CEO on Leadership: Stephen A. Crosby, President, CSX Real Property, Inc.

Summer 2013
Stephen Crosby

Stephen A. Crosby has served as President, CSX Real Property since 2000, responsible for sales, leasing and development of surplus CSX properties. He also oversees acquisition of property for industrial development, licensing of rail corridor use for utilities, pipelines or telecommunication transmission lines and numerous other property-related responsibilities. Since joining CSX Real Property in 1985, Crosby has held several positions in real estate development and operations. He was national chairman of NAIOP in 2004 and currently serves as a trustee of its Research Foundation.

Development: As President, what are your core areas of focus? 

Crosby: I always do a running SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis — for my group as well as our parent company customer. I am always thinking about how to transform that information into strategy, and strategy into execution.

Development: What qualities do you look for when hiring senior staff?

Crosby: I look for varied experience, critical thinking, strong team instincts, customer focus, interest in continued learning, strong core values and a strong work ethic.

Development: What market or economic data do you review on a regular basis to stay on top of your industry?

Crosby: We have a very varied spectrum of work and my people tend to specialize so I spend quite a bit of time bridging gaps — looking for trends, opportunities, unintended consequences and “bogey men” in all sorts of different places. The Internet has been a wonderful source of information. I use a lot of sites that push summary information to me and provide hyperlinks to details. Categories I tend to follow are real estate industry specific from sources like NAIOP, ULI and Globe St; railroad industry specific like Progressive Railroading and the Association of American Railroads; investor specific such as Seeking Alpha; urban planning/cultural like Atlantic Cities; local markets through the Business Journals; and business best practices through channels like Harvard Business Review and Strategy & Business from Booz & Co.

Development: Over the next 18 months, what challenges/opportunities do you see for your industry

Crosby: Over the last 10 years my business has gone from focusing on surplus real estate monetization to an emphasis on railroad growth. Our surplus property development is now done through joint ventures to allow our development folks and capital to be focused on rail-related acquisition and development. In the background we continue with a lot of contract, property, and facility management activities. The railroad business is not as static as it may seem. The Environmental Protection Agency’s (EPA) war on coal has greatly affected that part of our larger company’s business, but the challenges of the choking interstate system, high fuel prices, and driver shortages continue to fuel growth in the intermodal rail/truck transfer business. We’re also evaluating the use of natural gas as fuel for the railroad’s locomotives. Terminal development and main line capacity enhancement will keep us busy for the foreseeable future.

Development: How has the industry changed during your career?

Crosby: The real estate development side of our industry has become more driven by institutional investment requirements and is somewhat less a function of local initiative. It has also driven even greater disparity in market by market valuations. This seems to have created two classes of developer: 1) big, internally funded, volume dependent, geographically diverse, but also much more product specific than previously; and 2) small, local, deal-at-a-time and with often more flexibility in product interest. The former tend to operate in major markets doing big projects, while the latter tend to operate in smaller markets on smaller projects, which can sometimes be just as complicated, involving infill and mixed-use. On the plus side, the business is more professional, more focused on business continuity, and develops better product. On the other side, it’s very hard work and it’s very hard to get deals done. Both of these trends make organizations like NAIOP that much more important.

Development: What is the most valuable lesson you’ve learned over the course of your career?

Crosby: A career can be a long time so always do the right thing. Remember that life is a journey, decisions have consequences, and that treating people and communities the way you’d like to be treated will always pay off in the long run. As people who impact the built environment, we have an obligation to think long term. As frequent investors of other people’s money, we have an obligation to protect that trust. As leaders of employees, we have an obligation to plan, advise, educate, and guide them thoughtfully. As leaders of our communities, we have an obligation to lead wisely and ensure that the next generation is equipped to follow. The Boy Scouts got it right — leave your campsite better than you found it. Our world is a precious gift.