Combine a Kansas farm boy who struck gold selling cars in Kansas City; his son, who drove the business in the booming Southwest; and a savvy real estate player who needed a place to park, and you?ve got VanTrust Real Estate, the busiest developer in town these days.
VanTrust, which is controlled by Larry Van Tuyl with the financial support and counsel of his father, auto magnate Cecil Van Tuyl, has its name attached to most of the major projects being built including Plaza Vista, formerly the West Edge; the headquarters for AMC Entertainment and for Freightquote; and the 212-unit Village at Mission Farms luxury apartments.And while the Van Tuyls? assembled this real estate vehicle with the financial resources they control, it?s being driven by Dave Harrison.Harrison made a name for himself locally as a developer over the past decade while working for Opus Northwest, a Minneapolis firm, until that company dropped out of the business a couple of years ago. Harrison was left with a great team and knowledge of the local market, but no home ? until he met the Van Tuyls in the spring of 2010.?When Dave teamed up with the Van Tuyls, it put a substantial amount of capital at his side,? said Ken Block, managing principal of Block Real Estate Services. ?When you?re well funded with that capability, it opens a lot of doors.?Not just in the Kansas City area.While Cecil Van Tuyl is often referred to as a Merriam-based businessman, he and his son have their permanent residences in the Dallas area. One of VanTrust Real Estate?s biggest projects is the 2,200-acre Craig Ranch mixed-use development in the Dallas suburb of McKinney, and the firm plans to open offices soon in Dallas and Phoenix.VanTrust also has another office in Columbus, Ohio, and is pursuing industrial warehouse projects outside of Indianapolis, Ind., and Louisville, Ky.?We have the capital, we have the banking relationships and we have an ownership group that wants to develop or acquire distressed properties,? Harrison said. Block said the combination of the Van Tuyls? resources and Harrison?s expertise reminds him of the 1980s and 1990s, when developer Larry Bridges teamed with financiers Frank Morgan and Sherman Dreiseszun. Their big projects included two of downtown?s most prominent skyscrapers, One Kansas City Place and Town Pavilion.?They had significant money behind them and were able to build many high-profile buildings,? Block said.Larry Van Tuyl said real estate is nothing new to his family, observing his father was buying farms and other real estate in the 1960s and 1970s, and he began to buy properties too in the 1970s. ?We like real estate and we?re comfortable with it as long-term, passive investors,? Larry Van Tuyl said. ?It?s fun and we enjoy it.?Cecil Van Tuyl declined to comment for this article, but his background is the stuff of local legend. He grew up on a farm in La Cygne and got his start in 1955 with a Chevrolet dealership in Kansas City. Since then the Van Tuyl Group has grown to become one of the largest private car-dealership business in the U.S. with 85 locations and more than 120 dealerships in 13 states. Its sales are expected to hit $7 billion this year. Twenty years ago, Cecil Van Tuyl sold most of his local car dealerships, and the firm has just one in the metropolitan area, Van Chevrolet Cadillac in the Northland. The bulk of the dealerships now are in the Southwest ? the most are in Texas ? although they extend as far east as Georgia and west to California.The Van Tuyls, through Van Enterprises Inc., also are significant players in the insurance industry, and their holdings include Old United Casualty Co. and Old United Life Insurance Co. The companies insure vehicles from cars to private yachts and aircraft, as well as providing credit life and disability insurance. Cecil Van Tuyl?s early years in local real estate were low profile. In 1995, he sold a portfolio of 11 retail developments he owned in the metro, including seven strip malls in Johnson County, for about $50 million. But all that changed in 1996, when he began pursuing a massive mixed-use project near the Country Club Plaza called Brush Creek Plaza. That controversial proposal gave Van Tuyl, a very private individual by nature, a lot of unwanted publicity.The ambitious project called for replacing older apartment buildings in a two-block area northwest of Ward and Roanoke parkways with an office tower, apartments, retail and an underground garage. The neighborhoods fought it, and Van Tuyl finally abandoned his effort in 1998.Six years later, Van Tuyl sold the properties he had assembled for $10 million to an entity established by advertising executive Bob Bernstein. What followed was the West Edge development, a mixed-use project that included a headquarters for Bernstein?s companies and a boutique hotel. In one of the most tortured real estate sagas in Kansas City history, Bernstein?s development company got into an epic dispute with its builder, J.E. Dunn Construction Co., and work stopped in 2007 with the project 70 percent complete. Bernstein ultimately was forced to declare bankruptcy in 2009.That opened the door to the return of Cecil Van Tuyl. Along with his then-partner and friend B.B. Andersen, he created an entity called VA West, which offered the successful bid of $9.5 million at the bankruptcy auction two years ago. But within a few months, the partnership soured and Andersen filed a lawsuit accusing Van Tuyl of breach of contract. A judge awarded Andersen $6 million in a settlement in early August.Stuck with a stalled West Edge project with bleak prospects for completion, Cecil Van Tuyl turned to Harrison. During his time with Opus Northwest, Harrison had guided the development of projects that included the Corporate Ridge office park in Olathe and the new headquarters for HOK Sport, later renamed Populous, in the River Market area of downtown Kansas City.But in early 2010, Opus Northwest was put up for sale by its Minneapolis parent company. Harrison, a Kansas City native, didn?t want to give up.?We were looking to keep our development, construction and architectural team together, and we were looking for a Kansas City-based solution,? he recalled.He and his colleagues had discussions with several potential