Weller Residential is looking to the western United States for the next big bump in its apartment portfolio.
The St. Petersburg-based company recently opened offices in Dallas, Phoenix and Denver, and expects to expand into the west coast through acquisitions or relationships with existing clients, said George Quay IV, founder and managing partner.
“This is what we learned from Covid. A lot of people in high tax states in the Midwest or the Northeast started to realize I don’t have to live here. I can live anywhere,” Quay said. “We saw the demand for Florida and Georgia skyrocket in terms of people wanting to move here, because they now realized they could. We feel the same way about the west coast with California. People are going to Arizona, Texas, Idaho, Colorado. So we want to be proactive and set up a beachhead in those areas where we think there will be similar population growth.”
Weller is a real estate investment, management and consulting firm made up of family of companies — Weller Management, for conventional market-rate multifamily housing; Weller Workforce, which focus on affordable housing; and Weller Student Housing, with off-campus properties near major colleges and universities. There’s also Weller University, which provides online training for all of Weller’s employees.
Weller, with more than 600 employees, already has a significant portfolio in the southeast U.S., with $4 billion in assets under management, including 25,000 apartments at 120 properties. The company’s properties are more than 95 percent occupied, and it reported 4.5 percent year-over-year income growth as of the first quarter of 2021.
By the end of 2021, the company will move from its downtown St. Petersburg location to a new corporate office, a 3,000-square-foot building at 2880 1st Ave. N. that Weller bought in April for $1.24 million.
“We enjoy being downtown but we don’t own the building so we’re paying rent. That’s a primary factor,” Quay said.
The new office is in the Grand Central District, an area that’s seen upgrades and improvements that have increased property values. “With the demand in Pinellas County in general, we think that area will continue to appreciate,” he said.
The new office primarily will be for the four-person corporate team and will host meetings for regional leaders.
Quay started his career at Hyatt Hotels and was recruited by Village Green Companies, a property management firm in suburban Detroit, where he was president and chief operating officer for nearly 12 years. He was living in St. Petersburg and commuting to Detroit for the job when he decided to launch his own firm in mid-2012. He met his business partner, Joe Emerson, in early 2013. Emerson had been investment manager for the Southeast for Greystar, a global real estate development and management firm, and the two men found that their skills complemented each other. Quay had experience in operations, while Emerson brought investment expertise. They also got along well and saw the world similarly, Quay said.
“We met two times after that first meeting and agreed we should work together. He came on board and we’ve been together since the beginning of 2013,” Quay said.
They settled on the company’s name in one of those early meetings, while sketching out ideas on a napkin and drinking Weller Bourbon. Recalling that the late John Williams reportedly had named the real estate investment company he founded, Post Properties, after a meeting at the Post Tavern, Quay and Emerson decided to name their company Weller.
Initially, their business plan was to buy properties and manage them. The first acquisition was in March 2013 and they did a total of 17 deals by 2018.
“As we did these 17 transactions, we started to see pricing was getting extremely expensive. We were realistic. Our opportunities to acquire properties would probably be minimal, at least for a few years. So at the beginning of 2014 we decided to go into the third-party management business,” Quay said.
They brought in Lori Krull, a partner at Weller who previously was director of real estate with Greystar in Tampa, to head up the management business. The business grew over the years both organically and through acquisition. In 2016, Weller bought Bridge Real Estate, a Boca Raton property management and investment company, to get in bigger platforms. In 2019, Weller acquired some of the assets of Triumph Housing Management to create Weller Workforce.
“There’s such a push on trying to find workforce housing and in our experience there weren’t many companies that were doing that very well. So Joe and I decided if we could find a platform with the right people in place that we could acquire to get our foot in that space, we think there’s a long runway in the future for that type of management company,” Quay said.
Weller retained David Gates, who had previously been with Triumph and now is executive vice president at Weller. Other key Weller leaders are Michael Oliveri, a partner who was a founder of Bridge; John Vranich, president of operations; David Bordelon, controller; and Andee Myatt, executive vice president overseeing training, marketing, human resources and communications — all functions handled in the Boca Raton office.
Quay said the key to the company’s success is its culture and its people.
“We go out of our way to hire like-minded people that work like we do, that want to grow professionally and personally and are very flexible in terms of what that means to accomplish that goal. You have to get the right people on the bus and you have to get them in the right seats on the bus too,” he said.
The company uses an acronym, PARS, which stands for predictable, accountable, responsive and scalable, to focus on its mission of providing excellence for clients.
“A great property can be ruined by bad management. A sub-par property can really perform with the right people there. People are where the business starts,” Quay said.
He’s bullish on the multifamily sector in part because of the large number of people who continue to move to Florida.
“With the population growth here, home prices have increased dramatically and aren’t staying on the market for more than 48 hours once they get listed. So if you don’t have the cash reserves to move quickly to buy a home, that home is going to trade before you can get yourself prepared. So you see a lot of people renting because they are building up their cash reserves so they can afford to (buy) a house and there’s no single family home inventory available,” he said.
Weller sold the properties it owns in the Tampa-St. Petersburg area at the end of 2018, although it continues to manage some apartments locally.
“We will invest again when the market changes. It’s fairly overpriced right now, and who knows when that will change in Florida, especially with the increased demand we’re seeing, but at some point it will. We’re patient,” Quay said.