Joseph Azrack ’72 (right) is the Founder and currently Senior Advisor to Apollo Global Real Estate Management. Mr. Azrack has over 30 years of real estate investment management experience. Prior to joining Apollo, Mr. Azrack was President and CEO of Citi Property Investors (“CPI”) where he chaired the firm’s Management Investment Committees, and guided the Firm’s investment policy and strategy. Apollo Global Real Estate acquired CPI in 2010. Mr. Azrack is Chairman of Apollo Commercial Real Estate Finance (NYSE “ARI”) and is on the Board of Directors of Atrium European Real Estate (“ATRS AV”). Prior to joining CPI, he was Chief Executive and Chairman of AEW Capital Management, L.P., Founder and President of the AEW Partners Funds, a Director of Curzon Global Partners and Founder and Chairman of IXIS AEW Europe. Mr. Azrack is also an adjunct professor at Columbia Business School where he is a member of, and for many years chaired, the Real Estate Program Advisory Board. He will be teaching Real Estate Entrepreneurship, which will be offered for the first time in fall 2014. In a recent interview with Adam Koplewicz ’15, he discussed his career, advice for graduates, and his formative experiences at CBS.
Of your many impressive professional accomplishments, what are you most proud of?
I would say there are two categories of accomplishments that make me proud. One is the talented people with whom I have been fortunate to work. The group of people that I have worked with over the years has been really bright and creative, and I have also enjoyed being with them personally. The people at AEW in Boston who I worked with for 20 years are either still there running the firm now at $30+ billion AUM, or a number of alumni have gone out and started their own private equity real estate businesses, technology real estate service businesses, or international investment management businesses. So I am particularly proud of the people I have been associated with over the years.
The second would be that I have been fortunate to be reasonably innovative throughout my career. Back in the 1980s we were applying corporate finance structures to real estate to capitalize real estate operating companies long before anyone else was. When the commercial real estate world went into a depression in the early ‘90s, we were nimble enough to not only survive but also to find the opportunity in that environment. The RTC gave rise to the CMBS market and as an off shoot of bidding on RTC portfolio purchases we were able to capitalize on the high yield debt opportunity. That was great as an investment, but we also realized it could be an investment management business. So we built a successful debt CMBS and whole loan investment business. Separately, working with one of our portfolio companies, the Taubman Company, we created the first UPREIT in 1992 which gave rise to the modern REIT industry as we know it today. It too became an investment management opportunity by 1995, so as individuals we chipped in about $100,000 to start a REIT securities investment management account. A year later, one of our institutional clients committed $5 million to a REIT securities separate account. Other clients followed, and today AEW is running a $10+ billion real estate securities investment management business.
Overall, I am most proud of creating and launching new businesses and having worked with and mentored a pretty distinguished group of professional alumni.
What has been the most rewarding take-away for your professional life from your MBA days at CBS?
It was a long time ago but I would have to say that the first would be exposure to new industries and obtaining a broader perspective on career opportunities than I had coming into CBS. When I went to business school I had a pretty good idea of what I didn't want to do, but I didn’t know what I wanted to do. It was through friends and attending a class at the Architecture School that I was introduced to the real estate business, as CBS did not have a real estate program at the time. The real estate industry was fragmented, unstructured, and entrepreneurial, and I found that very appealing versus the perhaps more traditional corporate career opportunities at that time. The Business School permitted me to create a combined real estate and finance major including independent study projects with an industry advisor that gave me access to real time development projects, which in turn gave me a modest level of real estate experience to present to prospective employers when I graduated.
The second takeaway would be a solid understanding of finance. This is really important and has served me well over the years. Capital is the life blood of industry, and if you have a good working knowledge of how the financial sector works, and the tools to see the playing field in terms of different sources of capital and how they can be used, it's a really good skill set to apply whatever your professional focus may be.
Lastly, the people and industry exposure you can get at Columbia being in New York and with its alumni network is invaluable. Everybody comes to New York sooner or later so the relationships and the people you meet are really important. Just look at the people who come into class and speak. The combination of being in Manhattan, which is the leading center of commerce and finance in the world, and the Business School’s strong core finance curriculum, is extremely unique and valuable for somebody who is at a formative stage in their career.
What advice would you give to current business school students and young professionals looking to pursue successful careers in the real estate industry?
For the business school student, your first job is finding a job and you need to treat it that way. Some students will have met people through prior work experience and one thing will lead to another, but for a lot of students that doesn't happen. You just have to network and not be too selective about the first opportunity. Once you are in the industry, there are many ways to direct your career as you learn more and meet more people. Finding the right job takes time. You need to be prepared for interviews with research on the sector, the company and the individuals you will meet. It is important to be persistent and rigorous about conducting the process.
In terms of the job itself, it’s important to find a culture and people you can learn from. It’s also helpful if the organization has a big industry footprint, because it will permit you to develop a broader perspective and learn more, which will be helpful if you decide to focus more in one discipline or geography or another.
What’s your view for the future of the real estate tech service industry and its impact on the general real estate market?
I think it is early days. Marketing and distribution channels are changing with the internet and expanding mobile device applications. This is effecting everything, from the warehouse as it relates to fulfillment, to retail, and office space. I think the impact will be really profound and we are probably in the 3rd or 4th inning to use the baseball analogy.
The adoption of commercial and residential property applications has developed relatively slowly. I think now we are in phase 2.0 for this space. The emphasis is more on mobile. I don't pretend to know exactly how the industry will change, but it looks like the design, locational requirements and functionality of commercial property types and how they are managed will change pretty profoundly in coming years.
What do you enjoy doing in your free time?
My favorite hobby is probably fly fishing. It completely takes my mind off everything and is like a Zen meditation, usually in an incredible environment. I also enjoy reading, especially history and biographies because the past does repeat itself and you can learn a lot about the future from past experience.
Adam Koplewicz ’15 worked as the Chief Operating Office at Thayer Street Partners prior to entering Columbia Business School. He completed his BA in Urban Studies at Brown University. In the fall of 2014, Adam will serve as the teaching assistant to Adjunct Professor Azrack for Real Estate Entrepreneurship.