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NAR quietly buys building: good investment or bad use of dues?

The National Association of Realtors has used member dues to buy an entire building without explanation as to its use, and members are not reacting favorably.



national association of realtors building

national association of realtors building

Good investment or bad use of dues?

Recently, NAR purchased a building in Chicago as an investment. The building, 437 N. Rush St., a two-story building that borders the west side of the association’s Chicago headquarters off Michigan Avenue, filed for Chapter 11 in December of last year. It was a great buy for $1.45 million –but what NAR members in Chicago want to know is, why was the building purchased?

Doug Hinderer, NAR’s senior vice president, was vague when we asked him what the building would be used for. The building, paid for in all cash (no commissions were involved in the deal), could be knocked down to expand NAR’s existing headquarters, or maintain the building as it is and collect revenue from the building’s tenants, which include the Phil Stefani’s 437 Rush Italian Steakhouse.

I found it surprising that Hinderer and NAR were giving vague answers as to how this building would serve the association’s members, especially when it was just last year that NAR raised its member dues. Agents wanted to know why there was an increase in dues, and with this information about a $1.45 investment purchase, agents’ reactions varied from hopeful to confused to angry:

  • “You failed to mention the current appraised value is over $4,000,000. Sounds like one heck of buy for NAR and members,” Jack Persin, managing broker of Ryan Hill Realty and copresident of MORe, said.
  • “Nice that the membership is the last to know,” Lyn Sims of RE/MAX Suburban, said.
  • “We pay our dues so NAR can invest in real estate? Really? Regardless of whether or not it will turn out to be a good investment, this is not what I want them doing with my dues,” an anonymous comment from a “Kent Black” wrote.

Agents in the dark

Given all the facts, even though the purchase is well below market value, I have to say that I feel for the angry agents here. Members’ hands are tied here – they have to pay dues to stay a member of the association, and if they give up membership, their job as an agent would be a lot harder.

But NAR also isn’t telling them where their dues are going, and while this building could expand its headquarters, it sounds like that’s the least of agents’ goals – they want more help with their business, more conferences and seminars that can teach them how to navigate today’s market, and points of use and interest.

Maybe NAR can use this building for member education classes, but since NAR seems to be undecided as to how to use this building, we’re not exactly sure what it will be used for. And it might not be used for anything, just a way for the association to make more money. In that case, here’s hoping they don’t need to raise member dues again anytime soon.

NAR seems to have taken an uncaring attitude towards its members about this issue, but the deal is done. I just wish NAR would take a different attitude – it’s clear that with unhappy agents over dues and now using dues for this investment, there could be some upheaval in the future.

Stephanie Sims is the managing editor of Agent Publishing, which currently has online publications in Chicago, Houston and Miami. With expertise in evaluating housing markets, website content and social media strategy, and reporting information agents want to know about, Stephanie can be found at her desk with coffee that got cold or not eating lunch because she’s busy planning editorial assignments and interviews for the Agent Publishing websites.

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  1. Michael Gibbons

    August 15, 2012 at 2:06 pm

    NAR should be on one mission. Doing everything they can to raise the perception and practice of the Realtor porfession to that of Lawyer, Doctor or Accountant. Right now being a realtor is a little like being a waitress…last to be paid and sometimes they get stiffed by buyers and sellers alike. Somehow Realtors have to start getting paid for the countless hours of work they do too often on the “hope: they will get paid…in NC everyone gets paid at the closing table (lawyers, repairs, surveys etc) except the firm/Realtor – that would be a good place to start…

  2. Michael Gibbons

    August 15, 2012 at 2:26 pm

    Not sure how it works in other states but why not have buyers and sellers pay (fee-based) respectively for the professional services of a Realtor? Yes….that means buyers pay and sellers pay – why does that not make sense and simplify so much of this madness?

  3. Brian Hickey

    August 15, 2012 at 3:29 pm

    Buying a potential teardown, or anything for that matter, without any commissions involved – this coming from the top of the industry………..hmmm, seems to be against everything they promote?

