The High-Wire Life: How David Irmer Turned Grit, Faith, and Vision into a Real Estate Legacy

Now I am before the Zions of capitalism. Aan Prrisker says to he leans over into our conversation. He says, "David, you'll never have to worry about money again. You're walking the the highwire." Those little dramatics in life where I took that little extra step and you start doing that with your life. Everything in your life is a step up. I'm going to do that just a little bit better and I'm going to get so much more out of it. But you string little things together and you get big things. That's a belief I have in my heart and my work and my family. David Mer, one of my favorite people in the entire world, all the way from Kalisoga to Potter Valley on a dairy farm and then becoming a real estate development titan. This is an episode that is one to watch for sure. We'll go deep into David's entire history and cover so many important things. If you want to reach success, this is a guy to listen to.

Welcome to the show. David Irmer, one of my absolute favorite people in the world. Welcome to the show. It's great to have you here. I'm so so excited. Doc, you are too generous. I appreciate being with you. This is lovely. Yeah. You know, it's so great to have you here. Um gosh, we got a lot to cover in a short period of time. I did wear my Calonia Street t-shirt for you. I love Yeah, that's there's big history there for you. Yes, there is. And for both of us, actually. Um Yeah. So, the podcast is called The Pathway to Peak Performance. And when I think of someone who is a peak performer at the highest level, it is you. Um, and often in my life when I think, you know, things when things are tough, I always remind myself um of you and how you always charge through. You're just an incredible role model. So, the way we sort of do this is we go all the way back. go back to where it started and sort of who you are and try to capture the passion and the you know the the drive and what took you to where you are today and then sort of tell us what's going on from there.

Wonderful. First of all, let me thank you for those kind words. Uh that's very nice. Not too many of us really understand what the interior drive of ourselves are. We might be better served in looking at another and saying, "I know exactly what got you to where you are because I've observed you." But observing yourself is a whole another issue. But as I look back, Early Life on the Dairy Farm having been raised in a small environment, Northern California, born in the Napa Valley, uh raised in a little community by the name of Potter Valley, which is just east of Ukaya in Mendescino County. uh a little farming community, dairy cows, having specific jobs from a very very early age, five, six, seven years of age. My job was to get the cows, the milking cows, out of the lower field up to the milking barn for my father to uh present the day to the to the young ladies to give milk and uh uh get them on their way. My job was to make sure they were in the corral awaiting that presentation. So, uh, dad would, uh, get me up around 4:30, 5:00 in the morning and we would proceed to the milking facilities. And that was a job I undertook with passion. I knew I was in for something larger than just bringing an animal out of the lower field. uh the creation of that uh 10 gallon can of milk at the end of the day times 20 times 30 whatever it might be. I was a cog in that wheel and I was proud of it and my father uh drove me to understand that uh that was a a very significant part of our life and you son are uh presenting yourself uh in a way that uh we can not only survive but we can thrive. Um, and and I as I got older, I would move through the the farming process of uh planting and cultivating uh uh alalfa, uh, veetch, clover, uh, bailing hay and doing all the rest of the real critical farming activities. But at a very young age, I can recall with clarity uh how I would go down into the uh fields during the summertime irrigating when the irrigation uh district would uh present us with water. our aotment of water to water the fields. And uh dad would have me down on the levey system waiting for that water to come by and I would then dam the the uh ditches and allow the water to flow into our field. And we would have the water for an hour or two hours, whatever that might be, watering our particular uh area of the of the pasture and um and then uh pull the dam and allow the water to flow down to the next farmer. Uh that was a big job and and dad presented me with that and I took it on. and Jack, the majority of my life was self-motivated to a greater degree.

Entrepreneurial Spirit in High School Uh I I would enjoy building things and going after a a a small job and make it an even larger job. When I got into high school, I had uh uh David's window washing service, uh landscaping service, and I had so many jobs going on that I had to hire some of my high school pals. And so maybe I was getting 75 cents to a dollar an hour and I would give uh my my buddies 50 cents. So, I was getting a little override on just being able to manage and I enjoyed it. It It was something that was thrilling to me, not so much for the money's sake, but for having built something that was an established activity that others thought was very dear. I had grown-ups saying that little David is a go-getter. He's out there doing newspaper deliveries, uh, Yukaya Valley crearyy milk deliveries, he's got David's window washing service, he's he's got his landscaping service. This guy is going to the mood. And that alone was a great uh uh creator of of positive affirming energy. And so you you really from an early age just had that in you sort of sort of the um the the drive to make something happen. It was just it wasn't you didn't try when you said self motivation. It was sort of something that was inside you. We had a job to do. We were farm kids. Dad was a farmer. He was a milkman. Um, we didn't have money to hire third party. It was a family operation. And I was given the respect from the family for having done what I did. And Jock, I liked it. As a little kid, I I felt mature, if if that makes any sense. Sure. And and that drive built even more enthusiasm for me to do even bigger things as as time went along. But uh I I just loved the creation of business in the smallest of terms selling uh flour and and um uh vegetable seeds when I was in the third, fourth, fifth grade in Potter Valley going around to the neighborhood to the to the farmers. It wasn't much of a neighborhood, but to the farm houses and and sell uh Mrs. Smith on uh planting flowers around her house. And so I not only sold the seed, but I sold the job to plant the seed and then the job to maintain the flower beds. And I was just a little kid and I loved it because I was doing something important in my in my view in my mindset at that time. But but it was sort of a a an early motivation because we needed it as a family. And as I grew older uh through my late uh teens uh I I looked at it as a way of creating that charge after school. What am I going to do with my life? I saw my father working night and day and I I knew that was not the way to go. Uh we had to build another another life, another way of creating worth, not only self-worth, but a net worth, a worth that would allow family and would allow you to live comfortably and enjoy a lifestyle. Uh and that came about uh because of people I I got to know in these small little towns. Now, Yukaya had a population of 8,000. So, it was small, but I was the football captain. I was the class president. And so, I met people. I I I excelled in socialization. I was a great great uh social contributor. Uh my grades weren't that good. and I struggled that because I spent way too much time on my jobs and on my social events.

College Years and Early Career So when I went to uh mellow college for the first year, I struggle like hell. But again, I ran into people who would not deny my success. They assisted, they encouraged, they elaborated anything and everything I would do because I worked so bloody hard to get through that critical path at an early age. And uh I was just overwhelmed with people wanting to help me. I could never say with any honesty that you're looking at a self-made man. No, you're not. I had so many people assisting in the making of David that it would be difficult to to put their names down on a sheet of paper. Um, it was just a a marvelous young life. I went through Menllo for a year and I got married. We got married at a very young age and uh two years later we had a little baby girl. Leslie Anne came into our life and turned me around completely. I now wanted to get an education and I wanted to build a more sophisticated life. I was unhappy about working as hard as I was working for as little as I was getting numerically. just the numbers of dollars that you put in the bank at the end of the month didn't seem to match with the timeline it took to get them there. So, college was it. Menllo taught me something that has stayed with me even through today. I'm a a member of the board of trustees at mental college and have been for 15 years and I'm one of the the larger contributors to that college's uh economic success. So we give back certainly but we build on what has been given us and those that early first year of college told me this is what you need to do if you want to do great things then start to contribute to that greatness with hard heavy lifting right at the front end and I did that at mental college and then went on to the University of Miami where I graduated. Yeah. That and that's a an interesting story too because going all that way from um Silicon Valley essentially, which maybe wasn't Silicon Valley at that point in time, maybe that's just when it was starting, but all the way to Miami, Florida is a that's a pretty huge track and one I didn't want to take. I wanted to stay at Menllo College. I was in the mental business school. I was getting along great there. We were settled down with our our child and uh I was making a life in Athetherton, California, a place anyone would want to live today. Who wants to who wants to leave Athetherton, California? Yeah. But uh Melo College is at 1,000 El Camino Rial, Athetherton, California. That's our address. And I was just having the best of times. But my father-in-law who was supporting this education and was a timberman from uh Bukaya, Willlets, Fort Bragg, Kofalo up in the north county, Humbult and Menescino counties. Uh decided that he wanted to retire and move the family to Miami Beach. had always dreamed of living on the beach and that's where you wanted us to go. Did a little research on the University of Miami and said, "Son, this is where you need to go." The professors at the University of Miami are from Northern Schools, Dartmouth, Yale, Brown, Princeton, Harvard. They come down to the University of Miami because of the weather. Now, that's not true. Maybe some do, but not very many. I mean, it makes sense, right? You're you're up there. It's the weather's terrible during the winter time when we're 75 above and you're in Miami. Yeah. Well, it was different. And I did learn I I learned a lot about uh our diversity in America, in the South. uh how difficult our black communities and our Hispanic communities were having even in those earliest days. Miami Beach was restricted. If you were of color, either Hispanic or black, you could not be on the streets after sundown. They would take you in if you were a um housekeeper sent out to buy groceries. They were very very aware of the fact that they have to be out of the house to the store and back again prior to sundown. I never heard of such a thing. I'm from Northern California and and I'm shocked. I am truly shocked. An interesting aside, I made dear friends with the Cubans who were going to the University of Miami. This is in 1958-59. A friend of mine came to me and said, "Mom and dad are having a tough time getting money out of Cuba for my education. Castro will not allow US coins currency to come out of Cuba. So, we're having a difficult time with bank transfers and just the flow of putting cash in an envelope and sending it up here to Miami so that I can pay my bills. So, Dad was wondering if we could drive down to Key West, take Kubana Airlines over to Habana, which was a 20minut hop, 90 miles, uh, and and bring the money back physically. I saw adventure. This was great. I was going to help my pals and and I had a great big Pontiac wide track and this big four-door car was loaded up with six buddies and we would charge down to Key West, fly over to Abana, spend the weekend and then take 50s $100 bills and put them in the skulls of our shoes. We hollowed out our tennis shoes so that we could stack u uh currency in the shoes themselves and we fly home and and deposit the money in our pals accounts. This happened for a couple of years, no problem. we would stay with our Cuban uh relatives and so there was really no expense to it and and we were able to assist in in some very dramatic way in our minds. Well, on the last day in 1959, uh we were we were having a grand weekend, got to the airport, lined up to get on a DC3 to fly back to Miami when uh some guards took us out of line into the men's room and undressed us. Well, they asked us to take everything off. T-shirts, polished cotton, uh, trousers and tennis shoes. And I told the boys, "Don't take your shoes off. Take your pants off. Take your t-shirt off, but not your shoes." And they never went for the shoes. And we had the money in our shoes, of course. And they were poking us with rifles. And we they had no idea what was going to happen to us. It was very scary. But that was maybe a 30 45 minute event. And then we got back in line, got on the plane and we were quiet as a mouse all the way to America. Then we got on the tarmac and we said, "That's it. No more. No more money running. We are through." Oh my gosh. We could see ourselves in Elmoro Castle, locked up in the dungeon. It was a very scary thing. Entrepreneurial but very scary. Uh but we made pals with with those wonderful Cuban uh gentlemen and and it was uh quite thrilling. My wife never knew. I never told her what we were doing on all of those weekends. Wasn't every weekend, maybe once a month, every other month. But I wasn't telling her what I was doing. And when she found out, she was about to kill me. If Castro hadn't done it, I am going to finish the job. How dare you? So anyway, fun fun stuff. I graduated from the University of Miami with a Bachelor of Business Administration degree and my father-in-law had gone back to California uh with his family, his wife, his son and daughter, young son and daughter, and he's going to fly out to to be at the event of my graduation. So he comes out and he takes us to dinner that night and very proud of my accomplishments. I graduated college in three and a half years. I'm married. I've got a child. I'm going to get on with life. I want my business degree and I want to apply it. I want to put it to work. And I knew what I wanted to do. I wanted to be in in uh advertising, public relations, sales promotion. I want to work for a big agency and I want to do it in San Francisco. That's what I want. Harold Castile flies out to be a part of the of the graduation party, takes us to dinner, and says, "Son, daughter, I have a wonderful surprise for you. I bought you a business." What is the business? I bought you a business in Lakeland, Florida, which is right up the middle of Florida, in the middle to northern part of the state. He said, "It's uh worms. I bought you a worm farm, African night crawlers. It's run down a bit. It needs a lot of help, but it's right up your alley. You're going to build this business into becoming the king of the worms, fishing worms. You're going to sell fishing worms to fishing camps up in Minnesota and and Wisconsin and Maine and the Carolas. All of these Lake Country uh resorts that uh have fishing camps we are going to sell to. And we've got these little vans with air conditioning. We load them up with little boxes of fishing worms and we take them up to those fishing camps and sell them. And that's what you're going to do. I was shocked. I was dismayed. I was I was in a I I was in a state of disbelief. And that night, I told my wife, his daughter, that I could not do that. I I I just can't. I don't see myself in that business. And it could be worth millions. We walking away from something that is probably very dramatic, but I I that's not what I want to do, nor is Florida where I want to live. So the next morning, we told Harold that we were going to pass on the business. Needless to say, he was very uncomfortable and very cranky about the whole thing. He had a guest um uh lodge up in Rhinelander, Wisconsin on Lake OD uh a little 3 4 acre lake and he owned land around the lake and this little fishing lake and the lodge and had given me two week stay in that lodge as a as a gift for graduating. So, we were on our way in the car driving up to Rhinelander, Wisconsin. Uh, through the agony of having told Harold we were not giving uh the the president of the fishing worm any more thought that that was done. Well, we got up there and instead of staying two weeks, we stayed two hours and it was decided that we would come home. We would drive back to San Francisco immediately and start our life. And that's exactly what we did. We we got in the car the next morning and drove all the way back to San Francisco. And uh that was in 1960. I graduated in August. I had a summer session. Uh August of 1960 and uh that was a tough year. 1661 was a very tough economic year. And and so uh uh we had a struggle. It wasn't as easy as I considered. I had my diploma, but people weren't paying a lot of attention to it. So, I got a little job in Oakland at Western Pioneer Insurance Company as an accounts receivable clerk. I was the gentleman that goes after the non-payers of policy. If if the insurance broker agency does not pay Western Bioner Insurance Company the premiums, then I've got to go after that particular agency and if they don't pay, I cancel the policy. Terrible job. I wasn't fit for that job.

