Crushing it with Grocery Anchored Retail Centers with Jim Dillavou, Co-Founder, Paragon Commercial Group

**SPEAKER_1** (0:02)
Welcome to Real Talk Real Estate Discussions with Andrew Kirsh. In each episode, Andrew interviews industry leaders. We'll hear their real-time opinions on today's market, their background and unique career highlights, and guidance for newcomers to the industry. You can find this show at www.sklarkirsh.com and on YouTube, LinkedIn, Apple Podcasts, Spotify, Google Podcasts and more. Now here's the host of Real Talk, Andrew Kirsh.

**Andrew Kirsh** (0:40)
Episode 14 of Real Time. This week, I sit down with my former late Milwaukee's colleague, Jim Dillavou. Jim is one of the co-founders and principals of Paragon Commercial Group. Jim made the switch from being a practicing lawyer to full-time business person in the real estate industry. Paragon is one of the best in class retail owner operators, mostly in California, but specifically grocery anchored centers. We get into a really deep dive discussion on retail, the different types of sub-asset classes within retail, the capital that is flowing into retail, the secret sauce as to what makes a retail center work, the secret sauce as to what makes a new company work. And it's really a free-flowing discussion on the asset class that has had a lot of that headwinds over the last 10, 15 years. And we both agreed that over the last six to 12 months, there's been more interest in grocery anchored centers from the capital world than I've seen in my career. It's an interesting discussion and one that I think you will find interesting as well. Hello. Welcome to another episode of Real Talk. It is my pleasure to have my old Lathan and Watkins colleague, Jim Dillavou, co-founder of Paragon Commercial Group. Jim, how are you doing, man?

**Jim Dillavou** (2:28)
Andrew, I'm great. How are you? I heard you were at NMHC in Vegas yesterday.

**Andrew Kirsh** (2:34)
Yeah.
Nothing like 3,000 guys in Blue Blazers dancing at Marquis at the Cosmo. That is my definition of a good time.

**Jim Dillavou** (2:47)
Welcome back to reality. Now you've got to work.

**Andrew Kirsh** (2:51)
Yeah. This is work, right? You know it's slow when lawyers are spending more time doing podcasts than closing deals. But first and foremost, where does this podcast find you?

**Jim Dillavou** (3:07)
I'm sitting in my office in El Segundo, California and I apologize that I sound a little bit like Kermit the Frog. I'm at the end of what people in red states refer to the common as the common cold. But I'll do my best here.

**Andrew Kirsh** (3:24)
Not COVID, but a common cold? Or it is COVID, but you're just calling it a common cold?

**Jim Dillavou** (3:31)
No, there is no common cold in blue states. My doctor told me that in red states, it's called the common cold, but if I went to a blue state, they would call it something else.

**Andrew Kirsh** (3:41)
Fair enough. Well, you look like you're in a pretty cool office, brick walls. This is where you guys reside for Paragon?

**Jim Dillavou** (3:52)
Yeah. We bought an old 1950s warehouse in El Segundo, in the old industrial district of El Segundo called Smokey Hollow, and we renovated and turned it into our office.

**Andrew Kirsh** (4:04)
Oh, that's awesome. Any other tenants or you're the only tenant in the building?

**Jim Dillavou** (4:08)
We're the only tenant. We bought a couple of other buildings. We're actually one block away from one of your last guests, Steve Ludwig at Coastline Capital. He's one block over from us.

**Andrew Kirsh** (4:19)
Well, I know exactly them where you are. I've been to their offices, but Ludwig likes to just hang out in the 619 area code and sometimes graces us with his appearance in LA County.

**Jim Dillavou** (4:38)
That's true.

**Andrew Kirsh** (4:40)
So let's get right into it. Tell our audience what is Paragon Commercial Group.

**Jim Dillavou** (4:47)
Before I get into Paragon, I want to hijack your show for a second because none of your guests ever ask you questions or tell the history of Andrew Kirsh. Oh, wow.

**Andrew Kirsh** (4:55)
I can't wait for this.

**Jim Dillavou** (4:57)
I'm going to take it upon myself to do that right now and reminisce a little bit about when we were junior associates at Latham and Watkins and we had just started, I guess, first year, second year, third year, wandering the halls of the 40th to the 45th floors of the Library Tower in downtown LA until one, two, and three in the morning on a regular basis, closing deals for Credit Suisse and Deutsche Bank and whoever else was closing deals before the GFC. That's how Andrew and I got to know each other and you get to know someone really well when you work with them till those hours of the morning.