John Busi is recognised as a leader and innovator in the global valuation profession. With more than three decades' experience in commercial real estate and valuation, John is now leading Newmark Knight Frank's valuation and advisory service.
We spoke to him about trends in valuation, client needs and NKF's motivations for joining the IVSC.
What is your background in valuation? How has your career in valuation developed to date?
I left Cushman & Wakefield in 2016 after 35 years to launch a new valuation and advisory platform at Newmark Knight Frank. I was given a blank canvas and asked to create a “dream team” of valuation practitioners across the Americas. I had the opportunity to leverage everything I had learned over the course of my career about valuation, technology and most importantly about people to build something very special and unique.
What is your role at NKF, and what does it entail?
I don’t believe any of us would have left the comfort and security of our legacy environments just to relaunch the businesses we were leaving. Our leadership team joined NKF to do something different, reorienting the role of the traditional production appraiser to create a partnership and a vertical business model that allows professionals to build businesses that coexist across markets and asset classes. We have a structured, long-term commitment to the people who have become part of what we are building. In the past, the “appraiser” role was concerned solely with production. We have reoriented this role into a micro business unit that the appraiser “quarterbacks.” They are team leaders who mentor and coach teammates, pilot the analytics platform and interface and build long-lasting trusted relationships with clients.
Your role incorporates a focus on the integration of “next-generation technology.” What exactly does this mean (what types of new technology)?
The valuation & advisory industry is undergoing an information and technical renaissance, shaped by the prevailing belief that data is the only currency to hold value in this new world order. The ability to capture data is expected of all appraisers. The differentiator is understanding how to use that data. This is where our NKF team is focused. We’re building state-of-the art execution platforms today, we’re in “pre-game” right now, as we stage transformational delivery platforms powered by new math and new science.
You are recognized by many commentators as a “leading innovator” in the global valuation sector. Over the course of your career to date, what developments in the field of valuation have pleased/encouraged you?
The biggest change I’ve witnessed in my career is the evolution of what once was considered a mom-and-pop business into an integrated global enterprise. Sovereign wealth funds, private equity and institutional debt are all operating on a global stage, and if you’re not aligned with that landscape, then your business is a bit off balance. Our network across the Americas and our partnership with Knight Frank is critical to our success. Since I’ve joined Newmark Knight Frank, my team has been front and center at every global gathering. In this year alone, we’ve attended summits in London, Bucharest, Dubai, Cartagena, São Paulo, Quebec and Toronto.
It’s also been great to see the elevation in stature of appraisers in the corporate world. When housed in real estate services firms with multiple business lines, appraisers tend to get overshadowed by transaction “movers and shakers.” NKF is shining a bright light on its valuation professionals and through words and actions is making it abundantly clear that we matter. Our firm has empowered our professionals through organization structure, technology and resources and, most importantly, through culture.
What will the valuation profession look like in the future?
Over the next decade we will witness a transition in the valuation industry. Much of the content within an appraisal can be automated and we will see a gradual shift toward automation and an introduction of artificial intelligence. The business will bifurcate with the least complex asset classes becoming serviced by more automation and model driven processes. Conversely, the most complex assets will require more human interaction, more specialized expertise and evolved analytics.
Why is it important for the valuation profession to have common and internationally agreed-upon standards? Why does this matter to NKF’s clients?
It goes back to my earlier comments. If decisions by investors and lenders are being made across different geographies, then there have to be common criteria for weighing those decisions. Applying different standards to assets in different regions of the world will yield inconsistent conclusions.
How will NKF’s client base benefit through your involvement with the IVSC and the evolution of International Valuation Standards?
NKF will be a leader in this global evolution. The valuation and advisory business is propelled by trust. We want a common set of standards that apply to all, and we want to create and instill trust in every product we create and in every service we perform. This “trust-chain” begins with a baseline of standards and continues from vendor to client to all intended users.
John Busi is President, Valuation and Advisory at international commercial real estate firm, Newmark Knight Frank.