Why Preparation Is the Most Undervalued Skill in Sales Negotiation (And How to Use It)

They prep their numbers, they sharpen their pitch, and they walk in ready to take.

“That is exactly why they leave the table empty.”

Today's guest has done what most operators only talk about. Walker Thrash has closed public, private real estate deals that others could not figure out on their own. He doesn't just build buildings. He solves problems by mastering the one thing every negotiator avoids. Self-interest. Not yours. Everyone's.

On this episode, Walker breaks down how the best deals are never about price.

Why the most dangerous assumption you can make is walking in thinking you already know what the other side wants, and how the operators who closed the biggest rooms are the ones who learn to look in the mirror first. Let's unlock it. [Music]

“We're live. Today we got Walker Thrash. The real estate negotiator, the tycoon.”

I'm happy to have you on the show. I'm excited to deep dive into obviously your experience in real estate, but really unlocking when we talk about unlocking the

vault, unlocking those things that must happen, or that must be implemented, or employed,

when it comes to real estate deals and real estate negotiation. Walker, welcome to the show. Happy to be here. Thanks, Keva. It'll be fun. Just so the audience knows a little bit more about you. I'd just explain a little bit, uh, tell us a little bit who you are and how we got to, you know, how you got into this role. Sure, so my company's called Vertical, um, spelled with a K, but we are really

a public private partnering firm. So our emphasis is all real estate transactions, real estate development. Um, but we really, you know, we don't just build buildings. Our intention when we walk into the room is really trying to solve either a city or at the state level, solve a development

problem. We specialize in, I would say if you boil it down, ultimately, we try to place risk

on the correct sides of the table and then what sets us apart a little bit from a lot of people that, you know, kind of quote unquote consulting the public private room is in almost every project. We actually invest all or most of the private capital that goes into the private side of the development. Okay, and how did you tell us to like the kind of the history like how did you get to this point? Uh, because you know, I don't think you just, you know, wake up and to start, you know,

uh, investing and becoming the tycoon of negotiation when it comes to real estate. So it tells a little bit of the history here. No, my, my family, um, my grandfather was involved in both grandfathers in the lumber business. Uh, my father very involved in real estate mainly in apartments. So I kind of grew up around real estate, right? Real estate deals talking through that, um, for years spent time in my family business with my father and younger brother, um, but really

started to have somewhat of a passion for hotel development hospitality. We've, uh, ended up forming a small brand. It was part of the group. This form was small hotel brand. That's in six or seven states at this point. Um, and once you learn and putting together hospitality projects, because these hotels were full service had restaurants in the bottom is that financially a lot of hotels have some kind of public incentive to make them work. So somewhat cut my teeth, putting

hotel deals together, learning the public private nuances, where those buckets of capital were and really it's a more importantly learning how to, to navigate the public side of negotiating real estate deals. Interesting, okay. So we're the navigation on the public side to tell me

“a little bit more about that. Well, I, and I think this is true in private deals as well, but it's”

highlighted when you're dealing with the public realm, because to simplify it, it's no one at the table is it they're personal checking account on, right? When you're in a public arrangement, these are hired people, either it's city made or elected, right? City manager mayor, city staff, state staff, they're trying to put a deal together. They're number one objective is to execute and deliver whatever promise they've made. Okay. Once you don't see in the forefront or what I would say is

really the, the tripping hazard in a deal is to make it all about dollars and cents and price because that's just a commodity in the deal. It's really more about execution, delivering on vision,

private realm, the more you somewhat kind of understand the intentions and motivations of the different

factions or parties are in the table. Well, it's interesting you say that because Reno, we're talking about, I know we're talking about big, you know real estate deals, but that just goes to everything even to the smallest little deal. Like people will buy not because the price is wrong or the too high, it's because they don't see the value and what you got to just indirectly said there is if you can execute their vision, execute to speed the time. So if they see the value in what you're doing,

