Portrait of a real estate entrepreneur and his intuitive managerial style.
How Trammell Crow built the world's largest real-estate empire one handshake at a time
Trammell Crow, America's biggest landlord and one of its richest men, started out 40 years ago building warehouses. Crow's informal management style -- intuitively picking a partner here, a partner there -- allowed him to build his vast real-estate empire. But to succeed in today's environment, even Crow has had to change his style. -- N.W.A
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Trammell Crow, dressed to perfection in a rich blue, subtly patterned suit, sits in the elegantly appointed "conversation area" of his corner office and looks out the window. The master builder is silent, pondering the question of pride. Of all the things he has accomplished in his long life, of what is he most proud?
His bright blue gaze is leveled over Dallas, where the Stemmons Freeway winds through the haze and heat. The area is a featureless smear of warehouses, here and there relieved by an act of architectural assertiveness -- a massive hotel, a slim office tower, a sprawling "mart." This is the capitol, so to speak, of the master builder's empire. It is also the source and repository of much of his capital. Years ago, when he was starting out, he built many of those warehouses. The freeway is named for two brothers who provided the land for his first big push into real-estate development. The "architecture," much of it, belongs to him.
But his mind is not on what he beholds, all those scattered monuments to his energy, will, and business acumen. It is on the organization he has built here in the Trammell Crow Center, on the hundreds of men he has attracted to these offices and to the other Trammell Crow offices across the country and the world (there has never been a female partner in the Trammell Crow Co.). At TCC headquarters, no walls separate one partner from another. No signs of status separate them, either. Each man seems to dispose of the same number of secretaries, the same square footage, the same view over the freeway or downtown Dallas. If there's any distinction to Trammell Crow's own office, it is that it's more visible than the others, and therefore apparently more accessible. Sitting there, he can survey his partners' comings and goings like a father surveying his family from his favorite armchair. It's a good question, in fact, whether that's not what he is -- the progenitor of a huge, and hugely rich, family. " 'Father' is not an inapt way to relate it," he tells a visitor. He's describing the image of himself he sees in his partners' eyes, or the image he'd like to see.
Now 74 years old, Trammell Crow has built, or helped to build, more square feet of shelter, roughly 250 million square feet of it, than Donald Trump ever dreamed of building, more than any man in the country. More forms of it, too. Not just such path-breaking showplaces as Peachtree Plaza, in Atlanta, or The Embarcadero, in San Francisco, but lowly warehouses and strip shopping centers. Not just elegant atrium hotels, but trailer parks and middle-income housing tracts. Not just elaborate medical and hospital facilities, but huge, cavernous trade marts, such as the dazzling version of London's Crystal Palace he built for Dallas's InfoMart. He has offices in more than 100 U.S. cities, in five European countries, and in Hong Kong. On the company map, if you were to link the little black dots of all the Crow operations, you'd trace a pattern like the flight paths of a major international airline. The map traces the adventures of a consummate operator.
In his conversation area, Crow appears to be done thinking about the success he's had in the world. "My proudest accomplishment is this company," he drawls, very softly. Then he adds: "That it will endure after I'm gone." The unspoken irony is that the company in which he sees his immortality is no longer the company that he founded. The founding father does not repine. But the irony has begun to take a toll on the organization.
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Born in 1914, son of a Dallas bookkeeper, Crow grew up during the depression, too poor to go to college. But he studied accounting at night, and married well, to the daughter of the owner of a grain-elevator business. He served in the navy during World War II, and in the grain-elevator business for a few years after that. Real estate he fell into as other men fall in love, by accident: by having to find tenants for a warehouse owned by his in-laws. In his first deal, he bought a small piece of land, used it as collateral to borrow $40,000, and built a warehouse. He rented it to Ray-O-Vac Battery. By the early '50s he had pushed operations into Atlanta and Denver.
In these and subsequent deals, he was working out the formula that won him nearly a quarter century of success, from the early '50s to the mid-'70s. It was a different formula from the one followed by most developers. Theirs is to build a building on Other People's Money, depreciate it, sell it, then deploy the profit to start the process all over again with another building. Crow's formula was to hold on. "You can get rich selling real estate," he always used to say in those days, "but you can only get wealthy owning it." With warehouses, for example, the conventional wisdom held that you built one with a specific sort of customer in mind, then sold it to him, or nailed him down to the longest lease you could get. Crow had no use for that idea. Build the thing to be as adaptable as possible, he argued, and sign up customers for the shortest lease you could agree to. That way you could take advantage of a rising market and charge ever-higher rents. By 1971, according to a Forbes article of that year, Crow was the biggest private landlord in the United States, the proprietor (solo or in partnership) of more than $1 billion worth of real estate.
