Thursday, May 24, 2007
NOTE: Followed is a story about David Crisp from June 2006 followed by a recent story about his business disolving and another about 8 of he and his families personal properties in Forclosure only 10-11 months later.
Considering what the actual value of many of Mr. Crisp's properties were - before he OVERPAID for them, it seems like some massive fraud went on here - involving the sellers, brokers, bankers, appraisers, etc. - pretty much the entire RE food chain, as it were....
Saturday, Jun 10 2006 9:44 PM
It's tough not to notice Bakersfield's youngest real estate mogul when he's out in public -- at least when one of his four black-suited bodyguards happens to be in tow. Or when he zips around town in his $560,000 Mercedes-Benz sports car, one of a small fleet of exotic autos he owns or leases.
A millionaire at 26, David Crisp isn't shy about his good fortune.
Five years ago, the Stockdale High grad was waiting tables at a now-defunct Mexican restaurant and loading UPS trucks.
Today, he's a partner in a local real estate agency that's on course to garner roughly $400 million in sales this year.
Crisp & Cole Real Estate is just one of five companies he runs with partner Carl Cole, a 58-year-old former high school principal from North Carolina. Together they oversee about 60 staffers.
Hundreds of young agents have joined the real estate ranks in recent years to capitalize on Bakersfield's unprecedented housing boom, but none has matched Crisp's meteoric rise.
His recipe for success?
A mix of good marketing, unending drive and a lot of risk-taking.
Some good timing and a little luck didn't hurt either.
It wasn't yet 11 a.m. on a recent Wednesday, and roughly 100 text messages had already come and gone from Crisp's cell phone inbox.
The first call typically comes around 7:52 a.m., explained the fresh-faced entrepreneur, sporting black slacks, a blue-striped shirt and gold tie on his 6-foot frame.
"It's always someone trying to beat the 8 o'clock rush," he said.
Crisp's days are a whirlwind, full of rushed visits to the bank and zig-zagging trips across town to check on contracts and building projects.
His energy seems to rub off on Crisp & Cole's 25 agents, a few of whom are younger than Crisp was when he broke into the business at 21.
When he joined Kyle Carter Real Estate five years ago, Crisp quickly realized the 2000 Mitsubishi Galant he drove wasn't going to cut it.
Nobody took him seriously.
So, the fledgling agent bought a Corvette that he couldn't afford and hired an assistant he didn't need.
"Did I fake it till I made it?" he said. "Yeah. I'm not going to lie."
Now, he owns or leases 12 or so cars -- Mercedes, Ferraris, BMWs.
He whisks investors and agents to business meetings in Las Vegas via private jet, a prepaid service that costs the company up to $2 million a year.
Crisp's $50,000 Chanel watch glitters with hundreds of diamonds.
He bought his first suit on sale at Robinsons-May for $155 but now slips into suits by Armani, Louis Vuitton, Valentino and other top designers, some with price tags of up to $10,000. His agents are encouraged to do the same.
He's also building a mansion worth more than $5 million in Seven Oaks, complete with an escalator and NBA-size basketball court. It's perfect for hosting clients, charity events and Bible studies, he said.
It's all about marketing, he said.Even the mints that sit in dishes at the plush offices of Platinum Investments, one of the partners' companies, bear the Crisp & Cole logo on silver and gold wrappers.
If you look successful, people assume that you're doing really well, he said. Then you have to put in the hours.
"After you get your foot in the door, you can't be a joke," he said. "You've got to make sure you get everything done."
He keeps tight tabs on the local market, studying house sale listings late into the night after the phones have stopped ringing and the house becomes quiet. Most nights he's up until 2 a.m.
Crisp expects as much of the people he does business with as he does of himself.
At his office on a recent afternoon, Crisp talked to local homebuilder Charlie Bailey about a potential contractor he was looking to hire for a building project.
Crisp asked if the contractor could finish everything in the four months he was promising.
"I want him to know, basically, that there is a penalty on it if he doesn't get done on time," he said.