Real Estate Ventures and Innovations So, it lasted for 6 months and I ran into a friend of mine in the real estate business that was taking old timberland, cut over timberland, a,000, 5,000, 10,000 acre timber uh production. And once it's cut, once the timber is off of the land, the the residual is not worth very much, at least to that uh company that cut the timber cuz they've got to wait for 40, 50 years to get another crop. And in the meantime, they've got fire, they've got trespass, they've got insurance issues, uh all kinds of negative expense issues, taxes to just hold the land in a barren state, non-productive state. Well, Art Alwin came up with the idea that he could go to those companies and convince them that we could do joint ventures. You will put your 5,000 acres into a standalone company that will develop that into 20 acre parcels. And my company will develop those, sell them, take all of the proceeds and net of construction costs for roads and water and utilities will split that with you. where you might consider your land worthless, now it has a value. Wow. That's a great deal for them. It's a great deal for them. And it's it's pretty sophisticated. Pretty smart. And and we were young then. We're in our 20s, 22, 23 years old. Uh Art was a little older. Art was probably 25 or six. And I watched our do this first deal. I thought, I love it. I I love it. He has no money invested. He would trade out everything. He would give the surveyors that came in and did all of the survey work for laying out the road systems and and and surveying the four corners of the lots uh properties. So I I owe you a h 100,000. I'm going to give you 200,000 in lots. That that sounds like a good deal. So So he was able to do that and I was amorous of that program, but I didn't like the wilderness aspect of the program. Cut over timberland is not a pretty asset. It it is pretty rugged. Where were these first? Just out of curiosity with these outside of Willlets, California subgore up north, Art Alwin's father, but the ranch that Seab Biscuit retired to. No, the racehorse Seab Biscuit retired to the Ridgewood Ranch. And Charles Howard owned the ranch and and he owned Seab Biscuit. And um his son was killed just outside the ranch in a terrible car accident. And in as a memorial, uh Charlie Howard built the Willlets Hospital, the the Howard Memorial Hospital, which is there today. Um built that in the late 40s. Well, as a kid, I was able to go and pet Seab Biscuit at that ranch as a as a young boy. So, I have great emotions over the Ridgewood Ranch. Art's father uh-in-law was also a timberman. He was a lumberman and he would cut timber and harvest and create 2x4s. That was his specialty. And he cut 6,000 acres and he it was the aftermath of a major war. It looked awful. Trees were down. Now is this redwood? Is this was primarily redwood? Okay. So this is this is prime time lumber. We are now in the uh uh mid50s 53 52 34 um I was on that ranch in 4950. So, uh, Arthur had the asset, went to his father-in-law, created the, uh, the little Bridgewood, uh, development company, and cut that ranch that's 6,000 acres into the 20 acre parcels and sold them off as little ranchettes to people down in the Bay Area looking for an outlet into the greater uh, uh, counties of the north and and what they might uh offer a family as a as a ranchette as opposed to living in a townhouse in San Francisco in the summers. Sunshine, lots of space to roam around in. It had a lake. Uh Bing Crosby used to fish off of the dock of this this little lake. Wow. Uh and Bob Hope. So it had a little pizzazz going for it as well, a little romance. And I just watched as a I I knew Art very well and I knew his wife very well. They were in the lumber business. My father-in-law was in the lumber business. And so that gave me an insight to what he was doing and why his father-in-law would even be interested. the tax advantages and the cost of maintaining a large property for a massive amount of time to try to get another harvest. So, I understood that and but I didn't like the rurality of the development. I wanted finished home sites, paved roads, water systems, sewer systems, underground utilities, Lake Tahoe.

Developing Lake Tahoe Properties Oh my heavens, wouldn't that be nice? Well, uh, greater minds than mine would say, David, you're not going to find that. You'll find that in Menaceto County, Humble County, Trinity County. Yeah, you'll find a lot of that timber cut over, no real economic values here, but you're not going to find thousands of acres of Lake Tahoe. Just not going to happen. I found it. I found a Denny Logging Company out of Truckucky, California. And Bob Denny and his brother Bill had done some timber work for my father-in-law, Harold E. Castile outside of Willlets. And it was magic. He didn't know me, but he knew my father-in-law. And he knew how honest and forthright my father-in-law was to his uh business of cutting timber and selling logs to Harold's mill, the Harold E. Castile Lumber Company. So I would sit with with Bill and talk to him about my idea of instead of 20 acres, you sell me this cut over timberland right outside Truckucky across from the Truckucky airport, 600 acres. You sell me that land for $100 down and I'll give you a a note and deed of trust on the whole thing with release clause provisions whereby you release a lot at a time after I get get it completed, get all the the improvements in, you will sell me those lots and take back instead of cash, you'll take back a note secured by that lot and maybe three others. So, you've got security first deeds of trust on improved properties. Right now, it's just cut over, but this is going to be improved. I'm going to bring crews in and I'm going to rake 600 acres. I'm going to trim up the trees that are left that have been damaged by fallen trees in the lumber opportunity and I'm going to make it a park and this this park-like 600 acres will have 1,800 lots. I never like to interrupt you. I have to ask you, how did you come up with that formula? Because that's a very sophisticated, it seems to me, maybe I'm just a novice real estate guy, but that seems like a very sophisticated way of doing business. How did you come up with that? I had a very good friend uh who was an attorney at a law firm at 240 Stockton Street in San Francisco. uh wonderful young man just out of the Navy, a lieutenant, had done his stint in the Navy, um uh went to Hastings Law School, and he and I jumped around and he his specialty was real estate law. and he said, 'You know, David, there's no reason why you can't find somebody who would want a capital gain on the sale of their land. Uh taxes were high back in the 60s and and everybody was scrambling for a taxable advantage and and so Leo and I would have a beer and talk about the many and various structures that we may be able to consider to get you leveraged into a land opportunity. giving you the same formula concept as your friend Art Elwitt up in the north counties at Lake Tahoe. And I thought about this and I started to put it together. I said, "Yeah, but Leo, h how am I going to finance the on-site improvements and whatever off sites there might be?" acquiring the land through this idea of giving somebody an interest in the development proceeds of presenting a partnership if you will sell it to me for nothing down and taking back notes and deeds of trust. He said, "Well, David, I'm also in a tax attorney. You've got to remember there is no taxable event until that note that the seller of the property takes back as a part of his purchase price uh is paid. So when you sell to Jim and Mary Smith lot number one for $10,000 with 10% down or $1,000 down and you dedicate that note to the seller of the larger property. He has no taxable event until that lot purchaser begins to pay off the lot and he's got 10 years to do it. Now, if that purchaser of the lot wants to build a home, you haven't agreed to subordinate to his home debt. So, he's going to have to pay you out at that time. And let's say 25 to 50% of the lot purchasers of the entire project will want to eventually within 3 years uh build a home. That's the goal because your second home at Lake Tahoe, your ski home, your summer home, that's what we're selling. Okay. Okay. So, we started putting the pieces together and they made all kinds of sense to me except how do I get the roads, water, sewer, electrical lines? How do I get them paid for? And I hired another attorney in the East Bay who lived on Belvadier Island. Now, I'm living in Mil Valley at the time. And I talked to this wonderful man and he said, "You know, there is an old bond act, an assessment district bond act known as the 1911 1913 California assessment district act." And this is the way it works. Going back in time in 1911, we had a population of cars coming into the societal uh thrust of California, but no roads or or wagon trail roads, dusty, dirty, and and not very attractive or or appropriate for that mode of transportation. Plus, we have built up communities under the guise of water systems being appropriate uh as to wells and sewer uh disposition systems known as septic tanks. And these two did not marry well. you're going to have uh leakage from your septic system into your well system and diseases and dtheria and other terrible diseases were starting to happen because of that closeness to the two systems. So if we can create blocks of assessment districts and each one of those properties within the district would carry a bond. And that bond would be dedicated to a system of water uh systems underground as opposed to the well and the sewer system and and paved the roads. And you're going to pay that bond off in 20 years. So, it's a slow pay bond at a very low rate of interest. And let's also make that a tax-free bond so that the buyer of the bond gets it tax-free. So, he's encouraged to buy bonds in these growing districts that elaborate those districts into towns, into cities with an environment that works. I I never heard of this. 19113 but we looked into it and it was still alive in the counties I wanted to develop in which was first one was Elorado County and and I took it to the uh board of supervisors and their attorney and they searched it and Cersei said there's no reason why you can't no it's it's still alive in this county as a matter of fact we've had some very early 1911 13 acts in the county. So I did. I created the district. I raised the money. Now I'm 23 or four years old. Never done this before in my life, but I'm learning quickly. And I run into a a a bond house in Pasadena, California. And Olaf Lighill was head of the bond department. and he took a liking to me. This kid has got some magic as he would like to say and we are going to tap into that. These bonds are salailable. They are really salailable and it's a good asset. That $10,000 lot at fair market value, fully developed, will have a $1,500 bond on it. If you default, Mr. buyer of the lot on your payment, the bond is first. First, not the first deed to trust, but the bond forecloses first. So, if the first deed to trust wants to protect themselves from foreclosure, they got to pay off the bond. So, that's a pretty good asset. You can't lose. Everybody's a winner. Yeah. you get a a fine development activity as opposed to graded road systems, well systems, a septic system, which was all legal and you could do that. But what do you have? You have a very, very rustic small opportunity project that probably isn't going to last very well. I didn't want to go there. So, we created River Park Estates at the south end of the lake as our first 385 lots. We built a bridge across the lower Truckucky River, free span outside of the banks of the river so that the buttresses were not instream. Financed through the bond act, and I sold every one of those lots. And when the buyer of the lot buys his lot, assumes his bond, and closes, I'm off the hook for that bond. So now we've got 385 uh people that own lots that are paying for the bonds, and it works so slick. I took that very concept up to the north end of the lake and and that's where I met Bill and Bob Denny and and I could show him what had happened in the south end of the lake and he said great let's do it now Bob you've got to allow me to put the bond issue on this property and he didn't know what that meant we had to walk through that and he bought into it fairly quickly but then he gave me another uh charge. I have a federal and state tax lean on this property. Oh boy. Okay. How much? Well, it's 600,000 federal and state government. And And what year was that? Uh that was uh 63. Okay. So that's going to be like 1963. In today's money, how much would that be? Oh my gosh. Uh that would probably be uh 8 million maybe. Something like that. It was huge. It was bone. I'm I'm stymied. I'm I'm closed down. No, I'm not. I went home that night. I thought about it and I called my old friend Leo Andred. I said, "Leo, what do you think? We got a tax lane here. He says, "Well, David, why wouldn't the governments of California and the federal government want to do the same thing that the Denny's are doing, taking notes and deeds of trust back for their land purchase? Why wouldn't the federal government just take an assignment of their notes and deeds of trust as security? Right now, they've got a security in a tax lane on, god forbid, uh, properties that could catch fire, that could burn up, that could be vandalized. Nobody wants to buy this this darn thing. It's it's a big piece of unused properties that have been cut from a use that u now is not attractive. So, let's let's take it to them. We did. and and they scratched their head. They just couldn't believe what we were asking. They said, "Now just wait. You've got the right to foreclose on the entire property, the entire 600 acres. What do you got? A mess. And somebody else has to come in here and and see the goal, see the dream, create this this magic, and we're the people that can do that. And you're going to end up with a lot and a paved street and a sewer system and a water system, and everything is ready to roll for a house, and you're going to get paid off. So, why wouldn't you want to do that? They did. Both state and federal government took an assignment of that paper to pay off their lean and I got a lean-free property with the First American Title Company and I'm ready to roll. I got my bond issues for all of the the the uh improvements and I built my young sales force and uh I bartered uh newspaper ads from the Chronicle, The Examiner, the uh Oakland Tribune, and the uh Mercury News in San Jose. Those papers would give me halfpage ads about my homesite sales at Lake Tahoe and I would in in exchange give them notes and deeds of trust or at their leisure properties. If you prefer a a home site, I'll give you a home site at a discounted rate. And in turn, you'll give me a month, two months, five months of of ads. And they worked out beautifully, just beautifully. And we sold. And we Navigating Financial Challenges sold. And we built an organization that was pretty bloody impressive. But I needed cash. I'm dealing in notes and decent trust. 