  4. J Philip Faranda

    August 15, 2012 at 5:39 pm

    Stephanie’s point about transparency is a strong one. I would concede, however, in NARs defense, that if they transferred $1.45 million from a money market to a municipal bond portfolio it would get zero attention. Dues increase or no, the money was already there, and I am not sure membership has much of a say in how reserves are invested. And the non-brokered aspect of the matter does contain more than a little irony. 😉

  5. norm_fisher

    August 15, 2012 at 10:23 pm

    It’s an absolute outrage that a real estate association would choose to invest some of its money in real estate, especially real estate that’s trading at 36% of appraised value. Idiots! 

  6. GreggDLarson

    August 16, 2012 at 8:02 am

    I can’t believe some these comments.  NAR is financially sound and has millions of dollars in reserves. We all know that. Financial strength is a good thing for a trade association that wants to remain relevant and strong in the future, right?Having the money sit in a money market account making 0.5 – 1.0% versus snapping up a building for less than half its appraised value is called a SMART long-term investment.  Wake up and recognize a good investment when you see it, real estate professionals!  Some people expressed concern about the “vagueness” of what NAR will do with the building?  Have you ever been to Phil Stefani’s 437 Rush Steakhouse?  The place is an institution in Chicago (it’s been there forever), the food is insanely food, its always busy, and I’m sure their rent plus the other tenants in the building provides an EXCELLENT ROI on the $1.45M investment.  If NAR does nothing with the building but collect rent, it’ll be a great investment.  Or wait, maybe the real estate market will be stronger in a few years and NAR will flip the building for its $4M appraised value (or more) and make a few million in profit.  Is that a bad thing? Would it have been better to leave that cash in a money market account making 1% or less?  If you’re upset about the “lack of transparency”, what do you think NAR should have done? Take a member vote on whether this is a good investment of reserve funds by asking a million people with no knowledge of commercial real estate value in Chicago their opinion?  And in the process let every investor on the planet know there’s a smoking deal on this building so NAR could attract more buyers to bid?  i think quietly buying this building was brilliant. If you’ve ever been to the NAR building, it doesn’t take an expert to realize that prime real estate next door to NAR’s HQ on Michigan Avenue is a good long-term investment.  My hat’s off to whoever recognized this opportunity and jumped on it.  

    • rqd

      August 16, 2012 at 11:40 am

       @GreggDLarson All great points, Gregg.  
      Rhetorical question: Assuming this was an insanely great deal, why wouldn’t the Stefani Group (or one of their investors, benefactors, etc.) buy the building?  It’s a single tenant, purpose-built, restaurant building.  I’m guessing they could’ve owned it for far less than current rent and financing an insanely great deal is not a problem for a well run restaurant group with many well-heeled fans.
      As far as it being an institution that’s been there forever, I think that’s a bit of an overstatement as it opened in 2000.
      Still looks like a good deal, though.  I’m sure it will work out well.

      • GreggDLarson

        August 16, 2012 at 12:16 pm

         @rqd Good question – I don’t anything about the Stefani Group’s available cash, but I believe most successful restaurant groups stay out of the real estate business and use their cash and credit lines for expansion, not buying their buildings.  NAR is experienced with restaurant tenants too, just think of the famous Billy Goat cheeseburger, Chicago and DC!

  7. gertiecranker

    August 16, 2012 at 9:44 am

    Every association–Realtor or otherwise–is increasingly aware that dues income simply will not continue to be the sole source of income.  That’s especially true in organizations like NAR, with a certain loss in membership numbers in coming years. Association income must be diversified, and I applaud NAR for investing in what looks like a heck of a good real estate deal.

    • GreggDLarson

      August 16, 2012 at 10:43 am

       @gertiecranker Spot on, Gertie.  well said.

  8. NashvilleBrian

    August 16, 2012 at 11:29 am

    This post really makes me sad.  First, the term “quietly” in the headline.  There was nothing secret about this.  It was all over the director’s meeting, in tweet streams, in leadership meetings, in meetings with general members, the list goes on and on.  
    One of the many information sessions  NAR held on this showed the fully transparent breakdown.  The facts:
    NAR now owns an entire block on Michigan Avenue in Chicago on one of most expensive real estate spaces in America.
    The space has a TRIPLE NET income.  Repeat…a TRIPLE NET income.
    The current rate of the return is 13%.
    NAR paid $1.45M and the real property appraised for $4M two months later.
    NAR tried three times over the past 20+ years to do this, and couldn’t get it. 
    The investment of $1.45M adding a whopping $15M of additional value to the current building.
    I’m with Gregg on this one.  My jaw is dropped right now.  This article should be about the brilliance of the move, and it should’ve been written a year ago!