He's meticulous about checking the credentials of outside agents that work with his company. He's also demanding of his own agents.
The company started a hot line that lets callers reach an agent after business hours. Calls are forwarded to agents' cell phones on a rotating basis.
If an agent doesn't return calls promptly, he or she can lose their privilege to answer the hot line, which often provides valuable leads on properties.
Building a name
Crisp & Cole's next big endeavor promises to be its most-ambitious yet.
The company is proposing to build two 31-story skyscrapers on the Cal State Bakersfield campus, a $370-million project that would include condominiums and a hotel.
With his visionary attitude and flashy style, Crisp is building a name for himself in town.
He turned heads at a recent fundraiser for the American Heart Association where two bodyguards accompanied him and his wife.
The security team is a new addition to Crisp's life that's taken some getting used to for his family. He also has two German shepherds in training and a Range Rover with a license plate that reads "CCRE K9."
Crisp said he doesn't feel threatened but also doesn't want to take a risk with his family.
He describes himself as an "up-and-coming mogul" much like Las Vegas casino tycoon Steve Wynn, whose daughter was kidnapped in the 1990s.
"They're there for protection," Crisp said of the guards.
Rumors float around town about how he made his millions in such a short amount of time. He knows it.
"It comes with the territory," he said.
As long as you continue to give great service to your customers, you'll be successful, he said.
For partner Carl Cole, Crisp's ideas can sometimes seem crazy.
"He likes to make waves," Cole said. "He likes for people to say, 'What the heck is that? He's driving what? He took a plane where? He's got a plane?'"
Cole might not make those financial decisions "in a million years," but he trusts the brazen young man, whom he has come to consider his best friend.
He loaned Crisp a couple thousand dollars when he was just getting started and has been repaid many times over, Cole said.
The company has invested heavily in itself, and "everybody knows us," he said.
The partners started their own video production company in fall 2004 to create the 30-minute TV commercials that showcase Crisp & Cole properties daily on the major networks.
The company also keeps its agents looking sharp by giving them money to buy designer duds or helping them buy new cars.
"We've made it our business to live up to that marketing," Cole said.
A friendship forms
Cole first met his future business partner about a decade ago, while selling Crisp's mother a house.
A teenage Crisp was talking to a builder for his mom, a Vietnamese immigrant who struggled with English.
The 16-year-old was demanding and assertive, Cole recalled on a recent afternoon.
"I remember going home and telling my wife I was really impressed with this kid, who was really standing up for his mom," he said.
Five years later, Crisp walked into the Kyle Carter real estate office that Cole, a successful agent in his own right, had recently joined.
"I thought he was a little over the top and very confident, right on the edge of being cocky," Cole said.
In that self-assurance, the older man saw the makings of one of the best agents he'd ever seen.
A friendly competition formed between the two, and in 2002 they partnered up while still working at Kyle Carter, posting $15 million in sales that year alone.
They took on more agents and by 2004 sales had soared to more than $91 million.Then in March 2005, the two split from McMillin Realty, which bought out Kyle Carter, to form their own company.
In an industry dominated by older agents sticking to the same methods, the partners decided the younger, dynamic Crisp should be out in front, Cole said.
"He's the zip and go. He's the flash guy," said Cole, who describes himself as the details man who brings Crisp's ideas to life. "I sit in here and grind it out."
The relationship is kind of like a marriage, Crisp said.
They've been known to create a scene now and then with their arguments and door slamming.
"We're determined to make it work even if he does tick me off twice a day," Cole said, chuckling.
A number of agents have left other companies to join the successful team, which Crisp describes as "not a typical real estate company."
The bustling California Avenue office is full of young agents with pin-striped suits, gelled hair and hands attached to ringing cell phones.
Integrity, trust, success and other motivational words stand out in large black lettering along the walls. A white board at the front of the room lists dozens of properties for sale.
"People chase this job down," said Crisp, who demands much from these aspiring professionals.
He chides them to walk straighter, cut their hair and avoid slang.
If someone can't afford the designer suits, he asks, "How much do you need?"
