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[ALLISON ROUSE] Good evening, everybody. My name is Allison Rouse, and I'm the Director of Alumni Communities Engagement here at the Stanford Graduate School of Business. And it is my honor to bring to the stage the Philip H. Knight Professor and Dean of the Stanford Graduate School of Business, and Morgridge Professor of Organizational Behavior, Sarah Soule. [SARAH SOULE] Well, good evening everybody. Glad that everybody is seated, and I want to invite you to please start in on your salads as I share some remarks. there's a nice program here tonight, and there's no reason we should let our good food wait.
So please feel free to jump on in. So welcome, welcome to the Ernest C. Arbuckle Award Dinner. We have several people here with us tonight that I would like to give a few shout-outs to. First, we are so honored to have President John Levin and Dr. Amy Levin with us. John and Amy, thank you so much for coming. This evening is as much about the entire university as it is about the GSB, and your presence here of course reminds us of that.
We're also very, very happy to have with us the members of the Arbuckle family, Susan, Steve, and Anton. Thank you so much for being here with us. [SARAH SOULE] I would also like to welcome the members of the Stanford Board of Trustees, the GSB Advisory Council and Trust, the leadership team of the Business School Fund, and the board members of the GSB Alumni Association. You all provide the connective tissue of this community, and we're so grateful for your partnership, your counsel, and your care.
Thank you for joining us. Now before I go on, I want to take a moment to acknowledge the passing of Steve Denning, the 2018 Arbuckle Award recipient. As many of you know, Steve served as Stanford's longest serving board chair guiding the university with steadiness and with vision. He was a foundational force behind the Denning House and the Knight-Hennessy Scholars program, the Stanford Doerr School of Sustainability, Stanford HAI, and he co-chaired the Stanford Challenge We remember Steve tonight with gratitude and affection.
Now let me tell you a little bit about this award and about the man whose name it carries. The Ernest C. Arbuckle Award is the highest honor that the Stanford Graduate School of Business bestows. It's presented annually to a leader who has achieved distinction in management and who has demonstrated a genuine, sustained commitment to addressing the changing needs of society. Tonight, as you know, Hamid Moghadam will become the 56th recipient of this award.
[SARAH SOULE] Ernie Arbuckle was the third dean of the GSB, serving from 1958 to 1968. During that decade, he elevated the school to a place of global standing. He recruited exceptional faculty, he overhauled the curriculum, and he built new facilities. And he did all of that while bridging two worlds that do not always speak to each other, the world of academic rigor and the world of business practice. But what people remember most about Ernie, it's not really the buildings, nor is it the rankings. They remember the person Ernie Arbuckle, as many of you know, was a decorated World War II veteran, allegedly refusing morphine when he was injured
so he could keep a clear mind and bring his men to safety. This anecdote shows something about Ernie, that he believed that people beside you are more important than the mission itself. Ernie Arbuckle once wrote that if the private enterprise system as we know it is to survive, we must instill in our students attitudes that accept integrity, rooted in the bedrock of principle, as more important than operational competence. I think Ernie meant that because he understood that excellence without integrity is hollow, and that both of these depend on the kind of community you build around them. And as you've heard me say before, excellence
and community are still the core values of the Stanford Graduate School of Business. Now, before I go further, I wanna take a moment to recognize the people who have made this community possible. To our past Arbuckle Award recipients who are in attendance, would you either raise your hand or stand if you are able? We have John Morgridge, our 1996 honoree. Bob Joss Former Dean and our 2012 honoree.
John Gunn, our 2013 honoree. Mark Wolfson, our 2022 honoree. And Jim Coulter, our 2025 honoree. Thank you all for being here with us. We also have tonight 60 fellowship and faculty donors who are here. And would you, if you would, please just rise to be appreciated?
You are all the reason that 50% of our MBA students and 24% of our MSX students are able to be here and to be lucky enough to study at the Graduate School of Business. Finally, and then I'll try to shut up soon-ish, we have 41 fellowship students here tonight. Would you also please rise? [SARAH SOULE] To all of you, the people in this room are your community, and they made it possible, of course, for you to study here. And one day, I hope that you'll be the ones making it possible for somebody else.
Okay. Now, I get to say some words about the man that we're here to honor tonight. Hamid Moghadam earned his MBA from the Stanford GSB in 1980 Three years later, he co-founded AMB Property Corporation with Doug Abbey and colleagues, and John, who's here with us tonight too. Doug's a lecturer at the GSB, and he is going to lead our fireside chat later on with Hamid. Many of you know, of course, that Hamid led AMB through its IPO in 1997 and through its merger with Prologis in 2011. Under his leadership, Prologis became the global leader in logistics real estate and one of the top 100 companies in the S&P 500.
