My First CRE Investment: Architect Inspired by Chance Meeting With CRE Titan

This is the third installment in LoopNet’s new series, “My First CRE Investment.” You can find the first article in the series here and the second here.

It would probably be fair to describe Atif Qadir as a relatively meticulous individual. Each step along his career path has been guided by careful planning and preparation. When he decided to make the switch from architecture to development, he got an MBA. When he contemplated pursuing his own investment opportunities, he sent postcards to prospective mentors seeking advice.

And, yet, even for someone as meticulous as Qadir, taking the leap into real estate investment, was, at least partially, a product of one serendipitous interaction.

It was 2017, and Qadir was a development associate at Extell Development in New York City. While he enjoyed the position and felt he was learning quite a bit, it was ultimately a family office, and as someone outside of the family, he knew his future there was limited. He was beginning to make plans for his next move, and in the interest of broadening his industry contacts, reached out to organizers of the Harvard Real Estate Weekend conference to volunteer his services. They selected Qadir to serve as a coach in the conference’s case competition.

The keynote speaker at the conference was MaryAnne Gilmartin, who is now the founder and CEO of MAG Partners LP and at the time was president and CEO of Forest City Ratner Companies. Qadir was captivated by her remarks, and particularly encouraged by the way he felt she addressed them towards women and people of color; people who, as Qadir put it, “don't see themselves as real estate developers.” Qadir tried to connect with Gilmartin once her speech was finished, but she was inundated with admirers.

At a dinner for the conference participants that night, Qadir found himself seated across from a young man, a high school student, who seemed a bit out of place in the crowd of academics and real estate professionals. Curious, Qadir inquired how he came to find himself at such an event. The young man introduced himself as Devin Gilmartin and explained that he was accompanying his mother, MaryAnne, and planned to use the time in Boston to tour both Harvard and the Massachusetts Institute of Technology, where he was interested in applying. Unfortunately, he had discovered that MIT’s admissions office was closed for midterm exams, and he would be unable to tour the campus.

As it turned out, though, Qadir was in a position to assist with such a problem. “I was a tour guide at MIT when I was an undergrad,” he told the younger Gilmartin. “Would you like me to give you a tour?”

They made arrangements for Qadir to pick up Devin at his hotel the next morning. MaryAnne Gilmartin wasn’t supposed to be in attendance — Devin told Qadir that his mother was flying back ahead of him — but when Qadir arrived at the hotel, he found both Gilmartins present.

Qadir took them on a tour of MIT and ended up spending most of the day with them. He developed a good rapport with both mother and son in the process. Eventually, MaryAnne asked Qadir what his plans for the future were. At first, Qadir was hesitant to answer honestly.

“I was like, ‘This is weird because I work for somebody who you do deals with, so I don't feel comfortable telling you the truth.’ And she's like, ‘No, just tell me.’ And I told her, “I want to go out and do my own thing.’”

According to Qadir’s recollection, MaryAnne Gilmartin’s response was unequivocal. “Do your own thing,” she told him. “Go for it.”

And that’s just what he did.

Shortly after that chance interaction, Qadir purchased his first investment property: a two-bedroom condominium in Jersey City Heights, New Jersey. Priced at $120,000, the purchase enabled Qadir to make his “first investment on a scale that wasn't going to be super dangerous. I could use largely my own money and some from family and friends and then be able to make my mistakes there and understand processes and build up a team I liked.”

Over the next year or so, Qadir went on to acquire five more condominium units. In 2018, his success with those properties emboldened him to take on his next challenge: purchasing, renovating and repositioning a historic six-unit multifamily property in Hoboken, New Jersey.

512 Park Avenue had originally been constructed sometime in the 1890s, at least from what Qadir could discern via tax records. Totaling 5,000 square feet, the brownstone property was fashioned in an Italianate style that Qadir said was typical of multistory brownstones built in Hoboken during that time.

At the time of Qadir’s purchase, the building was in less-than-ideal condition. “It was mostly vacant,” Qadir recalled. “And there had been a fire that I understand was from a meth dealer that was operating in the location. And that had caused sprinklers to go off, which had resulted in major water damage that had been shoddily repaired.”

While the property had obvious value-add potential, what most intrigued Qadir was its unique structure. A covered walkway extended from the street-facing brownstone building to an outdoor courtyard where a carriage house dwelled.

“I've never seen a setup like that in Hoboken,” Qadir said.

In total, the property comprised six units: three larger apartments containing three bedrooms each in the main building and three studio units in the carriage house. There was a lot of potential there, but to transform the property into what Qadir envisioned would require an extensive investment in both time and capital.

Qadir and his partners spent approximately $2.1 million to acquire the property; they then put an additional $800,000 into the renovation process.

“Almost everything came out. It went back to its masonry, the wood beams.” Qadir recalled.

Qadir said that his objective was to create a property that had “the character of something from the 1890s, but with the modern conveniences that people expect.”

Throughout the entire process, Qadir served as the point man on the project, which meant fulfilling a variety of roles, depending on the day. “I was the day-to-day person that was taking care of everything, he said. “That included being the developer, being the shadow architect, being the nanny, the cleaner, the therapist, the psychiatrist, the nudge in city hall when the paperwork wasn't coming through — all of that.”

The renovation, while ultimately successful, proved to be challenging. “Everything that could go wrong on a project went wrong,” Qadir said. And just when things should have gotten somewhat easier, when all of the renovations were complete and it was time for lease-up, it was May 2020, and “we were in the depths of the pandemic.”

Fortunately, Qadir’s tendency towards meticulous preparation helped him avoid any significant leasing delays. Even before the pandemic, Qadir knew it could be difficult for potential renters to envision the optimal way to lay out a space. To overcome this issue, Qadir and his partners invested “the money to do really beautiful renderings and made sure to show [each unit] from many different angles and show in the floor plan what the size of the couch is that fits here; what is the size of the table that fits there.”

Qadir said that those renderings were particularly beneficial in renting the studio units, which, generally speaking, weren’t in great demand during the peak of the pandemic. The three-bedroom units were all gone within days of being listed, and within a few months, the studio units had also been leased.

Qadir credits a lot of the leasing success to the work of his agent, Marie Gomer with Compass, who he said got creative to lease the units under pandemic constraints by conducting virtual tours and filming video tours.

At this point, 512 Park Avenue is fully stabilized, and Qadir estimates that it has appreciated significantly from the initial $2.9 million he and his partners invested in the property.

Meanwhile, Qadir has continued to build his real estate portfolio. At this point, he’s acquired 15 properties throughout northern and central New Jersey that he refers to as “workforce housing.” When asked what he means by that, Qadir explained that his goal is to provide good housing “for people who have to work for a living.”

“When I look across my portfolio, the typical work profile is teachers. Some folks work remotely as research scientists. Some people work in healthcare as nurses,” he added.

When asked about the advice he would give to others who are contemplating a real estate investment, Qadir reflected on the city where he’s led the restoration of two historic properties and is currently renovating his own home.

“I would say number one is choosing the geography that you want to be the king or queen of or the one that you want to know everything about and go to town. That means going to every open house and meeting every broker — I've even knocked on doors to try to prospect myself. I became a city planning commissioner in Hoboken to learn about land use law; I'm a trustee of a local private school. So, I get to learn about the history, the processes and the relationships here and that counts for a lot in being a successful developer.”