10% down, $1,000 that goes to the salesman for his activity in in initiating the sale and getting it closed. Where's my money for rent? Where's my money for my house at my family? I got none. I got paper. I got notes and deeds of trust. So, I I went to a bank and I got a line of credit to have them loan me money against notes and dees trust, 50% of a note. So, if I had a $10,000 note, I got five grand cash. And that that worked through the 60s pretty darn good. They came right up to 67 and we were flying high, living on Belvadier, wonderful lifestyle and going gang busters with this Lake Tahoe business uh building thousands of lots. Yeah. And I I want to ask you about this. I I need to I need to clarify because before you said, "Hey, how we did it in the south side, but you were talking about Truckucky." So, you're in Truckucky and now are you talking about going down? Was this when you went to King's Beach? Is this the King's Beach area that we you're starting to develop? Where where are you at this point? Because I mean, you developed so much it's it's hard to keep track of it all. I took the concepts that we've been talking about to a real estate development company in the shopping center business. The company was Desmond McTavish and Associates to Pine Street. I went in interviewed with Dez. He was blown away with my concepts and and capacity at that time. and said, "We have we being Sandy McCormack, Al McCormick, and Desmond Stewart McTavish, we have a property at South Lake Tahoe. Why don't you go up and take a look at it? It's on the uh lower Truckucky River, right off of uh Interstate 50. Yeah. uh of an immigrant pass just before you get to Meyers. You hang a left on Highway 267. You go down a mile and there is the land. The next weekend I had found myself on the shores of the lower Truckucky River saying, "Oh my gosh, I've never seen anything more beautiful. It's in Christmas Valley. Can you imagine that? What a name. Christmas Valley with a lower trucky running through it, crystaline, clear, beautiful, and looking up at the uh immigrant pass. Uh it was just a heavenly piece of property. And so I came back and had another conversation with Mr. McDavish and he said, "Uh, let's do a deal. I am a shopping center builder. you are a subdivider of second-owned communities. I didn't think of myself as a subdivider of secondhome communities, but I'll buy it. It's okay. Uh, I can do this. And he and he said, u, but I'm not going to give you any money. We own the land free and clear, so you're not going to have to worry about uh an acquisition of the property, but but I'm not going to give you any money for any of the improvements. So that's when I went out and and got uh a hold of the law firm uh and started to work through the 1911 13x that we talked about earlier and putting this thing together so that I didn't need any capital for the on-site improvements. Uh we could all we could do it through the bond issue. And I took that back to Dez McDavish and he blew his mind and he couldn't believe that that even existed. Now Dez was about 40 years my senior. So he's in his early 60s at the time and and a very responsible, wonderful uh developer. Uh really knew his stuff and I could learn a lot from it. I'm going to learn the shopping center business. I'm going to develop secondhome communities at Lake Tahoe. I'm going to build sales organizations to sell these communities. What a broad spectrum of opportunity in real estate. So, I went with this because I said you you're going to do this project up at Lake Tao River Park Estates and we'll see how well you do. and at the end of that we'll talk fine let's do it am I going to get a salary am I how how am I going to live and he said no no no salary you will pay your way you will were at two Pine Street the old speckles building you'll get a desk and you'll pay your phone bill you'll pay for your secretary burial and we'll see what you look like in 6 months. So, you have the opportunity. Here's the land. Go see what you can do. Well, the first thing I did was I found the act and I put that together so that I knew I could improve this wild property, beautiful property. Uh, I have to build this bridge across the river. Like, oh my heavens. I don't know anything about bridge building. So, I did some research and I found the freespan concrete pre-stressed concrete uh uh guru of the business was Ty Lynn. And Ty Lynn was the master at pre-stress concrete and and freespan. So, I went to see him. He was in Fresno. And I sat down with uh Mr. Lynn and I told him what I had and he said, "Well, how are you going to pay for it?" And I said, "I don't know, but I'll figure it out. But this is where it is. This is what it is." He was attracted to my energy, my youth, and my nagging at him for a few months, and he finally agreed to do it. And I found the money in the act, the assessment district act to pay for that bridge and we got it built. And that bridge is there today. And that's 60 years ago. And it's just great. But it was a it was a testimony to one's willingness to put themselves out for the test and then do everything you can do in your power and make sure that you pass it. David, I want to ask you about this because this is a really cre uh a critical point in this moment in your pathway to peak performance which I think you hit peak performance early on uh many times. I mean we talk about almost like sustainable performance but in your growth path we think about it in a linear sense even though it's not necessarily linear. Um, in these moments, did you have self-doubt at any point in time? Were you afraid at any point in time? Was there anything that said to you, "Does your wife saying to you, "What are you doing?" You know, how are we going to live? What how did you get through that? I mean, I'm asking like 10 different questions, so feel free to narrow it down, but you get where I'm going with this, Jack. Those are exceptional questions. Recall now I'm married at a young age. I had a baby girl at 20 years of age. I'm now out of college. I'm now in business with a developer of some note. He is building shopping centers and has given me this piece of land but no salary. So I have got to find some money to make this all work for me. It frightens a wife, a partner that is not so intimately involved in that business and and seeing it from afar and worrying how am I going to buy groceries. I am living at number two Madrona in Belvadier. I know the house well. We had uh purchased a home for $19,000 in Mil Valley and it was incomplete. It did only the first floor complete. The second level was still to be constructed. There was a stubbed in bathroom on the second floor and uh three bedrooms yet to be built. and I bought it for $19,000 with 10% down which I borrowed. So So I went into that that little house with with no money, but I had payments. I I had to find some money to keep things going. Is this the house in Mil Valley or the House? House of Valley. Mil Valley. Mil Valley. Okay. Yeah. And we lived there from 1961 to 1963. And and Nancy swore that uh the babies were dying from exposure to the terrible weather. The fog would roll in. Uh it it was windy. It was rainy. It was it it wasn't the best of weather. And she was very upset about that. So, I said, "If this isn't a good house, I'm busy. I'm I'm working 20 hours a day. You go find what you want." And she did. She found a a designer, an interior designer that was doing design work in Belvadier. And she and this designer became very dear friends. And they came over to number two Pine Street to do some work for the lady who was living at Tupine who had lost her husband and did not have children. Two Madrona. Two two Madrona, right? I had two two twos. Two. You had the Pine Street business and two Madrona. Yeah. Yeah. So, she was in her in her later years and was thinking of moving out of that house into a more comfortable environment at uh a more formalized home for aged people and and uh she was embarrassed about sleeping on the first floor. She couldn't get up the stairs. Nancy would bring the little girl, Leslie Anne, over to the house, and the lady loved Leslie. Fell in love with her and and decided that uh Leslie needed to live in that home. Now, I'm going to give this house to the Catholic Church. I'm going to move into the Redwoods. I don't think the Redwoods were there, but a place like that. and and you're going to find a way to buy this from the Catholic Church. Nancy comes home and tells me about this and I said, "Okay, stop everything. We will take lots in River Park estates and we'll exchange lots for the value of two Madrona. She can then take the lots and give the lots to the Catholic Church." The Catholic Church come in, sell them to parishioners, give them away, do whatever they want, but then we'll have a house free and clear. No mortgage. Oh, I don't know. I don't. So, I met with a lady and she was enthusiastic about it. She says, "All I want to do is create a value and give that value to the Catholic Church. I don't care if it's gold bars or pickup sticks. I I that's all I want to do. So, how do you see that happening? We're going to get a an appraiser. And you will choose the appraiser for the lots and I'll choose the appraiser for your house. So, we'll get fair fair transactions. They'll be certified appraisers. They will come from Bank of America their list of certified appraisers that they can they use and you'll you'll choose one from there. I'll choose one and they'll organize the the appraisal of the properties and that'll be that'll that's what we'll do. Then I'll deed you those lots. You will in turn deed those to the church and I'll get the house done. We did it. The transaction was done and that was in 63. Wow. And we lived at Tum Madrona from 63

