C-Suite Spotlight: Grubb Properties CEO Clay Grubb
This series gets into the heads of the decision-makers of CRE, the people shaping the industry by setting investment strategy, workplace design, diversity initiatives and more.
Prevailing leadership philosophies have finally caught up to Clay Grubb.
Since taking the helm of Grubb Properties, his family-owned real estate firm, in 2002, he relied on consensus in making decisions.
That style of leadership ran counter to the image of the maverick real estate developer idealized in the 20th century, but Grubb, an alumnus of Tulane University and University of North Carolina law school, said in today's corporate world, leaders who listen are valued and often make better decisions.
Grubb, now CEO and chairman of Grubb Properties, started working with the family business at the age of 12, collecting mortgage payments. Today, Grubb has more than $2B in acquisitions and development with projects in Atlanta, Charlotte, Winston-Salem, San Jose and, for the first time, New York City.
Grubb is the author of Creating the Urban Dream and last year raised a real estate fund to help rescue struggling live music venues across the Southeast.
Bisnow: Tell us about your leadership philosophy and what experiences, words of advice or mentors shaped it along the way.
Grubb: My leadership philosophy is based simply on teamwork. I believe it’s imperative that we listen to all perspectives. While it can be extremely taxing to take the time to make sure everyone is heard and to attempt to build consensus, the result is a far better solution, and the extra effort is worth it. Taking the time to make sure we have considered all possibilities and come to the best solution allows us to execute with conviction. I also believe it is important that everyone take care of their health and well-being first so that they can bring their best self to the office.
Bisnow: How has the role of CEO/business leader changed over time — especially when considering the early days of your career to now?
Grubb: When I first became CEO in 2002, I was hesitant to make decisions without getting lots of feedback. Back then that was considered a weakness, but thankfully the business world has moved on from the days of maverick, go-it-alone CEOs. Today, inclusiveness in decision-making is considered a strength, and I think we’re all better off for it.
Bisnow: What will the role of CEO look like in 10 years?
Grubb: I think this trend toward inclusiveness will continue. Over the course of the next 10 years, technological innovation will make collaboration even easier, bringing CEOs closer to the troops. As a result, organizational charts will continue to get flatter.
Bisnow: Was leading a company always a goal for you? If so, why?
Grubb: Honestly, leading a company was not a goal for me. I am a numbers person by wiring and grew up doing deals and searching for the best investments. I had no idea how rewarding it would be to successfully lead a team and watch team members flourish.
Bisnow: What has been your biggest mistake as a leader?
Grubb: Early in my career, my biggest mistakes were often related to overpromoting folks before they were ready for the next step. Those actions cost me some great potential team members. I had a wonderful team member and I promoted them, before they were ready, to a position of leadership. This person was not prepared for leadership and did not appreciate that leadership came from listening and not directing. Eventually, I had to let them go. Had I been more self-aware as a coach, provided better tools for training, and moved slower on the promotion, they would likely be a valuable team member today.
Bisnow: Has your thinking changed about the workplace between 2019 and today? How? What will your office strategy be moving forward?
Grubb: Despite the pandemic and its disruptions, my thinking related to the office has been pretty consistent since 2019. I believe the most productive companies will continue to have the majority of their teams in the office. Sometimes, the best ideas come out of the unexpected meetings in the hallway, and this is difficult to replicate over Zoom. That said, I think work schedules will become more flexible.
Bisnow: There is a massive conversation underway regarding advancing more people of color and women into the C-suite. What are you doing to address those voices and that movement within your own organization?
Grubb: This conversation is seriously important and long overdue. The CRE industry is far behind in bringing women and people of color into senior management, and there is a lot of work to do both at the board and corporate levels. Our board of directors currently comprises four men and three women, including one woman of color. In selecting new board members, we consider numerous factors beyond strictly real estate experience, including integrity, judgment and breadth of experience.
We strive to maintain gender and racial diversity to ensure that all voices are heard. But, that said, we have a long way to go to achieve our goals. For our workforce, we’re taking steps to improve our hiring practices to provide a diverse pool of candidates for each position.
For example, we’ve increased recruiting at HBCUs and are partnering with internship programs devoted to underrepresented talent. We also focus on creating promotion opportunities for employees traditionally underrepresented in the industry so they can be supported in developing their careers once they join the company.
We also do annual compensation reviews to ensure we provide pay equity regardless of gender or ethnicity.
Bisnow: What do you think about the recent focus on sustainability and climate change? Is it overblown? Insufficient? Is your company tackling climate change in any way or taking it under consideration in your planning?
Grubb: Our industry needs to do much more to emphasize sustainability and [to] prepare, address and respond to climate change. Climate change exposure is one of our company’s five pillars of resiliency that we consider when evaluating site selection for our properties. The risk in these markets is not only from a direct hit from a severe storm, but also insurance rate increases due to this increased risk.
We try to create the most environmentally friendly properties practical and pursue sustainable practices in design, construction and development, and operations. We do this not only for the environmental benefits and efficiencies, but also because our residents demand it.
I’m proud that every single Link Apartments community has earned a green designation. Our most recent community, Link Apartments Linden in Chapel Hill, North Carolina, earned a National Green Building Standard Silver Certificate, and we’re going to work to achieve or exceed that level with all new multifamily buildings.
Bisnow: What is something CRE gets wrong in your eyes?
Grubb: As I mentioned, CRE needs to become carbon neutral or as close to it as possible. Climate change is critical and according to our government sources, commercial real estate generates 16% of all emissions in the U.S. It’s imperative that we work together to reduce this.
Bisnow: What asset class or location will perform best over the next five years? Why?
Grubb: America is facing a terrible housing crisis with a severe lack of housing — more than 3.8 million homes short of what is needed to meet demand, according to Freddie Mac. Years of underbuilding have resulted in a lack of supply, while the large millennial and Gen Z generations are driving growing demand.
This imbalance is likely to continue over the next decade. Multifamily communities — particularly ones that serve the "missing middle" — will do well. This will be particularly true in urban and infill suburban neighborhoods that are close to transportation options, cultural amenities, and resilient employers such as universities and medical centers.
Bisnow: What book, article or TedTalk meant the most to you? Why?
Grubb: [Albert] Ratner, the CEO of Forest City, gave a talk about his commitment to his family, his business and his community and how he split his time equally among the three. At a time of crisis for the company, he abruptly left a business meeting to attend a community meeting to everyone’s astonishment. That community meeting ended up resulting in a connection that actually saved the business.
It was a really inspiring story that has encouraged me to make sure we do not lose sight of our priorities in life just because things get difficult.
Bisnow: What is your all-time favorite TV show? Why?
Grubb: While I don’t really watch TV anymore, growing up I loved Sanford and Son. Redd Foxx was a master of the one-liner.
Bisnow: How do you spend your Saturdays?
Grubb: I get outside as much as possible on weekends. My Saturdays are often filled with hiking, mountain biking or potentially a water sport like skiing, kiteboarding or surfing. I usually follow that up with a nap at some point, a nice dinner and — if I’m lucky — the day is capped off with some great live music.