Mark Baker
How to Effectively Mitigate Business Risk
Mark Baker grew up in business on Prince Edward Island — his dad bolted two gas pumps onto a tire shop in 1980, and by the mid-'90s Mark was running the station. He and his wife took it over, tore the old site down, rebuilt it from the ground up in 2007, and ran it for a decade before leasing it to a larger regional operator. That lease was the hinge: it gave him a taste of the economics of owning real estate rather than operating a business on it, and he got an appetite for development. He founded ACRE Development Corp., and for the last three years he's done ground-up commercial development full time — finding the property, securing the tenant, and building out spaces for national and international brands across Atlantic Canada.
The throughline of the conversation is a reframe of risk. Mark argues you can't be risk-averse in real estate, but you also don't have to be reckless — when you immerse yourself in a niche until you genuinely understand it, you can reduce a vague, scary word down to a finite, quantified number. He stays rigorously in his lane (no residential, no flipping), and he lays out the three things a development deal actually needs — capital, knowledge, and the ability to execute — making the case that if you own the knowledge and the execution, the capital is always out there to be found. He even flips the script on the "safe" path: a lifetime of the same paycheck with no upside strikes him as riskier than the occasional loss. The second half heads outdoors to PEI's world-class fisheries — bluefin tuna, oysters, striped bass, Atlantic salmon — and Mark lands the plane on why he loves development: the long, patient 18-to- 24-month preparation is, to him, almost exactly like the hunt.
Risk is a vague word — your job is to make it finite.
You can't be risk-averse in real estate, but recklessness isn't the alternative. When you fully understand what you're doing, have a path forward, and immerse yourself in it to gain knowledge and experience, you can mitigate risk down to a really finite, quantified number. The fear shrinks as the understanding grows.
Stay in your lane until it's truly working.
Mark doesn't dip a toe in residential — plenty of people do well there, he just doesn't have the knowledge, so he focuses on commercial. The brands he works with do one thing extremely well and then scale; he runs the same play. The "seven streams of income" advice is backwards: you shouldn't have seven until you have one working really well.
Capital, knowledge, and execution — and capital is the findable one.
A successful development project needs three things: capital, knowledge, and the ability to execute. The misconception is that you need all the capital yourself. You don't — if you have the knowledge and the ability to execute, investors will happily participate in a deal. Nobody has the capital starting out.
The 'safe' path can be the riskiest one.
Mark finds it strange that working the same job for the same pay your whole life, with no incentive and no possibility of a jump, gets called safe. To him that slow-and-steady road looks more risky than taking a loss every once in a while on the way to building something.
Be your own advocate — even the experts won't catch everything.
Some commercial leases run 100 pages. Good lawyers will catch the legal jargon, but they won't flag the intricacies that hit the economics of your business. You have to know what to look for and what language to insert yourself, because nobody is going to protect the deal's economics for you.
Scale or pivot — the 'onesies and twosies' rarely win.
A couple of years before leasing the operation off, Mark saw the choice every industry forces: open site two, three, four and scale, or exit and pivot. Running one or two of something can make a decent living, but bigger is usually the way, and when he couldn't scale locally, pivoting to development was the easy call once the numbers made sense.
Development is the hunt; operating can breed complacency.
Mark loves the business, but day-to-day operations invite complacency. The development side never does — the searching, the planning, securing a tenant, the 18-to-24-month build. It's the preparation, the pursuit. It's almost like the hunt, and some people enjoy that process more than the end result.
Trades and human intuition are insulated from AI.
AI helps Mark pull market data quickly from a long way off — household incomes, growth, job creation. But nothing replaces getting in the vehicle, driving the site, sitting in the traffic, and feeling the turn radius at different times of day. That physical intuition, and hands-on trades like plumbing and HVAC, aren't going anywhere.
The word risk is very vague, and it’s certainly open to interpretation. You can’t be risk-averse in the real estate business, that’s for sure. But when you really understand fully what you’re doing and you have a path forward — when you immerse yourself in that path and gain some knowledge and experience — you can really mitigate risk down to a really finite, quantified number.
Welcome everybody back to The Hunt for Success, where each week we meet with entrepreneurs and business people who also like hunting and fishing. This week we have my good friend Mark Baker on. He’s the president and owner of ACRE Development Corporation, all the way up in Canada. I can’t wait to get up there and do a little fishing with him. Mark, welcome to the show.
Thanks, Sam. It’s great to be with you again.
Tell me a little about your history, because you told me about this when we met — you were in the gas station business and then you transferred more into the real estate side.