It's a risky but worthwhile investment that's paid off, he said. Like Crisp, many drive BMWs or Mercedes -- cars the company will front them the money for if needed.
For agent Jonathan Gainor, there's no comparing the ambition, marketing and teamwork at Crisp & Cole to the company where he used to work.
"Crisp and Cole is like the New York Yankees," Gainor said. "You either love 'em or hate them, and if you can't beat them, join them."
Where the money's made
While one of the most aggressive and top producing agents for his first real estate office, Crisp didn't make his fortune solely by selling houses for other people.
He took advantage of skyrocketing housing prices by buying and selling investment properties.
The first was a $130,000 house in the northwest's San Lauren neighborhood. A Modesto-area investor offered to buy the house for $175,000 before it closed escrow, so he didn't have to take out a loan.
With that profit, he bought a $487,000 house in Seven Oaks that quickly jumped in value to nearly $1 million. He pulled roughly $300,000 in equity from that house to buy other properties and grow his business.
It took off from there, one investment property after another, he said. Every dollar Crisp made, he pumped back into the business.
Crisp wouldn't reveal how many investment properties he's personally dealt with, but said the company typically has anywhere between 45 and 60 at any given time.
He also wouldn't say how much he makes in a year.
According to a statement made by Crisp in court filings during a child custody hearing last year, his gross income was about $10,000 in 2001. By 2004 his income had jumped to more than $160,000, which included his share of corporation profits.
He also brought in about $220,000 that year from buying and selling investment properties with his second wife and business partner, according to the statement.
Crisp wasn't always this driven.
As a teenager, he was better known for troublemaking than dealmaking.
The middle of seven siblings, he grew up in a four-bedroom house in Campus Park.
"He was a feisty, smart-mouthed little kid," who, along with his brothers, got into his share of fights, said older sister Kym Crisp.
The family struggled as their dad, a once-successful entrepreneur, hit bottom financially. Once, when they couldn't pay the electricity bill, the family stayed at his pizza parlor -- Fast Lane Pizza -- for a couple weeks.
The boys liked to sleep in the game room, underneath the basketball machine, she said.
In high school, Crisp called the police on his dad, whom the siblings say stole checks, a credit card and other belongings from the teens.
While a checkbook belonging to Kym was found in his bag, their father, Dan Crisp, said he feels there was a rush to judgment.
The senior Crisp, who spent nearly 14 months in jail for passing bad checks, said he never used anyone else's checks or took a credit card. The father said he has no ill feelings about his son calling the police and wishes him the best of luck.
"We've had our ups and downs," he said. "I'm proud of David. He's a very hard worker."
At 18, Crisp's life took a drastic turn.
In 1998, he married his high school girlfriend, who gave birth to their daughter, Taylor in December of that year. She's now 7.
"(Taylor's) the one who lit my fire," Crisp said.
He began working multiple jobs and ultimately got his real estate license after taking night classes at Bakersfield College.
"Most teenagers went off partying. He just stopped," his sister said.
Crisp and his first wife separated after about 21/2 years of marriage.
Taylor loves him to death, said ex-wife, Tiffany Crisp-Molina.
They go shopping, and he takes her to Hawaii every summer, Crisp-Molina said.
"He's always made sure his family was taken care of," she said.
In fall 2003, Crisp's now wife of two years, Jennifer, gave birth to their son, Aiden. The couple married soon after.
"They keep me grounded," Crisp said of his two children.
A flashy business bigwig in the public eye, Crisp is also a down-to-earth dad. He once dressed up like Batman to Aiden's delight.
That stunt earned him the nickname "Bat-daddy" from the blond-haired little boy.
A photo of the pair at the family's Seven Oaks home shows Aiden happily sitting in the driver's seat of his dad's gleaming silver Mercedes-Benz McLaren.
"(Aiden's) like nonstop, too," said the 24-year-old mother. "It's like I have two Davids in the house."
At home, he's a different person after he unwinds from the work day, his sister said. He likes to clown around.