In January of this year, Hamid transitioned from CEO to Executive Chairman. Now, Hamid has received so many honors for his leadership over the years. I'll just mention a few of them. In 2006, he received the Ellis Island Medal of Honor. In 2013, he was recognized as the Ernst & Young National Entrepreneur of the Year, representing the United States. And the Harvard Business Review ranked him the 17th best performing CEO in the world. But Hamid's relationship with Stanford, I think, runs deeper than all of these awards and accolades and recognitions.
He served on the Stanford University Board of Trustees, the GSB Advisory Council, the boards of Stanford Health Care and Freeman Spogli Institute, and he chaired the Stanford Management Company, overseeing the stewardship of our endowment. Hamid's also mentored countless students. He supported faculty and contributed to the intellectual life of the school, and I think that's exactly what alumni excellence looks like at Stanford and at the GSB. Alongside with Christina, he has invested in the intellectual life of the GSB in so many ways that will outlast us all. Together, they established the Moghadam Family Professorship And they're the primary benefactors of the Hamid and
Christina Moghadam Program in Iranian Studies at Stanford. And this is a program that supports interdisciplinary scholarship, courses, and public dialogue on Iran's history, culture, and place in the world. We're really happy tonight to have Abbas Milani, the Hamid and Christina Moghadam Director of Iranian Studies. And Abbas, wherever you are, thank you for being here Hamad-Hamid, what you've built in business is extraordinary. What you have given to the university is lasting, and the way you have done both with integrity and purpose is exactly what Ern-Ernie Arbuckle would have recognized and admired.
Please enjoy your dinner, and we'll be back, with the rest of the program after we have a bite to eat. So I've learned two things in dean school. Number one is get a red dress, and number two is learn how to interrupt people when they're right in the heart of a really great conversation. So there you go. And I'll be very brief right now, but I wanted to move to the heart of our evening's conversation, and I'm really glad to introduce somebody who's going to take us there.
Jahan Moslehi is the CEO and co-founder of Bridge33 Capital, a commercial real estate investment firm. Before founding Bridge33, he spent nine years at Morgan Stanley working across offices in New York and London. He, of course, earned his MBA from Stanford GSB in the class of 2010. And what I have learned about Jahan recently and in our conversation tonight is that he brings an incredible curiosity and commitment to everything that he does. He's a member of YPO, and he serves on the board of Conservation X Labs. So Jahan's going to share just a few remarks, and then he'll welcome Hamid to the stage to also share a few remarks before a conversation, a fireside chat with Doug Abbey.
So Jahan, the floor is yours. [JAHAN MOSLEHI] Thank you so much, Dean Soule. It's so great to be here today, and it's such an honor for me to be introducing Hamid tonight. You know, it's funny, I've actually realized that I've had many, many years to think about what I would say here tonight, not because I ever thought that anybody would ever ask me to give this speech But because when a mentor has had such a tremendous
impact on your life, you end up carrying around a list of things that you have to say about them. And so tonight, I'm excited to share just a couple of those. But before I do, I should say a few things about what Hamid has built. In 1983, he co-founded AMB and built it into the global powerhouse In logistics, real estate. 3% of the world's GDP flows through his buildings. 3%.
[JAHAN MOSLEHI] He is a visionary. I could keep going on about his resume, but his resume is not why I am standing up here tonight So I'm gonna go back to my list. In 2001, I was three weeks into my first job at Morgan Stanley. I was 22 years old. And when I was 22, I looked like I was 12. I got invited to a Morgan Stanley client event, and I show up, and I don't know anyone, and I don't know anything, and I'm kind of awkwardly hanging out at the bar by myself. And a guy walks up, and he starts chatting with me. And that guy was Hamid. The next day, I go into work and my boss, very sarcastically I might add, asked me whether I networked last night at the Mezref event and if I met anyone.
I pull out Hamid's business card And I show it to him and I say, "Yeah, I met this guy." And he says, "Oh, wow. He's a huge deal. You should email him." And I say, "Oh, I already have," and we've already gone back and forth five times. That gets me to the first thing on my list. For someone at his level, Hamid is uniquely accessible. He takes the phone call. He responds to the email. He talks to the kid at the bar who's obviously the most junior person in a room full of important people Hamid, for 25 years, you have always written me back, and I can't tell you what that means to me.
