The SHURE Initiative is pleased to announce a new quarterly segment to enhance its already in-demand content, research, and data analytics. The new segment, The PBSA Entrepreneur, will feature interviews with the President of Campus Suites in Toronto, Henry Morton.
Undoubtedly, successful entrepreneurs with strong teams have changed the bend of our daily existence, such as Steve Jobs at Apple, Elon Musk at Tesla and SpaceX, Jeff Bezos at Amazon, and Akio Morita at Sony.
Changes brought by these once-in-a-generation entrepreneurs have impacted how we live, work, and conduct our daily lives. However, being an entrepreneur is a challenging task. Indeed, entrepreneurs live and breathe a daily existence that involves risk and reward. Often, the risks are high, and the rewards are extraordinarily fruitful at many levels.
Many entrepreneurs fail at many levels. However, once in a while, one will hit a big home run and change the course of human history.
The SHURE Initiative decided to analyze the daily lives of entrepreneurs: How they think, calculate risk, and what keeps them moving forward.
The PBSA Entrepreneur is a quarterly interview with Henry Morton of Campus Suites. Henry is an independent PBSA owner and operator based in Toronto who has worked in PBSA for approximately 20 years and has played around with developing assets and property management of over 20,000 beds.
In our first SHURE Initiative PBSA Entrepreneur for Q1 2024, we cover several issues with Henry Morton about life as an entrepreneur. What is life like for Henry? And what can other aspiring entrepreneurs and business owners take from this highly successful Canadian business operation?
SHURE: What is the best advice you have ever received in business or life, and why?
HM: The best advice I have received is multifold: Culture is number one in business, but it’s also number two and number three. If you build great culture, you’ll build great companies. Another thing that I’ve learned is that when you tell the truth, it’s always easy to remember your story.
When you look after your business first, the business will ultimately look after you. If you and I always agree, then one of us is redundant and engages in thoughtful criticism as it’s required to succeed. I also learned I don’t pretend to be the smartest guy in the room ever and let other people think that for you and think that for themselves.
I also learned to learn your business better than anyone else. That will be a true competitive advantage.
And, the last thing: your good name is all you have, so don’t screw it up.
SHURE: Would you want to elaborate on how you learned these things, or was this passed down to you, or did you learn the hard way?
HM: Sure. Many of the things that I learned were that many of these lines or theories came from my father, who just recently passed away, and I have always thought of them in the highest of regard.
Most of the other things I’ve learned in business came not from successes but from problems, failures, or challenges I had in either life or business. And they’re things that I’ve adopted to decide how to live my life.
SHURE: That’s a good answer. You have ventured outside the box with innovative design and interesting P3 relationships. Tell us about the experience of encountering barriers and how you overcame the challenges.
HM: The biggest hurdle in dealing with P3s is patience and the ability to play the long game.
As a family business, we can talk about the long term. It gives us a significant competitive advantage because most companies or funds can’t think in the long term. And, whether it’s a bank, a school, or an insurance company, they don’t think in terms of five- or ten-year horizons; they think in terms of 50-100-year horizons, and unless you can figure out how to change your mindset to believe for the very long term, it is not easy to play with them.
Combined with that, it takes a tremendous amount of patience because there is no easy path to an answer. You have to learn how to work your way through the system, and you have to learn to listen to the higher education client and understand what it is that they’re asking you.
It’s easy to make assumptions, and those assumptions in the P3 world can also be death because they’re pleased when everything is going well, but if something doesn’t go according to plan, you will hear about it from the highest levels.
SHURE: Okay, that’s a good answer. Why is Canada so unique from an investment perspective?
HM: It’s a problem sometimes from an investment perspective. Canada is a true niche. Sorry, but this is a totally niche space within Canada. In that, there really are no capital markets. There are very few transactions to establish values. And every market is somewhat different in that same regard. There’s very little to poor accurate market data, notwithstanding the entrants to the market provide a valuable service.
