![\"Tom](\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/09\/Tom-headshot-1.jpg\")
<\/a>Tom McGuinness, CEO InvenTrust Properties Corp.<\/p><\/div>\n
Tom McGuinness learned at an early age that real estate can be profitable. His parents purchased his childhood home in 1960 for $15,000. When they sold it twenty years later, the value had appreciated to $150,000. The lesson wasn\u2019t lost on the future CEO.<\/p>\n
\u201cLocation matters,\u201d McGuinness asserted, referring to the family-oriented, working-class neighborhood on Chicago\u2019s southwest side where he grew up. \u201cThat\u2019s something I learned very early in my career.\u201d Inspired by his parents\u2019 venture into real estate, he decided to try his own hand at the business.<\/p>\n
In the decades since, McGuinness has applied his skills and experience to the challenges of turning a diversified non-listed REIT into a pure-play retail platform, known since April 2015 as InvenTrust Properties Corp. Over the past three years, he has guided his multibillion-dollar enterprise through a complex metamorphosis, all while navigating the retail sector\u2019s own fast-paced transformation. Operating within a quickly evolving segment, the simpler, more focused approach has enabled the company to refine its portfolio into a $3.5 billion open-air retail platform, which is poised to complete more than $1 billion in transactions this year, including $750 million in acquisitions.<\/p>\n
Through it all, McGuinness\u2019 cohort maintains, the REIT chief has stayed true to his roots. \u201cI think he can relate to the maintenance guy at a property and then equally relate to CEOs of billion-dollar companies,\u201d said Travis Roberts, CEO of University House Communities, the student housing subsidiary that InvenTrust divested in 2016.<\/p>\n
McGuinness\u2019 successful navigation of a dynamic situation speaks to his tenacity, said Jim Watts, a fellow Chicago native who has known McGuinness for more than 30 years. The two met in the late 1980s when Watts was a lobbyist for the Chicago Association of Realtors. He recounts a time when he and McGuinness competed in the American Birkebeiner, a 30-mile ski competition held in Hayward, Wis.<\/p>\n
\u201cTom had never really skied before, but the first time he tried, he finished the race and I didn\u2019t,\u201d Watts chuckled. \u201cIf he works 70 hours or less a week, I\u2019d be shocked. He\u2019s just a \u2018get it done\u2019 type of guy.\u201d<\/p>\n
Conducting due diligence and renovations for Chicago-area developers and managers in the late 1970s pushed McGuinness to learn all aspects of the real estate business, but the operations side appealed to him most. \u201cEven in high school, I liked fixing things, painting, et cetera,\u201d he recalled. \u201cSo instead of just outsourcing improvement work, I would come up with the specs, call contractors for bids, lead and supervise the job. I was very involved not just with analysis, but also with the execution.\u201d<\/p>\n
Along the way, McGuinness developed a keen understanding of capital expenditures and operational costs, which in 1982 earned him his first leadership role: director of maintenance for Oak Brook, Ill.-based Inland Property Management Inc., an affiliate of The Inland Real Estate Group of Companies Inc.<\/p>\n
Initially assigned to a single region, he gradually took on additional duties as a director of operations for multiple territories and then, in 1994, started commercial property management operations for the first of Inland\u2019s non-listed REITs. McGuinness assumed a similar role in 1999 for Inland Eastern REIT, first handling due diligence, property management and acquisitions for community shopping centers. Eventually he rose to COO, overseeing the $6.2 billion sale of Inland Eastern\u2019s 307 retail properties to DDR in 2007.<\/p>\n
Rapid rise<\/h2>\n![\"InvenTrust](\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/09\/InvenTrust-portfolio.jpg\")
<\/a>InvenTrust portfolio<\/p><\/div>\n
The fourth Inland-sponsored REIT, launched in 2005, was Inland American Real Estate Trust, which grew into the largest non-traded REIT in the U.S., racking up $8 billion by 2009. In 2007, the company began to diversify, purchasing student housing assets and Utley Residential, a student housing operator.<\/p>\n
Marking the company\u2019s first foray into the hospitality sector, Inland American made a transformative play with the acquisition of Winston Hotels Inc.\u2014a publicly traded owner of limited-service, extended-stay and full-service hotels\u2014and upscale hotel REIT Apple Hospitality Five, adding 27 lodging properties to the company\u2019s portfolio in October 2007. By 2012, Inland American had assembled $12 billion worth of assets; the following year, McGuinness was appointed president.<\/p>\n
During this period of growth, McGuinness met Tom McAuley, who sat on the board of directors for Inland Real Estate Corp. and was closely involved with the Winston transaction. When the deal closed, McGuinness became responsible for overseeing the hotel company\u2019s various units, including its revenue management group, which required him to develop an entirely new skill set. Observing McGuinness\u2019 adeptness, McAuley commented, \u201cHe\u2019s a quick study. You throw a different property type at him, and he\u2019ll learn it very fast. \u201d<\/p>\n
<\/p>\n
McAuley noted not only McGuinness\u2019 adaptability but also his transparency and honesty, especially toward the employees of the acquired companies who became his reports. \u201cHe treats them like family,\u201d McAuley said, \u201cand they create a lot of value for the company, which is very important during a merger integration.\u201d<\/p>\n
While Inland American grew, financial markets were beginning to topple worldwide. \u201cAs we went into 2008, we weren\u2019t sure where the slowdown in the economy was going to go, so we wanted to protect our shareholders and their dividends,\u201d McGuinness explained. In an effort to hedge against a nosedive by any one asset class, McGuinness drove an initiative to further diversify the portfolio, adding net-leased retail assets, office properties and distribution centers.<\/p>\n