You also inspired me to start my own real estate company with my partner Andy 14 years ago, and you and Doug decided to back me. Ever since then, your fingerprints have been all over everything that we- Have built. And that gets me to the second thing on the list. Hamid is the rare CEO who develops other CEOs. It's early 2021, we've emerged from COVID, and we're on the offense. We're one of the biggest buyers of shopping centers in the country.
Hamid calls me out of the blue and says, "Jahan "your number one job as CEO of this company is to build the best relationship with the 30 tenants that matter, figure out what their pain point is, and solve it for them." I did what I always do when Hamid gives me advice. I listen. And it was a couple of years later that I realized what he had done. That wasn't just tactical advice. That was the Prologis playbook, one that he had spent 40 years writing Based on the premise that when the rest of the industry is obsessing over capital, you obsess over your customers. That's how Hamid develops other CEOs.
Hamid shows up early, he stays in touch, and he gives you a piece of how he built one of the great American companies That is genuinely rare. Most CEOs at his level go on to build a great company. A smaller number go on to build an industry. And a very, very small few go to build other people who then go on to build their own companies and their own industries. Hamid has done all three, and that is a legacy that compounds. I want to close tonight with the following. I have spent 25 years watching Hamid in every type of room.
The real estate world, Wall Street, the Stanford community, the Iranian American diaspora, and most importantly, in his own home with Tina and Cyrus. What I have come to understand is that he's the same man in each of those rooms. The Hamid you see in the boardroom is who shows up at the dinner table. The Hamid who's given so much to this university and to so many other causes is the same Hamid who talks to that kid 25 years ago at the bar.
There is just one Hamid. And he is in every circle that I've seen him in, always the most respected man in the room. Hamid, congratulations and thank you. [HAMID MOGHADAM] Well, that was amazing, Jahan. I, I don't know who you were talking about, but I enjoyed every second of it, so. But, um, uh, Jahan has been, uh, as he talked about, the friend of the family's for over 20 years and, um, uh, a business partner for about 15 years when he started this company. Uh, so he's played a few roles. But in the last couple of months, we, um, he's been playing some really different kinds of roles.
He officiated our son's wedding, um, and, um, my son and his, uh, uh- And my son and his wife are here tonight with us, and he did a great job And now he's serving as the emcee for this event, I guess. So at this pace I think I'm gonna put him on retainer and, uh- And because he's really good at doing this. He's even better at it than real estate, I think. So- No, but in all seriousness, John, thank you. I really appreciate your friendship, your leadership here, and for being part of so many important moments in our lives, including Cyrus's wedding. And thank you GSB for the honor.
It's especially meaningful knowing the people who have received this award before me, and many of whom I consider among my friends and worked with them and really learned from them I also wanna really acknowledge the Arbuckle family. I was a little bit later than Ernie as a deanship, but he's legendary and, you know, his mark is always gonna be on this school as really the person that put this school on the map. So it's great to have you here and I look forward to getting to know you better. But really the way I ended up at Stanford is, started with a blizzard in 1978. Literally a blizzard. And this was one of the biggest storms that Boston had ever seen. In fact, if you Google the blizzard of '78,
you'll learn all about it At the time, I was at MIT and the city had imposed a week-long curfew. You couldn't drive your car, and in those days, there was a $500 fine if you drove your car and they caught you. So I was sitting around at home stuck, cold, frustrated and rethinking my long-term plans. Right in the middle of that, I got a call from Lori Lieberman. How many of you know Lori Lieberman? Okay, many of you who were admitted around that time. So Laurie calls up and says, "I hear Boston is shut down.
I wanted you to know that it's 75 degrees and sunny in Palo Alto, and you should come here." So not only that was a very effective recruiting strategy, but it really changed the course of my life. As I look back, that one call and that one storm was probably the biggest moment of change in direction of my life. Stanford is where I met my wife. Through Stanford is where I met my partners directly and indirectly in the business. Many of my closest relationships relate to this place. And in a very real sense, I didn't just get educated here, maybe I didn't get educated here, but it really shaped my life So I graduated in 1980 in the middle of the Iranian Revolution and
The first of a double recession that lasted through 1983. Interest rates were 22%, and I was trying to get a job in the real estate business. Not very smart. Like many people at that time, I didn't have a clear plan. The future I thought I was gonna have changed 100%. But what Stanford gave me wasn't a direction, it gave me a way of thinking, and maybe more importantly, a comfort with uncertainty That turned out to matter because the most important decisions don't come with complete information. When I started working, I wasn't trying to build a global company.
