At some point you become 40. At this stage in life, sensible people focus on their successes, their triumphs, their good fortunes and even their near misses.

For some, however, it can be a time to wallow in the wake of your failures. After all, you’re only as good as your last mistake.

It’s easy to place blame on those who let you down, pulled the rug out, took a stick to your kneecaps, or even the currently popular “difficult economic situation.”

But regardless of how it all happened, the blame still comes down to you.

“How did you let this happen?” you scream at the mirror. “How could you have been so careless?”

And that’s when the ‘what ifs’ really start to roll. You play back every decision over and over again in your head. Despite your intelligence, hard work and good intentions, you’ve created enough collateral damage to last a lifetime of careers.

Singing with confidence, missing the curve

So where exactly did you go wrong?

On an early Saturday morning in spring 2005, you’re sitting in an attorney’s oversized conference room negotiating the biggest development deal of your life.

You drive home that afternoon, slapping the steering wheel and singing with the radio, loud and proud, oblivious to the challenges that lie ahead.

Within a matter of hours the gravity of the project sets in and you press forward in the execution of your flawless plan. You assemble the best team. Your cash flow is strong, so you don’t spare a dime. You create impeccable talking points. You anticipate every problem. You write down worst-case scenarios and delegate a defensive team to deploy preemptive strikes.

You’ve created a conservative financial pro-forma. Nothing too ambitious, all well within your proven expertise. You devise a seven-year plan and you share it with every professional you know.

For a moment you allow your shoulders to relax a little when the prevailing sentiments from the pros are consistently the same:  “This is a no-brainer my friend!”

Now that you have a plan, you take it to the bank. The local guys love the deal but their nameless credit folks aren’t too keen on a $15 million acquisition and development loan – especially one with only a few dollars for the down payment.

“Look at the demand and our track record,” you argue. “We can TOTALLY do this.”

“No. You need to find an equity partner.”

“What kind of an equity partner?”

“One who has a lot more of something you don’t: CASH”

Doing the unthinkable

It’s the spring of 2006. More than a year has passed and like everything else that comes with time, you’ve formed an emotional attachment to your vision for the project. Your closing date with the seller is pending. You don’t want a bunch of partners screwing up your vision, but you start to contemplate the banker’s notion.

Some guys call you back. They’ve been in town a few years. You’ve driven by their deals, they seem real and they want to meet. You’re flattered.

They tell you how much cash they have available, and that they are practically “oversubscribed” with investors.

And in a matter of minutes you do something previously unthinkable. You’ve sold a deal you don’t even own to some guys you barely know. Turns out it’s a perfect marriage, too. You get to keep doing what you love (building) and they handle all the stuff you don’t love (finance, horizontal development, infrastructure construction, etc…)

It gets better. For that year or so you worked so hard getting to this point, they’re going to give you a mind blowing $3 million dollars AND let you stay on as a 5 percent partner for the inevitable upside.

No matter that the $3 million would be paid later, as soon as the deal was sold out, and after the bank was paid off.

A new LLC is formed. Six great guys, including you, are embarking on an incredible adventure. Within a few months you’re signing some loan docs “jointly and severally.” The land sellers get their payoff and you practically break your arm patting yourself on the back.

The partners gather with their spouses at a steakhouse near the beach to celebrate their genius. You raise a glass, exhale and breathe easier.

“We need to talk”

By fall 2006, the hard part is out of the way. You’re ready to get to work.

Your focus shifts back to marketing mode. It’s what you do best. You travel the region looking at the best projects, the coolest buildings and the most talented architects. While dirt is getting pushed around the site, you’re anxious to get started on the marina, an elaborate trophy that will have your prospective buyers drooling.

This has become more than a vanity project. This is your professional swan song. Not only will this likely be the last significant endeavor of your career, it will be your legacy.

Then something unexpected happens, something that wasn’t on your worst-case scenario list.

In the summer of 2007, you’re notified that all infrastructure work must stop. Despite being at least a year away from the flush of a toilet, your site abuts an underutilized lift station and a sewer moratorium affects all building projects in the city – even those nowhere near the problem.

Meanwhile, the interest reserve the bank lent you is dwindling, but it’s OK, because your 5 percent share of the ominous $50,000 interest payments is a manageable $2,500 a month. Good thing all you have to do is focus on selling condos and not dealing with peripheral matters.

About this time you get a call from your old friend at the bank. “We need to talk,” you’re told.

Interest payments haven’t been getting made, the project has slowed to a crawl, and you’re still at least a year before you can even start your first building.

That’s when you realize the reason you aren’t receiving monthly cash calls for your $2,500 share of the interest payments; your partners haven’t been asking for your 5 percent share because they can’t pay their substantially larger portion.

Despite the stock market’s slow but steady decline from its October 2007 highs, you make a split-second decision to reallocate some of your personal savings to pay off the other partners and get them out of the way. You’ve gone from being a 5 percent partner in the project to a 95 percent owner. Work begins again on the site and it’s only a matter of months before you’ll be going vertical.

