Chad Christensen, the president and chairman of Cottonwood Residential, spoke recently at the Profiles of Leadership course taught by Dean Taylor Randall and Professor Al Landon. He told the 60 students in attendance about taking a big risk that led to his business success with Cottonwood Residential, which is a real estate company that focuses on acquiring investment properties and taking over property management.
The journey of the company included peaks and valleys including the lows of the morbid housing bubble, which burst in the mid-2000s and the highs of receiving a capital infusion of $150 million the same Denver company that founded Quiznos and Smash Burger.
He showcased his business acumen by talking about the real estate industry and the keys to keeping your company fresh, which included managing risk, balancing high cash flow with yield rate, leveraging liquidity and diversifying assets.
One of the most fascinating, though, was the idea of starting a business within your own business. That idea manifested itself in his firm, Cottonwood Real Estate, by starting a cable and Internet company within the real estate firm — to help not only drive revenue but also serve other areas of the business by providing Internet and cable for the apartments.
The real story though was Chad’s road to success. After getting a degree from the U in English, he attended Wharton to earn his MBA. After grad school, Chad entered the job market at the worst possible time — September 2011, but he ended up with an offer in New York that included a hefty signing bonus.
However, Chad realized he wasn’t ready for that path and took a huge risk to take a job in Tulsa, Okla., (with no signing bonus). The decision to do so ended up giving Chad a strong base of knowledge and experience in finding, financing and closing real estate transactions, and he created relationships with commercial real estate brokers, real estate investment trusts, and large conduit lenders which became the basis and vision for Cottonwood.
What risks do you plan on taking?