PAX AUCTION NEWS!

The Biggest Cheerleader for Real-Estate Auctions
2009-01-31

By KEVIN HELLIKER and TIMOTHY M. MARTIN

A $500-a-seat charity fund-raiser was sputtering in the hands of an amateur auctioneer, so a guest named Steven L. Good rose from his table and took the stage at the Ritz Carlton in Chicago. Relieving the amateur, Mr. Good talked a mile a minute, entertaining and cajoling a fortune out of the well-heeled crowd.

Sheldon Good & Company

Steven L. Good

As a real-estate chief executive, Mr. Good was a self-promoter in the tradition of his role model, Donald Trump, but he promoted more than himself. Determined to dissociate real-estate auctioneers from livestock peddlers and used-car salesmen, Mr. Good strove to link his profession to high-end auctioneers such as Sotheby's and Christie's. Those efforts helped elevate the real-estate auction, long the last resort of desperate sellers, to a way of marketing premier properties.

"It can knock the top out of a good property, and Steve really helped develop that motif," says Mark Hale, a Chicago-area banker who sold countless properties through Mr. Good's firm, Sheldon Good & Co.

This month, the real-estate auction lost its biggest cheerleader. On Jan. 5, Mr. Good drove his red Jaguar into a forest reserve outside Chicago and shot himself. He was 52 years old. Relatives, friends and business associates say they don't know why he did it.

"It came out of nowhere. He must have had demons chasing him," his 75-year-old father, company founder Sheldon Good, said in a tearful interview.

In the history of real-estate brokerage, few executives have presided over as diverse a portfolio as Steven Good. Under his leadership, Sheldon Good & Co. sold airports, college campuses and developable air rights, along with the assets that gave the fast-selling business memoir he published in 2003 its name: "Churches, Jails and Gold Mines: Mega-Deals from a Real Estate Maverick."

That diversity reflected Mr. Good's belief in auctions. The firm his father founded in the 1960s was primarily a commercial brokerage until Steven Good began exercising his influence in the 1980s. After that, auctions came to account for 85% of revenue, according to Michael Fine, an executive vice president at Sheldon Good. Often a bright spot in hard times, real-estate auctions are suffering today for lack of buyers and credit.

The younger Mr. Good made a career out of selling hard-to-value but eye-catching assets. His strategy was to buy advertising and generate news coverage, as when he auctioned off the county jail in Valparaiso, Ind. The outdated facility would have cost $300,000 to tear down. Wanting to be rid of it, the county asked for a minimum bid of $25,000. Mr. Good, after generating international publicity for the auction, sold it for $365,000 to a pair of Greek brothers eager to turn it into a nightclub.

He also showed that auctions can be used to sell conventional real estate such as some worn-down buildings in the red-hot Chicago neighborhood of Lincoln Park. The owner, Northern Bank & Trust, received multiple offers even before it had appraised the properties, so it decided to let Sheldon Good & Co. handle it as an auction. As it turned out, "those properties went for well above what the appraisers valued them at," says Mr. Hale, the banker, who at that time worked for Northern Trust.

In 2002, the elder Mr. Good sued the younger over an ownership dispute. In essence, the son wanted to share ownership with top executives, while the father sought to keep it a family business. In 2005, they settled out of court, with the elder Mr. Good cashing out of the company. Now, the elder says this professional divorce was beneficial for both. "My son loved me and I loved my son...and being in business with each other was tough on him and tough on me," he says.

That litigation reflected a larger tendency of Steven Good to look out for his fellow executives. A contingent who had learned the trade under him called themselves "the Steven Good fraternity," says Mr. Fine, the company executive, adding that their late mentor always offered his services as an adviser, counselor and educator. His generosity of spirit was also evident in the dozens of charity auctions that he emceed each year.

By all accounts, however, he didn't share his own troubles with others. "There were a number of us who would have been thrilled to have him call up and say he's in a bind, but he wasn't like that," Mr. Hale says.

Despite tough times today, Sheldon Good executives say they face no crisis. They add that publicity surrounding the death, including a Jan. 7 news article in The Wall Street Journal, has attracted new listings. "We've got business we're just signing up" from clients who read about Mr. Good's death, says Alan Kravets, president of Sheldon Good.

On online auctioneer eBay, the asking price for Mr. Good's book has shot up to $499 for a signed copy, from as little as $1.34 before his death. On Amazon, it's going for $1,100.