The Madrona Years: 1963-1967 to 67. And in that those years, those four years, things went to the moon in back a couple of times. um this business of the trading of the lots. I then moved into a 2,000 acre property. Uh we bought more properties King's Beach Acquisition and Development in Kings Beach. We bought all of Kings Beach from Mrs. King. Kings Beach was really you. I mean, it was it was we bought all of the waterfront in Kings Beach and was redesigning Kings Beach into a pedestrianon community. We bought this land from Mrs. King. We we'd owned the old uh Brockway Golf Course. The owner of Brockway Springs Resort owned the golf course. And on the lake, 292 ft of lake frontage, was the clubhouse. And it was a ramshackle falling down, rotten. And I I bought that and I built a new car. And uh it was just gorgeous. And I was going to create the rest of the community into a pedestrian ski summer Rockaway Springs and the Birth of Timeshare resort community with a hotel uh condominiums uh which we built Springs. Uh and that was going to be the the lynch pin that the the key to building all of the downtown. And the state government came in and took the property, paid me for it, and turned it into a state park. Then it's a state park today. Took my club, the industry beach and cabana club, and tore it down and it's all beach. Wow. So, that was a big dream. It didn't quite come about. But we did have uh Brockway Springs and and Brockway Springs was a grand success. Brockway Springs was also the start of success of the symbol time share ownership. the very beginning of the time share industry, the ownership of time share, there was a use privilege early on in the 60s 60 the first one I think was 66 67 where you could you could buy a use privilege. You didn't own it. you just had the right to use it for 10 years, 20 years, five years, whatever. All all kinds of programs. And I I looked at that and said, if we could get an ownership involved in that where you actually physically owned August in a particular condominium unit and you owned it for life as you would a a whole unit condominium. Well, there was no law that allowed time and space. Space. Yes, that's condominium. I own unit 121. Then I own it for life forever until it falls down and then I own the residual. I own a prora share of this building. So we took that to a law firm in San Francisco. Uh and and they just shook their head and said, you know, that there's there's no law that allows for that. We we'd have to write law. Well, let's do it. Let's write law. So, we did. We wrote enabling legislation allowing for the ownership of time and space. Yeah, you own 121, but you only own two weeks of it. but two weeks in perpetuity and you could sell it, you could exchange it, you could lease it, you can do whatever you want with it. It's yours for that two weeks. That was a difficult proposition, but we got it done. And we were the first to do time share on a fee simple basis where you owned the right to use your specified time and space. So that was kind of fun. And that too was a a Tahoe venture. It's 1967. Uh, I'm running out of cash and I need to get myself financially reorganized. And the gentleman Olaf Lighill, who had been selling my assessment district bonds, his company in Pasadena had just taken King Resources public. And John King, John Milhouse King, chairman of the board of King Resources, liked Olaf Ligh a lot. Olaf calls him up and says, "I've got a young man that I've been financing uh developments up at Lake Tahoe, and he has been 100% 100% of the time. and I'd love to introduce you to because I think there's some magic where you might be able to uh acquire or finance or somehow assist this young man and his company. And John came because of his his uh care Meeting John M. King for uh Olaf invited us out and gave me 15 minutes of time. I said, "I'll take it." So we flew out to Denver, Colorado, went up to the top of the uh Denver Bank building where his offices were, and I met the man, John M. King sitting behind the largest desk I'd ever seen in my life. Uh I was still in my 20s. So I'm I'm out there kicking and getting and uh John sat behind the desk and started pumping me with questions one after another as quickly as he could and then finally stopped and he said, "What in the hell are you here for? I don't really understand outside of Olaf wanting me to meet you. So, we met. He said, "Let me ask you a question. When were you born?" Thinking he thought I was just a kid and he wanted to know my age. I said, "February 15th, 1937." He said, "I'll be damned. I was born February 15th." Really? Really, Mr. King? That's amazing. Oh, call me John. John, that is simply amazing. And he lightened up. He was 9 years my senior and and he's running this gigantic oil and gas business and finance and whatnot. Melt them mines uh 20 million acres of uh leaseold in the Canadian north. 20 million acres of leasehold so he could drill and frack and work all of that and I my mind is spinning. So, uh, now it's about 4:00 in the afternoon. I've taken more than five or A Businessman's European Adventure 6 hours and I've got a flight back to San Francisco because for the first time my wife and I are flying to Europe. We're going to go to Europe for the very first time and just have a 10-day vacation just to get away from the pressure of it all. And he says, "Okay, all right. You're going to go to Europe. Fine. This is good because I'm going to get you into to Geneva. You're going to meet with Bernie Kornfeld, Ed Cowat, Arthur Liipper, Alan Caner. I mean, these are huge names. Make Oh my god. Well, wait. The way my wife wanted this little time off from business, and now you meeting with with these captains of industry, but but I I'm I'm good with it. I'm fine. and he looks at his watch and he says, "You know, I've got to be up at the Little King Ranch outside of Grandby, Colorado. It's just a quick little flight and we've got a plane built for that particular runway. So, I'll fly us up there and we're going to have dinner tonight with some really interesting people." John, I I go to Europe tomorrow. What time? Well, I think our flight is at 2:00. Okay. Okay. Okay. So, I got to get you back at two. Whoa. Whoa. Whoa. This is our first flight to Europe. Pan-American. We're going to Europe. I I got a wife that is really looking forward to this trip. Are you a businessman or are you a vacationer? Says, "Well, John, you you know I'm a businessman. What? I'm telling you I'll get you there. I'll get you down there. I'll fly you down there myself. We just took a delivery of a uh Jet Star Boeing and all have that plane with a pilot, co-pilot, and and a navigator and a stewardist fly you down to San Francisco to meet your flight. You come on up to Little K and you meet my people. I'll have my treasurer there. I'll have some other people that you'll find interesting. So we do. We go up to Grandby, Colorado. It's now 6:30, 7 o'clock. It's in the summer, June, July. Uh, beautiful, beautiful place. And we're having dinner. And in walks, Wally Sherah, Wally Sherah was the first astronaut to be in all of the astronaut programs. A wonderful guy who became a very dear friend of mine. Another guy there was Jean Sirin. Uh John Glenn fighting Joe Fos was at our table. What a hero. My god. I couldn't believe what kind of gathering you were there. And it was casual and simple and no big deal. It was just wonderful. I went out the next morning at 6:00 in the morning and shot Ski with uh Jean Cernin and I beat him 25 out of 25. He got so angry. It was just a marvelous kind of come together. Now it's getting later and later. I I got to get home. I got it, John. We got to fly down to Denver and uh get on the plane, go home. Okay. Okay. Okay, we'll do that. So, he's in the car. We're going out to the airport to the runway. And he says, "Um, you know, we didn't cover a lot of your needs here. What? You You came down to talk to me about a business deal. You want a partnership? You want a What What is it you're looking for? what kind of a deal? And I said, "No, I I don't want a partnership. I don't need a partnership. I need a lending capacity on my notes and deeds of trust. I have millions of dollars worth of notes and deeds of trust. I want to hypothecate. I want to borrow 70% of." And he thought, "You, Jesus, you have millions of dollars?" Yes. Yes, I do. Already create. Yes. lots sold, financed, taken back, and now I've got to finance those notes to allow me to and I'll I'll give you uh a piece of things, but I'm I'm not going to do a partnership. Will you sell the company to me? If the price was right, I'd sell it. And you'd stay on and and deliver the product for a period of time. Well, we'll talk about that if it comes about, but I'd be open to something like that. Okay. Big cahoff laugh. Away we go. I get into London. The next morning, the phone rings as John. What have you decided? What do you want to do? Oh, John. I need a quarter of a million dollars. like I need the next breath. I need that money. And and so I I told you on that before I left that this is what I'm looking for as a starter kit. And as we become more successful in the sale, the need for more cash becomes very apparent. They say, "Yeah, I can see that." Okay. All right. So now, uh, he's taking me to the spanking room. He's really working me over on the phone and and he says, "Uh, you know, I don't know anything about your business. I'm an oil gas guy. I I know that. But what I'll I'll do, I know you, John, we we've only known each other for 24 hours. You don't really know me." He said, "Yeah, I do. You got a lot of me in you and I see dad. You're a scrapper and you're going to make something happen here. Tell you what I'll do. I want 10% of whatever you do. I'll throw 250,000 to that at that 10%. This is back in the 60s now. 250,000 cash is a lot of money. It's a lot of money. Yeah. So, so and you you want 10% of me and whatever I do? I said, 'Oh, John, I' I'd never agree to that. I'd never agree to that. I'm going to be a a very successful man, and you're not going to buy that for 250 or 2.5 million. It's it's just not going to happen. And he gives me a great big laugh over the phone. He says, "That's what I wanted to hear. That's exactly what I do with you. Don't ever sell yourself so cheaply. I will have $250,000 wired to your account today and we'll do the paperwork when you get home." And that happened, Jock. That happened. And I called my chief financial officer and I told him what was coming his way and I thought he was going to cry. We we had saved the day for that period of time and that would took us out about six months. And when I got back from my trip, I I I actually was in Spain, went from London down to Madrid and and I uh was in Spain when I got another call from John that said, "I will have a plane pick you up and fly you into Geneva so that you can meet with Bernie Kfeld and Ed Cowat and Liipper and Caner and all the guys." So we did. And since Nancy and I were brand new to Europe, we didn't know our way around very much. And she didn't want to just spend one day and didn't even get on plane, come back. So, she stayed in Madrid. And um we got her a hair appointment and nails. And I got her a car and a driver to drive her around a little bit. I got the the the the private personal thing pretty well set up, I thought. And then I took off the next morning for Geneva. I was going to meet the guys and then jump on a plane that evening and fly back. Well, Nancy went out of her mind. She was so unhappy. She was just beside herself. This is not what I signed up for. This is a terrible way to vacation. I'm frightened. I don't know anybody or anything about this hotel and how it works. and and oh my god, she's on the phone with me in Geneva and and guys, I got to get back. So the plane, the iOS plane brought me back to Madrid and I said, "Okay, no more no more business. We're just going to take care of ourselves here." So we lasted for another however many days. We we went to Rome, I guess, after that and then home. I got back and went into Denver and I made a deal with John M. King and uh it was a bad bad deal. It was a a deal out of uh a lot of duress and it should never have been done but it was I had gone public with my company in 1967 with uh King Resources out of Denver, Colorado oil and gas firm. King Resources was a very dynamic firm and they wanted a real estate arm. They wanted to build office buildings and all sorts of things that I didn't do. But of course, I said I could do if I chose to attractive enough to have them say, "Let's talk." And that firm although it was high-flying was financed by uh iOS investors overseas services out of uh Geneva, Switzerland uh by Bernie Kornfeld. Uh and and that was a firm that created bond issues in particular countries. the fund of funds in Germany, in Switzerland, in England, in Italy, and they that that fund would then buy only stocks in Germany, if it was a German fund of funds of Germany, fund of funds of Switzerland, only Swiss companies. And then they go out and sell to you and I these certificates that would allow us to be a part of that fund. And that certificate could be as low as $10 a week commitment to buy. And you would pay $10 into the fund every week. That was your commitment. And it would grow and grow and grow. And all of the sudden, the $10 commitment was worth $20 and it grew into a $3.3 billion fund. Wow. An incredible program. And it it and it worked. But all of a sudden, the wheels came off the cart. Bernie Kfeld was a very high-flying guy. Planes, castles, ocelots. It was the darnest zoo you ever saw. I became quite close to that because I was given a $50 million line of credit from the iOS people to buy and build American assets, American real estate assets of of any type. buy so I could buy land in an industrial park or in a office park or shopping center, whatever I wanted. And and so those earlier days were were were pretty wild. When the wheels came off that cart, I was left holding the bag. It's now 1970 uh August. King Resources is filing for bankruptcy. I am a subsidiary of that company, King Resources. iOS has cut them off. No more funding. They were getting 300 million a year out of iOS. My 50 million stopped funding. And here I was sitting in San Francisco living on Belvadier with my bank accounts frozen. I'm in a I'm in a pickle. I'm in a big pickle. I've got tons of assets at Lake Tile. I've got Kingswood Estates. I've got Sierra Meadows, Glenshshire, Devonshshire, Juniper Hill, Juniper Greek Ranch, uh Brockway Springs, uh Kingswood Village, on and on and on. Beautiful assets, uh tens of millions of dollars worth of assets, but not a penny of cash. And I thought, well, who can I talk to that might give me a little guidance? I was a ski pal with Donald Pritsker.