The Crisps' spacious house sits on a quiet cul-de-sac and is a popular hangout for friends and family.
Crisp wants to make everyone happy, his wife said. They take family vacations and have barbecues.
"When he comes home, he's David to us," she said. "He's a dad. He's a husband. He cleans."
The two met when she was still in junior high but split after they went to separate high schools.
They reunited just as Crisp was entering real estate and working long hours, she said.
The young mother is quick to voice her opinions of his more outrageous ideas.
"I go, 'David, are you kidding me?'" she said. "I'm pretty tough on him."
But, ultimately, she trusts him.
"We know we're blessed to have each other, to have our family," she said.
With Crisp's help, his wife and sister Kym plan to open a baby boutique this fall. Crisp Kids will be part of a shopping center in the works on the corner of Brimhall Road and Calloway Drive in the northwest.
Crisp is quick to take care of his family members. Last winter, he bought his father a 2006 Toyota Tacoma truck.
His parents are divorced now, but his mother, Tu Crisp, encouraged him to help out his father and others in need.
"I appreciated the fact that David would do that for me," Dan Crisp said. "It was out of his own heart."
Crisp and Cole have donated hundreds of thousands of dollars to Cal State Bakersfield, the American Heart Association and other local charities.
Crisp recently auctioned off a car lease worth about $28,000 at a heart association fundraiser, which raised $8,000 for the charity.
He also helped send six students in a virtual business class at his alma mater Stockdale High on a trip to New York City this spring for a competition.
He came to talk to the class last fall about his experiences in real estate, said teacher Terry Millsap.
The students seemed encouraged by his success, Millsap said.
"I think they thought, I can do this, too," she said.
The group later wrote him to ask if he could help with their fundraising efforts to attend the competition. He offered to pay the remaining balance of $1,800, Millsap said.
"That really meant a lot," she said. "It just made me feel like crying because we worked so hard."
Crisp's mother worries about her son's workload as he continues to climb the ladder of success.
"I say, 'Son, slow down,'" she said.
But Crisp shows no signs of putting on the brakes.
Fresh off a record-breaking residential real estate market, he's barreling full speed into the commercial world.
His next mission: build a pair of 31-story skyscrapers on the Cal State Bakersfield campus, a project of the huge proportions more common to the Los Angeles cityscape.
For starters, the twin towers would include 524 luxury condos, a four-star hotel with 115 rooms, health club, day spa and 75,000 square feet of commercial office space.
Crisp plans to make it all happen by his 30th birthday.
"There's nothing I've said that I've not done," he said.
The project is probably one of the largest mixed-use development of its kind ever proposed in Bakersfield, said Anthony Olivieri, a local commercial real estate broker.
The success of such a project would depend on many factors, including how fast the developer plans to lease or sell the spaces, the kind of amenities the property is offering compared to competitors, the city's growth and others, Olivieri said.
Bakersfield's current commercial market is strong with rents increasing and vacancy rates dropping, he said.
An enthusiastic Crisp has delivered at least two presentations on the towers project to Cal State committees, bringing an architect, attorney and other experts with him, said Michael Neal, the university's vice president of business and administrative services.
"I think (Crisp is) an energetic person that has a lot of vision in terms of what he'd like to do," Neal said.
The university has yet to develop detailed backgrounds of the local businesses, developers and organizations that submitted proposals in response to a call for public-private partnerships, he said.
Many questions still need to be answered to determine if the projects, including Crisp's, are financially feasible, Neal said.
Regardless of the Cal State project, the Crisp idea machine continues to churn.
Another of his life goals is to build a church.
Crisp recently became the newest member of a group of local business entrepreneurs that owns the Bakersfield Jam, a minor league basketball team that will start up its first season this fall.
He'd like to buy a local news station someday, too.
Construction is under way on offices along Stockdale Highway, which will house the Crisp and Cole companies.
The young real estate heavyweight admits he's still learning. It's about trial and error, he said.
If a company he's hired isn't getting the job done, he'll know better next time.
He plans to be a billionaire at 35.
