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Adam Leitman Bailey on Aggression, Keeping Secrets, and the 2020 Real Estate Market

Adam Leitman Bailey is one of New York City’s preeminent attorneys and entrepreneurs. His name has become all but synonymous with some of the most recognizable and influential real estate law cases of the new millennium. Take, for example, the Ground Zero Mosque case, wherein Bailey’s compelling arguments reminded the nation of the constitutional right […]

Adam Leitman Bailey is one of New York City’s preeminent attorneys and entrepreneurs. His name has become all but synonymous with some of the most recognizable and influential real estate law cases of the new millennium.

Take, for example, the Ground Zero Mosque case, wherein Bailey’s compelling arguments reminded the nation of the constitutional right of religious freedom, or Save Harlem Association V. Kimko, where his efforts ensured that tenants living in Harlem’s largest residential building were protected from unreasonable eviction.

Both Adam Leitman Bailey’s work, as well as that of the eponymous firm that he built from the ground up into one of the city’s foremost providers of real estate-specific legal services, have earned accolades from every influential organization in the industry. Bailey received a prestigious “AV” rating from Martindale-Hubbell for his top-tier performance and ethical standards; the Commercial Observer named him as one of New York’s Most Powerful Real Estate Attorneys. His work has further earned him a place on Super Lawyers’ “Top 100” list, as well as a fellowship position within the highly-competitive American College of Real Estate Lawyers.

Compelling, too, is the effusive praise that Adam Leitman Bailey has received from his colleagues and peers. One state judge wrote that “[Bailey] was the best trial lawyer I saw in my nine years as a Judge in New York City.” Another announced in an article that Bailey “is a brilliant lawyer…who always worked zealously on behalf of his clients.”

“Adam has an amazing mastery of the law, cases, and could cite the law and its history like reciting the alphabet. He has a vision for the firm where he could foresee how a case would likely be resolved at its very commencement,” another colleague who had worked with Bailey shared in an article for the Commercial Observer.

Adam Leitman Bailey’s story, accomplishments, and philosophy are each fascinating in their own right — and fortunately, I had a chance to sit down with him to discuss all three.

You’ve obviously been working in the real estate sector for quite a while. How would you say that today’s real estate market differs from the ones we saw in 1987, 2000, or even following the 2008 crash?

I have never seen a real estate market like the one we face today. During the crash in 1987 and the crisis of 2008, we knew where the market was going: down. The downturn was rapid, frightening. When the Great Recession began, it felt as though the sky was falling. What we see today is different. The market has been in a slow decline for around five or six years, and professionals only recently began noticing the downward slide.

With the 1987 crash, the sudden decline was the result of an overvalued stock market and the rampant use of untested digital tools in finance which caused forced selling, as well as forced selling due to fears of governmental intervention. In 2008, it was the subprime mortgage crisis. Today, there is no Black Monday like in 1987, or a Lehman Brothers or Bear Stern’s fall like in 2008. This time, the market has been slowly falling. The economy has changed, but the change has been barely reported or noticed until very recently. 

A lot of the blame can also be placed on government over-regulation. The reversal of laws that previously encouraged foreign investment and higher taxes, as well as trade disputes with friendly allies all played a part.

The result? The luxury real estate market is frozen. Even properties with heavy price decreases are still sitting on markets from New York to the Hamptons.

The rest of the market apartments are selling when they are sold at the correct price — though they usually require a sharp price decrease after being listed.

True, it doesn’t seem as though the world is coming to an end; the real estate sector is still operating and selling. If a seller prices their apartment or home at the right mark, that property will sell. Everyone still needs a place to live. But sales prices on luxury sales, as well as sales prices in every market, have been dropping consistently.  

Do you think the market can (or will) turn around?

Yes. The market needs to adjust. I do not know when the market will reach 2012 highs again but I believe in American real estate — both as a home and as the best investment in the world.

Now that it’s an open secret that the market is down, sellers have begun to list their homes at a price that will sell. Fortunately for buyers, the “correct” price is usually heavily discounted. This might be the greatest buying market I’ve seen since I started practicing real estate law. It’s not breaking any records when it comes to prices, but our current conditions do offer a fantastic opportunity for today’s buyers.

Those who really study the market, the ones who live and breathe real estate — they will be able to see signs of a turnaround once everyone begins pricing correctly. And if the market does not turn around, that isn’t necessarily negative—a buyer’s market is a wonderful thing, as it facilitates more affordable housing and allows more people to own.

What scares you about owning the 4th-largest real estate law firm in New York City as we move into 2020?

I begin every year scared. I wake up knowing that I am responsible for feeding the 50 families we employ. I take this commitment personally, and I am just as scared today as I was when I hired my first employee twenty years ago.