“the price is never an issue. Yeah, and prices, I don't want to pretend that price is an important,”

right? It's, it's real estate. It is, it's going to be the capital that trades hands,

but it's almost never the most important thing in the negotiation. Like you said,

it is on the value and money you're not equal. There's a lot of different value that can be trader on the table. It's nothing to do with dollars. But I, I would even put it in the sense of, if you just kind of set aside, like, you may not, you may not think this way. I do. I'm a, I'm a believer. Everyone is self-interested. Myself included. Yeah, absolutely. I don't, that's not a negative thing. I say this all the time. I mean, that feels like a negative comment.

The reality is we're all just trying to make it. We're taking care of our families. We're trying to reach the next step, next from in the latter, whatever that is. If you can walk into the room and understand that everybody around the table is the same as you. They have their own self-interest and you're objective at some levels to deliver their interest in a way that creates the value you need in the deal. It's a better story point. To pretend like you're the only one who really

needs to have your interest met is, again, that's just a, that's a stumbling block. We all need to get past quickly. I couldn't agree more. I mean, yeah, it's correct me if I'm wrong. I've not, I haven't done a lot of like, you know, studying of negotiation and all that. But the one thing I

“remember of an old mentor said, the best negotiation is when both people are, like, are leaving.”

I'm like, almost like, not, like, just satisfied. They're not happy. They're not static. They're they're almost, they're almost like, he made it seem like it was almost like they're, they're leaving okay. Because if you're leaving, he said, if you're leaving happy, that means they're leaving upset and that's not a good negotiation. If you're leaving upset, they're leaving happy. That's not a negotiation. A good negotiation is when both parties can leave on, you know, with a, with a

neutral kind of feeling. And I always thought about that. I agree with that. I would agree with that.

And that's, that's a really good negotiation and often times that's the best it's going to be if you add one thing on top of a great negotiation is when the parties leave the table and they feel like they created more value than they thought coming in. And hey, those are the best deals you'll ever do. That I love that. I love what you just said there. The best negotiations are when not one, when both parties provide more value than they thought, then they thought they were getting into.

“Tell me about that. Tell me other, I want to unpack that because I think that's so important”

because that can be translated through so many different things in life. It's like, you know, the whole camps, you know, the campsite kind of theory, right? Leave the campsite better than when you last found it. It's the same thing here to me is like, leave the negotiation, better off, more value, more excitement, more output than what everyone thought it was. Tell me a little bit, how does, how do you get to that place in the negotiation? How do you find that place when in the negotiation to look for

those things of value? Well, I want to say it's over time you do gain experience. You learn the questions to ask, right? But just in starting off, if you're fresh, and you say, hey, what's just a way to change the mindset? And I've been guilty this as much as anybody is walking into the meeting and assuming I understand what everybody's interested are and I've got a great idea and we're all going to agree on it. And if you can't have turned that 180, it's hey, instead of talking about

the deal, here's my performer, whatever that is, open it up a conversation, asking questions, assuming you have no idea what their interest are when you open the room. You'll end up teasing out things that you didn't think were there. And then, you know, and everyone isn't such a hurry. It's like, let's get it all done in meeting one. Sometimes meeting one really is just uncovering turning over rocks, trying to get information you can take on and think about. But in that question

those questions will come back to you, but the other part of you really sees and appreciates the fact that hey, you're trying to understand what they need and what that is, that's just a much more open

dialogue. Sounds like sales 101 to me. Ask the questions first before you speak. Learn.

Like, really try to diagnose, like, try to figure out what is going on. What do they need? What's, you know, what does success look like? All of the things before you start projecting, like I say, projecting your own opinions, your own facts, your own BS on the prospect. Yeah, I mean, you know, the more you quote unquote, no going in and want to teach everybody in the room, even the worse off you are, right? You're not getting their idea, especially

you're going to frustrate whoever in the room has the biggest ego. And those are real, like, dynamics around the table. But if you talk about asking questions, this is one thing I have seen a lot. I think we all dismiss the generation beneath this and we should it because there's some tactics

“that I believe that they actually really get at bringing to the room that you should take note of.”