We were just trying to learn, do a good job, and take advantage of opportunities as they came along. Over time, the opportunities added up. If there's a pattern, it's probably this: things evolve. You adjust, you make mistakes, and you try to stay relevant. What looks like a long-term strategy in hindsight is often just a series of decisions made along the way, with many mistakes among those decisions. What I've come to appreciate over time is how much of any outcome depends on circumstances, timing, people, and access to opportunity.
There are many people with similar abilities, greater abilities, who didn't get the same chances, and that's where this place like Stanford really matters. They create opportunity. They bring people together. They change trajectories, sometimes in ways that are hard to see at the time. I'm certainly a beneficiary of that. To the students here, I won't try to give you much advice. The world you're entering is different, and I'm not sure I followed most advice myself anyway. But a couple of things seem to hold up over time.
Be open to change, take on things before you're completely ready, and pay attention to the people around you In my case, that turned out to be the most valuable part of being here. And many of my classmates are actually here, and I'm really happy for their support. Let me end with a few more thank yous. To Stanford for playing such a central role in my life, to my family, my son, my new daughter-in-law, and especially my wife who I was lucky enough to meet through Stanford. And to my colleagues and partners who did the real work, and especially to my founding partners, Doug Abbey and Bob Burke, who are both here.
I now look forward to joining Doug in the discussion. So, when I think back, it's hard to believe that something as random as a snowstorm and well-timed phone call could set all of this in motion. But that's often the way things work. Small moments, the right people, and a place like this. Thank you. [DOUGLAS ABBEY] So picking up on the timeline, Hamid, you're an MBA too. You have two degrees from MIT and a Stanford MBA, and you need a job. And by the way, you were 23 years old, so you're, you've accomplished a lot already.
So walk us through how to look how to, go looking for a job [HAMID MOGHADAM] Well, you know, I think I told you part of the story. I think I hold two records at Stanford Business School. One was being really young with a graduate degree here, which is good, and the other one is really embarrassing the school by having more rejections than interviews that I had, and that is true. [DOUGLAS ABBEY] How many? [HAMID MOGHADAM] Two more. Well, we won't get into the numbers, but. [DOUGLAS ABBEY] Eighty-five!
[HAMID MOGHADAM] Two more than the number of interviews I had. So, you know I'm sure it had something to do with me, it had something to do with the circumstances, it had something to do with the economy. But it was not a fun time, let me tell you that. [DOUGLAS ABBEY] And tell us a little about, so you had all these rejections. He's not gonna tell you that there were 85 rejections, but there were 85 nos. And one of them was from Morgan Stanley. Tim, tell us a little bit about Buzz. [HAMID MOGHADAM] Doug is leading the witness here. So I think the story he wants me to tell you is that we were having a closing dinner for our IPO- At one of the wineries in Napa.
And everybody was saying nice things about Hamid, and Doug, and Bob, and the IPO, and what a great company AMB is. And the lead banker was Morgan Stanley, so they were really going all the way. And at the end of that, I invited people to look under their placemat, and there was a copy of a rejection letter from the guy who ran the real estate department at Morgan Stanley. And I said, "Well, must have gotten a lot smarter over the years, because I wasn't so smart then." [DOUGLAS ABBEY] I believe that you were going to paper a bathroom with all of your rejection letters, but Tina, you turned it down.
[HAMID MOGHADAM] She, yeah, she's the reason we don't have one of those. [DOUGLAS ABBEY] So, looking back to the early days, can you maybe share some memories of when you, Bob, and I started the company? [HAMID MOGHADAM] Well, all I can tell you is that we had these amazing meetings Monday mornings, and Bob used to keep the list, and there were like. I mean, I think our revenues were like a million bucks. But he had- 700 items on the list. I mean, we were working on the craziest, tiniest, most goofball things that you could ever imagine because in the.
I mean, we literally started the company with a $50,000 loan and never took outside financing. So we were paying our way, the concept that doesn't really exist anymore, I don't think, but we were kind of regenerating cash flow as we were building this company and self-financing it. So We had a lot of items, but very little business. And over time, I would tell you the thing that happened the most is that we got more and more focused on our core business, and we had fewer and fewer things to do, which is a lot easier than the opposite. So that's probably the most memorable thing. [DOUGLAS ABBEY] You remember when we were selected to get what we called the D Project.
It was a secret project, but we were asked to value the Spreckels Ranch in Salinas, and we had to become experts on growing lettuce in Salinas. So that was not exactly something you would learn in business school. So you're one of the few CEOs that's taken a company from a startup to an S&P Global 100. Real estate's a simple business, four walls and a roof, the industrial business is, that is. So yet, as you look at the history and the trajectory from 42 years ago, you've made so many decisions that have fundamentally changed who we do business with, how we're organized And a constant evolution of looking around the corner, and as you used to say, "We have to avoid being roadkill."
