Strike when conditions are good and exercise restraint when they are not, Bruce Petersen ’83, said of succeeding in the real estate market. On his recent visit to Texas A&M University’s Mays Business School, he sat down with a group of Business Honors students to discuss his experience navigating an ever-evolving – and often volatile – real estate market over the last three decades.
Petersen is executive managing director of investments at USAA Real Estate Company, where he is responsible for managing USAA Real Estate Company’s commercial investment activities to include acquisitions and joint ventures.
As an undergraduate at Texas A&M, Petersen studied finance but also took a few classes in real estate. His first job after graduation was leasing office retail space. Real estate soon became his passion. “Math and the legal aspect are both involved in real estate,” he said. “Those parts may sound uninteresting, but it’s the part of the business I enjoy. Every time we do an acquisition, it’s something different.”
Petersen said he was drawn to USAA Real Estate Company for its good culture, an exceptional history of success and its mission. “It’s easy to get up in the morning and go to work knowing your client could be laying down his life somewhere in the world,” he said.
Petersen said the 2008 crisis illustrated the importance of assessing when conditions were favorable enough to sell. “Pre-’08, real estate was going nuts,” he said. “I knew something was wrong in ’06 when commercial mortgage backed securities lenders were giving away Ferraris. That was a clue things were about to go upside down.” Fortunately, the company had sold a few portfolios by then. “You have to react to the market, not be at market,” Petersen reiterated.
During that time, Peterson successfully navigated USAA and the company emerged relatively unscathed, taking advantage of amiable markets in 2010 and 2011. In those years, the company underwent 42 or more acquisitions per year, as opposed to a stable state annual average around eight acquisitions per year.
Petersen also discussed how technology developments, especially in computers, had a revolutionizing effect on the industry. Petersen recalled “we had to type in our search criteria into those early computers and then go to lunch to wait, only to come back and sometimes find that the computer still hadn’t finished loading.”
Management major Michelle Hoch ’17 said she was glad for the opportunity to hear Petersen’s story. “Mr. Petersen offered valuable insight into the commercial real estate industry, an area which I don’t have a lot of exposure to,” she said.
Peterson said he recognizes the low exposure to real estate in school for most college students, and said he hopes to see that trend change in the coming years. “He has a strong passion for real estate,” reflected finance major Daniel Hulse ’17. “He wants students like us to have the opportunity to share his passion as they are given better opportunities to learn about the industry.”