“I sat down and thought, ‘If I go bankrupt, a lot of little guys are going to go broke because of me, because I was a smart ass.’ Then I thought, ‘what have I got going for me? I know how to log and I have an appraising ticket. You can’t take that away from me. I have my motivation. I have my sons.’ I realized that if I had all those things going for me, what the hell was I worried about? I walked out of those mountains, made a deal with my creditors, and I started doing appraisals.”
He did appraisals for the bank for $20 apiece, five a day. He did $4,500 worth of appraisals for construction mogul Ben Ginter, whom he’d met in Prince George. Like Mr. Ginter, Mr. Nielsen had grown his early fortune in Prince George. He worked in his 20s as a real estate agent, selling off vacant lots. The emergence of pulp mills in the area made for a booming market, which helped him get his start. Mr. Ginter, well known to British Columbians for his famous Uncle Ben’s beer, had made a fortune and lost it by 1976. Mr. Nielsen sent him a few notices for payment, but knowing Uncle Ben was in financial trouble, he decided to forgive the debt.
When Mr. Ginter recovered from his financial setback, he called Mr. Nielsen and offered to help him put together a deal with a Canadian insurance company that wanted to purchase great swaths of timber properties in B.C. Mr. Nielsen appraised 220 properties, put in an offer and closed the deal on behalf of the company. He netted a commission of $480,000, which was a lot back in 1982. For his part, Mr. Ginter declined a cut of the profits. Mr. Nielsen used the money to help pay down his $1.8-million debt, but he still had a way to go.
In his life before he went broke, he bought residential and commercial real estate, but the second time around, he gave that up. He understood horses, bears, fishing, and living off the land, so he stuck to what he knew. Because he had nothing, he went back to his first job, as a logger. He found a chunk of land near the town of Vanderhoof that was for sale for $45,000. He drove up and checked out the property and immediately saw the amount of valuable timber that was there.
He paid $500 as a down payment, which was all the money he had. He then approached the local sawmill and said: “I’ll lay my cards on the table. I only have $50 left in my pocket, and I need that to get back to Vancouver. I need $45,000 for this property. How about I log the property and give you the timber?” The log broker thought about it overnight, and the next day he gave Mr. Nielsen a cheque for $50,000, for the property and extra for expenses. He didn’t even ask for an agreement.
“He said, ‘you didn’t declare bankruptcy. You’ve almost paid back $1.8-million. That’s good enough for me.’”
Mr. Nielsen made a net profit of $225,000 selectively logging the land.
Between 1989 and 1999, he did 700 property deals throughout B.C., travelling from Yukon, Alaska and Alberta’s borders, to Vancouver Island and the Lower Mainland. He officially launched Landcor in 2000, devising an automated valuation model, or AVM, with a team of programmers.
In B.C., he says, our best year for residential sales was 2007, with $64-billion worth of sales. For the last three years, we’ve been doing about $45-billion in sales.
A key player in the future of Lower Mainland real estate will be rapid transit, and where it’s located, he says. Landcor recently figured out a calculation to determine the “sweet spot” around a rapid transit station where property values start to rise. It’s part of larger report on transit, and it’s only one of many the company churns out.
“I don’t have to work, but I don’t know what else I would do,” he says. “I have a gorgeous wife, the perfect marriage. When I get up in the morning, I plan my whole day in the shower. If I have problems, I think them through in the shower, and I don’t get out until they’re solved. I have a daily goal, a weekly goal, a monthly goal and an annual goal. If I reach my goal, I reward myself.
“If I don’t reach my goal and I get depressed, I reward myself, too.”