The Pritzker Connection The Pritsker family out of Chicago and uh he was president of the Hyatt Corporation at this particular time. and we would ski together on weekends in the ski season and and became very fast friends. Donnie, I need a word. I need it. I need some of your advice. Now, as the world turns, his brother Jay Pritsker, chairman of the board of Hyatt, was intimately and deeply involved with iOS and Bernie Kfeld in trying to save that $3.3 billion asset along with Gra Shields out of England and France and a couple of other very heavy financial hitters. So Jay Pritsker, brother of Donnie Pritsker, unbeknownst to me, was intimate to all of that King Resources iOS nonsense. What are the odds, billions to one, it was just amazing. Now, I didn't know this at the time. I had called for the meeting with Donnie, and Donnie and I had a lunch and I explained to him what was going on, and they said, "My gosh, well, I I know your assets at Lake Tahoe. They're they're priceless." I said, "Well, they're not priceless, but they they they are a very fine asset base, and we can build from that." And uh he says, "Well, how how how big is it? I said, ' It's probably, Donnie, just just assets with with no fluff in them, no marketability in them, just land assets, uh improved land and unimproved land, 100 million. Okay. Okay. And what do you think our cash flow might be in any any particular period? Pick a quarter, pick a half a year, a year, and and just give me that stuff. I know that these I'm throwing things at you very quickly, but pull some things together so I can look at uh some financials that make a little sense, but but keep it light and interesting. You own so many acres of land. so much of it is improved, so much of it is unimproved and the debt is what it is and and laid that out. So I did and he takes a look at it and he's really impressed. So Donnie had called his brother Jay in Chicago and explained who I was, what I was about, and what the asset looked like. He said that uh uh we could probably have some interest through the Hyatt relationship. We had a substantial line of credit at Hyatt that had not been touched. And he said maybe we could buy David's company out of this line of credit just to exercise the line. Not that we would have to do it that way, but just that might be a way. and Donnie shared that with me. But the end result was that Don and I flew back to Chicago and met with a Pritsker, the father of Don and Jay at the uh Water Tower Hotel in downtown Chicago for breakfast. It was Donnie, Jay, David, and AM Pritzker. And we sat down and said our pleasantries. And the three of them started talking about family amongst themselves. So and so was getting married in June and we're thinking about a venue for that and this is important. It it's a very tight-knit family and and and I was just nervous as a rotten peach. I I got to be eaten quickly here. an a sitting directly across from me started to talk to me about Tahoe. So I understand the assets that we're here to discuss is up at Lake Tahoe. I love Lake Tahoe. I have a home at Lake Tahoe and I I just couldn't imagine being in a more pleasant, beautiful environment in the summertime. I'm not big on the snow. I want snow, I'll stay in Chicago. But and and it was a great pleasantry. It was just soft and easy. He wanted to know about my kids and at that time I had uh I had three sons and a daughter now. So my my the armor family had uh had grown and I had a little more sophistication and I was having some fun at all of this except we need to make a deal. So, we're talking away and and finally Jay says, "I think you and David came out to talk to us about a proposition. Why don't we get to that?" Now, we'd been to breakfast for maybe 45 to an hour before we focused on the fact that we were here to talk business. So we started talking a little bit about it and and Jay kept acknowledging and asking questions that uh what has your experience been and at that time I had 10 years of experience. I started in 1960. Now it's the the corporation was formed May 11th 1961. So I have a stretch of years and I've done everything the hard way. There was no easy way. Yeah. You you you were walking the the highwire. I I was walking the high wire. But in that interim, in that 10-year period where now I am before the the the Zions of of capitalism, if I can make this deal happen with the Pritsker family, either through Hyatt or through other family activity, I I have a position that I couldn't possibly ask for any better. I was asked the question, how did you get here? How how in the world did you finance all of this? And I started abbreviating what we had gone through. And all three gentlemen were just shaking their heads. Oh my god. Yeah. Yeah. Good for you. Oh, you did that? Good for you. And you needed cash. I said, "Yes, I I did. I needed cash to pay the bills." So, I put in a little ad in the Wall Street Journal and I um I dug up some investors, early on investors that were really wonderful people and and they helped me uh Beverly Investments out of Beverly Hills manage personalities, sport and movie and screen and stage and all of that. Well, who were those people? Well, it's Natalie Wood, Lee J. Cobb, Charlton, Lauren Green. He said, "Really?" I said, "Yeah, well, Natalie Wood is still invested in Sierra Meadows. She still has an interest there and is paid. The rest of them are paid off." And a state senator, James Bush. Uh, yeah. So, I I named off some people. I said, "My god, how did how did you get them?" I called him up. I offered him a deal and and a lot of it was personality, I must tell you. But I had the land. I had How How did you get a thousand acres? How do you My god, you're a kid. I said, "Well, I I'm I'm young, but I'm not a I've never been a kid. I was I wasn't born a kid. I just th this is my enthusiasm. This is my energy level. this is what I do. He said, "Well, I that's that's impressive, but King Resources is in bankruptcy. How is this affecting you?" I said, "It is affecting me. I'm not bankrupt. My company is not bankrupt, but the parent is." Okay. Well, that could be good. As Jay is saying this, that could be good. Let's think about this. you say you you got a somewhere between 70 and $100 million worth of asset. I said, "Yeah, that if it were to sell over time, that's what you're going to see. This is a fun component of it. were sitting there and they they're they're now closing on the deal internally and and okay, we're going to do this and this and and you can help us find uh acquisition sites, leaseold sites for our hotels and we're going international and we're going to be all over the place and we want to expand into Southeast Asia and we're boom boom and this thing is growing upside down. I all I'm trying to do is meet payroll on Friday. That's all I want to do. And now I'm I'm I'm building a hotel in Jakarta. So it was a wild moment and I just let it ramble and I thought, "Oh my god. Oh my god." Oh, you can spot it. Oh. Oh. Just before we leave the meeting, Jay says to me, "Uh, okay. It'll be structured like a partnership. We'll own 50% of your company and you'll own 50%. And so you're going to be committed to really making this thing work. We'll have uh a debt instrument. We'll have a note on the money it takes to buy the company, but once that gets paid off, we're 50/50 and we'll develop the world. Aan Prrisker says to me, he leans over into our conversation. And he says, "David, you'll never have to worry about money again. And I know a big piece of what you've done in your life is chasing money. Not chasing a great deal, not buying that land because it's the best piece of property in the world to develop, but because you could buy it in a specific way that organizes your ability, but not necessarily a marvelous piece of property. It happened to have been an okay piece. It's all right. It's fine, but it's not the best of the best. you'll only deal with the best of the best because you'll have that kind of of capital to work with. And it was seconded by both brothers and they said that's the only way we want to work. We'll give you money, you'll give us performance production and we'll go from there. Okay, I got to get out of this meeting. And they pop out and they leave. Donnie and I have another coffee. I said, I think the meeting went okay. I think it I think we've got something here. Um I'm going to have to do some homework. I'm going to get back and talk to our our senior uh legal uh Marvin Terman and Marvin will put some things together and you'll get busy on proformas and and and statements. Bring your all of your financials up current and let's let's see what we could do. And we walked back to to the plane and we jumped on and I sat down in first class and Donnie, he said, "What what the hell are you doing?" I said, "Well, this is where this is I I flew out first class. I'm flying back first class." I can't believe you. You're on your ass. You can't meet payroll. And you're flying first like spec with me in the back of the bus. I'll be damned. He and I talked about that story until the day he died. He he died in 19 uh 75 and and was just a a marvelous marvelous partner all those five years that the the deal with Hayyatt made and we developed our finest hours in those five years. They were the ones that bought all the assets back from the from the courts. Bankruptcy courts cleaned all that up. John King and Bernie Kornfeld were out of the picture. Jay Pritsker and I talked about that whole mess so many times and and what a disaster it was for all of the stockholders of iOS. All the $3.3 billion dollar of money in the in the 60s. Oh, in the 60s, all of those stockholders, it just went upside down. But when Donnie died, Jay wanted to take Hayyatt back to a pure hotel company. And and that happened. And and I must say the finest relationship I've ever had in business was with the Pritsker family. That's phenomenal. They they would give you a word and they would live to that word and never never take it as anything more or less than what we had suggested. You can't ask for anything better than that. And it was with a great deal of respect and love that we built that. And of course, I I knew the governor of of Illinois when he was a little guy because he was Donniey's son. JB is Donniey's son. And and so that's kind of fun. And Penny Pritsker, the daughter of Donnie, was our Secretary of Commerce under under Obama. So, the kids did pretty well, too. But that was a wonderful relationship. And after Donniey's death, Jay uh gave us all an opportunity to buy our companies back. There were seven partnerships and other relationships within the Hyatt family and and he gave every one of the senior executives uh chief executive officers of their company the right uh to make some sort of deal with the family to reorganize and and and bring their companies back into the fold. Uh, I I did I gave uh Jay a proposition and I paid him off in 18 months and it was fun. And Jay would always call me when he came to town. He'd be out visiting San Francisco and the hotels in the city. He always call me up for a lunch or let's have a drink. I'm I'm upstairs. Uh, come on up and see me. And that's just the way the relationship's built. And uh it in 1975 I I bought the firm back and uh the rest of it has been from second home community development by the thousands at Lake Tao and a shopping center at South Lake Tao. the Beiju shopping center, two shopping centers and apartments and condominiums here in the immediate Bay Area, which gave me a a whole new lift. That was a real real interesting exciting period of time when I when I moved from the majority of my asset building second homes into primary primary shopping centers. Uh we built seven shopping centers in the Bay Area and uh hundreds of condominiums and and took off from there.

