“If the shoe fits, wear it,” the CEO of the company I work for said on my very first day as an intern last summer. At the time, I had no clue what he was talking about.

I later learned that this proverb is specific to the real estate finance industry. Prior to working at George Smith Partners, a boutique real estate investment bank, I had never heard it before. I am assuming that the majority of this collection’s readers have not either.

Basically, the proverb means to “take what you can get”. In real estate finance, borrowers of capital always hope for more favorable terms on their financing. This includes loan terms, interest rates, and prepayment penalties. Despite there optimism, the collateral property that borrowers own often does not merit the favorable financing characteristics that they are hoping for. As a result, our advice as investment bankers to our clients is to take the deal that’s on the table. In more abstract terms, we say, “If the shoe fits, wear it”.

It is interesting to think about how any why such industry specific folklore is created. My prevailing thought is that it allows members of the real estate community to immediately gauge one another’s industry savvy.