On the whole, Canada is a very specific, very individual-focused arena. There’s not a lot of broad market data that’s being consumed by all. Individual assets rival the United States without a problem. The newest projects could be placed anywhere in any major market. Still, the industry lags, and we’ll probably never catch up because we need the information flow, capital markets flow, and institutional involvement. When those things don’t happen, it causes great difficulty in having an actual investment perspective from a broader market.
Some funds in Canada have available money, but they have to figure out their own information and flow to play properly. But it’s not like the United States. In the U.S., if you have a fund or a bank who wants to fund three-story projects of pink flamingos on the second floor in a city with less than 40,000 people, there is a niche player to fund that, never mind the big, broader players here. We’re figuring out how to expand our lending beyond one or two major banks to make money available for everybody. So, it’s very different from the United States. And as a result, people go to where there’s often better information because it’s easier to justify the investments you’re making either on a development or an acquisition basis.
SHURE: As a forward-thinking entrepreneur, what’s the next significant change to impact the industry? For example, many are talking about artificial intelligence or how the shift to working from home has changed the landscape of the past few years. In 10 years from now, Henry, what change will you look back at and say had the most significant impact on real estate investors that’s happening right now?
HM: That’s a super good question. I’m going to throw out an answer you’ll have yet to truly think about, which is the word I’ve used: maturity.
Many unprofessionals have seen nothing but good times, and it’s challenging times that make a mark on a person in how they respond. It is what affected me the most. They need to see adversity or change. They can stop being a little bit less individually focused and instead deal with the part of something bigger than themselves. Many people have yet to have the opportunity to see what happens up until very recently with cap rate changes, interest rate changes, and significant inflation changes.
I use the word maturity in a couple of different ways: One is to think of an industry more holistically, and the other is to have a little bit more gray hair to assess and understand how to make decisions in this much more uncertain environment. A little different answer than what you expected.
SHURE: What’s the worst advice you have ever received in business or life, and why?
HM: Culture is not the top priority. That’s the worst advice somebody could give me because it is my top priority. When people only listen to themselves, I think they do so at their own peril. It would help to be open-minded, listen to others, and take their advice. You need to realize that there are usually people who are way more smarter in the room than you are and it’s valuable to have their input. I find that many people around you are trying to protect you from yourself, and if you’re not going to listen to them, you will probably end up where you belong.
SHURE: How do you know that people have your best interest at hand?
HM: Because you’ve built culture. You don’t make your business transactional. Understand what a relationship business means, and live your life by it. If you do it just as transactions, nobody cares about you.
The greatest compliment somebody can give me is to say, I thought about you last night when I was at home, when I was off the clock. That’s the greatest compliment I can get from somebody. They’re doing something on their own time, and when you’re simply transactional, no one will think about you and how to improve things or protect yourself from yourself.
Build the business and appreciate the people around you. But again, that comes back to culture.
SHURE: You said building the culture, having people protect yourself from you, and building something bigger than yourself is essential. On the contrary, not building the culture would be bad advice.
How do you get a feel for people, and how do you build trust and relationships with people you work with or JV with?
HM: First, you create a reputation where you believe people can trust you, and you find like-minded people in that regard. You trust, you believe in, those who are engaged in finding ways of doing projects more significant than themselves. If they do that, then we’ll build a relationship and find ways of overcoming adversity because every project has something that will go wrong.
You have to figure out how to manage those together. Find the people who are in that to work side by side with you instead of in front of you. You will build those relationships as opposed to creating a transactional business where no one’s worried about how to solve a more extensive picture problem.
SHURE: I ask that question because most partnerships fail. Isn’t it something like more than half of business relationships fail?
HM: Sure, but fail is a funny word because failure can happen over the long term. However, it can happen over the short term.
It’s sometimes in business relationships like a marriage has run its course. A marriage can fail because of infidelity, and they can fail because of mismanagement of expectations, they can fail because of money, or problems with children. They can fail because they grew differently; there’s nothing wrong with that. In that last case, it just means that things change over time, and that’s a natural progression.
SHURE: That’s a perfect answer.
HM: Alright.
Related SHURE Initiative Event: SHURE: VANCOUVER & WESTERN CANADA | March 26-27, 2024 Simon Fraser University, Burnaby, British Columbia