And if you find yourself in the room, let's just say you're not the center of attention. You are not getting the questions. You're not, you know, the guy or the woman in the room that that's fielding everything. And you're trying to figure out how to get that edge and get into the conversation, here's a novel idea for pair, right? Putting together whatever the math is that's going to be on that deal or if it's the slide, if you have information in your hands,

it's amazing the direction of the questions will start to flow to you. You'll get to ask more

questions because of that and all of a sudden you're a player in the game, you know, and you may not have been, but if there's a rule beneath all of this, preparing for your negotiation and preparing for your meetings, it may be the most undervalued skill in the game. Wow, this is super important because you said most undervalued. I mean, to me, I would maybe maybe I'm too naive or maybe just who I am, but I'm thinking, how do you go into a negotiation, not prepared? How do you go on the

no-go negotiation, not having all the facts? I mean, I just, I'm shocked when I go into meetings. And then we're busy. I'm going from one meeting to the next. The other two or three people, five people in the meeting are doing the same thing, especially now. I mean, you're going from a team's called in-person meeting, trying to grab a bite-dead in between. I see it all the time. I mean, everyone in the room walks in and says, all right, what are we talking about today? Why? Yeah.

And if you're holding the singular parts of information, the questions do get, you know, they start to be directed to you, you get to them, direct questions back. But preparation, I don't know,

“I think part of it is that we like, you know, we watch too much TV or our phones. We just, we feel like”

you got to be smart, quick, and the quips have to flow. I mean, the best deal makers and the most authentic deal makers, I know they just do a lot of preparation. So preparation, I would assume that's a huge opponent. I wouldn't, that's not surprising me. So, you know, I'm just kind of writing these things down as we're going because I'm just thinking about, hey, how can I extract the process of the art of the negotiation? And one of the ones that I'm hearing is for sure without a doubt,

you need preparation. So, if we talked about preparation, because down I'm going, you know, thinking about, okay, how deep are we talking about what level of preparation are we saying here? Are we talking about knowing the the surface level stuff or we talking about going deep and knowing not just the surface level, so stuff about the deals, but knowing about who you're playing, the preparation of the player, what they like, what they eat, where they live, all those things.

“I look, I think there's a little bit of both, but I would say there's a, I would caution one thing.”

It's just like I said, I don't, and never think it's a great idea to walk to the meeting with

everything figured out. It's also the preparation is different as you progress through, you know, a longer negotiation. Some of the deals we work on take a year, right, 18 months. So, you know, you may have several meetings, but let's just, let's put it in, let's drill it down into something tight. So, let's say it's a land deal. You may walk into the first meeting, it would be helpful to know all the comp sales in the area. What the zoning is, like some very

baseline things, and I know, you know, half of people listen here and thinking, well, obviously you

and something that baseline. But when you win someone has the information, like I said,

they become a critical part of the conversation, they get to ask more questions. I think the power

is in the people that get to ask the most questions in the room. Like, say, right, the lot is one in the room isn't the, isn't the strongest due the weakest, right? And the strongest one in the room isn't the one that has all the answers is the one who asks the right questions. Yeah, and, and, and the quality of the questions matter, yes, enough you'll ask the good ones. Yeah, I mean, yeah, absolutely. But it is helpful. I mean,

again, at a baseline preparedness critical, but I think once you're prepared,

“being able to speak from your authority is a skill, and it's, it's something you should”

contemplate before you walk into a meeting because give me any business situation, the authority shifts,

and you may have a different authority in a different situation. But, you know, if it's real estate related, and I walk in, unless just I will do like comparable sales. If there's an appraiser in the room, here she is the authority on value, right? I then may speak from a different angle, and my authority in the room is historical knowledge of deals that have happened in the area. Right? But, but understanding, and everyone has an authority. I mean, the lowest ranking

member on that table knows something at a higher degree, or at a better level, or in more detail than the rest of the people in the room, you need to think about that before you have a prolonged

