Billboard Mastery Podcast: Episode 71

The Best Deals I Ever Did

I have built or bought over 300 billboards, but some stand out from the pack. In this Billboard Mastery Podcast we’re going to review the best deals I ever did and look for commonalities that all those deals shared. As you’ll see, there are definite attributes that all great billboard deals share.

Episode 71: The Best Deals I Ever Did Transcript

We all have deals in life which are superior to others. Different things we get involved in that all work out so well we think to ourselves, "Well, it would be tough to beat that," or, "That's my best deal ever." So I thought I would share with you some of my best deals ever. This is Frank Rolfe with the Billboard Mastery Podcast. This is a handful of the deals that I consider the best ones, my greatest works of art. The first one, probably in the number one position, was the portfolio of signs I purchased out in Los Angeles. Now, it was a long story, but basically there was a guy that went out and he built a little billboard company with a lot of really spectacular locations. Wilshire at La Brea, Rose Bowl, the entrance to Universal Studios to name a few, and then he was killed in a car wreck. And that billboard company went as an inheritance to his brother who knew nothing about the sign business. And so basically he just abandoned it. He stopped paying the ground rent. He stopped renewing the permits. He never leased any of the ad space. And I was tipped to the fact that there was an abandoned sign company out in Los Angeles. This is back in the 1980s. And so I talked to the guy and I worked a deal that he would give me one year of due diligence to try and reactivate all the leases and all the permits and rent the signs and then to go ahead and go forward and buy it at a certain price.

It seemed like an impossible mission at the time. Seemed like a suicide mission. But nevertheless, I flew out to Los Angeles and I started a one-year odyssey of every single sign, meeting with the ground owner, convincing them to give it a second shot, getting them to sign a new lease, going to the city, getting all the permits fixed, going out and renting the ad space and getting the ads installed. And when I got it all done, I was able to buy the company at a low price, but that isn't why it was the best deal ever. That was good. But what made it truly spectacular was once I got all the signs reinvigorated and back to life, I went to what was then Patrick Media, now known as Foster & Kleiser. And I wanted to see if they had any interest in any of those finished signs. And to my amazement, they agreed to pay me on just three signs as much as I was paying for the entire company. So I ended up with a portfolio of billboards in Los Angeles with not a penny in it. That was a great deal. And then I had a similar great deal during the Texas savings and loan crisis back in the late '80s, a big steel monopole that was sitting there. And I went to the owner of the sign and the owner of the sign said, "Here's the deal. The guy has threatened to sue me for all of that lot rent payment. I've never paid him and it really is bumming me out. So here's the deal, if you can get him out of suing me, I will give you that sign for a buck."

Interesting. Okay. So I go to the person who owns the land. And I said, "Hey, I'm just curious. You got a sign on your property. I've talked to the guy that owns it and he really, really is worried you're going to sue him," to which the guy to my amazement said, "No, I'm not going to sue him because I've already declared bankruptcy. So it just doesn't really matter to me anymore whether I see that money at all or not, because now the land belongs to this person." Basically, what had happened is land had gone under. The guy declared bankruptcy. The land had been sold to somebody else. I went to that guy. So I said, "Hey, you got the steel sign on your property. I understand you've taken over the property now. I'd like to bring the sign back to life and start paying you lot rent." He said, "How much?" I said, "I think $200 a month." And he said, "Oh, that sounds fantastic. Let's do it." I took in my lease. He signed it up and went back to the guy and got the sign for a buck, an entire steel monopole for just a dollar. And then I had the old wooden sign I found along highway 75, north of Dallas. It was sitting there abandoned. Bunch of telephone poles, old sheets of plywood, nothing on it at all. Spectacular location. So what's the property owner, would never talk to me. Couldn't do anything at all. Finally, desperation, went to his house, knocked on the door. He was a wealthy guy.

A maid came to the door wearing a complete maids outfit like you see in the movies and said, "What do you want?" I said, "Hey, I'm here to see the guy." And I left my card and I went back again, I did it again and again. And I get a call from the guy. He says, "Look, I don't know who you are, but you're freaking the maid out. You're freaking me out. What is it you want exactly?" I said, "I just want to bring your old wooden billboard back to life." He said, "I'll tell you what, I'll let you do it as long as you promise to never come in my house again." I said, "Perfect, great. I'll do it." He signed my lease. I went out and I brought the sign back to life. That was one of the highest producing signs for the money ended of all time. I only had in that sign, maybe a couple thousand dollars. The sign made about $25,000 a year profit year over year over year for almost 14 straight years. That was a great deal. Then there was another billboard in downtown Dallas. It was actually owned by Foster & Kleiser and they'd abandoned it right on Main Street at Converse Street, right in the heart of downtown Dallas. Big 14 by 48. It had lights. It had everything to it, but they had given up on it and they gave up on it because there was a sign right smack in the middle of it that said, "Park here."

So no one wanted to rent the ad space. So I tried the thing up under contract for almost nothing. I think it was like five grand or 10 grand, which is just ridiculous. Taking from a big company like that. I went to the guy with the parking lot and said, "Hey, what would you think about lowering your park here sign down so it doesn't block the sign?" And the guy said, "Oh, that's a great idea because it's blocking my sign the other direction. I never meant it to be so high. I really wish it had been lower so you could see my sign in both directions." I said, "Well, if I paid to have it lowered, would you have a problem with that?" The guy said, "Oh no, that would be great." So once again, I saved the day, got the parking sign lowered, went out, rented the ad space. I had almost nothing in the sign. And then there was the portfolio of signs I bought from a company called Dean Outdoor. What happened there? Well, Dean had fallen on hard times. The signs were not performing loan at the bank. The bank was desperate to get rid of them. Then I went in and got those signs for literally next to nothing, pretty much just a scrap value. And when I later sold my sign company off, those were some of those valuable signs I had. I had places like Interstate 30 at Dolphin Road, these very, very prominent signs. And people didn't realize I had gone in there and bought them for a penny on the dollar.

Now, what do all those stories have in common? Well, let's look. Number one, they all came out of distress. All of them had some distress, whether it was signs that were from the legacy of someone killed in a car wreck, signs that were came out of the Texas S&L crash, signs that were abandoned sitting by the road dying, signs that were in the hands of a bank that had been foreclosed on. So distress has something to do with it. That's for sure. Another thing was I got them cheap because I had to do some kind of major turnaround, the kind of thing most people don't like to do or don't want to do. So that was another important element to it all. And then finally, because I was able to come up with creative ways to fix them, like getting the "Park now" sign lowered, like going out and getting all those signs in LA brought back to life. So I was able to creatively find ways to resolve the problems. But all of the stories, what they have all in common, they all come out of problems and out of distress. Now, the US economy right now is pegged to probably be going into the worst recession that maybe any of us have ever seen. Or certainly if you're not as old as I am, you've never seen anything quite like it because you have to be in your 40s just to have been an adult during the dot-com bust. So maybe all you've seen is just the great recession of 2007, 2008.

But regardless, we're going into a recession, we just don't know when. Recent articles state it's probably going to be this year, but if it's not this year, then certainly by next year. And if we're going into a recession or depression, that is the perfect time to do great deals. You can't typically do great deals when times are good. There's too much competition and people are too happy. Where you really score the really great things that are life changing, typically comes out of distress and comes out of recessions and depressions, which we're probably going into very, very soon. So if you want to do some great deals, if you want to buy things or build things that are truly spectacular, the best time is coming up. Because as soon as we hit that old recession, whatever month it begins, that will be the trigger to some great deals being available. This is Frank Rolfe, the Billboard Mastery Podcast. Hope you enjoyed this. Talk to you again soon.