The leader of Trammell Crow Company (TCC) and global CEO for CBRE’s Real Estate Investments (REI) business segment talks about taking the leadership reins at the height of the COVID-19 pandemic and much more.
Development: How did you get into commercial real estate?
Mike Lafitte: My father was a banker and I thought I would become a banker — that’s after considering becoming an orthodontist. While studying for my MBA at Southern Methodist University (SMU) in 1983, however, I got an internship with Lincoln Properties and fell in love with the business. I joined Lincoln after graduation. After that, I held production, leadership and development roles with Bear Stearns and PREMISYS Real Estate Services (a Prudential affiliate). I joined TCC in 1997 and in 2006, CBRE acquired Trammell Crow Company.
Development: You have said that becoming CEO of Trammell Crow Company was the honor of your life. Could you tell us why?
Lafitte: I was born and raised in Dallas. You cannot be a “Dallasite” without having great affection and regard for the Trammell Crow name — both the man and the company, including its traditions, people and culture. When I joined the company in the 1990s, I never dreamed that one day I would serve as the CEO.
Development: What prepared you to take over leadership of a real estate industry juggernaut like TCC during a pandemic?
Lafitte: It’s a team sport. When you move into a role like I did here, you rely on the leadership team that you have in place. People in leadership positions at CBRE and TCC often move around to different jobs over time to be cross-trained and broaden their experiences. COVID-19 was not the first major disruption that our leadership team has faced, which included the commercial real estate collapse in Texas in the 1980s, the dot-com bust, the financial crisis and numerous market cycles. We prepare for these moments. We anticipate disruption. However, we never expected a pandemic.
We recognize that even with the crisis, we have a big business to run, employees and tenants to support, and projects to complete on behalf of our investors. We did all of that, and I am so proud of the way our leadership team and company responded to this crisis.
Development: What were the steps you took to ensure the safety of tenants, building visitors and employees while moving the company forward?
Lafitte: Our first priority was the safety, health and wellness of our people. We had a significant amount of in-process development around the world that for the most part did not stop. We put all the safety protocols in place at job sites and buildings — but our work continued. We focused on keeping the trains running. Our frontline workers are true heroes. They got the buildings built and kept operating our projects. Our people performed very well as we came through the pandemic.
Development: What do you look for when you hire or promote senior people?
Lafitte: We promote the vast number of people from within, but we will go outside to hire talent when necessary. Character is critical to us when it comes to our senior team along with experience, work ethic and a collaborative spirit. Another important element is diversity. We have a very intentional focus around diversity, equity and inclusion at TCC and CBRE. Succession planning is also something we take very seriously for our senior talent. We equip our rising leaders for their career development.
Development: What does leadership mean to you?
Lafitte: The leadership team must create the vision and the aspiration for where the business wants to go. Out of the vision and aspiration comes the strategy, which leads to an execution plan. From there, it leads to all the people decisions that we make. As Jim Collins wrote in his book “Good to Great,” you must make sure you have the right people on the bus and that they are sitting in the right seats. Commercial real estate is a constantly changing, moving business. Leadership is not about the leader as a person, it is about the team and results.
Development: What is your primary role as CEO of Trammell Crow today?
Lafitte: I work closely with our leadership team across the business units. We have an active investment committee, which I am involved with, where we are engaged in managing risk, deploying capital and making investment decisions. My role includes a balance of internal and external responsibilities, and I enjoy interacting with our people as well as with our capital partners and other stakeholders.
Development: In your roles at CBRE and in your position at TCC, could you tell us how you handle internal conflicts or mistakes should they occur?
Lafitte: Mistakes and conflicts will happen, and what is important is how you manage it. We hit issues head-on. Ultimately, you need to live out your core values. At TCC, we have a set of core values we call R-I-S-E: Respect, Integrity, Service and Excellence. We manage the firm with those core values at the forefront. When we deal with internal issues, it is important that we are honest, transparent and decisive. It is important for leaders to listen, but it is also important for leaders to act.
Development: What is your outlook for commercial real estate over the next three to five years?
Lafitte: I am quite bullish about the next few years. Office, hospitality and retail have been disrupted, but we are seeing them start to come back. The office market is massive, and there is a strong commitment to the workplace from large occupiers around the world. Will it change? Yes. Will people do more with less space? Yes. Is it going away? Absolutely not. For industrial and multifamily, the demographics are extremely strong, and these two sectors should continue to be in favor and perform very well.
Development: Over the course of your career in real estate, what is the best advice you have been given?
Lafitte: The importance of integrity, the importance of hard work and the power of focus.
Development: What advice would you give someone entering the commercial real estate business today?
Lafitte: Build your network. Start out with a great firm. Absorb as much as you can, but be patient. Your career is the long game, the marathon, not the 100-yard dash. Be a student of the industry. Learn from what you see that goes right, but more importantly, learn from what goes wrong.
In the early years of my career in real estate in the late 1980s, the world melted down. I saw companies going broke right and left. I saw banks going under. I tried to learn from what I observed about the markets, the failures and the actions that resulted from the disruption. If you can learn from the mistakes of others, then you don’t have to make them yourself.
Development: What crucial lessons have you learned in your career in real estate?
Lafitte: For real estate or anything else, cycles will come and go. You have to figure out how to navigate those cycles. You also need to take calculated risks, understanding that you will not always get it right. You’ve got to get out there into your “uncomfortable zone,” but at the same time, you’ve got to manage risk. Finally, staying true to core values and a strong set of principles is a must.
Development: Leading a company like Trammell Crow while maintaining your role at CBRE as global leader has its stresses. What are your favorite ways to relax on your time off?
Lafitte: I enjoy working, and I love my job and the people that I am with. But outside of work, what is important to me is faith, family and community. I am blessed with a growing family with adult kids and a couple of grandkids running around. I like being in the outdoors — mostly biking, golf or fishing. I have lived in Dallas all my life. I have many friends here, and I am fortunate to be part of a great community and industry.