John Glascock, new director of University of Cincinnati’s real estate program, is an expert in Real Estate Investment Trusts, or REITs. These trusts pool investors’ capital to purchase and manage income properties, or mortgage loans, offering liquidity and dividends.

REITs can be complicated beasts in the finance world, and Glascock is a heavyweight intellectual known for global consulting work. He comes to Cincinnati from an endowed real estate finance professorship at the University of Cambridge, UK, but he has taught and consulted all over the world, from Beijing to Malaysia to Dubai. Glascock was in Singapore whenCincy caught up with him to ask these questions:
Q: In May, you took 30 Cambridge real estate students on a field trip to Germany, and lectured there on subprime crisis challenges for real estate professionals. What was your message?
A: It was three-fold: 1. It is not a sub-prime issue, but sub-prime was the trigger. The real issue was and is excess leverage. I-Banks and others had too much leverage in an attempt to get more yield. 2. Many people (banks and pension funds, too) took CDO and sub-prime leveraged funds because they wanted yield ­— they wanted yield so badly that they did not look at the assets in the portfolio.

3. Bonuses had a lot to do with this behavior. (People would think) “if we can just get the yield for a year or two, my bonuses will let me retire.”


Q:
You have taught and consulted extensively in China, and you write frequently about risk management in global investing. Is it possible to invest safely in Chinese properties?
A: There is no such thing as a safe Chinese investment, in the same way as there was no such thing as safe USA investments in 1850. When economies are blowing and going, returns are great but so are risks. Just ask any of the first bondholders of the first (attempted) USA railways. China’s market is very complicated, and you cannot just go there and invest. I’d suggest having a local partner.


Q: Why University of Cincinnati?
A: It’s a great university. (Business School Dean) Will McIntosh and I are friends — it’s always easier to work with someone you know and respect. Also, Steve Slezak has been developing an excellent finance team at UC, and it’s easier to bring great real estate to a community and university if there is a great finance base.

Q: What can educators do to lure finance majors away from lucrative hedge funds and into real estate investing?
A: Since I’ve been at Cambridge, our No. 1 placement has been in investment banking — but many end up in real estate in a few years. In many ways, most will make more money in real estate than in hedge funds or IB, but it sometimes takes them a year or two to see that.

Q: A John Glascock was a British bass player for the iconic band Jethro Tull. Any relation?
A: Yes, and he always comes up first on Google! (Genealogically, a) Thomas Glascock left Essex, England in 1643, and arrived in Fairfax, Va., later that year. My family and I live in Essex now.