The Reno, NV-based Dermody Properties was founded in 1960 by local
businessman, John A. Dermody, who had just sold a successful appliance
business--but kept the building and became a landlord. From there he
turned his attention to the warehousing and distribution business.
Dermody, a charismatic salesman, is in part credited with turning the
Reno/Sparks submarket into a leading hub for West Coast distribution
when he attracted the first New York Stock Exchange company, Bigelow
Carpet, to the area. In 1972 he was joined by his son, Michael, and the
two would go on to build up the company over the next 30 years.
Today the company is a leading industrial developer, owner and
operator with a client list that includes APL Logistics, Walmart, Pepsi-Cola, UPS, Amazon.com, 1-800-Flowers.com and Dole Food Co. to name
just a few examples.
A major shift for the company came in the late 1970s when Michael
Dermody began to vertically integrate the company, forming United
Construction Co. and D&D Roofing. In 1979, the company moved beyond its build-to-suit business by developing its first speculative
building. It was the beginning of a long history of build-to-suit and speculative development. Since then the company has hit a number
of milestones—including the assumption of the CEO role by Michael Dermody—as it continued to build out its diversified line of businesses and property locations. By 1990 the firm had the scale to align itself with CalSTRS, a partnership that would last 14 years. That, and
another partnership with Lazard Frères & Co., would allow Dermody to continue to grow its platform while remaining a privately held.
By 2007 it had accumulated a formidable portfolio and it made industry headlines when it sold its 25 million square feet of holdings to
Prologis in a $1.8-billion transaction—a sale that was also notable as it was the the largest transaction in the history of CalSTRS. Dermody,
though, held on to 518 acres of entitled, development-ready land from its portfolio and continued to serve its customers from its four
original offices in Portland, OR, Reno, NV, Chicago and Philadelphia. Thus the foundation of its next round to growth was laid.
Today the company continues to develop its trademark logistics center facilities, LogistiCenter, breaking ground recently on one in in
Woodinville, WA, east of Seattle. LogistiCenter at Woodinville will consist of two buildings totaling 409,500 square feet. “LogistiCenter at
Woodinville is consistent with our strategy of developing modern logistics building in land-constrained markets,” said Douglas Kiersey Jr.,
president of Dermody Properties, at the groundbreaking.
CHAIRMAN & CEO
Duke Realty is the leading pure-play, domestic-only industrial REIT in the country, with properties in
21 major logistics markets across the US. A leading US industrial REIT, Duke offers e-commerce and
supply chain companies a crucial edge and owns and builds facilities up to 1.2-plus million square
feet, in key distribution locations. When Jim Connor became chairman and CEO of Duke Realty in
2015, the company was executing on its plan to reduce its investment in office assets and concentrate
on the industrial and medical office sectors.
To that end, Connor spearheaded a $1.1 billion office, four-market portfolio sale in 2015, followed by
other office dispositions over the next two years. But as the company neared its portfolio composition
goals, his vision for the company shifted and he proposed and led the effort for Duke Realty to become
a pure-play industrial REIT. To accomplish the transition, Duke Realty sold its health care assets and
platform for $2.8 billion. With the capital from that and other dispositions, the mission was two-fold:
further strengthen the company’s balance sheet and grow its industrial portfolio.
On the balance sheet side, Duke Realty paid down $787 million of debt and bolstered its capacity to
fund additional real estate investments of approximately $1.4 billion. On the growth side, Connor
wanted to expand the company’s presence in high-barrier, high-demand markets. Further, he wanted
growth through value-creating development projects, as well as through the acquisition of quality, strategically located industrial assets with high cash-flow potential.
Under his leadership, Duke Realty started $845 million square feet of new industrial developments in 2017. The company also was
active in the acquisition arena last year, purchasing nearly $1 billion of top-quality industrial properties primarily in Tier 1 logistics markets. Concurrent with growing its portfolio in 2017, Duke Realty maintained occupancy in its existing properties, as well as quickly leased
new deliveries and acquisitions. At year-end, Duke Realty had a 98.5% occupancy in its stabilized in-service portfolio. Diversity is another
focus of the firm.
Duke Realty has also instituted programs to add minorities and females to the company’s workforce. One noteworthy program is Duke
Realty’s partnership with Roosevelt University’s Marshall Bennett Institute of Real Estate. Duke Realty has established the DREAM program, under which the company provides an annual scholarship and support students with counseling, mentorships/internships, student
forums, training courses and placement assistance.
CHAIRMAN & CEO