Navigating Financial Turmoil 75 pretty much on my own uh financing myself and pulling myself together through 80 81 uh just doing a lot of work everywhere. We went to Bale, Colorado, and we built a sevenstory midrise uh condominium and time shared it as well. So we had some time share interest there. We built and was selling Brockway Springs. So, that was going beautifully. We bought a property up in Larksburg just behind the hospital up on the hill. Uh we called that uh Eagle Point. Eagle Point. And built condominiums there and sold those condominiums. You did that to moment? Yes, we did. Wow. And it was just wonderful. It was just things were things things were really happening. They were they were cooking. They were cooking. So now we're we're entering the 80s, early 80s. Uh I buy a very substantial property on Cheeseman Park in Denver, Colorado, right on the park. And we're going to build a 32story beautiful, beautiful condominium and face it to the front range across the park, across downtown, the the state house, and into the mountains. And it was gorgeous. It was simply gorgeous. This is 81, 82, 83 begins to happen. And the wheels are coming off the cart. The market slowed down. The stock market is becoming very difficult. Banks do not want to loan any more money on real estate. And I've got a couple of million dollars invested in Denver. I own the land. I've got three old 1880 houses on this land front running the park that needs to be torn down. I go in for the building permit to build my high-rise in lie of the three older historic houses. I didn't think they were historic. I thought they were disasters and and I would get an applause for just removing them. He kept can't turn them down. I can't tear them down. No, these are queen hands and you have to preserve them. You can move them, but you have to preserve them. Oh my. Well, a couple of months a month, I find the park is is about like this table. My my high-rise is over in the south uh east corner. And over here on the northwest corner is is a great big Victorian 6,600 square feet. Big Victorian of some note, some some uh uh pioneer built this thing back in the 1800s, but it was just shambles. And the land around it had nothing on it. It was just grass and and some some landscaping. So I saw those three houses coming across this park and landing over here. Fix up the Victorian and sell in off as its own and then place these three on the park on Cheese. That'd be right on the park. And I could fix those up, put little basements, haul them across the the park. Bingo. I'm all I'm ready to go here. It's all clean. This one will pay for itself. If all I can do is just get the money back from the move and the rehabilitation, we're fine. So, we do it. And we got the governor at the opening of the project because it's it's it's this is what developers can do when the motivation is there because we have a lot of old properties throughout Denver that need saving and and instead of tearing them down and building the new, we preserve and we create and we are motivated to do what Mer and company has done over here. So the mayor is there, the governor is there. Martha and I get married that week at Christ Church in Salelo and we honeyode in Denver, Colorado and and at uh Vale, Colorado where we built uh another sevenstory project. did some time share in it as well in Vale called Dale Run out at Lion's Head. So, we go to the big party. We meet all the nice people and we're going to sell this thing out in the weekend. Pool be gone. So, we head on into Veil. We drive into Veil and we're going to honey for three or four days there. Swing on back. Take a look at the final results of of Humble Court. this project and and boy, it's going to be a great great party, great time. We walk into this beautiful old house that we had spent hundreds of thousands redoing and it was a mess. It was a party mess. There were empty glasses. There were champagne bottles. There was food product. It was like somebody had a great big party and then at about 12:00 said, "Okay, everybody home. We're going and we could just leave it." I couldn't believe it. I could not believe it. My people did this to me. My Denver people. Oh my god. So more than I spent a day or so getting cleaners to come in and and to spot on brand new carpet and and odds and ends that needed fixing. So, we spent our honeymoon doing that, fixing it all up. Came home, put it on the multiple listing market endeavor. It didn't sell. Now, we're into crisis. I got a big loan with Denver National Bank and I got to sell this. I got to sell those three units and the larger property. Does not sell. Does not sell. Does not sell. One year, two years. What am I going to do over here? I got a loan on on this property, too. And I I've got to start thinking about building that. Can't get a loan. Nothing is working. I finally give these properties away. These these four properties. I give them away for the loan. Just assume the loan. I'll get you preapproved at Denver National. You'll just take over the mortgage and I'll walk away. And I'll have left a million some dollars in this pod and uh 600 700,000 over here. I sell that to another developer who spent about 10 years before he developed the property. But it it got built. It got built and I came home with my tail between my legs. At this very same time, we have a call from Southern Pacific Railroad.

The Southern Pacific Railroad Deal The introduction to Southern Pacific at the at the World Trade Center, the nice lunch. The introduction ends up being an offer. Um, could we hire you as a consultant? Even though I I needed the money, I needed the cash flow. This is this is in 83 82 83. So early early 80s when all this is not going well and I need another big project to make me feel good. So they said, "Well, we'll hire you as our consultant and and we'll listen to you and and you're going to be the guy that could pull pull all this together." I said, "That's not who I am. That's not what I do. I'm a groundup developer. I see a site I like. I entertain a specific land use. I work with an architect and a land planner to bring that into some sort of personality. And and if I can find that sweet spot, I'll finish the the acquisition of the site and build the dream. That's what I do. Oh, well, you know, we're historic here in town. We've owned it as Southern Pacific Railroad for 150 years. Uh, we we've got to finish it. We we do we have, but I appreciate you're seeing us. Okay, that's fine. Call on me at any time if I can introduce you to anybody or help you out. I'm I'm living in Belvadier. No, I I wasn't at that time. I was living in Salelo, but I had lived in Belvadier for 10 years. Okay, thank you very much. 6 months go by and I don't hear a peep. Finally, I get a call from some Pacific. Would you see us again? Yes, I I will. We sit and talk a little bit and he says, "We want to sell this studio." I said, "Why would I buy it? You can't get it approved. Why do you think I could get it approved? That doesn't work." And he said, "Well, you know everybody in town. You you you can do this where we can't. You have all of the history and and the power of a 55 acre site in their downtown. I would think you could organize a program that would fit the community and yourselves beautifully and you'd be a hero. Oh, we we just don't want to do this anymore. We want to sell it and we thought we'd come to you first. I said, "Okay, well, give me a week to think about it." So, I I pull some of my resources together, my financial resources in Los Angeles, and we talk about it. I said, "Oh my gosh, that property is probably the best property in all of the Bay Area. It has everything going for it." Uh, why why don't you think about it? We'll we'll find some money to put this thing together cuz they want cash. They want all cash. Okay. So, I come up with a program. I will be your savior on this site, but I want to buy the site when it is fully approved to be developed. I cannot take that risk. I am not a risktaker in real estate activity. I am a creator of real estate values. And right now your land is valueless. It doesn't have a value. So how is this going to work? We'll go into a contract of sale. We will place it in escrow and I will hire, retain all of the necessary uh creative people to design and get ready for building the project, whatever that might be, commercial, residential, but I'll I'll put all that together and you'll pay the price. You'll write the checks to the architects and engineers and land planners, land use study people, environmentalists, soils, civil, electrical, mechanical, everybody. And when I close escrow, I will repay you all of the funds that you'll put out to get the approvals. I will do all of the approval work at no cost. So if you have to take this back because I can't perform, look what you have. I have been able to create something for you that uh it will be pretty pronounced. They get the consulting that they were looking for. It's like it's a win-win. It's a win-win. They came back and said, "Yes, we will, but we have to define what we're doing here." And I said, 'We going to I'm going to hire the attorneys that are going to create the assessment Creating the Assessment District district. We're going to create the redevelopment agency district. We'll work it all the way through to a final map for all of the civil work and a condominium map for the condominiums and buildings 14 and 15 which are the two commercial buildings as as we're starting to lay this thing out. All of that will be refunded to you but paid by Sun Pacific. They said yes. Okay. if we have your full attention and 18 months to get it done. Now, I wanted the 18 months, not Southern Pacific so much, but I wanted the 18 months so that I could go to the town and say, "Town, I don't have all night and day." So, you can have you can have your groups of study. You can you can do whatever you wish, but we have a timeline. You now have an opportunity to use me for your end product. You tell me what you want here. I'll go out and I'll get interested people throughout the community to think about it, to get on a task force that will bring us a product that we we can buy off on as a community and the developer can make a little money. It's a win-win for both parties. And the city council, town council were great.

Collaborating with the Town Council They were absolutely great. We got ourselves pulled together. I started working directly with the mayor and some town council people and we just ripped. Uh I had Tony Gazardo. I had a coffee with Tony Gazardo this morning across the street at Ori. Great. He has been with us that long. And Tony and I are best of pals. Tony is 91 and he was the one that did all of the land planning here, all of its land use studies, all of its landscaping. And Fischer Freriedman, Rodney Freriedman who lives in Belvadier was the architect. And uh so it's all local stuff. Rodney lives here. Tony lives here. I live in Salelo, but lived here for 10 years. Know it well. Let's do this. This is a local job. Don't let it slip away and end up in an ownership in Chicago or LA or or Denver. Keep it local. Keep it right here with people who care. And that resonated throughout the community. That made sense. And it it truly did. It did make sense because we did care uh and we did some really interesting things. So anyway, we're working through this program and in February of 1985, we close ASCRO and we took title with building permits being delivered to the title company so that when we closed Asgrow and passed title from Southern Pacific Railroad to the industry companies, it came with building permits. so that nobody could sue and get between us and the building permit because it was a half a second in recordation. From the final map to the recording of the condominium map to the recording of the building permits, boom, boom, boom, done. You got a project. Now, anybody can sue for any reason, but but they can't break that chain. that that really did happen. And I paid off Southern Pacific Railroad. I put together a consortium of savings and loans. Uh there was six I think here and they all chipped in and gave me the money necessary and away we went. We started land construction, roads, uh all of the necessary grading and and uh creation of pads for each one of the building spaces and it was just pumping along pretty good. I came over here one day about 3 months outside of uh the Unexpected Contractor Bankruptcy grading activity and we had a big fence all the way around protecting it from the kids. It was a pretty trashy piece of property. It had a lot of old buildings on it. And I had a big cleanup. I had a big uh job of of uh tearing this stuff down and and renovating the land back to a normaly. So I come over here and the site was quiet. There was a soul on the site. Where is everybody? The trailers, construction trailers were locked. My god. What happened to my contractor? Where is every My contractor is out of San Jose. I called the Carlane Swenson Construction Company. I can't get through. Can't get through. Can't get through. They filed for bankruptcy. What? My heavens. This is a big company. was 82 years old when I signed the construction contract and they had 19 jobs and everybody spoke very highly of them. Their bank was Wells Fargo and they had $12 million in cash and and in the 80s that was a lot of money. That was that was they're they're good. These people are doing the right thing, David. We we've got some reorganization to do. Reorganization? and I've got a project to build. Get yourself out here and and get going with this. It's going to take some time. It It's going to take a few few months to get oursel back into shape. Oh, no, no, no, no. Now I've got bonds on the contractor, improvement bonds, labor, material bonds. Uh so my next call was to fireman's fund. your contractor has just failed and he's bonded. I want you guys in a meeting tomorrow to tell me how we're going to proceed. Well, they did. They came out to the site and we did have a meeting. And their position was, we got to take time to look at everything. We got to look at the plans to make sure that they were good plans. Maybe you created this bankruptcy or maybe your bad plans, your bad specifications. Maybe you said something to the subtrades when you were walking around out here. We understand you did a lot of walking of the site, which is your pleasure. That's fine. You're owners. But did you tell any of the people to do anything specifically that may have caused a failure? We've got to find all that out. Oh my god. Oh my god. We're We're upside down. There is dirt everywhere. We had begun driving piles into each one of the building pad sites for soil stability. Quit everything. I mean, there's there's nothing going on. Shortly after that, I would say two months after that, the federal FDIC Community Crisis and Recovery came in and shut the savings and loans down. So now we have no financing available to us. All of our money is now locked up. My contractor is bankrupt. Some of the trades are going bankrupt because my contractor can't pay them. And now I've got my financing taken away