Stephen Bittel has worked in the commercial real estate sector for over 40 years. He is founder and chairman of Terranova Corporation, one of the top firms in South Florida that has served as the exclusive agent for more than $5 billion worth of commercial projects and represented notable clients such as Morgan Stanley, Bank of America, and New York Life. Bittel was born and raised in Miami and attended Bowdoin College in Brunswick, Maine for his undergraduate degree. After graduating magna cum laude with a bachelor’s degree in economics he spent a year studying abroad under the Watson Fellowship and then returned to Miami where he began to attend law school at the University of Miami.
Bittel started Terranova Corporation while still attending law school, working out of his home office to grow the company from the ground up. Although he eventually did complete law school and pass the bar exam he kept his burgeoning company as his top priority. Starting with the operation of a commercial property for a local partnership, Terranova soon grew to a property base of over 8 million square feet and worked on over 100 different open air shopping centers, in addition to numerous office buildings, industrial parks, multi-family and self-storage assets.
The company has grown and remained relevant by maintaining an agile strategy, shifting its focus to urban retail centers in areas that were part of a walkable downtown core when the markets indicated a change in living scenarios. With properties in popular areas such as Miracle Mile in Coral Gables and Lincoln Road in Miami Beach, since the coronavirus pandemic Bittel and Terranova corporation have been working to reinvigorate the retail areas, while remaining vigilant to new opportunities that may present themselves.
What is Terranova Corporation all about?
Terranova is a multi-strategy opportunistic real estate and private equity investor. I started the company in 1980, and since then our team has grown the company to become one of South Florida’s leading commercial real estate firms with a portfolio that currently includes more than a billion dollars in assets. We’re in our 41st year of business now, and we operate a geographically diverse portfolio of commercial real estate and other operating businesses.
Please tell us a little bit about your background and how you started your company?
I’m proud to say I am a native of Miami. I was born in the public hospital, and I attended school in the Miami-Dade County public system from first grade up until I graduated high school. For college I sought to broaden my experience by going to a school that was completely different from the environment I had grown up in, so I traveled up the coast to attend Bowdoin College in Maine. The winters there were certainly a shock to the system! After earning my undergraduate degree I was awarded a Watson Fellowship which allowed me to study abroad for a year, and it was through that program that I made many of the connections that would eventually see me forming Terranova.
Funnily enough, I never planned on becoming an entrepreneur, or even working in real estate. Both my father and grandfather are lawyers, and I always assumed I would follow in their footsteps. After studying abroad I returned to Florida and enrolled at the University Miami School of Law, but I also began working full-time at a commercial real estate firm to pay the bills. I ended up having a knack for it, and when they offered to restructure my compensation I realized that I could do even better if I just started my own company. It was the fall of my second year of law school that I began operating Terranova out of my house, and although I did complete my degree and pass the bar exam, my heart was in the company I was working to build from the ground up.
What are some of the projects you are working on right now?
Right now we are actively operating our Lincoln Road Miami Beach and Miracle Mile Coral Gables retail portfolios, working to rebuild them to their pre-Covid-19 strength. We continue to redevelop our gas station, convenience store and car wash assets and are adding a newly rebuilt store each year. Our Austin multi-family asset continues its renovation path, and we are engaged in seeking distressed opportunities in real estate and corporate assets.
What is an average working day like for you?
I get up shortly after six each morning, drinking my coffee outside and inspecting our collection of over 2,000 orchids before exercising in our gym. In between these activities I consistently check my emails, asking our team questions and making sure we are moving forward. I also usually read the news and relevant industry publications before heading into the office. From then on, every day can be drastically different. It comes with the territory of running a company – you have to be able to pivot and adapt to however you can best lead on any given day.
What would you say are the top three skills needed to be a successful entrepreneur, and why?
Integrity, empathy for others, and an unrelenting drive. As the leader of a company you provide the vision for your organization, and everything that happens within the company is centered around that vision. In order to have a clear and cohesive vision you must have strong principles that you adhere to, serving as an example that every other person in the business can follow.
When it comes to empathy, I think this is a skill that will serve you just as much in life as it will in business. It is incredibly important to realize that we all differ in how we perceive the world, and seek to understand others’ perspectives. By using that information to guide your communications, you become a much better entrepreneur and person.
Finally, look at any famous entrepreneur and you will see that while they all differ greatly from one another, the single trait they all have in common is drive. Without the ability to persist in the face of difficulty and adversity, you will never have the determination and grit needed to keep a company growing.
What are your plans for the future?
Times of distress have usually been our best chances to put our balance sheet to work. So much of working with any market is getting the timing right, and so right now we are focused on expanding our portfolio of assets through opportunistic acquisition of distressed debt and equity.
How are you funded? What is your best advice to entrepreneurs when it comes to raising funds?
