Colby Durnin is the founder and CEO of CREDE (Commercial Real Estate Development Enterprises). Founded in 2001 while working with Oaktree Capital Management, Mr. Durnin and CREDE have been involved in the development and redevelopment of more than 100 projects, including all asset classes, spanning 15 states and 5 countries.
How did you become involved in the construction and design industry?
Like many entrepreneurs mine was not a linear path. I started off building aquaculture farms throughout Mexico and Central America. When I returned to the United States I became a partner in a small residential and commercial TI construction company, I noticed how small firms were not focused on process so I created the process and merged three other companies into the group to scale it up. Once we were more of a boutique size, I was able to sell out my shares and transition over to more institutional construction and real estate working for Keller CMS and Urban Partners. My observation of the market as I worked across the country was that many of our competitors are focused on their business and fees not the returns of their clients and/or their projects. We made a paradigm shift and request whenever our clients/partners will allow that we leave a part of our fee on the table to co-invest or act as a performance bonus, so they know we are aligned. Working with opportunity funds over the last 20 plus years has allowed our teams to move throughout both the U.S. and all asset classes as we have been involved with virtually every type of distressed real estate you can imagine.
What is something that your company is doing that you consider innovative?
Aside from our overall economic model, I would say our approach to the business. As we are both sponsors and fee developers our teams look at every deal and project as if they were working on a project that we own. Many firms in our industry just specialize in the due diligence, or the CM piece; we are full integrated so we understand the project cradle to grave and can backstop our clients on all parts of the process or just specific parts and pieces in our designated swim lane if requested. Additionally, I would say our size as a mid-size company is an advantage, we are large enough to pull new designs and innovations from projects across the country but small enough to give you a boutique feel.
What poses a challenge, risk or opportunity for your clients and what is your company doing to address it?
The biggest challenges facing everyone are due to the uncertainty with COVID-19 and what it has done to the real estate and construction world. Fortunately for us, our business model helps aid in our ability to be flexible and nimble in different markets, so we can adjust accordingly during the good and bad times.
What is something you view as an emerging trend in the industry and what are your perspectives on it?
We are seeing a shift into the industrial space, cold storage and other large warehouse facilities. Multifamily and hospitality are taking a hit and most investors are waiting to see how other companies come out of this pandemic. It is a wait and see approach with most at the current moment and we are trying to find opportunities in other market segments due to the current landscape.
Any final thoughts on what to keep an eye on in the near future in the construction and design industry?
COVID-19 is going to force business to rethink how they operate. Time will tell how things will change, but there is a great chance that certain geographical markets will require designs that will provide more distancing, along with the proper equipment for increased health and safety measures.
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