Because if you're not doing that. So give us a little bit of a hint as to kind of the discipline and the thought process that led to all of these significant changes over the years. [HAMID MOGHADAM] Well, I have a couple of theories about business, and this is a dangerous place to talk about them because there's so many people who know more about business than I'll ever know. But one of them is the bicycle theory of business, which is that you gotta keep pedaling, otherwise you tip over. If there's not forward motion, there isn't enough excitement, there isn't enough opportunity for people and all that. And companies that rest on their laurels usually fail.
And you can look at incumbents from decades and decades and decades, and they're never the same companies. So, I've always been impatient. I've always wanted to do more than we're doing, and always pushing the envelope, and always, not always actually making the right decisions, but pretty quick in adjusting our path. So I think, and if there's one, suggestion that I have for the business school is that it's all about making decisions Alternative A in the case, alternative B in the case, which do you do? And what are the numbers that support each?
I've never seen numbers that don't support the decision that you wanna make. Okay? The numbers are always good. So that's really, I don't think it. I think the key for me, for us, to building this business, was when the business is going really well, to become anxious and uncomfortable. So the better the business went, the more anxious we got and started looking for other opportunities. So that was the playbook for the first 10 or 20 years. But I would say of late it's been simpler, and that's been- Actually, just opening up your ears and listening to what your customers want.
They tell you, you don't have to be brilliant to hear that. And it's not so much about making decisions, it's just about listening and adjusting over time and keeping your customers happy. And it's easier said than done. And in the real estate business, which is a very deal-driven business, it's never been about the customer. Nobody actually knows the name of their landlord or cares about the landlord. But when you get to a scaled business And you're serving the needs of a customer across 20 countries or something, then it really becomes the customer. Because no deal, no single deal, no matter how big it is, no matter how profitable it is, is going to move the needle on
a giant company like this. But serving customers well, better than anybody else, [DOUGLAS ABBEY] We used to call them tenants. [HAMID MOGHADAM] Yeah, we don't call them tenants anymore. Yeah. Tenants, tenants implies a landlord-tenant, feudal kind of relationship, and I don't think you can really treat your customers- [DOUGLAS ABBEY] So how did you evolve from thinking about real estate as collecting rent from these customers of yours- for industrial space that's maybe 5 or 10% of their spend on logistics And that's what real estate people do is they you have a lease and you collect the rent. But how did that opportunity
to grow that business beyond just collecting rent? How does that manifest itself? [HAMID MOGHADAM] Well, hopefully one way is collecting more rent from the same customer. And the trick to that is actually solving more of their problems other than their space problems. And what other relationship do you have that you're in touch with the customer, whether they like it or not, hopefully they like it, for five to 10 years? They're not going anywhere. And you have an opportunity to sell them products and services and other things that solve their needs, whether that's energy, whether that's sustainability services, whether-whatever.
So you have a captive audience, and there's so much more value to that customer and that revenue stream. And the real estate industry really ignored that because it was a very fragmented business and nobody really when I got out of business school, there were billion-dollar companies in real estate was unheard of. And so it was a very fragmented business, and you couldn't build a customer franchise because when you have two to three buildings, it's all about location and that building. It's not about the platform. But when you have 6,000 and you've got 11,000 customers, it's all about leveraging that platform to do other things for them. So it was an insight that we kind of- Backed into, if you will.
[DOUGLAS ABBEY] So it was not all up into the right-hand corner. And for many of you leaders out there in 2008, it was pretty brutal being a leader of a company. And I know how loyal you were. To the employees of AM- then AMB, PLD. You took such a great pride in building a great team. AMB's stock price was trading at 65, and it went down to the range of nine, and Prologis, our biggest competitor, was at 70 and went down to about two. So talk about a challenging period of time. Jahan wrote a case called Navigating Treacherous Waters, which was about the period that you went through Um, that we now still teach at the GSB.
Um, but talk about the personal element of it. I mean, remember there's a story of you and Cyrus playing golf and hearing about what was going on in Wall Street. There was a personal element of it, which I'd like you to hear a little bit, but I'd also like you to, How did you turn lemonade into lemon, lemons into lemonade? What was, what was it that, um, you learned from that experience that I think helped, helped you, uh, go from playing, uh, defense, which everybody was doing, to playing offense?
