Marshall Finds Expansion Suitable In Current Economic Times
SALISBURY – Preparation is the key in today’s economy and a local business, Marshall Real Estate Auctions, has taken the steps to not only survive but expand.
“I see people keep holding on for the market to come back while we are in a slump,” owner Doug Marshall said. “My argument is get your business to where you are making money now and you will become much more successful than to wait and wait and wait.”Marshall refers to his core business model as a bus.
“It was very important during the slowdown years for me to get the right people on my bus and the wrong people off of my bus,” he said.
The company opened in the late 1990’s and during the “boom years”, it grew rapidly, by 50,000 percent in five years. Marshall said by late 2006 he realized he had to begin streamlining his company’s holdings in investment and commercial properties, as well as re-arrange staff.
“I knew that this market place on the Delmarva Peninsula was going to become distressed,” he said. “I predicted being in the auction industry the banks and the lenders would have to use auctions to liquidate properties so I wanted to be in an equity positive position to invest in certain bank portfolios because I figured that would be the best deal.”
With tough times ahead, Marshall invited RE/MAX brokerage to join his office in 2008 to help handle properties.
“What it really taught me was auctions were going to be more and more needed but less and less people would participate because the lending requirements were going to be so stringent that it was going to be impossible for people to competitively bid,” he said.
Next, Marshall decided to sell off a division of the auction company to his employees, which became Allen & Marshall Auctioneers and Appraisers.
“We had to make some tough decisions and I peeled off a division of my company that was very profitable,” he said. “I either had to lay off a bunch of people or sell the company to them.”
By selling off the division, Marshall’s real estate company became more focused on the banking industry’s need to get rid of properties. Since there were such few buyers, an unseen consequence was Marshall became the main buyer of bank portfolios in the region and led him to owning hundreds of building lots. That is when he decided to bring in a full-time realtor that specializes in short sales and hired Joel Maher as residential property advisor to take on pre-auction property listings.
“After we ended up with these portfolios, now I needed someone to build new homes for us … I needed to bring on a power house contractor so I hired AJ Tucker,” Marshall said.
Tucker, former partner of Tucker Homes, was hired as director of construction. Marshall explained that while he was streamlining he changed his business model to list a property before auction.
“What I failed to realize was that the growth of the brokerage was affecting the auction company,” Marshall said. “So I decided by buying properties at distressed values where I could build the homes and have AJ manage the construction end of it that I had to take some key staff from the auctioning and transport them over to the brokerage.”
While acquiring projects and transferring employees, Marshall found himself in need of a marketing person and that is where Victoria Kent from Montgomery County came in and is now the auction company’s vice president of marketing.
“After I ended up with all these lots, I realize now I need to have a homebuilding company so we developed Marshall Home and Land Company that will focus building in the communities that we own,” Marshall said.
Marshall said he is proud to admit that he made no money from 2008 into 2011. Between streamlining, taking substantial losses, not taking home any pay and living below his means, Marshall has been able to eliminate debts and move into a position to invest in “some really good people.”
Marshall’s passion over the foreclosure industry has landed him a seat on Gov. Martin O’Malley’s task force where he works in Annapolis once a week to help find ways in stabilizing home and neighborhood values throughout the state.
“I am so opposed to the current foreclosure system that I have been leaning on the government to find an alternative to the current system and that is what prompted the call from Annapolis for me to come up and help them develop some solutions and it has been very enlightening,” he said.
Marshall shared a couple of future projects the company plans on taking on but couldn’t release too many details. He said between a new commercial facility on the Maryland-Delaware line, one of Maryland’s newest green energy communities, and the construction of other homes in sporadic neighborhoods he hopes to create two to three dozen full-time positions by the end of 2012, as well as a couple hundred part-time jobs.