Business Journal homes in on a dozen residential developers who, surprise, are building in the L.A. market.
Neil Shekhter is living the American dream, and he achieved it in no small part by driving cabs.
Shekhter is preparing this month to unveil a 50-unit luxury apartment development in Santa Monica, adding to a portfolio that was seeded by savings from a small taxi company the Soviet refugee owned in the early 1980s.
Even in this difficult real estate environment, he’s got more projects in the pipeline. There’s a mixed-use affordable housing development with 97 units and 7,000-square-feet of retail space that’s under construction, a similar project set to break ground in October and three more luxury apartment properties he’s planning to start building in 2011.
Shekhter, 47, likes to build on the Westside despite the obstacles that come with building in such a dense area. He claims to welcome the headaches.
“We focus mostly on hard-to-build areas, areas where there is no land anywhere so people can’t just come and build anywhere they want,” Shekhter said. “It makes it more challenging, but I like the challenge.”
Shekhter has had experience overcoming hardships.
He grew up in what is now Lviv, Ukraine, and came to the United States at 17 with help from the Jewish Federations of North America. At the time, Shekhter, his mother and grandparents moved to West Hollywood, where there was already a community of Russian Jews who had fled Soviet oppression.
He started driving cabs when he was 18, and a few years later he bought several cabs and started his own business employing other drivers. But Shekhter was more interested in being a real estate investor than a taxicab operator, so he purchased an auto center in 1985 for less than $1 million with savings from his company.
“I decide to make that kind of an investment because it was auto related, which I knew a little about,” Shekhter said.
He started Brentwood real estate developer NMS Properties Inc. in 1988 and bought his first apartment building. The firm now owns 30 affordable and luxury apartment buildings, mostly in West Los Angeles and the San Fernando Valley, as well as three commercial properties.
Shekhter said he enjoys building affordable housing in more expensive areas such as Santa Monica because it gives people the chance to live where they couldn’t otherwise afford.
“We can attract younger professionals or blue-collar workers,” said Shekhter, who’s even more passionate about building.
“I like that creative aspect of every project, where you can work with an architect to try and design a project for that particular area. And I especially get involved in the design of the units themselves to make sure the units are designed in a way where I believe they are going to be well received by the public.”
These days, the recession has presented Shekhter with his biggest challenge yet. As banks tightened their lending standards, he had to sell one building and renovate several others instead of razing them and rebuilding.
“The most challenging part with the economy has been dealing with the banks. But what’s helped us make it through this tough environment is that we are also operators of apartments. We have existing cash flow,” he said.
“I can take some short cuts,” he added, facetiously. “It comes with the experience of driving a cab.”
Neil Shekhter, 47
President and Chief Executive
NMS Properties Inc., Brentwood
Shekhter started Brentwood real estate company NMS Properties 22 years ago with savings from a taxicab company he founded after emigrating from the Soviet Union. The Bel Air resident began investing in apartment buildings and then decided to develop his own projects. He has one luxury complex set to open and several others under construction or in planning.
Reason I’m a Residential Developer: I began investing in apartments in the mid-1980s, and discovered that there were design problems and quality issues that just couldn’t be overcome with remodels and renovations.
If I Weren’t a Residential Developer I’d Be: I love this business and cannot imagine doing anything else!
Most Challenging Development: I acquired a site on Wilshire Boulevard along the corridor just east of Westwood. The site was tight, and the building was all concrete. It was the first midrise of my career, and it was a good challenge.
Best Career Moment: Envisioning the “mini loft” in our Olympic Studios project, a 375-square-foot loft that has proven very popular. The sense of satisfaction is watching all the happy residents enjoying the fruits of our design, and the naysayers now coming to visit!
Worst: The last 18 months, with the capital markets somewhat frozen and not being able to kick off several deals that were ready for construction.
Favorite Project I Didn’t Develop: I am currently very impressed with the renovation of Santa Monica Place that Macerich did. I am amazed with what they have done with the existing structures and how the design blends beautifully with the Third Street Promenade.
Local Competitor I Respect: I admire developers that build quality projects and hold them long term. And also developers who are an active part of their communities through their philanthropy. An example is Jona Goldrich.
Bucket List: As a former refugee from the Soviet Union, I was helped tremendously by the Jewish Federations in settling in to the United States. My dream would be to give back to the immigrant community by providing some transitional and affordable housing.
