the same

zone — the "Main Street" concept so popular now.

"It requires a very different approach to planning and zoning,"

says Finn. "It scared East Windsor to death." At the time

he was building Brooktree and battling to get water and sewer into

the town. "Getting Twin Rivers through became a real cause celebre.

There were times when it looked pretty bleak."

He got the zoning but lost the project. After four years, with no

money left and two toddlers at home he sold it to American Standard.

"They made me a millionaire instead of being poor. No, I don’t

necessarily like the way they did Twin Rivers. It is nowhere near

as beautiful as it would have been, and it might have been more profitable."

Another portfolio, including properties in Lawrenceville, New Hope,

District of Columbia, and Florida, was sold to Certainteed under similar

circumstances.

From 1974 to 1978, says Finn, he was in a state of semi-retirement,

doing consulting for major companies. He was making a speech at a

real estate convention when he got into the squabble with the Fortune

500 expert who insisted that no one could use brokers throughout the

country because they would be so fragmented. Thus challenged he founded

New America Development Corporation in 1978 and signed up his first

member in 1980.

Says Gerry Finn: "I like to think I am a visionary. I know I am

a good salesman. I have always been able to sell anything. The only

thing I am not is a day to day management person." That’s where

the son comes in. "Jeff is a thinker, but he has the practical

ability to make it happen. In spite of the nepotism, he’s good."

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Jeff Finn the Successor

In 1980 Jeff Finn had just graduated from high school, having cut

his management teeth at a tender age in one of the family businesses.

"My father is a fantastic motivator," says Jeff Finn. "He

has a way of letting you know of ways to grow in a positive way."

A member of the notoriously disciplined Peddie School swim team, he

worked his way up summer jobs at the Brooktree pool from the snack

bar to lifeguard to pool manager, taking the manager’s slot when he

was still in high school. He met his future wife, Cherie, at the pool,

and they now have a six-year-old daughter and a nine-year-old son.

After majoring in finance and marketing at Boston U, he graduated

a semester early, and started to work for the firm in January, 1984.

"It is a wonderful place to be and a fantastic company," says

Finn. "We have a team of great people, all focused on the mission,

and an interesting culture — stimulated by the entrepreneurial

nature of our broker members."

Besides communicating by E-mail, on the Web, and on the company’s

Intranet, NAI has frequent conferences, both regional and system wide.

Former Vice President Dan Quayle was the keynote speaker at a conference

in March.

Each of the brokerages in the farflung network is independently owned,

but to keep everyone in line, each member is evaluated annually for

technology, training, accounting procedures, and processes. Some are

re-certified, others are helped, and some are terminated as members.

This contrasts, Finn says, to big companies, with fully-owned offices,

that might have difficulty terminating an underperforming office.

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Competition from Colliers

Finn declines to say what it costs to be an NAI licensee, but a member

of a competitive network, David Houston, says he pays $100,000 annually

to represent New Jersey as Colliers Houston, and from the network

he gets 20 percent of his business.

Houston casts a different light on differences between NAI and networks

such as his. Colliers, he says, is different from NAI because it is

a "cooperative, a global corporation of equal shareholders."

He lays claim to the single source concept and tells of one office

that has 34 people working on an account for the brokerage firm of

Edward D. Jones, which aims to open 90 small offices every month over

the next for five years.

Rather than develop proprietary software, Colliers handles its record-keeping

and communication with a version of Lotus Notes. "A real estate

manager can get onto our system and see every change in every file,"

claims Houston.

Colliers stock is owned by member firms with 246 offices around the

world and a headquarters on prestigious State Street in Boston. The

president and CEO of Colliers is an employee, not an owner, and reports

to the board of directors. "NAI is a for-profit entity," says

Houston. "In Colliers you don’t have the we or they, we are all

one."

Finn’s reply: "When you have a for-profit motive, you have a business

that strives for excellence and that cannot afford to be inefficient.

In their model they focus on doing brokerage, and their model is on

providing brokerage, not providing corporate services."

Jeff Finn says his father taught him motivation and

positive thinking, that "You really can achieve what you dream

you can achieve. I have never had a concept of giving up. We don’t

argue. We think very much alike. If we talk through an issue we come

to an easy and obvious solution. We have a unique relationship."

"We are blessed in that regard," says Gerry Finn. "Jeff

and I have a wonderful relationship.

"He’ll never slow down," says the son. "He has a great

ability to stimulate new ideas and even greater visions for the company."

It’s still a father-son team. "I’m never going to retire,"

says the father. "They can carry me out. What I do is go out and

make big deals and bring in clients. That’s exciting, much more fun

than the day to day."

The only thing Gerry Finn would like to do that he isn’t doing is

get back on the radio. He used to do an hour-long live show on WHWH.

Among his subjects were Mrs. Bruno Hauptmann, Dr. Kevorkian, a madam

from a house of prostitution, and the mayor of every township in three

counties. "I interviewed every politician in the area, I only

did it for fun."

Still, his greatest thrill is watching his work in action: "As

a developer, one of the great excitements is going out in the evenings

and driving through what you built, and seeing the kids play, and

knowing it wouldn’t have been there if you hadn’t done it," says

Gerry Finn. "Now, seeing NAI signs all over Barcelona, Spain,

is almost the same kind of excitement."

New America International (NAI), 572 Route 130,

Box 950, Hightstown 08520. Gerald C. Finn, chairman and CEO. 609-448-4700;

fax, 609-448-8126. Home page: http://www.newamerica.com.


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