/
RSS Feed
Bio
Julie A. Smith, Chief Administrative Officer, The Bozzuto Group
Show Notes
Current Role
- Currently Chief Administrative Officer for 5 yrs. now. Spent first 25 yrs. of career running Property Management. Toby Bozzuto assumed CEO role when she made the transition to CAO role (5:00)
- Suggested her role change would offer opportunities to others to run Property Management (6:00)
- Mike Schlegel is COO who runs P&L units (7:00)
- CAO role is all non operating functions (7:15)
- Vertical growth of The Bozzuto Group (9:00)
- Initial intention to manage their own assets (9:15)
- Started in 1989 and was “cash strapped” (9:30)
- An equity partner asked them to manage the property on a third party basis in the early 1990s (9:40)
- First project for institutional owners, which became a theme for third party management (11:00)
- Action steps- Focused on revenue first (11:30)
- Why wasn’t top line growing? (12:00)
- Looked at all aspects of project to increase rents and reduce vacancy (12:30)
- Setting up variable compensation to align rewards of employees (13:00)
- No control over “fixed expenses” (14:00)
- Variable expenses are “nickels on the floor” (14:20)
Origins and Education
- Grew up in Niagara Falls, NY (14:30)
- Parents were school teachers (15:00)
- Area driven by industrial activities primarily (15:20)
- Love Canal issue negatively impacted area (15:30)
- Parents grew up in 1930s (15:50)
- Dad a Principal (16:00)
- Mom was a home economics teacher- she learned about details in cooking that spilled over to her “eye for details” in most of her activities (16:30)
- Her Dad was loved by students- treated people with respect (18:00)
- Elementary school Principal who dealt well with parents of challenging students (18:45)
- Special relationship with her- all her girlfriends would share with him (19:50)
- Attended State University of New York- Oswego (20:30)
- Father went there (21:00)
- Could afford it (21:15)
- Business and Communications major (21:30)
- Spent her Junior year in Copenhagen, Denmark (21:45)
- Traveled around Europe while there (22:15)
- Became more worldly after her year there (22:30)
- Met a good friend from Pittsburgh who suggested that the two of them move to Washington, DC after graduation (23:10)
First Job
- First job at Warner Communications in the DC CBD (24:20)
- Public Affairs- Premiere of Superman with Christopher Reeve (24:50)
- Sharing a taxi with Elizabeth Dole (25:30)
- No interest in Public Affairs (26:15)
First Real Estate Positions
- Met with someone who introduced her to the B.F. Saul Co.- Worked for Roger Ellison there (26:20)
- Gave her an apartment general manager’s job in Reston, VA (27:00)
- On the job training in 1985 to learn how to manage the property (27:20)
- She moved then to Fort Lauderdale, FL with the Saul Company and opened new apartments there (28:25)
- She met people from Oxford Properties from DC and she mentioned that she wanted to come back to DC and they hired her (29:15)
- Joined Oxford as a Marketing Coordinator in Gaithersburg, MD in 1986. Tom Bozzuto was running the region. (29:55)
- Plug and Play- Build as many projects as possible (30:40)
- 55,000 units in portfolio at that time nationally (30:50)
- Active in many national markets, yet she worked the Northeast region with Tom Bozzuto (31:25)
- 1986 tax law changes basically demolished Oxford’s business, as their projects were “tax oriented” and did not generate pre-tax cash flows (32:00)
The Bozzuto Group
- Tom Bozzuto, John Slidell and Rick Mostyn left Oxford and started Bozzuto (32:50)
- Julie joined Bozzuto one year into it to operate projects (33:00)
- She was uncertain about its viability, but could do something else if it didn’t work (34:20)
- Enjoyed doing what needed to be done on a “start-up” business (34:45)
- Learned how to develop properties with John Slidell (35:15)
- Learned about financing with Rick Mostyn (35:40)
- She was the “table setter” of the operations (36:00)
- Competitors- Lincoln Properties, Trammell Crow, Caliber, Artery & Shelter (36:40)
- First urban property- Managed McLean Gardens for Alex Brown as asset managers (38:30)
- 1994 took over for good experience (39:25)
- Westbrooke Place– Attempting to get $2.00/s.f. in rents (39:50)
- First luxury property (40:40)
- Springboard to other opportunities (40:55)
- First website on a property- “Digital experience” (41:15)
- Good learning experience to understand the “luxury” market (42:00)
- Customer Experience- Bozzuto philosophy of “Sanctuary” (42:50)
- Housing change is a stressful experience- diffuse “negative experience” into a positive experience (43:40)
- Goal to make “customers for life” (44:30)
- Relentless focus on the customer (44:50)
- The best customer is the one you already have (45:00)
- Perfectionist spirit- driving values (46:00)
- Core Values of Bozzuto (46:15)
- Grown company through following clients to new markets (47:55)
- Good work begets good work (48:15)
- Northwestern Mutual took them to New Jersey and then Boston (48:30)
- Heitman gave them a trophy asset in Chicago and now have 18 buildings there (49:20)
- A few “false starts” in Atlanta and Charlotte (49:45)
- Did expand in Florida (49:55)
- Developed relationships with operators as well as investors (50:20)
- Led with management to markets (52:30)
- Manage relationships (52:50)
- Management business requires “scale” (54:30)
- Work for companies that are loyal and let them get a project to an efficient operation (54:50)
- Risky business (55:15)
- Nothing like the hospitality business (55:25)
- At her origins in the business, fees were 5-6% or so. Fees today are much lower and required skills are much more necessary today (55:50)