It’s now March 2008. You’ve invested hundreds of thousands of your own dollars into architectural plans, engineered drawings, and marketing materials. Your excitement to begin construction is overwhelming.

The economy seems to have stalled somewhat but you read an article that the market would rebound by the fourth quarter and you congratulate yourself on your timing. Instead of patting yourself on the back this time, you roll up your sleeves.

You need more momentum. You cut a deal with the city and the RiverWalk gets built. Activity breeds activity you say to yourself. You set your sights on getting that first building started.

Learning a new word

Fall of 2008 and this time it’s not a phone conversation, but a meeting in the bank’s conference room.

Your main guy is there and he looks pale.

There’s another guy in the room. You meet him for the first time, not sure of his role. He’s older, from out of town, and he tells you he’s just there to help the bank out. Since you haven’t missed an interest payment and the project is progressing (albeit slowly), you see this as more of a “general update” meeting.

But it’s not. You learn a new word that day from the out-of-town guy. It’s called “curtailment.” You don’t need to ask the meaning, as the one-sided conversation continues long enough for you to realize that the lender is no longer going to advance funds from your original loan in order to complete your project.

That’s not the bad part. The bad part is when he tells you that falling real estate values and new government mandates require you to transfer a significant amount of your personal brokerage account funds toward your loan principal balance.

Your safety net of available cash is an attractive opportunity for the bank. In an instant your liquid assets have now become a liability for you in this negotiation.

These guys just don’t get it you think to yourself. Fine. You give them what they want because you are going to go out and find a better bank to deal with, one that will appreciate your passion and commitment to this once-in-a-lifetime project.

You’ll show them.

Waiting for a call

The messages you’ve left with the other banks go unreturned. You’ve been in this business long enough to know that if they don’t call back, they aren’t interested.

The stock market is half its peak and continues to decline. It’s compounded the stress on your cash cushion because you opted to borrow against your securities instead of selling them into a declining market.

You are running out of cash very quickly. The threats are real, the demand letters grave. Within a few short months you are back in the lender’s conference room. This relationship has seen better days. You stay cool but the knot in your stomach is unrelenting.

For the first time in your life you aren’t going to be able to pay an interest payment.

You learn another new term, “forbearance agreement.”

After reviewing it, even your own attorney suggests you retain a lawyer from New Bern, the one that requires a $25,000 retainer, but you don’t heed the advice because you’ve convinced yourself that you’re invincible. This project has too much potential; you just need to keep pressing forward.

You sign the forbearance agreement because you believe that all you need is a little more time to find new cash and an improving economy.

Certainly things won’t get worse.

You have a rough idea as of the amount of time and money you’ve put into this project, but once you sit down and calculate the actual cash you’ve invested, the cash that you are unlikely to ever see again, the gravity of your situation sets in. Your loss is in the millions.

You stop eating. You stop talking to your wife and kids. You’re always tired, but no matter how hard you try, you can’t sleep, and if you do fall asleep, you can’t stay asleep. Nothing feels good, and you are so angry with yourself that you really don’t care what happens.

Surrender

It’s the spring of 2009. You plant yourself in front of your laptop and generate a manifesto of options for the lender. You create your own workout plan; it reads like a global military operation. You list every available scenario, 15 in all, and make a recommendation. Who knows this project better than you?

You hand-deliver your set of solutions. And then you hold your breath – for a month.

Some guy from Richmond and his boss from Orlando fly into town. This time they are in your conference room, but it’s obvious they still hold the leverage. Your plan has merit, but you need to find a buyer or more equity. You owe the bank a lot of money, but it appears you are better alive than dead to these guys.

For a moment you are grateful. This is the ‘time’ you needed. With their help, you get back to work and finish the site. Within months the marina is filling with boats and the joggers are discovering the RiverWalk. Roads and sidewalks are complete.

Instinctively you shift gears back to ‘marketing mode’ and begin in earnest to generate the pre-sales you need for that first building. Surprisingly you hit your sales target, your buyers are qualified, and their deposits are in the trust account. You carry your loan request to any lender with a pulse, but there are no takers.

You do this for almost a year. Your world is consumed with managing a project with no income and no signs of life. You’re losing momentum, faith and confidence. You just want your old life back.

Then, in the fall of 2010, you meet the new guy from Raleigh assigned to you by the bank. He’s stern, smart and a realist. He’s only slightly older than you, but his well-honed experience is very specific. Most of his career has been spent on the unattractive “workout” side of the real estate world.

Like a seasoned counselor from hospice he tells you: “Stop fighting. Your demise is inevitable. Your time and money are lost. It’s time to get your affairs in order.”

You don’t want to believe it.

“No. You don’t understand. We are so close, we’ve come so far. This can’t be the end.”

But it is, and, for the first time in years, you sleep.

Editor’s note: On July 1, the lender took ownership of the marina property. The bank contracted with Cape Fear Commercial to market it, and a call for offers yielded seven offers. The property is under contract, according to Cape Fear Commercial, but details have not been disclosed.

Dave Spetrino lives in the Historic District with his wife and their two sons. His current favorite quote: “Experience is what you get when you didn’t get what you wanted!”