[HAMID MOGHADAM] Yeah, that's, you know, I. Two-part question, the personal piece of it, I look at Tim Arndt who's our CFO now, and the two of us spent so much time together working on this thing and, you know, building models and figuring out what business we should be in. And I remember speaking to Jim about maybe we should buy the company back, remember? And the check was even too big for you, and you, you can write some pretty big checks. So, but the personal part was the hardest. And we had to lay off about 20% of our staff. We'd never laid off anybody. I mean, we had, obviously you can't run a company without having to ask some people to leave because of performance and all that. But we'd never laid off a company
because the business was shrinking. But we didn't do it in one step. We thought we planned for a normal recession, and we went 5%, and then it was deeper, and we went another 5%, and we went another 5%. That was a terrible mistake on my part. We should have done it all at once. It killed me. We were very generous to people with time and financial resources during that period of time, because that's really important. And interestingly, many, many of those employees that left are now the best friends of the firm. They really look at the then A and B part as maybe one of the best parts of their career, and most of them have landed-all of them, I think, in good places. But it was very personally hard.
I mean, I just would get up at 2:00, 3:00 in the morning and somebody said, "What keeps you up at night?" During that period, actually, 2011. And I said, "The Wall Street Journal." And they said, "What do you mean Wall Street Journal keeps you up at night?" I said, "Well, the Wall Street Journal guy always threw the paper in our backyard at 3:00 in the morning, and for some reason I kept waking up at 3:00 in the morning. And I figured out it's not the stress, it's the guy throwing the paper in the backyard." So, no, but seriously, that part of it was extremely difficult and stressful. And, you know, by the way, it wasn't just us.
The entire REIT Real Estate Index went from 1,200 to 270 I mean the entire industry, because people thought there wouldn't be another dime of financing. But the other big lesson was simplify the plan. Really simplify the plan, and get on offense as quickly as you can. So we did a controversial equity offering at that time, without getting into the details, which is a story of another case that you teach. But that allowed us to get on offense, and that allow us to buy our biggest competitor and, and create the new Prologis. And out of the seeds of that, very difficult player, I think we became, period, we became a much stronger company. But clarity Communicating, communicating, communicating
the priorities until you're sick of hearing yourself talk. But you've got to strip it down. You've got to strip it down to a very simple message that people can understand and rally around. And you can't Look weak. You can't look like you don't know what you're doing because a lot of people depend on you. But I got to tell you, there were a lot of times I had no idea what I was doing or what we were doing. So that's the truth. [DOUGLAS ABBEY] So in the class, we ask the case about what would Hamid do. The question is- You had, you'll remember the numbers, but you had you were gonna look.
No one had done a secondary. Nobody had demonstrated that you could raise capital in this brutal market, and the only way that you could ever be in a position to play offense would be to raise some equity and have a war chest So we asked the students, and you'll help me with the numbers here, was your first secondary was at what? [HAMID MOGHADAM] Was it north of 50, I think. [DOUGLAS ABBEY] Okay, 15, 16. And the NAV at that time would have been, who knows what it was, but- [HAMID MOGHADAM] We're not teaching a class, Doug. You can get to the point.
[DOUGLAS ABBEY] I can do this math, and we asked the students, should Hamid do a highly dilutive, Call the real estate value. It was worth 65, maybe it was worth 30 or 40, whatever the number was. Should Hamid do a highly dilutive secondary offering? And at 12? Yeah. Yeah. And almost every student says no, and then Hamid explains why that was the right move. [HAMID MOGHADAM] Well, in hindsight it was the right move because it took an existential risk off the table.