  9. heatherelias

    August 16, 2012 at 3:18 pm

    Just to make a quick clarification, both parties in the transaction were represented by commercial agents (as was detailed in the May article at Chicago Agent Magazine you linked to within this post).  From that article: “The deal was conducted with Phil Hoffer of GNP Realty representing NAR and Bruce Miller of Jones Lang Lasalle representing the Wrigley Company.GNP normally represents NAR in its real estate dealings, considering it has a long-standing relationship with the association and is the management company in charge of its headquarters.”

    • Brian Hickey

      August 16, 2012 at 6:18 pm

       @heatherelias Thanks for the clarification Heather – make more sense that the Assoc would have agents involved.

    • Brian Hickey

      August 16, 2012 at 6:19 pm

       @heatherelias Thanks for the clarification Heather – it makes sense that the Assoc would have used agents to facilitate the transaction.

    • GreggDLarson

      August 16, 2012 at 11:47 pm

       @heatherelias Heather, thank you for the clarification on the agent representation – do you have any idea why a few vocal people/members  assumed no agent/broker was involved in this transaction?  

      • heatherelias

        August 17, 2012 at 8:52 am

         @GreggDLarson I’m guessing since this post said “no commissions were involved” they assumed there were no agents. But I’m only surmising. 🙂

  10. JimReppond

    August 16, 2012 at 7:14 pm

    Thankfully someone is out there doing reporting of where our dues are going. If you trust the NAR to tell us the truth or use our dues for what they were intended, I can refer you to a REALTOR who has a great deal on some swamp land in Florida.
    Some have praised this move as “a great investment” or “great ROI and profit opportunity”. This is not what I pay dues for! If I wanted to do that I would have invested in a REIT! Please just lower my dues and stop trying to make money from my money!

  11. Oldbroker

    August 20, 2012 at 5:46 pm

    Most members do not follow the news or business of their associations…local, state, or national. I have served as a volunteer leader of my association for over 25 years, as a state director for 20 years, and as a member of many NAR committees and forums (incldung a year as a forum chairperson) and I know this to be the case. Knowledge of what is done at the state and national levels is even more remote and members typically know even less about them, and what they do. And that is a members perogative.
    Also, Realtor associations often buy buildings and excess land for current and future use. I have facilitated planning sessions for over 100 associations over the years and it is not unusual to have a segment of the leadership that believes the association’s money should be invested in real estate and not in CDs.
    Saul Klein

  12. GreggDLarson

    August 20, 2012 at 6:32 pm

    Good point, Saul. Most of the local associations I’ve worked with over the years have done well by purchasing their own land and building, especially in the long run.  This is not new or unusal behavior for an association by any means, which made this article even more peculiar and off target.

  13. Oldbroker

    August 23, 2012 at 1:35 pm

    It always amazes me when people say “not with my dues dollars.”
    Associations have a perpetual existence and our REALTOR associations are where they are today NOT because of the dues paid this year, but because of the dues paid over many years, by many members…and by the many efforts of years of volunteer service, and effective management, under different economic conditions in all types of economic environments.
    Associations must be able to deliver consistent services in good times and in bad times, with a fluctuating membership count.

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Opinion Editorials

5 ways to grow your entrepreneur business without shaming others

(OPINION / EDITORIAL) We all need support as business owners. Let’s talk ideas for revenue growth as an entrepreneur that do not include shaming your competition.



Entrepreneur women all talking around a meeting table.

The year 2020 has forced everyone to re-assess their priorities and given us the most uncertain set of circumstances we have lived through. For businesses and entrepreneurs, they were faced with having to confront new business scenarios quickly. Maybe your entrepreneur business was set to thrive as behaviors changed (maybe you already offered contactless products and services). Or, you were forced to add virtual components or find new revenue streams – immediately. This has been tough.

Every single person is having a hard time with the adjustments and most likely at different stages than others. We’re at the 6-month mark, and each of our timelines are going to look different. Our emotions have greeted us differently too, whether we have felt relief, grief, excitement, fear, hope, determination, or just plain exhaustion.