“protract negotiation. It's important. I'm loving it, because now I'm seeing it right here is like,”

okay, preparation to ask you in the questions, and you can only ask the questions if you have the preparation. Number three here, it's really, it's about, no, I put knowing your audience, but really knowing your authority, knowing what the authority is in the room, who's in the room, and where they kind of lay in the authority hierarchy. Absolutely. Okay, because even if if you walk into room with somebody you admire, like they are just far beyond where you are in your point in life,

you know something around that deal at a more greater level than they do, and it made me understanding that authority is born from your preparedness, and you understand some of the nuances of the math, or the research that's been done, you can create an authority, like I said, by being prepared, and then as you speak from it, you will start to gain a little more traction in the meeting, and like I said, a question start to flow to you as well. This is sound, it's nuanced,

but I've just seen it play out over and over again, and it doesn't matter what your title is. Oh, would you say some of the, some of the reasons or some of the things that stick out to you, when you think about all the negotiations you've done, that have stop deals right in their tracks, that like taking deals right off course, and a assuming interest in being misaligned with where you're trying to take the deal is a great way to get one off the tracks. By that, I mean,

you think it's all about this, and it's really about that, and you failed to really take the time to tease that out in the front end, and I mean, we've all been built to that, where I'm like, here's the carrot, this is going to be the one that really moves the deal forward, and you just

realize it's never been about what you thought it was to happen a lot. Is that as simple as just

asking the negotiation, a conversation, and just saying, rather as the beginning of the middle, are you even here at the end? Does what does success look like here for you? Yeah, okay, that's, that's, that's, I think there's 20 ways you could do that, but in, if you were going to figure it out in a, maybe a few questions, I'm trying to just arm a listener with, okay, let's keep it tight, simple. What do you more need in the deal?

“And that can be a question that's also a question you need to ask yourself. What do you need?”

What would you love to see happen in this deal, which is different than what you need? And again, I think these are more important asked of the other party than asked of yourself, but you need to understand both sides of that. And then this is the one I think people don't

question. It doesn't matter to you. Yeah, we assume everything matters.

And so often there are deal points that are on the table that they're like kind of care about that,

“but you find value in it. And the, I think the, really the, the new ones there is trading value”

that's not, it's not all about dollars and cents. And understanding what's not important to them is one way to start to figure out where you might be able to capture value and then push value back to them for what is important. Well, I like it because by understanding what's not value about, you know, to them is getting you closer to the one thing that is valuable to them. And they might be holding their poker cards closer to their chest where they're not going to tell you

what's the most value to them. So it's an indirect way of getting to there. I would assume. Yeah, it enlarged deals. I've seen a lot. He talked about what what kills deals. I love to talk about things in the negative. Again, I'm a big offender. I have been in my career on this one. Holding the cards too close to the vest in a long drawn out negotiation, or you know, a higher stakes negotiation oftentimes you do it to your own detriment. And one of the, one of the ways

I've seen that happen is price is such a sensitive subject. You know, once you get there,

it's always, you know, everybody tenses up and says, what are you willing to pay? What is that?

When it's not, you know, I'll give you my, where I think you can take the tension out of the conversation is to make your math objective. And the way, you know, the way I've seen to do that in real estate is here's here's how I'm underwriting this deal. And here's my gap. Right. Let's not make this about a secret that I've got like tucked away in the closet. Here it is. Let's figure out if we can solve this problem. And when you bring the other side around to

helping you solve the problem that you see, I've just seen that's a much more successful path. It's, it's interesting because if you people get tense, you set around price and I was going to say, well, really, is that true? Is that true or not? And then I was thinking, it's probably because we, you know, you read in the books, the person who says the price first loses, right? And you think about that. And it's true. I mean, the sign shows that, but there's a way to, there's a way in the discovery,

I believe, to figure out what the price range is. So that price isn't has to be or needs to be such a shocking thing.