"The odds say I won't," he said. "That's why I like those odds."
And now the more recent 2 story's on CRISP:
Tuesday, May 8 2007 9:43 AM
The company formerly known as Crisp & Cole Real Estate Inc. is in the midst of reorganizing and downsizing as the local housing market continues to cool.
David Crisp, President/Realtor of Crisp & Cole Real Estate works at the front desk of the office at Platinum Investments on California Avenue.
Local real estate magnate David Crisp has formed a new company, Crisp Real Estate Inc., and operations at Crisp's in-house mortgage company, Tower Lending, have ceased. Crisp's California Avenue offices have closed, plans for new offices have been scaled back and several employees have been laid off.
"It's a result of the downturn in the market in Bakersfield," said Jack Doremus, the former broker of record at Crisp & Cole Real Estate. "People are losing their jobs everywhere."
Crisp declined to address any of the changes in detail.
"It doesn't concern anybody else," Crisp said. "It's my business."
Doremus, who is now sales and production manager at the RE/MAX Magic office in Bakersfield, said he resigned from Crisp & Cole in late March after Crisp told him and five others with high salaries that Crisp could no longer pay them.
"He said, 'I can't make payroll for you guys.' So we left," said Doremus, who said he has remained good friends with Crisp. Doremus said the four others with backgrounds in fields such as human resources and bookkeeping have also landed at RE/MAX Magic.
Other local real estate companies have also had to tighten their belts as the once-booming market slows. Among them was the March closure of McMillin Realty's Bakersfield office, which eliminated more than two dozen jobs.
Crisp's new venture, Crisp Real Estate Inc., was licensed as a corporation by the state Department of Real Estate on April 19.
"Crisp & Cole Real Estate is no longer," Doremus said. "They wanted to form a new company. It's all been switched over to the new name."
Carl Cole, the other half of the former Crisp & Cole partnership, stepped away from the company last year but has remained active in plans to build twin high-rise towers on Cal State Bakersfield's campus. Cole said the towers project -- which has recently shrunk from 32 to 24 stories and is still seeking financing from investors -- will not be affected by changes at the real estate company.
Tower Lending closed its last two loans in March and Crisp is now using another mortgage company, Cole said. Cole said that although he remained the broker of record at Tower, he hasn't had any direct involvement with the company in recent months.
"David was running that company," Cole said. Cole declined to comment on other changes at the company formerly known as Crisp & Cole.
A building that had been slated to become a new home for some Crisp & Cole operations has been put back on the market by Crisp. The approximately 10,000-square-foot building in University Place across from CSUB is listed for sale for $4.5 million. Crisp is listed as the property's selling agent on the Bakersfield Multiple Listing Service property listing.
Crisp purchased the building from Bakersfield University Partners for $2.5 million in late April.
As recently as last year Crisp and Cole said publicly that they planned to move Crisp & Cole's California Avenue operations into the University Place property that Crisp purchased and an adjacent leased building on Stockdale Highway. The California Avenue offices have since closed.
Crisp Real Estate currently operates out of a single office at the Town & Country shopping center just east of the University Place properties.
The company has signed a 10-year lease with developer Gregory D. Bynum and Associates Inc. on an approximately 5,000-square-foot building next to the property that is for sale.
Greg Bynum, owner of Gregory D. Bynum and Associates Inc., said Crisp & Cole originally planned to use the leased building for Tower Lending. The larger building next door that Crisp & Cole bought was to become home to the company's real estate operations, Bynum said.
Crisp said the leased building is large enough that a second building won't be needed.
"We have enough room in the other one," Crisp said.
Crisp called the change in office space plans "just a business decision" and referred to the building being listed for sale as "an investment."
Wednesday, May 23 2007 11:20 PM|
Last Updated: Wednesday, May 23 2007 11:26 PM
Eight properties owned by local real estate power player David Crisp and his close family members have entered the first stage of foreclosure in just the last six weeks.
David Crisp, president/Realtor of Crisp & Cole Real Estate, works on a computer at the front desk of the office at Platinum Investments.
