Twin Cities’ Gaughan Companies: Succeeding In a Tough Market
by Dan Rafter,
Minnesota Real Estate Journal, March 2011
Forest Lake, Minn.-based brokerage and commercial property management business Gaughan Companies has succeeded through 41 years. The company is now making a big move, joining CORFAC International. The newly renamed Gaughan Companies/CORFAC International, has a bright future as it brings property management, brokerage, construction and development services to its clients, both in and out of the Twin Cities area.
Minnesota Real Estate Journal recently spoke with Patrick Gaughan, president of the company, about the reasons why his firm is growing when so many others today are struggling. Minnesota Real Estate Journal: Let’s start with the latest news: Why did you decide to form a relationship with CORFAC International? Patrick Gaughan: Some of our agents were doing work outside the Twin Cities area. Lou Suski (vice president of sales and leasing with Gaughan Companies) was representing a tenant with offices in Chicago, Milwaukee and Atlanta. We were working with some other real estate firms to assist in that. CORFAC is useful for such relationships. If we want relationships that are more global, and we want to meet the needs of our clients who do business on a more global basis, this is an important step to take. MREJ: What steps have you taken to grow your business through these bad times? So many companies we speak with are shrinking today because of the still-challenging economy, but you seem to be growing. Gaughan: We contemplate that all the time. There are a couple of reasons. One is the relationships. Sometimes, it’s the commitment of the team, the people who work in our organization, the brokers. They take their jobs very seriously. They are there early. They are always focusing on their clients’ needs. The combination of forming these relationships and focusing on the hard work seems to be where the success is coming from. When the economy changed, when it went downhill, it separated the people in this business who are serious and those who aren’t. MREJ: Can you tell me about your company, its history and size? Gaughan: We have been growing it. We just signed up a new property management account two weeks ago. Someone else had it. We bid on it and received it. MREJ: Why were you able to get this account? Gaughan: It was about the relationship. They had us do some brokerage work for them and they liked what we did. The other account wasn’t performing well for them. On the brokerage side we are not big like CBRE, but what we can do is really focus on the client and customer and get to know them personally. We brought some nice results for them, and they were very happy. That’s how it started. MREJ: How long have you been in the real estate business? Gaughan: The one thing about a family business is that you work with it from a very young age. I’ve worked in this business from the time I was 10 or 11 years old. Then when I got out of college, I went to work for my father. He passed on when I was in my mid-20s. I’ve been in business ever since. I took over running the business. He wanted me to own the company. I was the right person for it. We were talking about it prior to his passing. MREJ: How important was it to you to keep the family business going? Gaughan: You need someone in the family who has the aptitude for whatever the business is. It comes natural to me, and I really enjoy it. It also gives me the ability to have a sustainable business. I take that very seriously, especially for the people who work for the company. I passed on a lot of dramatic expansion opportunities because I didn’t want to take on a lot of debt. A lot of companies now are troubled by the high levels of debt that they have. The word on the street is that the businesses don’t have the ability to support their brokers the way they used to. I’m talking about the smaller brokers around. We don’t have that problem. MREJ: What do you enjoy most about working in commercial real estate? Gaughan: The relationships with people. You have to be able to understand the numbers related to real estate, too, of course. You need to be able to understand it as a business model, understand the numbers behind it. On the broker side, it’s about the people and really just working with our brokers, understanding them as a whole and what their needs are, what their goals are. If you can help your brokers reach their goals, then they can do the work they need to do to make sure the clients are happy. That makes for prosperity and usefulness. MREJ: What are some of the most difficult challenges of succeeding in this field? Gaughan: In a down economy, it’s being resourceful and working hard, being proactive. Business doesn’t just come to you as it did in a good economy. You can’t just reach out and grab it. MREJ: You’re planning to open another office in Minneapolis, right? Gaughan: We are planning on another location in Minneapolis. We’re hoping to open that office in the spring of summer of 2011 here to meet some of the needs for the brokerage side and management side. I told Lou, “Find us an office.” He is working through the process of gathering information now.