We were never in an existential issue, but the market had that perception. And real estate is all about capital, and access to capital is an important signaling thing. So yeah, we diluted a good chunk of the company by doing that, but that allowed-we maybe diluted ourselves by a billion, and that put us in a position to buy $30 billion of real estate For nothing, for 30 cents on the dollar. Now, the reason I know the decision was right is that after we did it, 85% of the companies in the real estate business did the same thing but didn't have that advantage of timing. And sometimes being first is important,
and sometimes being first is a good way of getting killed. So that happened to be one of the other ones. [DOUGLAS ABBEY] So I'm sure you're asked many times about AI and data centers and energy, but how is that an opportunity for PLD? How have you created an opportunity for PLD in this space, in that space? [HAMID MOGHADAM] Well, the guys that are doing it are sitting right there because I'm a has-been, and those guys are running the business, so they're in a better position to answer the question. But look, we happen to own 6,000 buildings in the biggest cities in, in the world in 20 countries where the biggest consumer markets are. And we have 14,000, 15,000 acres of land
Um, ready to go and a lot of it entitled. And we built a power energy business in the last couple of years, which is key to building data centers. So we're monetizing a lot of the things that used to be logistic buildings to data center sites and conversions. And I think we're just getting started. I think that's going to be an amazing opportunity, and it's going to have long legs. And it's very hard to come up with real estate in those locations. And I think the first chapter of the game is these big AI factories that people are talking about and are obsessed with. I think the next stage of the game is going to be about the closer-in inference data centers that work on a low latency business without getting-
Technical because even with the speed of light, you can't have things going back and forth. If a kid jumps in front of your car and the car that signal can't go to Kansas and back. So I think that's gonna be the next opportunity, and I think we're gonna be pretty uniquely- [DOUGLAS ABBEY] What's the reuse of a $33 billion project in Abilene, Texas? [HAMID MOGHADAM] I don't know. Nobody knows yet. But if it's got power, it's certainly worth the land and the power, and who knows, maybe something else [DOUGLAS ABBEY] So the team is here, but you spent 42 years in a leadership role.
And if you look over, 40 years is a long time. But I think it's a useful horizon to think about, Okay, 40 years from now, what would you, what kind of advice would you give to the team? What are the challenges and opportunities when you look out over a 40-year time frame? That's a long time. What would you say, what would you focus on? What kind of advice? [HAMID MOGHADAM] I would say to a young. If I were doing this all over again and I were- Call it in my early mid-20s, the things I would do differently is, number one, I would take more risk earlier.
I think we were too conservative, and that's because we didn't have any margin for error. I mean, we were bootstrapping the company. You remember, we weren't even paying ourselves for the first two years and all that stuff. So maybe we weren't in a position to take more risk, but I would have taken more risk earlier. And I think the most important thing is have good partners And get up every day being excited about going to work. I don't believe that, okay, let's figure out what's gonna be the optimal industry or position or job to be in, you know, 2026 and pursue that as a career, because for sure that will change.
I mean, in 1980 when I was getting out of business school, petroleum engineers were The name of the game. You wanted to be a petroleum engineer. That's changed 100 times. So you gotta love what you're doing because that's what's gonna get you out in the morning and go to work excited. And you gotta have partners. I think important partners and good partners, compatible partners, not necessarily the same skills or the same temperament because people who know the three of us well can't even imagine that we've been partners for this many years. But we never, I don't think we ever had an argument about what's the right thing to do.
We had plenty of arguments about what's the right business strategy and all that, but on the values and all that we were pretty aligned. So do something you love, be aligned on the values, keep it simple, and have some good luck, and luck is important. But then I believe that people, luck maybe is not perfectly equally distributed, but it's pretty widely distributed. But you gotta show up when that luck comes knocking on the door. Speaking of enjoying what you do, I'll share a little anecdote. Our boss, Joe Azrak, who, uh, suddenly finked out on. It was gonna be Azrak, Abbey, and Moghadam.
What a name. Wow. But Joe finked out on us. I spent a day with Joe driving and seeing every regional shopping center in Phoenix for a pension fund that was looking at it. And at the end of the day, sitting in the Biltmore hot tub, Joe looked at me and says, "Can you believe they pay us to do this?" So I think this business, the real estate business, is just a wonderful, wonderful business to be in. Um- By the way, it was the largest employer of Stanford and Harvard MBAs I mean, Bill Rothaker is here. Trammell Crow was the largest employer, I think, of those classes of MBAs in the early '80s.
It was very much in the vogue. I mean, technology was going to work for Hewlett-Packard or IBM. And real estate was the entrepreneurial career in those days, and that's really changed. Certainly here, it's changed in a big way. [DOUGLAS ABBEY] Speaking of business school, we were sitting and having a nice conversation with Sarah, and we can play amateur business school people here today. I'm sure you- [HAMID MOGHADAM] She's your boss. You better, yeah, be careful. [DOUGLAS ABBEY] I'm sure you remember from Le Petit Prince, the businessman who sits and looks at the little desk and deals with les chiffres, which just, that's numbers was all-
You can focus on, and we know that the students who come to the top business schools are well trained in finance. They work for Goldman Sachs, they've been in consulting, they've worked in private equity, et cetera. But I ask the students, "How many of you've been in sales?" And out of the student, you know, the class, one or two people raise their hands. So if you were thinking today about, if you were thinking about how you, what skill set you would need to be a leader in the future, how would that differ maybe what, what. How could you look at in the future? What kind of skills would w- do you think business schools could be teaching, maybe that they, they could emphasize more?
