13. The tendency of real estate negotiations to fall into zero-sum thinking has been highlighted in several retrospective reviews of Donald J. Trump`s The Art of the Deal (written with Tony Schwartz), Random House (New York, 1987). George Wu of the University of Chicago`s Booth School of Business notes: “It`s probably not surprising that Trump`s overall tone in The Art of the Deal is combative. One of his most important pieces of advice is: “Fight.” He portrays negotiations as a zero-sum game, with a clear winner and a clear loser. But like any negotiation approach, this attitude only works sometimes. This can be successful if you are trying to close a difficult deal in a pure price negotiation. But it can fall flat when negotiations require one party to really listen to the other, try to solve a problem together, or figure out how to make imaginative deals. review.chicagobooth.edu/strategy/2016/article/art-deal-not-art-war Since at least the early 1980s (and probably much earlier), there has been a push to explore “positive sum” alternatives to the win/lose dichotomy. Probably the most influential text is Getting to Yes: Negotiating Agreement Without Giving In by Roger Fisher and William Ury of the Harvard Negotiation Project, Penguin Books (New York, 1981). The authors consider that the win-lose approach of contradictory positioning is ineffective, leads to reckless agreements and poisons relationships (see pages 5-6).
In a retrospective review of Fisher and Ury`s contribution to alternative dispute resolution, Australian law professor Tessa McKeown concludes: “While the principled approach to negotiation or problem-solving developed in Getting to Yes is not without flaws, it is arguably the most successful method of negotiation developed. The parties are more likely to reach an agreement through negotiations in principle, interests will be better protected and relations will be safeguarded more effectively. (Tessa McKeown, “Fisher and Ury`s Getting to Yes: A Critique,” Faculty of Law, University of Wellington, Victoria, May 2013). ↩ Buzz McCoy`s advice remains powerful today. He was the partner who built Morgan Stanley`s real estate practice over a long and successful career. His reflections on leadership are based on experiences with commercial real estate icons such as Trammell Crow, Charlie Shaw, Donald Bren, and corporate and financial leaders such as Bill Hewlett, James Burke, and Bob Baldwin. Living into Leadership leads ethical discussion from the abstract to the particular – and with the credibility that complex experiences deserve. The recent Great Recession shows how flawed these remedies are.
It is unlikely that Kant was surprised by the failure of “reasonable” remedies to prevent all abuses. This highlights the importance of preparing and presenting real estate case studies as professional teaching material. This would be proof that we have learned lessons and are making changes based on the experience of the global financial crisis.7 Based on our decades of experience with real estate decision-makers, we consider not only that a serious examination of ethics in real estate is educational, but that it is a topic applied daily in the business world. In this environment, it is difficult for market participants to gather information about the moral standards of their counterparts and almost impossible for individuals to impose moral sanctions. In response, the real estate market has developed certain conventions that protect rare buyers from some of the worst types of unethical behavior. These include: In the second part of this paper, we will now address some of these practical issues. In some, we find positive examples of ethical behaviour in action; in other examples of deficits. We will see real estate leaders reflect on moral thinking, reflections that are valuable not only for young people entering the field, but also for veterans for whom ethical considerations are a lifelong concern. Examples are drawn from the disciplines of development, finance, management and consulting. Discussions about real estate, in turn, will examine the philosophical, cultural, and psychological underpinnings on which ethical thinking is based. Commercial transactions – including real estate transactions – are certainly subject to moral scrutiny.