My greatest fear is that I won’t be able to support the family I’ve built at Adam Leitman Bailey, P.C. Every year, regardless of how well we’ve done, I’ve worried that some economic fluke will leave us without enough business to support our team of attorneys. We’ve grown every year, and I have a connection to every single person at my firm. The prospect of losing even one attorney haunts me.

This fear usually starts a few days before the New Year and lasts for a few days — and then I find myself too busy to worry about something that I cannot control.

That said, I’m not alone in worrying about a potential downturn in business, especially in New York. Many clients are choosing to buy beyond the city and in other states. NYC has passed several anti-property laws in recent years, including problematic rent-regulation policies that will prevent property owners from being able to provide quality housing to their tenants in the long run. Now, owners are looking elsewhere, knowing that the odds of successfully owning and operating a property in NYC are long. 

I do not think fear is a bad thing. It is a great motivator. For 18 of the 19 years that Adam Leitman Bailey P.C. has existed, it has increased its profitability by a substantial margin.   

Like every year, we need to be better than the year before. 

Where do you see strengths in the real estate market? Do you have your eye on any weaknesses?

I think the greatest strength in today’s market is its appeal to buyers. It’s an incredible market for residential and commercial buyers for several reasons. First, interest rates are very low, which allows people to have a higher price ceiling when they shop. Secondly, banks are lending freely and allowing more buyers to qualify for loans. Lastly, the economy is doing remarkably well. Employment rates and wages are high, trade has been phenomenal, and American businesses are flourishing. All of these factors make it more likely that a person will have the financial resources they need to buy a home or commercial space.

That said, the market does have a few major weaknesses. There is significantly less foreign interest and investment in U.S. properties — primarily because the government is interfering too much. The climate of political uncertainty is negatively impacting the market as well. After all, how can you expect people to make big financial decisions when they don’t know who will take over the presidency or what their legislature will do? Investors want stability, and we don’t have it right now — in Congress or in the executive office.

You have a reputation for being an aggressive attorney and tough business person — is this to help you negotiate deals, or is there another reason?

The truth is, I don’t care what people think of me. What I want is to make my law firm the best in New York City. I strive to make every case a winner and get our clients the best deal possible. Ask any real estate lawyer, and they’ll tell you — aggressiveness will win in a courtroom and at the negotiating table. Being shy and reserved won’t get you anything but your client’s disappointment. 

Clients do not want to pay their attorneys to sit back and have a judge or adversary tell them what to do. They are paying to advocate and persuade for their rights and overturn the injustice against them. At Adam Leitman Bailey P.C., our attorneys fight for our client’s right on paper, negotiating contracts and in the courtroom. We want to win for our clients, so we proactively move forward and get the job done. We work harder to build a case and think of arguments that will ensure victory.

That said, being aggressive in a courtroom doesn’t mean being abrasive outside of it. Our negotiations are peaceful and friendly; I don’t think anyone at my firm has ever heard me yell during a business conversation. Our opponents often expect aggressiveness — but we keep it sweet. We keep the conversation professional and prioritize goals so that we know what each party needs to be satisfied. When others expect aggressiveness but you demonstrate a softer, more professional side, the subversion of expectations gives you an advantage.

It’s like Teddy Roosevelt used to say: Speak softly and carry a big stick.

You were born middle-class in Bayside, Queens and faced even tougher economic times when you moved to California as a child. How does your difficult past affect you today, and how does it shape how you approach your legal work?

When I was five, both of my parents lost their jobs after participating in a teachers’ strike. Not long after, my mother took my sister and me to California in search of work.

Looking back, I can tell you that it was not a good idea to move a child that young across the country and away from his support network — but the experience did make me the person I am today. The financial stresses my family faced taught me to be an exceptional saver, for myself and my clients. The firm has a pot of money set aside for a rainy day, and we work to save both for ourselves and our clients. I live by my Grandpa Bob’s mantra: “It’s not how much money you make, but how much you save that counts.”

You’ve participated in some of the most famous cases of the new millennium. How did you get so fortunate to get such important cases with such a small firm?

There were a few reasons. Some of the cases that ended up getting a lot of attention were cases that never should have become famous that many other attorneys rejected—until we were hired.  We used the facts of the case intertwined with the law to convince a judge or jury why the law should be changed. Many of these cases led us to get the call on the high profile cases where the client chose us based on referrals and our past performances.

At Adam Leitman Bailey P.C., we specialize exclusively in real estate law — it is a great honor to be on the most important cases and the most complete real estate cases.  We are known by many as the firm to call when the stakes are high and the person or company must win. That is a dream come true.

These days, our ability to consistently take on and win some of the most significant cases of the millennium has sparked fear in our adversaries, because they worry that our firm will find an unanticipated and creative way to win the case.

