Breathing new life into Baltimore’s historic real estate
Eugene Poverni is the managing partner and CEO of Poverni Sheikh Group, a real estate development company based in Baltimore. Unlike many firms, PSG is vertically integrated and fully manages every stage of its projects, from brokerage and advisory to construction to property management. The company specializes in the sustainable, adaptive reuse and rehabilitation of historic and distressed structures such as The Vault, a landmark 40,000 square-foot bank building that PSG recently converted into a mixed-use retail and residential space.
OFFIT KURMAN: What does your company do?
EUGENE POVERNI: We are a 24 person vertically integrated real estate firm focusing on development, construction, management, and lending here in the greater Baltimore–DC area.
What makes your company special?
I think our ability to find interesting opportunities and look at them through a slightly different lens, and layer on our ability to execute vertically—to take something that somebody else may have passed on and say, “Look there is something here we can really do and execute on.” Whether it is a piece of dirt or an old building, to see the opportunity there and then bring on board our construction, our development, our management, to actually turn that vacant building into something real.
Why immigrate to Baltimore?
It was definitely picked for me. We came here vis-a-vis Israel when I was six, and my great-grandfather had immigrated herein in 1979, and so my grandparents came in 1989 and we came in 1993. My parents have been in Baltimore ever since, and I spent a small stint in DC. It’s good to be home.
What do you remember about Ukraine, and what is your first memory of America?
I remember being in a crib, looking out at a tank that I really liked, and it was broken, and I remember my father trying to fix it. I actually remember Bill Clinton’s inauguration being on TV. We came on January 11th or 9th and I think his inauguration was the 18th, 19th or 20th. I remember this happening on television in 1993. Random, but he was my first president.
What is the mission behind building up existing real estate?
We had to figure how to get into the real estate business. We didn’t really have a background in it. We didn’t really have close family in it. So, we had to step back and say, “Where do we think we can find an opportunity? Where do we think we can execute with limited knowledge?” At the time, we’re talking is 2009, 2010—we’re in the middle of an economic recession; we’re in a city like Baltimore where there were some foreclosures, there was extra housing inventory. It seemed to us that it would be easier to find something that’s already there and finish it, rather than it would be to find something new to build from the ground up given our lack of background. We paired that with the fact that there were these old buildings and some of the city incentives and the tax incentives that we could layer on top of revamping these existing buildings, it was almost a no-brainer. If we could buy at a good cost basis, create a good product, rent at an affordable rate in a good community, we knew that model worked, and so that’s what we focused on for the first two or three years.
What made you shift from law to business?
Like any immigrant child, your parents want you to be a doctor or a lawyer—maybe an engineer—so my parents really wanted to make sure that I did one of those three. I’d always liked arguing with people. I always liked to try and convince my parents why I’m right or they’re wrong. My nickname when I was a little kid in Israel was orech din, which means “attorney” in Hebrew, because I was always trying to defend my fellow classmates from the teachers.
I had always known I wanted to become an attorney, but along that way of growing up and watching Matlock, I got into business for myself: I started selling things online when I was 14 and 15, and kind of got a taste of working for myself. That altered my mindset that I had since I was a little kid: while I wanted to be an attorney, always, now I felt what it was like to work for myself—what it’s like you know be responsible for my own monthly income, annual income, my own happiness—and that was always in the back of my mind. Even when I went to undergraduate, I knew I wanted to go to law school; even when I went to law school I knew that at some point I would want to work for myself. The question was always was “It going to be related to law or not?”
Real estate turned out to be a really good nexus in the middle. At least a quarter of my time is spent reviewing or negotiating contracts—just for us, instead of a third-party client. We still get some good called bang for the buck out of the law degree, but I get to be in business for myself, with my partners, and really try to make something out of it.
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