Montvale Firm Plans Homes, Wal-Mart
By: Prashant Gopal
It’s a time of firsts for Ivy Equities.
The Montvale Company, founded and operated by two college buddies, recently launched its first private real estate fund and is working on its first single-family residential community and its first Wal-Mart.
The $50 million Wal-Mart project in White Plains, NY, is expected to be the chain’s first bi-level urban store in the New York City area. The retailer - which is generally known for sprawling, shopping-cart-friendly floors and vast outdoor parking lots - will occupy the first two floors of the former Sears building Ivy is renovating. Parking will occupy the top six floors of the nine-story building.
A Wal-Mart spokesman said the company is interested in opportunities in urban areas and must be flexible with its real estate strategy.
The Wal-Mart is Ivy’s highest profile project, and also is a sign of its flexibility. The company, founded in 1996, focuses mostly on buying and managing suburban office buildings in the tri-state area. It has purchased about $1 billion of real estate.
Ivy’s strategy with all of its investments is to squeeze profits from undervalued properties, said Chairman Russell F. Warren Jr., 37, and CEO Anthony P. DiTommaso Jr., 40. The company declined to disclose its revenues.
The company, for example, is renovating a 28-acre office property in Montvale left vacant by Toys “R” Us a few years ago. Ivy is renovating the 130,000 square foot office building and putting up 28 luxury town houses and single-family homes on the site.
“With more competition to buy commercial real estate, we’ve had to evolve and take on what would be more complicated deals,” Warren said. “A lot of players are capital providers, not operators. We decided to build out our management team to allow us to take on more complex projects.”
Warren and DiTommaso formed the company soon after Warren sold his publicly traded company, Professional Sports Care, to HealthSouth.
Sports and medicine have played pivotal roles in Warren’s career. Warren and DiTommaso met as players on the Princeton University football team.
Warren founded Professional Sports Care with his father, Russell F. Warren, a renowned surgeon and longtime New York Giants’ team doctor.
Ivy Equities invests in both real estate and health care. Ivy Healthcare Capital, a $30 million venture capital fund, invests in medical device and orthopedic services companies. That fund closed a year ago (the company plans to start a second $100 million to $200 million health care fund this fall). Ivy launched a $30 million real estate fund in February, which was open to individual investors.
Prior to that fund, the company raised capital, a project at a time, often through institutional investors. The fund is designed partly to spread risk among a number of properties, DiTommaso said.
As a rule, DiTommaso and Warren say, they contribute at least 20 percent of the investment for each project and fund. “We have our skin in the game,” DiTommaso said. “One of our mantas is: Our interests are aligned with yours.” Warren said the company’s investors like dealing with a private fund rather than buying shares of a public real estate investment trust, which often rise and fall with the stock market.
For now, they see no reason to go public because it is easy to find investment capital, Warren said.
“Public companies are interested in a smooth earnings stream and can’t accommodate for lumpy earnings and development projects that pay out at the end, not along the way,” Warren said.
About Ivy Realty
Founded in 1996, Ivy Realty, a wholly owned subsidiary of Ivy Equities, is a leading real estate investor and developer throughout New Jersey, New York and Connecticut. Ivy targets investment opportunities in undervalued, high grade, income producing commercial properties. The Company has built a reputation for successfully completing a wide spectrum of creative developments in the office, mixed-use, retail, build-to-suit and residential sectors. Currently, Ivy Realty owns, manages and leases a 3.5 million-square-foot portfolio with added development potential throughout the tri-state area.
For more information contact Ivy Realty at their Montvale, New Jersey headquarters at (201) 573-8400 or visit the website at www.ivy-realty.com.
