In today’s episode, Ron Terwilliger, a great influencer in the apartment sector and dedicated philanthropist, shares part one of his story: his leadership at Trammell Crow Residential and how he literally spawned the next generation of the business.
A Strong Foundation
Ron Terwilliger grew up in Arlington, Virginia in the late forties and fifties. He played baseball and basketball at Wakefield High School, and despite a back defect which was thought to be the end of his playing career, he went on to play for the Naval Academy. There, he was named an Academic All American in basketball.
Post-graduation, he spent five years in the Navy before getting his MBA at Harvard.
“I had one real estate class and I really liked it. I have a fairly good feel for numbers and how they relate and how to think about the quantitative side of the business.”
His first real estate job was at Sea Pines Company at Hilton Head Island, where he met colleagues who would go on to work with him closely over the years. When the economy shut down and Sea Pines went bankrupt, he was almost frightened out of real estate. However, he also credits the intensity of the experience at Sea Pines, the recession, and their youth for creating such strong relationships between him and his co-workers.
After Sea Pines, he joined the Henry C. Beck Company in Dallas as CFO where he helped grow the business. While in Dallas he was invited to join Trammell Crow Residential by Terry Golden (a business school classmate).
Trammell Crow’s offer required him to take a significant pay cut, but he would have a 40% share in the company. He remembered how his father never took a risk and realized that if he didn’t take this shot, he would never become an entrepreneur. Dick Michaux, a former Sea Pines associate, was his first partner. When Ron completed his first apartment project he made his first million.
He spent most of his time cultivating relationships with investors and lenders, managing core partner relationships, and hiring. Individuals who stood out to him were often MBA’s, smart, had a good feel for numbers, an engaging personality, a healthy balance of work and pay, with a strong commitment to support their families.
At Trammell Crow, Ron shares that his vision was to get rich slowly by avoiding over-leveraging and to think of your partnership as lasting for a career.
Overcoming the Savings & Loan Crisis and a Tanked Economy
It was a desperate time for a lot of people in real estate. At Trammell Crow, they didn’t have any recurring income or assets other than a property management business that was cash flowing, so they had to make salary cuts and let people go which he says was incredibly difficult. These people didn’t deserve to lose their job, but it was just a fact of life and necessary to save the company.
This challenging time however brought about growth in a new way.
As the market got back on its feet, they began developing again. Ron attended a conference with his colleague Chuck Berman, where they met with Fred Cavan about doing a REIT in the Northeast.
This series of events led to the creation of AvalonBay with Dick Michaux, Bryce Blair, and Tim Naughton serving as CEOs. Gables with Marc Bromley was formed six months later. Four years later Leonard Wood left to form Wood Partners and about that same time Bruce Ward started Alliance.
As these tree branches from the family tree of Trammell Crow grew, Ron continued to build it back and strengthen the roots. After the recession in 2008, Ron retired and set his sights on philanthropy, which we will dive into on next week’s episode!
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