Yeah, I kind of grew up in business. Both of my parents were involved. My dad was in the tire business and introduced gasoline for the first time in, I believe, 1980 — just two little gas pumps and a couple of service bays, like most things across North America at that time. I really got involved in the mid-’90s, basically running the gas station, and gained a lot of experience. My wife and I took over the operation, completely abandoned that site, and rebuilt one from the ground up in 2007. We operated it for 10 years, and long story short, we ended up leasing that site to a large operator here in the region. That’s what transitioned me into the real estate side. I always enjoyed the development side — and once I understood the leasing side and saw the benefits, I got an appetite for it. We created ACRE Development Corp., and for the last three years we’ve been going pretty steady with new development projects.
A lot of guys focus on fix-and-flips and residential. You’re focused more on the land and commercial. Tell me why.
We’ll look at second-gen buildings too, if there’s existing buildings on good real estate and a chance to backfill or redevelop with minimal capital and a good tenant. But in our region there just aren’t a lot of those, so it created an opportunity for ground-up development. That’s how the business has evolved.
Do you have a criteria you look at? Did you develop that over time?
It comes from a little experience and a lot of fact-finding and educating yourself. I’m somewhat envious of you guys in the States, because what we do up here gets really rewarded down there from a tax perspective — the IRS code incentivizes developers and real estate professionals. Here, the federal government doesn’t quite see it that way; they tax us pretty heavily. But there’s a lot of opportunity for new ground-up development. We identify a property in a marketplace, and we have relationships with national and international brands. If we have an inkling they want to be in a certain market, we’ll go searching for property. If we find a fit and it’s for sale, we put it under contract and start negotiating the details — size of building, length of term, all of it.
When we met — on a cruise ship — we had a lot of good conversations about business and entrepreneurship. You’re from Canada, I’m from America, different tax structures. How did you develop that mindset of going out on your own?
I think there’s a misconception around the word risk — it’s vague and open to interpretation. You can’t be risk-averse in real estate, but when you really understand what you’re doing, have a path forward, and immerse yourself in it, you can mitigate risk down to a finite, quantified number. Residential — I don’t dip my toe in that water at all. A lot of guys have done very well there; I just don’t have the knowledge, so I’ve always focused on commercial.
Know your lane. Until you’ve got the one section you’re working in under control and producing, don’t go to the next thing. There’s a misnomer that you should have seven streams of income — but you shouldn’t really have seven until you have one working really well.
It’s the same in any business. The brands we work with — a coffee and donut brand, a burger and fry brand — they do one thing very, very well, and then they scale. We’re trying to do the same thing.
People think it’s just easy to go be an entrepreneur and everything works out. But when I see someone doing a normal job for the same pay the rest of their life, with no possibility of a jump — that seems more risky to me than a loss every once in a while.
I’d agree. To pull off a successful real estate development project, there are a couple of factors: capital, knowledge, and the ability to execute. The misconception is that you always need all this capital. It helps, no question — but if you have two of those three, if you have the knowledge and the ability to execute, the capital is out there. Investors like yourself will happily participate as long as the person doing the deal has the knowledge and ability to execute. Capital is not always required, and nobody has it starting out.
You’re in Prince Edward Island. Shifting into the hunting and fishing world — how popular is that in your area?
A lot. I can’t speak too much to the hunting side — small fowl, duck and Canada goose hunting is big here, wild partridge and pheasant — but not much big game. On the fishing side, I’ve done a lot on the river systems, ponds, and streams. And we’re fortunate to have some large species — the Atlantic bluefin tuna. The north shores of PEI are considered the tuna capital of the world. Charter fishing for those has become an industry of its own, and there’s a commercial fishery too. The lobster and shellfish fishery is big here.
My favorite oysters are always from your island.
PEI oysters are world-renowned, for sure.
Do you see any correlation between doing those outdoor activities and business — how people master both?
Absolutely. It’s funny, I was thinking about that just before we came on. Back to how I got into development — when I’m honest with myself, that was more enjoyable for me than operating. I love the business, don’t get me wrong, but complacency can set in in day-to-day operations. On the development side, that never seems to happen. Looking for the property, all the planning, securing a tenant — it’s the preparation. It’s almost like the hunt. There’s definitely a correlation, no question.
Some people enjoy the process and preparation more than the end result. I’m building a barn right now and I don’t enjoy any part of it — dealing with contractors, getting people there on time.
I concur. Make no mistake, I’m not much use with a tool belt on. It’s the planning and logistics I enjoy. It took me a long time to get where I am in terms of knowledge — a lot of mistakes along the way. It’s complex. You have to be part architect, have some knowledge of engineering, understand traffic patterns, understand what these companies look for so you’re not wasting your time or theirs. And then some of the legal side too — some of these leases are 100-page documents. The lawyers look at the legal jargon, as they should, but you have to be your own advocate and know what to insert regarding the economics.
When did you decide to get out of the gas-station business and do this?
