The Pacific Group: Navigating, Developing the Metro Atlanta Market

Atlanta Real Estate Forum Radio

Vice President Harold Cunliffe with The Pacific Group joins the Atlanta Real Estate Forum Radio podcast to dive into the real estate development business, founding The Pacific Group and more. Cunliffe joins host Carol Morgan on the tenth guest on the Legends of Real Estate series. A graduate of the University of British Columbia, Cunliffe earned a degree in civil engineering and went on to work for several construction companies with real estate developer clients. Seeing the wealth of these developers (think Rolex and Mercedes), Cunliffe was inspired to go down the same path. After accruing some savings, he purchased a small piece of property to begin amassing his wealth. During this experience, he became familiar with zoning, development regulations and many other things, and started to realize the real estate business is far from simple. Situated in British Columbia in the 80s, Cunliffe was front row to a commodity boom and a market flooded with cash. Cunliffe said, “It was pretty easy for me to stumble into this particular real estate deal, pull it off and make a bunch of money.” As he was doing this, he worked for a construction company where the boss acted as his mentor, aiding him along the way. During development, Cunliffe was able to get a sewer line attached to his property, allowing him to transfer from one unit per acre to two units per acre. Luckily at the time, lot values were increasing by the thousands. Lots Cunliffe intended on selling for $30,000 became worth $80,000 in value. Seeing the incredible increase in value, Cunliffe’s boss congratulated and terminated him, forcing him to complete the real estate transaction and search for another job. At this time, the commodity market crashed, and jobs were scarce. A friend and company partner, Mike Kilgallon, attended the University of British Columbia with Cunliffe and went into business with him. Eventually, the two also went broke together. Kilgallon was able to secure employment with a Canadian developer in the Los Angeles market and ran into some partners in Texas with access to savings and loan (S&L) money by chance. The meeting prompted the partners to ask Kilgallon to open an Atlanta office. Cunliffe said, “At that time, Atlanta had created 100,000 jobs, and I knew that should equate to about 60,000 housing starts. But at that point, Atlanta was only doing 20,000, so there was a big lack of supply and a big demand.” After looking around, Cunliffe secured a 200-acre piece of land in Roswell for $12,000 per acre. Cunliffe quickly secured citizenship and went to work before the S&L crisis. At this time, Kilgallon’s Texas partners had gone under while Cunliffe formed The Pacific Group. A big fan of the analogy “you have to keep swimming,” Cunliffe believes it’s key to keep your nose above water as a real estate developer. Becoming involved, positioned and furthering your education is a crucial part of the business. Cunliffe said, “There’s going to be a low tide. You’re going to get down there and be able to pick up all the treasure. All you have to do is pick it up and get to shore as fast as possible. Don’t go back in the water when it’s high tide again because you’ll lose all your treasure. That’s what happened to me three times.” After operating in metropolitan Atlanta for a time, a partner in Texas with access to S&L money approached Cunliffe's team with a deal. The partner would front the funds if his team handled the deals, resulting in a 50/50 split. When the S&Ls ran out of money in 1992, the Resolution Trust Corporation searched for people to complete the projects to return as much money as possible to the FDIC. The managers of the Resolution Trust Corporation recognized that Cunliffe and Kilgallon were not discredited borrowers and tasked them with finishing real estate projects. This resulted in the duo entering into a forbearance agreement that stated the two were to pay off the corporation with a certain amount of money o...