I can give you an example. A little over a decade ago, Adam Leitman Bailey P.C. found a little known statute called the Interstate Land Sales Full Disclosure Act and brought it to New York. The whole process started when people who had signed contracts on properties in New York began coming to our firm to seek help with backing out of their deals during the financial crisis. The reasons varied; some said that the markets changed, that they got pay cuts, or even that they lost their jobs. The result was the same: they couldn’t afford to buy in New York anymore, despite their signed contracts.

At the time, Adam Leitman Bailey, P.C. didn’t have an answer, but we promised to start looking into the problem. The vast majority of other lawyers had told the clients that there wasn’t a way to back out, given that they had signed their contracts. But when I began doing research, I found a relevant statute that was used in Florida. It stated that if a seller withholds certain information, the buyer can back out and reclaim all of their money. It was a bold and crazy move — I don’t know if anyone else would have tried it. But I did, and I filed the first New-York-based lawsuit on it.

After I did, people started telling me that I was crazy. My opponents began to threaten us with sanctions; a judge yelled at me. But in the end, I won the case. Then, when word got around, thousands of potential clients began calling the office. We didn’t have the workforce to answer all of them. Eventually, I realized that this statute alone wasn’t the answer. Most of the people calling wanted these homes but didn’t have money from the banks to help cover the cost. So, our firm negotiated on behalf of our clients for new loans and achieved countless closings and discounts.

Our work with the statute turned out to be influential. Congress eventually changed the law after we won enough cases and negotiated more discounts of the purchase prices so our clients could purchase homes with a large discount. The result had a resounding impact not only on NYC but the nation at large.

What is your biggest weakness?

I cannot handle injustice. I cannot stand it; I cannot live with it. I react intensely whenever I feel that someone is being abused or taken advantage of. No one deserves to be treated that way, and too often, our laws do not protect the innocent.

A minor weakness would probably be my workaholism. I need to balance my life more — but right now, I spend most of my waking hours at work.

Who are your idols?

I don’t have any living idols. I didn’t even meet a lawyer until I started studying for law school.

If I had to choose, I would say that I idolize certain historical figures. I admire President Abraham Lincoln for his ability to overcome obstacles and spark change during the Civil War. I see Alexander Hamilton as one of the greatest New Yorkers to ever live — his work creating the national dollar, New York Post, and the Bank of New York (and all before he turned 48) was remarkable. I admire Winston Churchill as well; to me, he is the greatest leader of all time. He provided courage and spirit through the worst times, and his people valued him for it.

I do have a few living role models. I am still in contact with my high school cross country and track coach, Raymond “Hap” Harrison. When I was a teen, he taught me to be relentless in my pursuit of success. He had such an incredible impact on my life that I gave a scholarship from my foundation, Building Foundations and Dreams, his name.

I try to follow the example of these people and live my life trying to be a role model for everyone around me. I do hours of charity work every month, take on cases pro-bono and set myself up as an example whenever I can. Many of the kids, students, and employees that I work with have few people to look up to — doing my best to stand as a role model seems like the least I can do.

You’re both a highly public attorney and someone who prides himself on his confidentiality. How do you reconcile the two?

Every attorney needs to be a skilled secret-keeper. Confidentiality is one of our most prized skills; our job is to take everything that our clients tell us to the grave. Clients need to know that we will keep their secrets no matter what.

Sometimes I can take a few hits for not sharing information. My wife will sometimes read the paper and see that a well-known name is working with me and demand to know why I didn’t tell her. My cases are often big and high-profile, so they receive a lot of media attention.

That attention isn’t bad, either. Two decades ago, few attorneys spoke to the press; now, everyone does. I’m happy to talk to reporters because I’ve realized that attorneys can no longer fight a case exclusively in court. You can make an already-notable case in the press. Best case, you have a shot of convincing both the judge and the public of your argument. Judges read the news just as much as anyone else, and they prefer not to be on the wrong side of public opinion. It’s incredibly important to learn how to speak to the press. At the same time, the majority of less-public cases need to be kept out of the press, and I have to work even harder keeping them out of the paper.

New York has a roster of exceptional attorneys. How did Adam Leitman Bailey P.C. develop such an enviable client roster? How do you bring in business?

That’s an easy answer — it’s not about me. I give all of my time, but I am only one person within a firm of 20+ talented employees. Adam Leitman Bailey P.C. has kept some attorneys for a decade or longer; most of the firm’s members started their first jobs out of law school at ALBPC.

We farm talent like a baseball team. We hire people during law school, groom them, and eventually offer them jobs. Once they graduate, they have a skill set equivalent to a third-year attorney. Our lawyers train to win and close deals. We aren’t a firm where attorneys leave at five or stroll in at ten in the morning. We work, and we work hard. Our single-minded approach is what draws our clients to us. They know that every single attorney at Adam Leitman Bailey P.C. will give their absolute all to achieve victory on a case. It’s a valuable mindset, and we live it to the fullest.

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