Although most business transactions result from the private interaction of only two agents, the timing, number, and pattern of most transactions in the consumer market allow observers to derive a great deal of insight into the decision-making process and behavior of market participants in general. As for Kant`s proposal, there are many case studies to study. Local supporters of the deal, who have tried to restart talks with the company, have acknowledged shortcomings. In an “open letter” published as a full-page ad in the New York Times on March 1, 2019, more than 80 signatories — representing a cross-section of politics, business (including real estate), labor, education, nonprofits, community groups, and the arts — urged Amazon to reevaluate. However, with a characteristic (and perhaps unnecessary) New York chutzpah, the letter distorted the controversy as follows: “We know that the public debate that followed the announcement of the Long Island City project has been noisy and unwelcoming. Opinions in New York are strong – sometimes strident. We consider this part of the charm of New York! 11 This chapter and the next two attempt to give an incompatibilistic or indeterministic explanation of free will compatible with current scientific knowledge, without assuming any obscure or mysterious notion of agency or causality. A number of topics are addressed in the process of constructing this theory: self-forming actions (SFA) or preparation (SFW), moral and prudent choices, shared will, indefinite efforts, chaos theory, thermodynamics out of equilibrium, quantum physics, neural networks, weakness of will, mind and body, plural voluntary control, selection by reason, consciousness and purpose, Self-networks, chance, popular psychology and brain, valuable experiences, and more.
Consider only a selection of the basic ethical vocabulary: responsibility, trust, integrity, fairness, truthfulness. So, consider how the values expressed in these terms come into play in the development process, mortgage financing, business negotiation, employee management, capital mobilization and provision, and business strategy development. Suppose a real estate decision-maker, with the help of legal counsel, is satisfied that an approach is entirely justifiable from a legal point of view. If so, can such an act be justified as ethically sound solely out of self-interest? How would you know? Why should you care? And what matters is the impact that the chosen approach will have on the people involved, both initially and afterwards. Ethicists sometimes analyze these questions in terms of consequences (for example, utilitarians might say, “Do what brings the greatest good to the greatest number”; the Hippocratic Oath says, “First, do no harm”), duties1 (such as the Kantian approach mentioned in Part I, or prescriptions such as the “Thou shalt not do” of the Ten Commandments), or care (perhaps the morality of the Sermon on the Mount or the Buddhism way of compassionate Buddhism for all sentient beings2). If these approaches seem far removed from day-to-day real estate decisions at first, it may be worth thinking a little more. Aren`t the kinds of environmental or economic statements that regularly accompany development approvals or funding boards an expression of the ethics of consequences? Isn`t the concept of fiduciary responsibility rooted in duty? Isn`t the growing ESG3 movement exactly an attempt to see stakeholder empowerment, both immediately and at some distance in space and time, as relevant to practical business decisions?4 Ethics is the product of our higher beliefs, but it is not the complete expression of our higher beliefs. In other words, ethics is influenced by and stems from our higher sense of morality. The fact that ethics can change over time does not mean that morality is transitory.
This means that the understanding of morality can change. This is especially true when we encounter different groups of people or are faced with dramatic technological and/or environmental changes. In our globalized economy, where the pace of change always seems to be accelerating, moral reflection is more important than ever, and perhaps never more difficult. Real estate cannot be spared this challenge. • This recognition of a higher standard should not be ignored in ethical discourse, especially when it comes to real estate. Codes of ethics often prescribe options for action that inherently meet these legal requirements. This has the very useful effect of deterring followers of these codes from engaging in behaviour that would lead to imprisonment or, alternatively, substantial fines. However, such de minimis ethics is incomplete, and many industry codes of ethics explicitly acknowledge this. 12. Lest the fall of the Amazon be seen as an anomaly or simply a strange example from New York, one of the co-authors of this article can confirm that equally complex considerations of socio-economic impact and public acceptance were weighed into General Motors` search for Saturn plants in the 1980s – a blue-collar company of comparable size. James and Deborah Fallows talk about economic development decisions made in much smaller communities, including Columbus, Mississippi (Yokohama Tire and Severstal Steel, using “megasite” incentives from the Tennessee Valley Authority) and Eastport, Maine (Cooke Aquaculture, Sexing Technologies [the latter has been involved in the export of artificially inseminated pregnant cows by a disproportionate percentage of female cows).
produce calves for replenish dairy herds depleted by mad cow disease]. and support for clean energy technologies that export 450,000 tonnes of wood by-products per year to replace coal in electricity generation).