Now that we are participating in life a bit more virtually than in 2019, this is a good time to re-visit the pros and cons of the influence of technology and marketing outreach online. It’s also a great time to throw old entrepreneur rules out the window and create a better sense of community where you can.

Here’s an alluring article, “Now Is Not the Time for ‘Mom Shaming’”, that gives an example from about a decade ago of how the popularity of mommy bloggers grew by women sharing their parenting “hacks”, tips, or even recipes and crafting ideas via online posts and blogs. As the blog entries grew, so did other moms comparing themselves and/or feeling inadequate. Some of the responses were natural and some may have been coming from a place of defensiveness. Moms are not alone in looking for resources, articles, materials, and friends to tell us we’re doing ok. We just need to be told “You are doing fine.”

Luckily, some moms in Connecticut decided to declare an end to “Mom Wars” and created a photo shoot that shared examples of how each mom had a right to their choices in parenting. It seemed to reinforce the message of, “You are doing fine.” I don’t know about you, but my recent google searches of “Is it ok to have my 3-year old go to bed with the iPad” are pretty much destined to get me in trouble with her pediatrician. I’m hoping that during a global pandemic, “I am doing fine.”

Comparing this scenario to the entrepreneur world, often times your business is your baby. You have worn many hats to keep it alive. You have built the concept and ideas, nurtured the products and services with sweat, tears, and maybe some laughs. You have spent countless hours researching, experimenting, and trying processes and marketing tactics that work for you. You have been asked to “pivot” this year like so many others (sick of that word? Me too).

Here are some ideas for revenue growth as an entrepreneur (or at least, ideas worth considering if you haven’t already):

  1. It’s about the questions you ask yourself. How does your product or service help or serve others (vs. solely asking how do I get more customers?) This may lead to new ideas or income streams.
  2. Consider a collaboration or a partnership – even if they seem like the competition. “If you want to go fast, go alone. If you want to go far, go together.” – African proverb
  3. Stop inadvertently shaming the competition by critiquing what they do. It’s really obvious on your Instagram. Try changing the narrative to how you help others.
  4. Revisit the poem All I Really Need to Know I Learned in Kindergarten and re-visit it often. “And it is still true, no matter how old you are – when you go out into the world, it is best to hold hands and stick together.”
  5. Join a community, celebrate others’ success, and try to share some positivity without being asked to do so. Ideas include: Likes/endorsements, recommendations on LinkedIn for your vendor contacts, positive Google or Yelp reviews for fellow small business owners.

It seems like we really could use more kindness and empathy right now. So what if we look for the help and support of others in our entrepreneurial universe versus comparing and defending our different way of doing things?

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Opinion Editorials

Can we combat grind culture and injustice with a nap?

(OPINION EDITORIALS) A global pandemic and a climate of racial injustice may require fresh thinking and a new approach from what grind culture has taught us.



Sleeping cat with plant, fighting grind culture.

Information is delivered to us at warp speed with access to television, radio, and the internet (and more specifically, social media). We are inundated with messages. Oftentimes they’re personalized by something that a friend or family shared. Other times we manage them for work, school, or just keeping up with news. Many entrepreneurs already wear many hats and burn the midnight oil.

During this global pandemic, COVID-19, we have also seen a rise in awareness and attention to social injustice and systemic racism. This is not a new concept, as we all know. But it did feel like the attention was advanced exponentially by the murder of George Floyd on Memorial Day 2020. Many people and entrepreneurs felt called to action (or at least experienced self-reflection). And yet they were working at all hours to evolve their businesses to survive. All of this happening simultaneously may have felt like a struggle while they tried to figure out exactly they can do.

There are some incredible thought leaders – and with limited time, it can be as simple as checking them out on Instagram. These public figures give ideas around what to be aware of and how to make sure you are leveling up your awareness.

Dr. Ibram X. Kendi, Director of the Center for Antiracist Research – he has been studying anti-racism and has several books and interviews that help give language to what has been happening in our country for centuries. His content also delves into why and how white people have believed they are more than people of color. Here is a great interview he did with Brené Brown on her Unlocking Us podcast.

