Walker & Dunlop is one of the largest commercial real estate firms in the country. But the road from a small, family-owned shop to the major player it is today wasn’t always easy, CEO Willy Walker said on this week’s Walker Webcast.

Walker & Dunlop’s story began in 1937 when the company, founded by Oliver Walker and Laird Dunlop, became among the first to use Federal Housing Administration insurance to create single-family home loans. 

After decades operating as a relatively small shop, the tide started to shift for the Bethesda, Maryland-based company in 2003, when Willy Walker joined the firm. At the time, Walker & Dunlop only had one office with 23 employees — but Walker had big visions for what the company could achieve.

“It's very clear to me, as I look back on joining a family company, that when I got there, I was way too focused on trying to show that I was going to chart a new course and be this great leader to take the company to all new heights,” Walker said. “I didn't want anyone to sit there and think that the only reason I was there was because my name was on the door.”

Walker praised his father for letting him act like an “arrogant, ambitious, hard-charging CEO” during those times, allowing him to make his mark on the company. Walker officially stepped into the role of CEO in 2007, and since then, the firm has grown to more than 1,400 employees across 40 locations. 

However, leading Walker & Dunlop wasn’t always easy, both personally and professionally, he said.

When Walker took Walker & Dunlop public in 2010, he had three children under the age of 10, he was chairman of the board for three public companies, and he decided to start training for the Olympics as a distance runner in his free time. 

But this desire to pack “too much” into life at once and prove that he could do everything simultaneously started to cost him personal relationships, he said.

“You get to a point in your life where you really feel like you have to push, where you really feel like there's something that's either worth pushing for or something that means enough to you that you can't let go of it,” Walker said. “At the same time, there are also those times where if you push too hard, it's going to just break.”

Professionally, Walker said there were a few times in the history of Walker & Dunlop when he led the company into periods of “unprecedented risk” to achieve a goal. 

Walker said his firm was in the process of acquiring another business where three bankers generated 40% to 50% of the revenue. Walker wanted a force majeure clause in the purchase agreement so that if those bankers left the company, Walker had the opportunity to back out of the deal. 

The seller declined this proposition, leaving Walker with the high-stakes decision to either move forward knowing this risk or back out of the acquisition entirely.

“I convinced our board to go forward with the deal,” Walker said. “We announced the deal, and the day that we announced it, one of our big competitors put a massive amount of money on the table for those three individuals to move across to our competitor. We ultimately got those three bankers to stay, and they’re still with us today.”

Fortunately, this high-risk approach ended favorably, he said. But if it hadn’t panned out the way he’d hoped, the company could have been set back dramatically. 

“Unless you're willing to take those types of risks, you're not going to be able to create the type of growth and value that we have created,” he said. 

Walker said a lot of people in commercial real estate today are switching from a hopeful to fearful outlook on what comes next. 

When the Federal Reserve started tightening in 2022, general consensus was that interest rates would return to where they were in years prior, Walker said. But now, that sentiment has changed from a “we hope rates come down” perspective to a “we’re fearful that rates go up further” mentality. 

“There are a lot of people sitting there saying, ‘Well, if the 10-year Treasury goes from 5.25% up to 6%, what does that mean for my refinancing that's coming up in a year or two from now?’” he said. “They're looking at whether now might be the time to go and refinance that loan so that they're not caught in a higher rate environment a couple years down the road.”

Walker said another big question looming over the industry is whether artificial intelligence will fundamentally change business as the world knows it. Data center hyperscalers in particular expect their business model to change, with companies like Anthropic growing quickly and charging a premium for their new cutting-edge AI models. 

But Walker questioned whether people will continue to want this cutting-edge technology, given its substantial price tag.

“At Walker & Dunlop, for instance, we have a closed environment with OpenAI,” he said. “We love OpenAI, but we're not a biotech company trying to solve cancer. We don't need those bleeding-edge models to be able to run a mortgage company.” 

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This article was produced in collaboration between Walker & Dunlop and Studio B. Bisnow news staff was not involved in the production of this content. 

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