“Agreed. And that's what I'm saying. I try to make that. I try to make math objective.”

Not to do that. You can't be overly greedy. You know, that it has to have a sense of

reasonableness to the discussion. But it is subjective. It will always be subjective to say,

this is what I'm willing to make or this is what I'm willing to pay or this is the gap that I'm willing to close. That is, in arguably, a subjective thing, right? Even if you use some metric that's reasonable, you are deciding what that gap is or what you're willing to pay. But when you lay it out on the table, it really becomes an objective criteria to deal. It's like, okay, we'll walkers willing to do this when it comes to price. Maybe we can trade some value around that.

And that price actually adjust. You have to be malleable there. Because once you lay that on the table,

“you need to be confident that you did that correctly. Because now it's out the open. But”

I just find that's, I don't like to hold them close to the best because I feel like the other party actually will help you solve the problem better if they feel like you know, open with them. So what, what are the things you've seen then when deals, have made deals go quicker or, you know, the deals that you can think about were the most smoothness. What were the main factors or the two or three things that have to be in a deal for it to move fast, efficient, effective,

and everybody happy? So, all right, there's, there's one rule from the book that, and I believe this into my core, is that good deals become, you know, good, good ideas, become great ideas when you give them to other people. And for a deal to go smoothly, then really, I feel like to be efficient in the process. When you can do what we were just talking about, when you can make the math objective,

parties are somewhat in the same stratosphere. Asking for help from the other side and having them be a thought partner and how you solve this gap. That is such a win. When it's, when it's employed or deployed directly and the other side buys into that idea that you are genuinely asking for their help, because you're trying to solve for this equation, the deals can take off.

That kind of goes to the, he who plans the battle doesn't battle the plan a little bit.

“Yeah, absolutely. I mean, you know, how many ideas that you had did you think were great?”

Several of sure. So, so it was the other person across the team. Yeah. When all of a sudden the help becomes part of their idea, how you're getting there, they're creating with you. I just find that the deals flow a lot more smoothly and quickly. I love it. And, and that deals that you're in right now. Are you in deals right now? Go ahead. I mean, we try to stay active. You're staying active. What deals that are coming

up for you right now that we can learn from that are, that are maybe finding, you're finding challenges in and how you're being creative to work around them or deals that are smooth that are going so fast, so like quickly and you can go, that was because of this one thing. Um, okay, so I give you an example right now. It's a deal in Colorado.

“Where there's a city, there's city funding, state funding. There's also tax increment financing.”

It's just a complicated math deal. But ultimately it involves a big bus terminal

to office buildings and some raw real estate. So it's a mixed use project a little bit of retail. Um, and there's some users already at play. Where the value is getting created from both sides is that as a standalone private deal, it doesn't make sense. And as a standalone public deal, it's not sexy enough to attract the tenants. You know, if you really just want to call it what it is.

And so we are creating some development fees at the private level that actually help to develop some of the public infrastructure. Now, the only reason I say that is not because I don't want to get the weeds on that. So this gets boring. But the reason I say that as we didn't go into that deal, assuming that that would be a structure regret looking at what we found and asking questions is that was the, that was the biggest issue for the city to be able to get the project off

the ground was the timing and being able to put that infrastructure in. And so we thought we just figured out a solve between us. But that would absolutely not be possible if we were sharing our information. If it wasn't an objective conversation about how are we as a team going to put this deal together? Yeah. I love it because it really goes back to what you were saying at the beginning of this conversation. And I just wrote it around and again, we know this too, right? What happens

with that assume, right? Makes an asset a year and me, right? And it's so true. So what I'm hearing right

