CSA talks with Dave Cheatham: Marketplace wisdom
Dave Cheatham spent 21 years as a top-ranked retail broker at CBRE before he left to join the team of Hall of Fame quarterback Roger Staubach in 2005. As managing principal for Cypress Equities West — an affiliate of Staubach Retail Services that develops, operates, and manages properties — he oversaw 6 million sq. ft. of GLA.
He left to help found Velocity Development Services, which he affiliated with X Team Retail Advisors, an integrated platform of 37 retail real estate firms covering 40 U.S. and Canadian markets.
We asked Cheatham, current president of the group, to apply his far-ranging view of the marketplace to the challenges of the day.
What do you see happening in the industry over the next 12-to-18 months?
It’s like Economics 101. The industry is trying to find its equilibrium of supply and demand. We’re seeing turmoil and change, but the change is exciting and is bringing new opportunity. For now, it’s focused on the merging of e-commerce with brick-and-mortar storefronts. Almost every major retail brand is dealing with the re-engineering of its real estate portfolio, whether that means adding and closing stores or rethinking the use of its real estate and customer experience.
Give us an example.
Consider the restaurant experience. You have customers who eat at the restaurant, but they can also order on a kiosk, drive through, and pay with their mobile app — or preorder on their phones for express pickup. There are also delivery options with services such as Uber Eats or DoorDash. As technology changes the way people patronize the restaurant, it forces owners to consider their customer space and staffing needs and how that impacts kitchen and prep space — as well as accommodating for delivery and pickup orders. As we see it, the impact of technology and customer expectation is felt far beyond just a conversation about e-commerce and fulfillment.
How are you working to address these changes?
This is an exciting time to be working in retail, but it is not without its challenges. We believe the X Team business model excels in this way because it’s exclusively retail, led by highly experienced professionals located across the nation offering the full breadth of services necessary for success in this tumultuous and ever-changing business cycle. Tenants, landlords, and investors all need the knowledge gained from tenant rep, landlord leasing, and investment advisory and sales.
How did this far-flung network of brokerages come together?
At the beginning, the formation of X Team was driven by an entrepreneurial vision and desire to improve client service. It was 2002 when X Team founder Jim Stokas left Trammell Crow Retail Services Group to focus on a new approach. He immediately recognized the need and opportunity for a national network of retail-centric experts who could expand the diversity and reach of service to clients.
Today, X Team comprises partners averaging more than 20 years of experience in property dispositions, retail investments, and representation of tenants and landlords. A lot of the larger institutional retail center owners need someone who understands the local market and has the creativity when it comes to right-sizing and attracting a strategic tenant mix. At no time have the fundamentals of real estate been so important, especially for retail, which typically occupies the best real estate within its local market.
So are you saying local market expertise is at a premium these days?
Our competitive advantage is that we have proven seasoned professionals in each of our offices, most of whom began their careers at the larger corporate firms. While the big firms are in major markets, they may not necessarily have a complement of tenured retail industry experts who know the local market dynamics. And, more importantly, these larger firms, while boasting full-service capabilities, are not well-integrated among business lines, expertise, or markets. X Team is culturally founded on the principal of integrated collaboration by market and business expertise.