Probably a couple of years before we leased the operation. Once I got the debt paid down, it was like every other industry — either look for site two, three, four, five and scale, or exit and pivot. The onesies and twosies make a decent living, but bigger is the way to go, and I wasn’t seeing opportunities to scale locally. The gentleman we leased to was really growing his business, so it made sense. Once the numbers made sense, it was an easy decision — and I knew I wanted to take off into real estate.
What benefits have you gotten from moving into real estate versus being an operator?
Time management, I’d say. Between us and a co-tenancy — a regional coffee and donut operation in our convenience store — we had 20 employees in a 2,200-square-foot building. A lot of moving parts, a high-volume site, things moving all the time. We enjoyed it, but I have three children, and the margins were shrinking while we had to grow volume. I didn’t see opportunities to add sites without going too far from this one, so it made sense to pivot. I wasn’t going to push my children into that business anyway.
Are your kids doing any of what you’re doing now?
Two are too young still. My oldest boy is doing his own thing — he’s in the commercial lobster fishery here, and he just finished a plumbing program. I know you’re into the HVAC side, which I think is great. With all the new construction, he chose the plumbing trade, and I think it was a smart one. There’s a bright future in the trades, no question.
I think we’ve got at least a couple decades before robots take over.
It’s funny you say that. I think about AI — I don’t use it too much, we’re nimble and small, but it’s had some positive influence, mostly getting data quickly. Like the deal we looked at in the Huntsville and Madison area — high growth, strong household incomes, job creation. AI can help you collect that data quickly from a long way away. But nothing beats getting in the vehicle, driving the site, being part of the traffic, seeing how it flows, the turn radius at different parts of the day. AI will never replace that.
I agree there’s certain things — intuition, the human element — it’ll never have. It’ll put some people who don’t evolve out of business and change how we do things, but your son’s in the right position. Being able to do something with your hands is important.
For sure. My middle boy and youngest — a daughter — take an interest in what we’re doing. My wife is helpful in the business. I think because I’m home a lot, or working from the vehicle, they don’t realize part of it is work. They might think it’s easy.
I just tell my kids I get paid to talk on the phone.
Exactly. Though it isn’t always — sometimes you’re on the phone at the ball game or on vacation. You never get any time off.
Your area is such an incredible fishery. Any plans for fishing trips in the future?
We usually don’t go out of province, honestly, because the species we want are here. We’re surrounded by water — the sea trout come in from the Atlantic and the Gulf of St. Lawrence, there’s steelhead, rainbow, all kinds of trout. The striped bass have come on strong in the last decade — most fishing here used to be done in the early morning, but the bass are caught at dusk, so now there’s a strong striper fishery. And the Atlantic salmon — strictly fly fishing, but you hook onto a decent grilse or salmon and you’re in for a fight.
That sounds like so much fun. I’ve got to find a way to get up there.
We’d love to host you anytime, Sam. What you’d enjoy most is the tuna.
Awesome. Mark, I really appreciate you being on the show — a lot of insight in what you do. We’re going to be talking several times; we’re going to do business together. Until next time on The Hunt for Success, we’ll see you next time.
Mark Baker
President & Owner, ACRE Development Corp.
A second-generation operator who grew up in his family's business on Prince Edward Island — his dad introduced two gas pumps to a tire shop in 1980, and by the mid-'90s Mark was running the gas station himself. He and his wife took over, tore the old site down and rebuilt it from the ground up in 2007, operated it for a decade, then leased it to a larger regional operator. That lease was his on-ramp to commercial real estate: he founded ACRE Development Corp. and for the last three years has run ground-up commercial development full time, securing premium locations and building out spaces for national and international brands across Atlantic Canada.
Born and raised on Prince Edward Island, surrounded by water on a small island, Mark grew up around small-fowl and waterfowl hunting — duck and Canada goose are big there — and has spent a lifetime fishing the river systems, ponds, and streams. PEI is the bluefin tuna capital of the world and home to a world-renowned shellfish and oyster fishery, and Mark talks about the striped bass and Atlantic salmon runs that have come on strong in the last decade. He's quick to say he's no longer much use with a tool belt on — his love is the planning, the hunt for the right property, and the long build, not the day-to-day operating grind.
Mark reframes how entrepreneurs should think about risk: it isn't recklessness and it isn't something to avoid — it's a vague word you make finite by immersing yourself in your niche until you can quantify it down to a number. He breaks down the three pillars of any real estate deal (capital, knowledge, and the ability to execute) and why the capital is the part you can always source if you own the other two. He's candid that the slow-and-steady, same-paycheck-forever path feels riskier to him than the occasional loss, and he draws a straight line from the 18-to-24-month patience of ground-up development to the patience of the outdoor hunt — the preparation is the part he loves most.
“When you really understand fully what you're doing and you immerse yourself in that path and gain knowledge and experience, you can really mitigate risk down to a really finite, quantified number.”
Keep hunting.
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