Today we are substantially self-funded but enjoy a number of long-term banking relationships. We also have a long-term history of institutional partners that we continue to look together at opportunities. My biggest advice for entrepreneurs when it comes to raising funds would be to focus on scaling rather than growth at any cost. The investors you want on your team are the ones who will do their due diligence and be interested not only in your potential for growth but also how you plan to do so. I’ve seen many businesses fail because they tried to grow too big too fast.
How many users or clients do you currently have, and when do you consider your company a success?
We have a handful of high net worth private family offices that have co-invested in minority positions with us for many years. I have always felt that the next success was just ahead as we keep pushing to reach the next great idea or opportunity. I think many entrepreneurs will tell you that they are never quite satisfied with the level their company has reached, even those who have grown to astronomical heights. As I said previously an unrelenting drive is an essential quality of an entrepreneur, and with that comes the constant desire to see your business evolve to the next level.
What is a mistake you made starting your business and what did you learn from it?
I started with a negative net worth and was whatever is less than undercapitalized, which was a necessary evil but difficult nonetheless. I learned early on that managing your balance sheet as well as your cash flow was critical, especially in my industry. Like I’ve said, times of distress have usually been our best chances to put our balance sheet to work, and I wish I had entered many of the previous down-business cycles with greater liquidity to seize opportunity.
How do you go about marketing your business and what has been the most successful form of marketing for you?
This is pretty industry-specific, but in the early years we employed a lot of creative trade show ideas to stand out, like having everyone wear the same shirt so ten of us looked like many more. We also tried to have a consistent theme for a few years at a time, which really worked to build an outsize reputation for performance. I suppose for us, the most important aspect of marketing would be to create a strong and cohesive brand that sets us apart from the competition. In that way, we are able to create demand.
Say I was starting my own version of Terranova, what advice do you have for me?
Partner with hard-working, honest people that share your vision and can grow with you, and readjust, readjust, readjust as the market changes.
I could give you all sorts of tips and tricks, but at the end of the day a business is nothing without the people who work behind the scenes. While we may have big dreams, it is ultimately through the team that we will be able to realize those goals. Hiring the right people is important for any business, but if you are just starting out it is even more vital because these are the people who will be playing a key role in understanding and executing your vision.
The world is constantly changing, and to deny that will be a huge detriment to any business endeavor you attempt. While having a vision for your company is important, it is equally important to have flexibility and stay in tune with the way things are shifting, and adjusting your plans accordingly. For example, in my business during the 1980’s and 1990’s we focused heavily on acquiring shopping centers in suburban markets, as that was where young families were moving to at the time. However, as we entered the new millennium it became apparent that many of the younger generation were opting to live in more urban areas. Rather than stick with what we had been doing because it worked in the past, we pivoted and began investing in properties that were in downtown walkable cores, and should we need to we will make necessary adjustments to our business model again.
What resources are you currently using to grow your company?
I think one of the greatest resources is your own mind, and I try to constantly keep it engaged. I read like crazy every single day – I’m always searching for new ideas and sharing articles with my colleagues, friends and family. In my teenage years I took three different speed reading courses which even today has made a huge impact in my ability to absorb information quickly and efficiently. No man is an island and obviously part of the reason you hire employees is to have them bring skills and knowledge to the table that you don’t possess yourself, but your company can only grow if you are staying in the know and researching solutions to problems.
What is your definition of success?
The freedom to reach higher and higher for your goals while earning the respect and trust of your friends, family, colleagues and peers. To be the one that gets the first call to help others. Those are the things that I personally value.
What books or business courses would you recommend for entrepreneurs?
Tom Peters’ In Search of Excellence was so good I took my whole leadership team to hear him speak after I gave them the book when it was first published back in the 1980’s, and I still recommend it today. At the time, the idea of passion in large businesses was a game-changer – most previous management books and education put forward the idea that business is all about rational behavior and numbers. This was one of the first books to identify that people want more than rational rewards such as things or money, they want purpose and meaning as well, and businesses can give that to them, whether as customers or employees.
As for courses, I would recommend auditing some classes from a local school such as macro and microeconomics courses to learn about why people did what they did in the marketplace, not just measuring what they did afterwards. Additionally, even something as simple as brushing up on your math skills can do wonders, and I always loved math courses because there were real answers.
If you had the chance to start your career over again what would you do differently?
I would have shifted earlier from the third-party service business to straight equity investing years earlier. And I would own a lot more car washes.
What is your favorite entrepreneurship quote?
“The harder I work, the luckier I get.”
I’m not sure who said it, but I believe that we make our own luck in this world, and you can’t expect success without working extremely hard for it.
How can readers get in touch with you?
They can reach me at sbittel@terranovacorp.com – I would love to field any questions aspiring entrepreneurs may have. You can also find my personal website https://www.stephenbittel.co.
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