now, people are falling along like I'm falling, because I'm always looking for the process. I'm

always looking for the steps is preparation is everything. You want to, you want to make sure that you are fully prepared. And you and I sat there and thought, you know, even me, I was like, how are people not prepared, but the reality is, people are coming into negotiations, are coming into meetings, are coming into the fight on prepared. That's a sure way to lose. Let's just say that I can guarantee you, you'll be successful if you're not prepared. I can guarantee

you won't be successful by not being prepared, right? So preparation is what I heard number one. Are you prepared? Number two is, are you ready to ask questions? Those who are prepared can ask the right questions. Three, which I love, which is, you got to know your authority, knows in the room, know who has the power, where that power is and how you're going to flow the power out of the thru or two or from that authority figure, but don't ever, ever lose the idea of

who's in the who's in control right now. And then we moved to what I love was the opposite. Instead of

“asking, what is it you want? We're looking at the negative almost and going, what is it you don't want?”

Let's get, let's get what you don't want off the table first, because that's just going to get

as closer to what you do want. And then from there we have enough knowledge that we can make,

is the more major that that becomes. The bigger the math, the bigger the bigger the ability to

“make it objective and the impact of what that objective math can do will dictate a good negotiation.”

And then I love this. And once you've done this, and if you're not, it sounds like at that level, if you're still at a standstill or there's still things you're having a hard time figuring out, you put the other side in the thought leadership as a thought partner. You asked them, "Well, what do you think we should do?" Just getting them involved because those who battle the plan, so those who battle the plan, they'll battle the plan. And then what I've wrote here,

Big Star, never once through the preparation, through asking the questions, through knowing the

authority, through knowing when they're telling you what they don't want, when you're making the

“math objective probably big time here. And when you're asking for the help, never, ever just assume”

anything in any negotiation. Yeah, I mean, you've wrapped it up. You could write those rules ten different times. You'll have commonalities. Yeah, I mean, well, there it is. The people are listening and I mean, there it is. For me, that's basic, like to me, that's basic, basic negotiation.

Here's what I'd say. Is it going to make you the richest person in the world? No,

but guess what? That alone, I guarantee you will make negotiations a lot easier. A lot better. A lot more efficient. Absolutely. And look, you do one extra, you get to one extra deal in a year, make some major difference. Especially in the acquisition. Yeah, I mean, we're always trying to be

“efficient with our time. And I mean, I drill back to on the prepared side. You know, next time”

you walk into a meeting, just think about how many people really are unprepared. It'll shock you. Yeah, no, I'm going to be looking at that. I was thinking about the meeting this morning where I was in a meeting, nobody, we were, it was in negotiation, but nobody was prepared. We're wasted colossal time. It was a waste of colossal time. So imagine walking into negotiation and I'm having that feeling like what a way to stop negotiation. For for those of them are listening, they want

to learn more. They want to learn where they can get your book. Be able to take what I just did and you know, get the more nuance of it. Where can they go? Yeah. I mean, Amazon, you know, Barnes and Noble, all the online channels, bookstores and several areas, especially regional and Colorado. But I'm mildly active on LinkedIn, but if there's any listeners have a real estate,

public private deal, they can always find this online. It's on verticalco.com.

It will make sure we add those in the show notes. So again, Walker, thank you so much for being here. If we're going to leave the audience one thing, one tactic, one last comment statement that sits behind our vault when it comes to negotiations, when it comes to getting them through the finish line and/or getting them back on track with something you can leave us with. Look in the mirror, see that you are at your core, self-interested, and then understand,

so is the person across the table. So just a good way to start. Look in the mirror and see that you are self-interested in the same person you're speaking to, is self-interested. I love it. It's just a fact. Basic but facts. Everyone is in it for themselves. Hate to say it, but it's true. We're going to leave it there. Again, thank you. If anyone wants to learn more, they can always

come to the show notes and get the links to where they can find you. Thanks so much for being here.