from me. And I've got a town that is really panicked because it's torn apart. Torn apart from Mar West all the way to Mar East. From Timberon Boulevard to Paradise Drive, Paradise Drive from Timber Boulevard and Main Street down to the Caprice was a private road. It was not owned by the county or the town. It was owned by Southern Pacific Railroad. So now I own it. And that road is a dirt road. And and once a year Southern Pacific Railroad would chain it off so you couldn't use it. You'd have to go in back of the project on Mar West and around that way. They wanted to to preserve the privacy of that road system. So now all of that is torn up. It is just dirt. It is graded dirt and it's blowing dirt all over the bloody place and all the town can see is a disaster for a long long time for years and years. So, the first thing I did was I pulled the town together and went to the Corinthian yacht club and and ordered a great big spread of of food and and wine to be served. And I brought in the federal people, the oversight people to the banks, fireman's fund, the contractor's lawyer, and all of my people, Tony Gazardo, uh, Fiser Freriedman, and and others. So, we're up on stage, and you could ask us questions, anything. This is going to be an absolute open book. We're either going to do it together or we're going to just live with what we have now. And this is unacceptable. We can't do that. I have to refinance this project. And I can't do it if I have a whole community against me. No, there isn't a bank in the world that would take a look at this. And so if we can't get the money, we can't complete the plans as we had approved, as as your community has approved, as you people have approved. The development approval went to a referendum vote after it was approved by the town hall. Six votes. Six votes. I mean, this project has a story unlike any other development I've ever run into. It it was simply amazing. But the town came together, the mayor, uh the the the uh town council, everybody pulled together because they saw if we did not, it could last a long long time. It really could. It it could have been a big disaster. Then of course, Southern Pacific Railroad is out of the deal with a with all the cash they wanted. We saw this coming. Oh my gosh. So, so we went to work. We went to work and we replaced the banks through the FSLIC. We we joined hands. We got together and they brought in some people and we replaced the the financial responsibilities. We replaced we rebid the project and we brought in the best contractor in the world and they actually came in and tore down. They built a lot of the Golden Gate Bridge. So, they're old and they're wonderful and they're great people and they took a look at a lot of the construction that was in place and said, "We're not going to have our name on this. We're not going to go in and and complete what is standing because it's not sound. We're going to tear down or we're going to replace whatever those pieces were." Now I had at this time we we had uh uh completed some of the project and we had people moving in and we had to move them out so that we could reconstruct their homes. Now, if you own a brand spanking new home and your ass to leave, Whoa, whoa, whoa, wait a minute. I sold the house I was in to come over here to Point Tipperon and move in, which I have done in good spirit and good faith, and now you're telling me I have to leave because there's some deficiencies in the construction. Well, yes, for 6 weeks or 3 weeks or 5 weeks or 2 months or whatever. But the answer was, well, we'll go, but we want to be taken care of. So, you will pay the rent on the place we have to move to. you will store our furniture or move our furniture into the new place and you'll do all the repair work and then you'll move us back in. Now, when we leave our home to the rental home, we want our breakfast, lunch, and dinner. I said, "Well, no lunch because you're generally out of the house at lunchtime." So, breakfast and dinner. We want our breakfast and dinner. We want our laundry. We want travel money because you got us in Santa Rosa now and and and how are we going to get down here and all the many and various opportunities you have in in a lifestyle we had to look at. We even sent people to Hawaii. I became best friends with so many people. We're writing checks and we're doing this and I've got it. I've got it because fireman's fund, the bonding company, is now suggesting that they have some exposure that we have to take care of the deficiencies in construction. Our guy that we bonded didn't do the job. So, okay, we created the fund, we managed the fund, we put responsible people involved in that fund and and we did it and it was an incredible undertaking. We finished off the job. We started selling the rema Oh, in in the end in this uh ensuing few months after we had cleaned everything up, we got a refinance. We got a new contractor on board and they came in lickety split, managed so well and brought the ownership that were involved in the earlier sales together and listen to their stories. example, we only we had uh one in the Bayside community that bought an upgraded white carpet for the entire house. They were a Chinese family and they would always take their shoes off to go across their white carpet to keep it just perfect. Well, the earliest of uh uh construction people didn't do that. and they'd walk, "Well, we're going to we're going to just scrub it up and and you know, we'll clean all the carpets like brand new. You won't know the difference." He said, "No, no, you won't. You're going to replace all of the carpet in the house. Replace all of it? That's $40 a yard for this 100% wool carpet. Beautiful. Be the best pass." Yes, you will do that. fireman's fund was our fault. He'll do it. That didn't happen too many times, but it happened. And so the the level of of care we took was pretty dramatic. Now we're getting it back in. We're starting the project is going well. The lagoon is is dug. We find the the old steam engine at the bottom of the lagoon that we we hook into. Do we rise it? Clean it. Do do what? It's rusted out. It's a terrible mess. Just leave it alone. Leave Leave it where it is. It's sinking slowly into the mud. It'll just go down and be there. So, you'll just seal off your lagoon above the old fire engine. But full disclosure, we're building the Bayside Park 1985. We get all the way down to the Caprice and by Elephant Brock, which it work had been done after our completion. But in the very early stages, we did a lot of Elephant Rock work so that it could be used again. And that was a part of our give back to the community. So, we had done that and we're starting on the Bayside Park and we run into a grave site. A 19-year-old American Indian boy had died of chickenpox and was placed on the shoreline in a grave and it was 119 years from the time we found him when they did all the testing of the body. Can anything else happen to me? I mean, it was simply amazing. So, I thought it was going to shut us down for months, but everybody climbed in and said, "Let's get this going. We'll get the body exumed. We'll get it over to the University of California. We'll deal with the American Indians, the Pomos that had some ownership in that relationship with the dead boy." And and and we got it done. And we got it done quickly. and this town pulled together like I've never seen a community in my 62 years of development. I never have seen anybody give me the kind of care and attention every one of our uh agencies at the town. You're through it. It's 1985. We get the park, the Bayside Park completed. We're so proud of it. the curve linear pathway, the green grass, moving the road system from right up against the bay to pulling it back and getting some spatial quality between the road, Paradise Drive, and the Bayside Park and our water. All of the rock structure that that supports and maintains the bay from the land was put in place. The pathway was built, the grass was planted, all sawed. It's ready to go. And it's the 4th of July, 1985. I'm living at uh 58 Atwood in Saucelo with my new bride, my new new wife, Martha Carden. And I get a telephone call late at night from an unknown person who tells me he's going to kill me. He is going to kill me because I created this park, this nonsense nuisance of a space in the town where you're going to see hippies and tent people and homeless people structured all along our waterfront. And it's just awful. And you did it. And if I were you, I'd watch myself tomorrow at the inauguration. It hung up. I tell Martha, we we put our heads together, said, "Well, we've got to call the chief of police in town and we've got to call the sheriff and we've got to call the FBI and let these people know because on on July 4th, we we inaugurated the park and we had the band, we had had all the speakers and somebody up on the hill with a rifle to take me out the heartbeat. So, we call everybody and we tell them what had just happened. And I said, "Well, what should I do? What what are we going to do?" They said, "There's not much we can do. You received a phone call. You have no idea who called you, where it came from, if it was Loal, if it was out of state. You You know what? How How are we to do anything? Or what am I to do? Stay home." If I were you, I would not put my face on that podium. I wouldn't do that. And and let us do our work. We'll try to figure out what we can do. And and I'll say this is going to be for you. And that was it. I didn't go to the reception. I didn't go to the inauguration. I didn't go to anything. And here's my tree. This beautiful park. And um I I saw little kids out there with frisbes. I saw mom and dad and the children having lunches, picnics. I just couldn't be a party. So So that passed us and we never heard a threat uh from anybody ever again.

Sales and Marketing Strategies Now we're into the sales season in 1986. We're getting ready to sell our community that's based here at the lagoon and the uh community in back of us along the marsh restoration area. We had taken that whole marsh area and cleaned it out with a with a big shovel. just brought this big machine in and tore out all of the junk and tires and car body and just junk that had been back there for years. So, we had this great big open area that was now filled with water uh was the marsh and we planted it in marsh kind of growth. Tony Gazardo put a big plan together and wild ducks and geese would come in and it just started to get better and better and after three or four months you could have sworn it had been a marsh as you saw it forever. So we were very happy with that. We built a 66-in storm drain system that ran from the marsh and its runoff water through the system and out to the bay. Our little town of Main Street flooded every single year. There was a high tide and a rainstorm. The waters would rush down and and just flood the town. And we had sandbags on every storefront until we brought the system together. So that was wonderful that that worked that we were very happy with that. Now we're up to a sales endeavor. We put a sales list together. We bring brokers together. We do all kinds of interviews. We do all kinds of research to find out how to price our product. What's fair? What's just, what will move in the marketplace? Oh, no. Not those prices. It'll never happen. Oh, no, no, no. It's way too much money. Oh my gosh. You think you're going to sell a condominium here on the waterfront for $325,000? Oh my heavens, you're going to own them forever. I was starting to buy in a little bit because some of the local brokers whom I really admired was convincing me that perhaps I was a little foolish in pricing them the way I did. I said, "Guys, I I got to have these prices. We've got this kind of money in it." Well, we put a great big white tent up where the ferry service uh now parks the bicycles and people gather at the little gathering area before getting onto the ferry white tent. Every Saturday and Sunday, we would have champagne and scrambled eggs and and bacon served to anybody who would want to come down and have breakfast with us. Breakfast on the bay. And we did that week after week after week. And people would come over from San Francisco down from Hillsboro and Athetherton and Menel Park to see what this thing is all about on the bay. No, there's no on the bay there. Well, yeah, we are. And we started to sell. And we would not sell one or two a week. We would sell 20 a week. And I was selling so fast. I didn't really have a lot of time to increase the prices. I would move them a little. I'd move them 10,000 20,000. But a a a home that now sells for three and a half million sold for 300,000. So nobody ever lost any money at Point. In a 40year span, that's the best deal going. Oh, nice. Yeah. Yeah, it is. And it's liquid. If you want out of your home, you got them scanny and light. I think that is one of those those investments where you you literally if you put it on the market it's gone before. I don't even think you have to all you have to do is just call the agent and it's gone. It's a wonderful thing to have been a part of. But that was the fun part that once we got it constructed and these homes were just glowing and the contractor did such a grand job and and now people are starting to move in and be really responsive to their new spaces. Very active. Loving it. We had parties out at the poolside uh to celebrate the new uh purchasers of homes and we got a spirit of of togetherness. We're Point Timberon. Yes, we had a terrible time. We had an awful time, but nobody gave up. Nobody walked away. Had I just said, "I I can't do this." Oh my. We'd still see dirt in the road because there'd be so many lawsuits and so many bad things happening. I just kept saying, "As long as you're with me, Jock, you're with me and we've got this level of responsibility clearly in mind, we're going to make it happen." And he did, you know, and it's it's amazing. It changed this town dramatically. Um, you made it. And that was derelic space. That whole railroad area. $3.5 million worth of toxicity. Yeah. Was found and removed. Yeah. Think about how that impacted the Environmental Challenges and Solutions bay. Also, if you think about this, this is an interesting fact. So, if you take a look at where uh that young Native American man would have been, yeah, the water moving through there moving so quickly, eventually that that toxicity would have seeped through the ground and into that mud. It's all kind of like aspen trees or the roots are all connected. that would have had a serious impact on the bay. So the from an environmental standpoint the the the fact that you did that work is tremendous. We've all considered that and and our environmentalists also brought that to everybody's attention. Now I I I want to make one other statement. When that was brought to our attention, this project was almost complete. The big challenge was at the existing parking area that is behind building 15. Early in the process, the town of Tibberon wanted the lagoon to be freshwater. I understand the conundrum. We wanted freshwater for whatever reason. And