The Denholtz Evolution: 65 Years of Cycle-Tested Experience11.14.2017
By: Steven Denholtz, CEO of Denholtz Associates
1952 was a great year. Not just because the United States was facing bright economic prospects, a gallon of gas only cost 20 cents or a brand-new car could be bought for less than $2,000. 1952 was also the first year that the company that would be known as Denholtz Associates began operating under the leadership of my father, Jack Denholtz. Jack founded the company with one goal in mind – building what people wanted, where they wanted it for a price they could afford. At the time, that meant single-family homes in the rapidly growing New Jersey suburbs.
In what was the beginning of the post-war economic boom, the stock market was considered surging at a shade over 2,600 points and New Jersey had a population of over 5 million. The new type of development called the suburb was a phenomenon that would become a uniquely American creation. The development of highways all over the nation and New Jersey made new locations suddenly accessible and affordable places to build a home and start a family. Jack Denholtz’ emphasis on developing single-family homes spoke to this demand but concurrently Jack also recognized the next step of this trend – People would like shorter commutes.
Jack was the first developer, with his long-time friend and real estate broker, Bernard Zimmel, to develop the flex/industrial building concept. The flex concept was an industrial building that combined dedicated industrial space with office square-footage. Flex buildings created an environment for companies, both large and small, to have adaptable, multipurpose locations and allowed New Jersey to make the most of its location between several major metropolises. This forward-looking vision helped move Denholtz from a residential developer to a commercial real estate developer and positioned our firm to weather the upcoming economic disruptions that would mark the late 1970’s, 1980’s, 1990s and the Great Recession that laid waste to dozens of firms across New Jersey.
The lessons gleaned from these experiences enabled the Denholtz team to build a diversified portfolio of assets across several sectors, adopting a multi-tenant strategy in the process that helped create resilient and flexible investments with a diversity of tenants and industries.
We now adhere to the mantra –
“When viewed from the right perspective, all problems are, at heart, opportunities.”
I believe this to be true. We have emerged from each recession as a more efficient and nimble organization.
Today, our firm continues to evolve in the wake of the Great Recession. Although no real estate developer wishes for a recession, they are an unfortunate fact of our business cycle. Firms that have a proactive strategy built upon that realization and based on past experiences are the ones that truly emerge from the other side as stronger and more efficient operators.
The post-recession evolution
Although we initially began as a single-family home builder, we have evolved to meet the changing needs of the American consumer. I continue to look to the future to create projects that fit into a broader need – whether that is for waterfront housing, mixed-use urban projects or exciting suburban office buildings. We recognized the growth potential of outer ring cities like Red Bank, N.J. and are in the process of developing a luxury mixed-use residential and commercial project there right now. Last year, we saw that Class-A industrial product was in high-demand and exceedingly short supply throughout Central New Jersey. We then purchased and renovated an abandoned warehouse in Franklin that we later sold to a leading cell phone accessories distributor. We have heavily invested in office and industrial assets in the Tampa Bay and Orlando, Fla. markets as we see these as the next boom cities in Florida. This flexible and adaptable approach to commercial real estate development investment enables us to deploy capital efficiently and unlock value where many others might be unable to.
Looking back while looking forward
Many things have changed since our founding. It’s a lot harder to fill a tank of gas with spare change and cars are more expensive. Current development patterns lean more heavily towards urban development and shun substantial suburban development. And the New Jersey worker has moved from working in factories to working at exciting pharma companies, biotech firms, innovative startups and growing small businesses. What has held steadfast since that time is the founding ideal voiced by my father that I bring into my work each day at Denholtz Associates – developing in-demand projects and crafting a cycle-tested investment strategy that enables us to weather the ups and downs of the economy to return value back to our investors. That vision powers our office, industrial and mixed-use projects through our entire portfolio and guides our company as we continue to look towards the future while always remembering the past.