- Dealing with customers is an art and have a good relationship (57:45)
- It is a juggling act to manage properties (58:40)
- Job for extroverts (58:55)
- Bozzuto team “moves mountains” to overcome challenges for tenants (59:20)
- Some residents told them that “they were the best thing that happened during COVID-19” (59:45)
- 70% of residents are “single” (1:00:00)
- Bozzuto was ranked as a “Top Employer” in Washington region for six consecutive years (1st in 2020) (1:00:55)
- Exciting for employees to see that culture (1:01:20)
- Family culture (1:02:15)
- Responsibility to “each other” and diverse as an organization (1:02:40)
- Employee led community groups (1:03:00)
- Grass roots organizations among employees (1:03:30)
- Stephanie Williams– succeeded Julie in President of Property Management role (1:04:15)
- She had been a developer and had done a couple projects (1:04:30)
- Julie went to her and asked her to consider moving over to the business development role (1:04:55)
- She and Julie spent time on airplanes pitching business (1:06:00)
- Julie decided to offer her the President role (1:06:15)
- Her role would be to manage a large group of people (1:07:15)
- Spent 9 years “training” Stephanie (1:08:00)
- Pandemic impact (1:08:40)
- Transition was not too difficult, except for the property management on site “essential employees” which was a challenge to keep them “protected” and how to juggle families (1:09:10)
- Feedback- Site task force to learn about issues (1:10:00)
- Some employees got COVID (1:10:20)
- People were moving out and not moving in- vacancy increased dramatically and it had a stressful impact on management staffs (1:11:20)
- Rental Assistance Program- Stimulus checks and supplemental benefits were helpful (1:12:20)
- Challenges working with local housing agencies for distribution of allocated capital (1:13:00)
- Eviction moratorium continues to extend (1:13:40)
- Markets recovered to the point when rents can now be escalated (1:14:15)
- Construction costs and supply chain issues are delaying projects and increasing costs (1:15:30)
- Amenity Wars- bar is always being raised (1:17:20)
- Flexibility is and will be a necessary amenity- term flexibility- less than one year leases or options to terminate lease (1:17:50)
- Space to work in apartment (1:18:30)
- Retail is important (1:18:50)
- Service is becoming even more important than ever (1:19:20)
- City Ridge project (Roadside) (1:20:15)
- Bozzuto will be leasing and managing it (1:20:30)
- Cathedral Commons– Students “left” during COVID so it had a negative impact (1:21:30)
- Short stay units “dried up quickly” during the pandemic (1:22:20)
- Office tenants are “locked in” yet apartment renters don’t (1:23:00)
- Customer experience is the most important thing (1:24:00)
- Investment in the “nest” (1:24:20)
- Difficult to buy a home now (1:25:55)
- Shelve housing plans until more housing stock increases (1:26:30)
- Several residents “moved up” to larger units (1:26:55)
- Single family rentals (1:27:20)
- Home building- Ritz Carlton in Chevy Chase Lake (1:28:50)
- Building but not sales of projects (1:29:10)
Personal Voluntary Roles
- Serves on NMHC Board (1:29:45)
- New Chair of ULI Washington (1:30:10)
- She aspired to be like Tom Bozzuto in his giving back (1:30:30)
- Chair of Victory Housing (1:31:20)
- Began as Women’s Leadership Initiative head before taking the ULI Washington Chairperson role (1:31:50)
- All this cuts into her personal time- gets much satisfaction from it (1:32:45)
- ULI mission & education (1:33:10)
- Building a broad network (1:35:20)
- Woman leadership is scarce (1:36:00)
- Never felt excluded at Bozzuto even as the only woman at the table (1:37:00)
- Her experience was unique, yet she recognizes that other companies are not as well treated (1:38:50)
Hiring
- People that have a heart (1:39:40)
- Creative thinkers (1:40:00)
- Passionate (1:40:10)
- Set high bar for work (1:40:20)
- Large internship program- 90 last summer (1:40:45)
- Look for raw talent (1:41:00)
Personal
- Two daughters understand what Bozzuto does, yet neither are in real estate (1:42:20)
- One is in digital marketing (1:42:50)
- The other is a musician and is in Nashville, TN (1:43:10)
- Active family life (1:44:00)
- Important for her family to understand her work priorities (1:44:35)
- Dogs are a “requirement” (1:45:00)
- 20% of residents have dogs (1:46:15)
- Work/Life balance- Harmony and integration (1:47:00)
- Life is not balanced, but go with it (1:47:15)
- Wins in her career (1:48:15)
- Property Management Company of the Year- First time in 2000 or so
- Reputation- Seven years in a row as PM of the year (1:49:40)
- Losses (1:50:00)
- Losing her Dad- So hard since he was such an influence
- And then her Mom the same year
- Needed a reset (1:51:15)
- Surprises
- Bozzuto Group’s success amazes her (1:51:55)
- Advice to 25 yr. old self
- Take more risk- measure it if you need to do it (1:52:45)
- “Don’t be afraid to go out on a limb, because that is where the best fruit is” (1:53:00)
- “The Defining Decade- Why the 20s Matter” (1:53:50)
- Own your life (1:54:40)
- Billboard- “If Not Now, When?” (1:55:30)
Postscript
- Colin Madden– Hot topics forced from COVID (1:57:30)
- Single Family Home Rental Business
- Technology impact is significant
- Mindset of tenancy
- Flexibility- Reference to Dror Poleg book, “Rethinking Real Estate”
- Dynamic spaces in residential setting
- Remasking for Delta variant
- Relationships with tenants
- Bozzuto a cultural flywheel
- What causes people to be who they are
- Julie cares about ULI
- ULI mission and advocacy
- Time management
- Take chances in life
- Don’t hesitate
- Single Family Home Rental Business