The Crisp family name appears more than any other on a list of local loan defaults valued at $500,000 or more since the beginning of the year, online legal notices published by the Daily Report show.
The name appears five times -- in notices issued to Crisp, his wife and mother -- among a list of 70 such defaults countywide since January, the online records show.
No other major developers in the Bakersfield market were found on the list.
In all, more than $4.5 million worth of loans taken out by Crisp, his wife, Jennifer, and his mother, Tu, are now in default.
A ninth default notice issued earlier this month was canceled last week.
Lenders issue default notices to indicate legal action may be taken against the borrower if loan terms aren't met.
Contacted twice in the last two weeks, Crisp said he was not aware of any default notices. He could not be reached for comment Wednesday.
Tim Cox, owner of Crown Mortgage in Bakersfield, said home loans slip into default for many reasons and the situation tends to be "sad (and) difficult" on a personal level.
"Someone loses a job, some company has problems, there's a death in the family -- who's to say? But the trend is definitely up from previous years," he said.
The number of Kern County homeowners running into mortgage trouble has risen dramatically in the past year.
In April, 770 Kern homeowners entered some stage of the foreclosure process, according to RealtyTrac, a company that tracks foreclosures.
Compared with the same month a year before, the figure represents a 564 percent increase in the number of local homeowners with mortgage woes.
Foreclosure numbers everything from a missed mortgage payment to bank repossessions.
In California, foreclosures are typically handled out of court. A mortgage lender starts the process by filing a notice of default with the county recorder's office, according to RealtyTrac's Web site. The notice states the dollar amount by which the loan is in default, as well as the date when payment is due; it is mailed to the borrower and other interested parties.
Three months after filing a notice of default, if the borrower has not made payments to bring the loan current, a lender can put the property up for sale in what is known as a trustee's sale. A borrower may stop the foreclosure process up to five business days before a trustee's sale, RealtyTrac's site states.
Crisp's wife, Jennifer, was named in the first of the notices of default on April 12 for a $400,000 loan at 12706 Lanai Ave.
Since then, three more loans in Jennifer Crisp's name have gone into default, including a loan for a $1.295 million property at 11219 Draper Court.
The home is a 3,764-square-foot property with five bedrooms, 31/2 baths and a pool, according to First American Real Estate Solutions.
David Crisp's mother, Tu Crisp, was issued notices that two loans in her name went into default this month. A third entered default but later had the default notice canceled.
David Crisp also was issued two notices of default this month, for a $398,790 and a $860,000 loan.
According to public records and First American Real Estate Solutions, the loans in default are:
* April 12: A $400,000 loan to Jennifer Crisp for property at 12706 Lanai Ave. entered default. She purchased the property for $500,000 on Oct. 5.
* April 20: A $1 million loan to Jennifer Crisp for property at 11219 Draper Court entered default. She purchased the property for $1.295 million on Sept. 20.
* April 27: A $629,962 loan to Jennifer Crisp for property at 12718 Locksley Drive entered default. Purchase details could not be located.
* May 10: A $767,200 loan to Tu Crisp for property at 12716 Crown Crest Drive entered default. She purchased the property for $959,000 on Aug. 23.
* May 10: A $860,000 loan to David Crisp for property at 1805 Grimshaw Court entered default. He purchased the property for $1.075 million on March 17, 2006.
* May 11: A $527,472 to Jennifer Crisp for property at 8702 Oak Hills Ave. entered default. She purchased the property for $659,500 on July 29, 2005.
* May 14: A $398,790 loan to David Crisp for property at 10805 Prairie Stone Place entered default. He purchased the property for $443,500 on Dec. 28, 2005.
* May 21: A default notice was issued to Tu Crisp. Details about the loan and property were not immediately available Wednesday.
In addition, one default notice was canceled.
A $367,960 loan to Tu Crisp for property at 12422 Woodson Bridge Drive entered default May 4. On May 17, the default notice was canceled.
-- Staff writer Gretchen Wenner contributed to this story.