partners before they were introduced to the Van Tuyl Group. In May 2010, the Van Tuyl organization established what was then called Caymus Real Estate with Harrison as president. Its mission was to be a full-service real estate development company.Larry Van Tuyl said the decision to return to real estate in a big way was based on the belief the commercial real estate market was emerging from the devastating recession that hit it in 2008.?We felt like the real estate business had been suffering along with everybody else the past several years and believed things were set to start growing again,? he said.Larry Van Tuyl said he and his father were impressed with Harrison and the team he assembled. They also knew the Kansas City market.?My dad has been in the area forever,? he said. ?He knows when it?s going to grow and how it will grow. ?We?ve been in challenging businesses, the auto business and others, and we?ve been through cycles.? We feel the stars are lined up now to take advantage and the prices are reasonable.?The first project undertaken by Caymus was a shopping center called the Crossroads at Belton, a 17-acre project anchored by a Price Chopper store. It opened in April.But the company really began its rise to become one of the bigger players when it teamed up with the developers of Park Place, a mixed-use project at 117th Street and Nall Avenue in Leawood. In late 2010, Caymus landed Generali USA Life Reassurance to be the primary tenant in a $15 million office development at Park Place.That deal at Park Place was followed by an even bigger project when AMC Entertainment announced last September it would relocate its headquarters there as well. Construction on that $30 million project is well underway and AMC expects to occupy the four-story building late next spring.But while things were taking off at Park Place, there was that matter of how to finish the West Edge development. Harrison said Cecil Van Tuyl turned to Caymus in February 2011 when his partnership with Andersen soured.?We put a team together from 360 Architects and three contractors to help us evaluate the various scenarios,? he said.About a month later, the Polsinelli Shughart law firm called. The firm needed an alternative site for its planned headquarters after a proposal submitted by Highwoods Properties, owner of the Plaza, stumbled in the face of intense public opposition. While Polsinelli Shughart was the ideal tenant to jumpstart the West Edge, there was one huge problem?the office building designed by renowned architect Moshe Safdie for Bernstein was not suitable for the law firm?s needs. After several months of study, the decision was made to tear it down and build anew.?The original development would have been exceptional had it not been for the economics,? Harrison said. ?It would have been cool for Bernstein, but if you don?t have that specific user it would have been extremely challenging and improbable that somebody else could come into that building.?The project, now renamed Plaza Vista, is well along with a new 10-story office building designed by 360 Architects scheduled to be ready by late October 2013.In May, the decision was made to rename Caymus to reflect its ownership. It didn?t take long for VanTrust Real Estate to land another big office deal, Freightquote. Freightquote, which describes itself as the nation?s largest online shipping provider, was founded in Lenexa in 1998 and had grown to 1,200 employees. Last winter, it began searching for a larger space and quickly became the target of the incentive battle between Kansas and Missouri in the metropolitan area.Kansas City officials offered a site near State Line Road and Interstate 435 south of St. Joseph Hospital, but the deal was contingent not only on receiving the incentives, but how quickly a 150,000 square-foot building could be erected. Freightquote wanted to be in its new space by early 2013.VanTrust Real Estate, with its deep pockets, was one of the few developers capable of moving that fast.?It required substantial capital and quick movement,? Block said. Besides office buildings, Harrison said VanTrust also sees big opportunities in apartment developments.Besides partnering on the $33 million Village at Mission Farms project in Overland Park, the company also is about to break ground on a $39 million apartment development at 51st and Main streets in Kansas City, and recently announced a proposal to build a 150-unit luxury apartment development that would include a Whole Foods store at 51st and Oak streets.?We saw a huge opportunity with apartments because of the changing dynamics of the rental market that was a by-product of the housing bust,? Harrison said. ?There?s a very good market for new product for the renters by choice.?Whitney Kerr Sr., a principal vice president at Cassidy Turley real estate company and longtime observer of the local development scene, said the Van Tuyls? high-profile return has been very encouraging.?If he hadn?t stepped forward to do some of these projects they would still be growing tumbleweeds,? Kerr said. ?The problem with our economy is we don?t have enough Cecil Van Tuyls out there. There aren?t enough entrepreneurial spark plugs.?Kerr added, ?if the maximum returns you can get on a treasury bond is 1.6 percent and you are in a position to make real estate transactions with strong credit and wonderful incentives, why wouldn?t you??Larry Van Tuyl said his firm has been steadily working in Dallas and Phoenix, but Kansas City has become more of a focus since the partnership with Harrison was formed two years ago.?Dave has great experience building and managing all kinds of different properties like offices and apartments,? he said. ?We?ve done it in a smaller way and feel it?s time to be more aggressive and there are some great opportunities presenting themselves now.?There are some AAA locations, that?s what drives us. And if you like real estate, it makes your heart go faster when you go by a project.?To reach Kevin Collison, development reporter, call 816-234-4289 or email kcollison@kcstar.com. Follow him on Twitter @kckansascity.
Source: http://www.kansascity.com/2012/09/10/3806870/the-busiest-developer-in-town.html
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