We believed the real money in real estate came from borrowing long-term, fixed-rate debt in an inflationary scenario that ultimately depreciated the … - Sam Zell

My big-picture goals were all about creating liquidity by monetizing assets, fund-raising for opportunities on the horizon, and doing great deals.

From the very first deals we did at EGI, I have spread the opportunity — both the risks and the rewards. We co-invest, side by side, and I often provide a “promote” to my people, allowing them to share in profits on a portion of my invested capital. That means I put my money behind theirs (say $150,000 of my money to $30,000 of their money), and if our investments or funds achieve their minimum target metrics, my people get returns based on the aggregate ($180,000). In effect, we’re all invested in each other’s success. It’s not only about motivation; it’s a mandate to collaborate. Deal opportunities and challenges are discussed, questioned, and probed by the team at large because everybody has a piece of everybody else’s deal.

Frankly, there’s no substitute for limited competition. You can be a genius, but if there’s a lot of competition, it won’t matter. I’ve spent my career trying to avoid its destructive consequences. Competition skews people’s assessments; as buyers get competitive, the demand for assets inflates pricing, often beyond reason.