Tamika Mallory – American activist and one of the leading organizers of the 2017 Women’s March. She has been fighting for justice to be brought upon the officers that killed Breonna Taylor on March 13. These are among other efforts around the country to push back on gun control, feminist issues, and the Black Lives Matter movement.

Brené Brown – research professor at the University of Houston and has spent the last two decades studying courage, vulnerability, shame, and empathy. She has been listening and engaging on how racism and our shame intersect. She also speaks about how people can reflect on themselves and where they can take action to better our society. She has some antiracism resources on her website.

With all of this information and the change in our daily routines and work habits (or business adjustments), what is a fresh approach or possibly a new angle that you haven’t been able to consider?

There is one social channel against grind culture that may not be as well-known. At an initial glance, you may even perceive this place as a spoof Twitter and Instagram that is just telling you to take a nap. But hold on, it’s actually much smarter than that. The description says “We examine the liberating power of naps. We believe rest is a form of resistance and reparations. We install Nap Experiences. Founding in 2016.”

It might be a great time for you to check out The Nap Ministry, inspired by Tricia Hersey. White people are called to action, and people of color are expressly told to give time to taking care of themselves. Ultimately, it goes both ways – everyone needs the time to recharge and recuperate. But people of color especially are being told to value their rest more than the grind culture. Yes, you’re being told you need to manage your mental health and include self-care in your schedule.

Through The Nap Ministry, Tricia “examines rest as a form of resistance by curating safe spaces for the community to rest via Collective Napping Experiences, immersive workshops, and performance art installations.”

“In this incredibly rich offering, we speak with Tricia on the myths of grind culture, rest as resistance, and reclaiming our imaginative power through sleep. Capitalism and white supremacy have tricked us into believing that our self-worth is tied to our productivity. Tricia shares with us the revolutionary power of rest.” They have even explored embracing sleep as a political act.

Let this allow you to take a deep breath and sigh – it is a must that you take care of yourself to take care of your business as well as your customers and your community. And yes, keep your drive and desire to “get to work”. But not at your expense for the old grind culture narrative.

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Opinion Editorials

The actual reasons people choose to work at startups

(EDITORIAL) Startups have a lot going for them, environment, communication, visible growth. But why else would you work for one?



Startups meeting led by Black woman.

Startups are perpetually viewed as the quintessential millennial paradise with all of the accompanying perks: Flexible hours, in-house table tennis, and long holidays. With this reputation so massively ingrained in the popular perception of startups, is it foolish to think that their employees actually care about the work that startup companies accomplish?

Well, yes and no.

The average startup has a few benefits that traditional business models can’t touch. These benefits often include things like open communication, a relaxed social hierarchy, and proximity to the startup’s mission. That last one is especially important: While larger businesses keep several degrees of separation between their employees and their end goals, startups put the stakes out in the open, allowing employees to find personal motivation to succeed.

When employees find themselves personally fulfilled by their work, that work reaps many of the benefits in the employee’s dedication, which in turn helps the startup propagate. Many aspiring startup employees know this and are eager to “find themselves” through their work.

Nevertheless, the allure of your average startup doesn’t always come from the opportunity to work on “something that matters.”

Tiffany Philippou touches on this concept by pointing out that “People come to work for you because they need money to live… [s]tartups actually offer pretty decent salaries these days.”

It’s true that many employees in their early to late twenties will likely take any available job, so assuming that your startup’s 25-and-under employee base is as committed to finding new uses for plastic as you are may be a bit naïve—indeed, this is a notion that holds true for any business, regardless of size or persuasion.

However, startup experience can color a young employee’s perception of their own self-worth. This allows them to pursue more personally tailored employment opportunities down the road—and that’s not a bad legacy to have.

Additionally, startups often offer—and even encourage—a level of personal connection and interactivity that employees simply won’t find in larger, more established workplaces. That isn’t symptomatic of startups being too laid-back or operating under loosely defined parameters. Instead, it’s a clue that work environments that facilitate personalities rather than rote productivity may stand to get more out of their employees.

Finally, your average startup has a limited number of spots, each of which has a clearly defined role and a possibility for massive growth. An employee of a startup doesn’t typically have to question their purpose in the company—it’s laid out for them; who are we to question their dedication to fulfilling it?

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