[HAMID MOGHADAM] I think sales is certainly one of them, but I think execution is the big one. I think it's much less about decision-making and much more about executing the decision well. And I don't think it's a subject that lends itself to a ton of research, so I think it's tough to do in a business school setting, particularly one which values research in a big way for faculty and practice. But at the end of the day, it's all about execution. I would take a Okay decision and executed well over a great decision that never gets executed. So yeah, I don't know how you teach it though.
[DOUGLAS ABBEY] So I was gonna ask you a question, which was about retirement. How is retirement going? Which maybe you'll, but before I do that, I think more seriously, Since you've retired, you have spent, you've had another job working 30 to 40 hours a week and very involved in what's happening in Iran, and I, you know, just commend you for taking an interest in the policy decisions. Could you share a little bit about what that experience has been like for you personally? [HAMID MOGHADAM] It's been a very frustrating experience because the two people that I've been trying to, the two groups that I've been trying to influence,
one has been U.S. policymakers, and that's a challenge these days, you know, to say the least. And there's a lack of clarity and it's all over the place. So it's been, even though I've talked to all of the people you read about in the papers that make the important decisions, there is very little understanding and knowledge of what's going on over there. And without getting into the politics of what's happening, which I have some clear ideas about, maybe wrong, but clear in my mind. So that's been hard to move the administration in a direction. I think some of the things they've done have been courageous and correct. And I think in the later stages, they started veering off track, and it's gonna be hard to get it back on
track where we are. The other vector in that soup has been working on the Iranian-American diaspora to get them, try to get them aligned Behind a leader that could maybe lead the transition, a transitional government that will get you to the other side of this regime so that the people of Iran ultimately can make the decisions of what they wanna do. And I'm pretty sure they're gonna go for democracy given the opportunity. But they're dealing with a lot of risk, and you've seen the number of people getting killed and all that in the streets. So that's been really tough because Iranians, they're all chiefs and very few people that wanna follow. So Uh, I don't know.
It's, it's been frustrating And it's. I thought it would be very rewarding, but so far. I'm glad I did it because somebody had to do it, but it's not, I don't have a lot to show for it. [DOUGLAS ABBEY] And with the 30 or 40 hours you've been spending on a week over that for the last three or four months, when that frees up now, how are you gonna be spending your time? What are you gonna do for fun, Hamid? [HAMID MOGHADAM] Well, for fun, I actually like doing what I'm doing. I like the portfolio of the stuff that I do.
I spend maybe a day and a half-ish, two days, depending on the time, on the Prologis stuff. And basically Dan gets to do all the things that I used to do that I really didn't wanna do, and I only do the things that I wanna do. So that's part of it. That's a good chunk of it. We recently formalized our family office and getting organized around the investment program with that, and I'm lucky enough That I talked My son into joining me in that business. So that was actually scary, and because I wasn't quite sure how that was gonna affect our relationship. But so far so good, and I'm really enjoying it. I'm loving it actually.
[DOUGLAS ABBEY] And your golf game? [HAMID MOGHADAM] My golf game is not that good. I'm playing like- Actually, but part of that is because I started when I was 50, so. And talent is an important missing ingredient, so. [DOUGLAS ABBEY] So there are a couple of tables back there of students. Um, you were in their shoes, you know, 40 plus years ago, But anyway, maybe, as we wrap up here, any parting words to these wonderful young students here? [HAMID MOGHADAM] Yeah. Don't go with the fad du jour. Think for yourself. Don't worry about your competitors. Focus on your customers whenever you have a business, and you'll be fine.
Uh, I think being out of consensus is actually a good thing, not just for the sake of being out of consensus But I think when you follow what everybody else is doing, you're usually too late. So it's better to figure out what you should do as opposed to worrying about what other people do. [DOUGLAS ABBEY] Well, thank you very much, Hamid. What terrific. Thank you all for sharing your thoughts. Excellent. Well done. That was good, dude. That was good.
[SARAH SOULE] So I get the great joy now of thanking Doug for leading that wonderful conversation, and Jahan for those wonderful opening remarks, and for bestowing this lovely, lovely, emblem of this award to you, Hamid. [HAMID MOGHADAM] It's a real honor. Thank you. [HAMID MOGHADAM] Thank you.
[SARAH SOULE] So with that, I would like to call a close to the evening. I would like to thank all of you for coming, for your support of Stanford and for the Graduate School of Business, and the best of luck to all of the young people in the back. These were great words of wisdom for you to carry forth. Thank you all for coming.
