You're facing a failed business venture in commercial real estate. How can you bounce back and succeed?

Bouncing back from a failed venture in commercial real estate requires resilience, strategy, and a touch of humility (the perfect trifecta). First, I’d do a deep dive into what went wrong—not just a post-mortem, but a strategic “post-learn”—pinpointing missteps and translating them into clear, actionable lessons. Next, I'd focus on rebuilding with smarter positioning and a stronger network. This means keeping an eye on emerging market trends, leveraging past connections, and, most importantly, targeting high-stability sectors that can ride out fluctuations. Lastly, I’d reframe the experience: investors respect resilience. A well-framed story of a comeback isn’t just compelling—it’s a powerful tool to build trust and character.

First and foremost figure out what your role in this "failure" was. As a CRE finance person, there's nothing worse than when the new lender asks about this venture and the sponsor puts the blame on everyone else but themself. Being honest and forthright about the reasons for the failure will go a long way to building bridges with new relationships. Do everything you can not to blame others, since the person you're now dealing with will assume that if things don't go well then they'll be blamed for whatever happens.

From observation, it is very important to ensure that market research (including within the different segments) and information on the needs of the market are accurate. Sometimes, just following what other developers, property owners are doing will lead to excess stock as there is no real market.

Start by conducting an in-depth analysis of what went wrong in the project, identifying gaps in market research, financials, or management to learn what to avoid next time.

Where you are a foreign party, and not familiar with the legal and regulatory framework, it is important to find a strong local partner who can then guide the process, and who also has a strong understanding of the market. The successful transactions that I have assisted with all have this as a common thread.

After analyzing your failure, it’s time to refine your strategy. Focus on realistic, data-driven adjustments that can shift your approach. Identify new opportunities in the market—whether it's a shift in location, client focus, or project type—and explore areas where your previous approach fell short. Remember, flexibility and innovation are key to moving forward. Adjusting your strategy based on solid insights gives you a better chance to succeed and recover from the setback.

Adjust your approach by targeting a new market segment, revisiting funding methods, or adapting management strategies to better align with current market dynamics.

You need to act quick and determine if things can turn around or it it's time to cut your loss. If you decide to try and turn things around with a given investment gone south, you also have to consider the opportunity cost of dedicating resources to a struggling venture. In some cases, it may just be worth it to spend time and money on better opportunities elsewhere.

To bounce back stronger, use this failure as a learning opportunity. Invest in expanding your knowledge of commercial real estate trends, financial strategies, and negotiation tactics. Attend seminars, network with industry leaders, and read about successful recovery stories. Constantly educating yourself not only sharpens your skills but also builds confidence. Knowledge is a powerful tool in real estate, enabling you to adapt quickly and seize new opportunities that others might overlook.

Invest in continuous learning—whether through courses, seminars, or self-study—to stay informed on industry trends, regulations, and innovative strategies for stronger decision-making.

As mentioned previously, having a strong local partner, as well as well informed consultants and advisers is key, as real estate is a very domestic matter. Global players will also sometimes need to seek help from local consultants and/or advisers, where they do not have a strong grasp of the domestic issues - this could include equity conditions, licensing and consent requirements as well as availability of infrastructure.

Build connections with industry professionals and mentors who can offer guidance, insights, and potential new opportunities for growth in future projects.

Due diligence is key to better understanding potential joint venture partners' strengths and weaknesses. Particularly where the foreign party will need to rely on the local joint venture partner for the local regulatory regime for the project. This will also need to extend to how the parties view compliance with law issues, so as to avoid potential roadblocks halfway through a project.

Develop a proactive risk management plan with comprehensive due diligence, realistic financial projections, and contingency plans to safeguard against setbacks.

First, conduct an analysis of the failed venture to identify specific risks that contributed to its demise. This involves examining market conditions, financial miscalculations, and operational inefficiencies that may have played a role. Once these risks are understood, develop a robust risk management plan that includes diversifying investment strategies, establishing contingency plans, and implementing stringent financial controls. Engaging with industry experts and mentors can also provide invaluable insights and guidance on best practices for navigating future projects. Additionally, leveraging data analytics to assess market trends and potential investment opportunities can help you make informed decisions to minimize exposure to risk.

Embrace resilience by learning from mistakes, focusing on your goals, and maintaining optimism—essential traits to navigate and succeed in commercial real estate.