one of the problems is uh since Marin does not have a plethora of fresh water, it's a very very precious commodity in this county. How do we continue to serve the lagoon? How do we fill it? How do we maintain it? How do we manage its its level? Well, we want you to build a sistern under the parking structure, a concrete sistn, so that when water drains off of the the the marsh area, it'll fill up the sistern and then when the lagoon goes down, the sistern will dump water into the Oh my heavens. Woo! We've got all the water in the world right here. Let's just bring it in from the bay. We We want to try this first. It It costs millions. We build a system. We pave the parking lot. We fill the lagoon with fresh water. Buy it. Fill it. Just hundreds of thousands of gallons. We We're full. I walk out the next day to admire our work and I see a shimmer of oil on the surface of the lagoon. Oh my heavens, what in the world? Some young person threw a can of oil in there or something like that flashed in my head. That's that's probably what happened. Uh so, okay. Okay. Worst case, we got to drain it. Best case, we can skim it and and we'll take care of this. Well, we skimmed it. We got everything collected and pulled it back. It wasn't as bad as we thought, but it's so it's good. And next day, I walk out, it's there again. Oh my gosh, what happened? So, I go and check the system and the system in the parking lot is full of oil. Oh my gosh. It's coming from the parking lot. It's internalized itself and it's a pocket of of oil that we missed. We just flat out missed it because we found all kinds of toxicity. Paint. A lot of paint. Bunch of lead, I'm sure. A lot of lead. Well, lead based paint. Yeah. In those days, they they would just paint a car or the engine, and then if there was a little paint left over in the can, they uh create a sump. They dig a sump and then just pour the paint residual into that sump and it would percolate down through the soil, hit the bay mud and pretty well stabilize. and there's just kind of finger out little by little. Nothing too dramatic. And that was the biggest charge, but they they would clean the engines of oil when they were working on them. And they that too went into the sump. So, we got a whole history of this stuff. Now, we we got a handle on it. We got our environmentalists out here. We got our soils uh engineers out. Everybody's taking a look at it, writing reports. bumping into trees trying to figure out best way to handle it. And it came right down to you you you've got to dig it up and and get it out of here. You got to move it. You got to get that soil out of here. Okay. Okay. Well, this is a big job. I got to go talk to Southern Mississippi Railroad. I certainly did not leave all of that oil on this site. So, we got to remove the toxicity. We got to get it off site. What is that going to cost? Well, we do a preliminary study. Uh cubic yards of dirt that have to be hauled off and then cubic yards of clean dirt that have to be brought back in. You can't just leave a great big hole. So, dirt out, dirt back in. 20 yard dump trucks, dual dump trucks, 40 on the Tibberon Boulevard access to our town out and back all day long hauling this material. I've got an estimated cost. I go in to see the seller, Southern Pacific Railroad. I tell them of the concerns. agree uh interest in what was going on. Uh can we see the reports? Can we of course I'll give you everything I've got. No, what I thought would be the best I could expect from the seller would be we will share the cost. We'll pick up 50% of it as a seller of the property and you pick up 50% I gave them all the reports. I gave them the estimations from the uh hauler of the materials out and back and u it was three and a half million. So big number. They called me back into the office and we had a meeting. We poured a coffee and we were sitting around. They were asking me questions of how how well the project was was selling and and they were so pleased with the way it turned out and looking. It's a it's an absolute joy to see something as as substantial as that looking so well within a smaller community. We did not overwhelm the community. There's no highrises looking down on people. We're we're delighted with it. Uh and getting around to the toxicity removal, that's on us. Excuse me. We put it there. We're going to pay for it to be holed up and disposed of. Well, thank you very much. Thank you very much. That's the first really great thing that ever happened to me on this project. Not an argument, Jock. Not two words of this is a part of you, too. Now, we don't own this. You do. How do we know you didn't put that garbage there? None of that. Not a question. And I've I've never had more respect for a an American corporation and and their responsibilities to something they did to the environment. You know, David, it's amazing. Um I think I met you first even though probably had was around you uh but didn't really meet you. It was say 25 years ago. You've always been a delightful person. At first, I've told you this before. When I first met you, I thought I thought, can anybody be that nice? Can anybody really be that nice? And um one of the things that I've just really come to know and respect about you is the way that you treat people. You treat people so well. I've heard you say some things to people um you know firsthand that I think was done with such incredible class kindness. Um you know you've been a a tremendous role model to me. I get a little choked up thinking about it because how much you meant to me. Um, one thing about this show is trying to dig into those moments. And as you listen to this, if anyone has listened to this show, now we're at we're past Reflections on Leadership and Faith them. We've edited this and now it's all out. And you've got to hear just a ton of grit, tenacity, vision, never give up, all of those things. And in the moments where you're feeling, I don't know, overwhelmed. Overwhelmed. What do you do? How do you get past that? I pray. I'm a Christian. I believe in my religion very deeply and I practice it. And I know if I call for help and I give it my best, my religion isn't Santa Claus. It wants partnership. And as long as I can respond in an affirming, positive, creative, industrial way, going to work, getting off the dime and making something happen. What is that something? We'll find it. I can't even begin to tell you how many times I've gone into a very dramatic meeting and somebody has asked me so how are you going to do that before we give you a response of yes or no I want to hear how you're going to do that I said I don't know this very moment that's the honest truth I don't know but you give me the opportunity and I'll find the answer and we will prevail. And John, if you believe that, if you truly believe that, and I believe that comes from my deep inner self and believing in my Lord, my religion, my creator. If I truly believe that, then be honest to your religion. Be honest to it. Don't don't give it a mouthpiece of I say prayers every night and and that's it. No, no. God wants you to say prayers. He wants to hear what you have to say, but he also wants you to go out and do something. And believe me, I will give you what you look for, what you seek. But you got to seek, you know, so many people uh are contemporaries in business. Well, you know, I'm religious. I I walk in the forest and and I look at the trees and I get peace and and you know, that's my religion and and bless your hearts for it. If if that works for you, that's fine. But I need something more substantial. I need to work with my religion. My religion is active. And so that's a big piece of it. It's also looking back on my 88 as of this year and I I look on the years that I have spent in the traces of creating a life personal and corporate. And what I see is a dynamic response to building something that I felt was very very necessary for the kind of creative life I wanted to live. But I have to build that example fun. But here we are. I buy the piece of property up at Kingswood Innovative Development Projects Estates in King in Kings Beach from the Denny Longing Company. They had trashed this beautiful pisa property and I'm going to build 600 home sites on this property. What am I going to do with all the slash and all of the junk and trees that are are just lying at a 45 because they were felled into by by other merchant timber removal. And I was coming back from Nevada City and and I saw a team of of men working on the hillside of a roadway and they were brushing it and cutting limbs off of trees and dressing it up and there may have been 30 or 40 men uh doing this this work. Well, I got an idea. What if I did that with secured people, jail people on my site and I paid for it? I I I would buy the lunches and breakfast and dinners and what and transport whatever I had to do, but I would get teams of people on that site and I'd make it into a park just like a perfect perfect property before loggy. We cut up, puck up the down trees. We'd stack them so that anybody that bought that lot would have firewood for 20 years. It was kind of fun. And and I I got a team of men, older men, younger men, uh probably 30 men, 40 men, and we went to work on Kingswood Estates, and Griff Creek ran around the edge of it, and Griff was just plowed with slash with broken trees and limbs, and it was just a mess. We cleaned up the creek. We cleaned up all of the land that I was to subdivide. And then when I built the road systems, and they're all curbal linear roads. Nothing went in a street. I'm not building roads. I'm building an access to get from Highway 267 to your home. But that's not going to get it. I want to go around that stone. And I want to go around that great big tree that was left as a seedling tree and and uh make it look just great. Flash an idea. I've got natural gas up here. What if I put in a natural gas system and I had flaming torches throughout the forest? What? You lost your mind? You're going to put fire in the in the forest? So, so I go to PG&E and I tell her what I want to do. I want to put a torch 8t tall at every home site so that when you drive through the forest, I've limmed all the trees up uh 15 18 ft. So, you can look through the forest. You see the little twinkly lights. Think about driving to your home site off 267 to your new uh uh home away from home on a nice curve linear street that goes around that outcropping of rocks instead of just right through it and around those those trees. And we had islands in the street saying that this way and they're all planted in flowers. Beautiful flowers. So they have big flower beds and now you're in a park instead of just a subdivision, not a subdivision. Your time from the moment you leave 267 to your home site is an absolute joy. It's an experience. It's an experience and it's different than anything else you've had all week, month, year long until you got to Kingswood Estates. If I did it, it happened. It wasn't just, "Yeah, we're going to have these these these torches and oh no, no, no." PG said, "No, of course now. We do it all the time. Of course, no. We can contain it." And they cut off valves and somebody bangs on it and destroys it and shut off at the at the stem. Uh, we went through the whole thing and we did it. And I go up there today and I look at that and I I just marvel at it. But that was done in 1963. Wow. So, back to our question, how does that even happen? Well, it's encouraged because somebody else was doing it. The state was doing it on a on a roadway, on a roadside, cleaning up brush and debris, fire protection, and just good looks, you know, handsome. as you as the citizens drive through. And I took it to a private position. Here's an idea. What if we did this? Well, how much is that going to cost? Can it work out? And what I was doing is improving something so beyond the norm that others that were subdividing in the area decided, "Boy, that really works. and and it can't be that much more. I mean, if you just took a a 10,000 square foot lot and decided you're going to just clean up that lot, it's a mess. How much would that be? Would it be $100? Would it be $500? And could I get 500 more if it were Biffy? So those those little dramatics in life, there's a lot of them where I took that little extra step through shopping centers. Go the extra mile. Tenants will do better. You will do better because they'll be happier. Their their customer will buy more. They'll want to stay longer. So you've got a more advanced piece of equity than you would if you just did a half paid job. And you start doing that with your life. Everything in your life is a step up. I'm going to do that just a little bit better and I'm going to get so much more out of it. And you take it to relationships where you meet with your friends, your pals, your your your family friends, your congregation, wherever, whoever it might be, and give just a little bit more. You know, Jack, a prime example of this is the love affair we have with St. Steven's Episcopal Church in Belvadier. We have been offering a gathering of community of our church community and out and people that have an interest in us to come down to the San Francisco Yacht Club and celebrate the fact that we are back together. We have come back from vacation. We've come back into the community, our not only our religious community, but the community at large. Do you think that makes a better community out of Tibbron? Of course it does. Of course it does. And it's more fun to live here because of a little tiny thing like that. It's not a big thing. It's a little thing, but you string little things together and you get big things. That's a belief I have in my heart and my work and my family. Well, you know what? It's not only a belief. It's been demonstrated. You know, you believe that that's the way to do it. And you've demonstrated it for years. You've produced amazing results. Uh you're inspiration to so many people. And um thanks for being here today. Jack, I want to leave it by suggesting this. You and I have been dear friends for a long time and we have a commitment but had a very personal commitment at uh St. Steven's Episcopal Church where we were having some challenges with staff and you and I took on that challenge and we did it in a graceful meaningful way that left everybody standing. And I was never so amazed and and wonderfully wonderfully excited about the way you handled yourself with authority. But everybody got the message in the best of ways, in the best of terms. As I'm quick to say, nobody died. It was wonderful. And and I live off of that. That is a part of of of me and would happen in my presence with you. Yeah. Kind words. Kind kind words. Thank you, my friend. Thank you.

Closing Thoughts and Gratitude Thank you so much for watching this episode. I hope you enjoyed it as much as I did. David's charity is Menllo College, which is a phenomenal institution located in the heart of Silicon Valley and has so much to offer anyone who really wants to chase technology, entrepreneurship, and business. Again, thank you and we look forward to seeing you on the next episode.