Although the strategy kept the company afloat through the recession, it had only postponed a liquidity event, so McGuinness took steps to distinguish Inland American from other non-traded REITs. In 2014, he took the company under self-management, bringing with him all of the employees from the external business and property management units. The following year, he renamed the firm InvenTrust Properties, Inc. (IVT). Then began the task of developing the team and company processes.<\/p>\n
Paring down<\/h2>\n
\u201cWe realized that if we were ever going to have a listing, then that level of diversity was probably not beneficial,\u201d McGuinness recalled. \u201cWe started with the sale of our apartment portfolio to Greystar for $460 million and our net-lease portfolio for $1.8 billion to AR Capital in 2013, then we turned our attention to the hotel, retail and student housing platforms.\u201d<\/p>\n
Acquiring upscale student housing communities was first on McGuinness\u2019 agenda, but he soon recognized that the relatively young asset category was lacking in inventory. To address this issue, McGuinness\u2019 firm got into the development business itself, building the majority of the student housing properties it owned and managed, until concluding that the construction process would impede the company\u2019s trajectory toward a listing.<\/p>\n
The result was the largest-ever transaction of its kind, the $1.4 billion sale of University House Communities in June 2016. A joint venture of Canada Pension Plan Investment Board and GIC, the Singaporean sovereign wealth fund, became the new owner of the\u00a0 13,000-bed portfolio.<\/p>\n
Shedding the lodging platform also was a priority for McGuinness. \u201cThe portfolio was in the right condition because we\u2019d invested so much in capital expenditures, and the overall sector was also performing well,\u201d he explained. In 2014, he oversaw the $1.1 billion sale of the company\u2019s select-service hotel portfolio to Chatham NorthStar, followed by the 2015 listing on the New York Stock Exchange of Xenia Hotels & Resorts (XHR).<\/p>\n
In a display of professional integrity, McGuinness assured that Xenia was set up to thrive after its listing: \u201cI knew with CEO Marcel Verbaas leading the company and the strong balance sheet in place, Xenia would be able to execute on its long-term strategies.\u201d<\/p>\n
Category cachet<\/h2>\n
<\/a>InvenTrust portfolio<\/p><\/div>\n
The fourth Inland-sponsored REIT, launched in 2005, was Inland American Real Estate Trust, which grew into the largest non-traded REIT in the U.S., racking up $8 billion by 2009. In 2007, the company began to diversify, purchasing student housing assets and Utley Residential, a student housing operator.<\/p>\n
Marking the company\u2019s first foray into the hospitality sector, Inland American made a transformative play with the acquisition of Winston Hotels Inc.\u2014a publicly traded owner of limited-service, extended-stay and full-service hotels\u2014and upscale hotel REIT Apple Hospitality Five, adding 27 lodging properties to the company\u2019s portfolio in October 2007. By 2012, Inland American had assembled $12 billion worth of assets; the following year, McGuinness was appointed president.<\/p>\n
During this period of growth, McGuinness met Tom McAuley, who sat on the board of directors for Inland Real Estate Corp. and was closely involved with the Winston transaction. When the deal closed, McGuinness became responsible for overseeing the hotel company\u2019s various units, including its revenue management group, which required him to develop an entirely new skill set. Observing McGuinness\u2019 adeptness, McAuley commented, \u201cHe\u2019s a quick study. You throw a different property type at him, and he\u2019ll learn it very fast. \u201d<\/p>\n
<\/p>\n
McAuley noted not only McGuinness\u2019 adaptability but also his transparency and honesty, especially toward the employees of the acquired companies who became his reports. \u201cHe treats them like family,\u201d McAuley said, \u201cand they create a lot of value for the company, which is very important during a merger integration.\u201d<\/p>\n
While Inland American grew, financial markets were beginning to topple worldwide. \u201cAs we went into 2008, we weren\u2019t sure where the slowdown in the economy was going to go, so we wanted to protect our shareholders and their dividends,\u201d McGuinness explained. In an effort to hedge against a nosedive by any one asset class, McGuinness drove an initiative to further diversify the portfolio, adding net-leased retail assets, office properties and distribution centers.<\/p>\n
Although the strategy kept the company afloat through the recession, it had only postponed a liquidity event, so McGuinness took steps to distinguish Inland American from other non-traded REITs. In 2014, he took the company under self-management, bringing with him all of the employees from the external business and property management units. The following year, he renamed the firm InvenTrust Properties, Inc. (IVT). Then began the task of developing the team and company processes.<\/p>\n
Paring down<\/h2>\n
\u201cWe realized that if we were ever going to have a listing, then that level of diversity was probably not beneficial,\u201d McGuinness recalled. \u201cWe started with the sale of our apartment portfolio to Greystar for $460 million and our net-lease portfolio for $1.8 billion to AR Capital in 2013, then we turned our attention to the hotel, retail and student housing platforms.\u201d<\/p>\n
Acquiring upscale student housing communities was first on McGuinness\u2019 agenda, but he soon recognized that the relatively young asset category was lacking in inventory. To address this issue, McGuinness\u2019 firm got into the development business itself, building the majority of the student housing properties it owned and managed, until concluding that the construction process would impede the company\u2019s trajectory toward a listing.<\/p>\n
The result was the largest-ever transaction of its kind, the $1.4 billion sale of University House Communities in June 2016. A joint venture of Canada Pension Plan Investment Board and GIC, the Singaporean sovereign wealth fund, became the new owner of the\u00a0 13,000-bed portfolio.<\/p>\n
Shedding the lodging platform also was a priority for McGuinness. \u201cThe portfolio was in the right condition because we\u2019d invested so much in capital expenditures, and the overall sector was also performing well,\u201d he explained. In 2014, he oversaw the $1.1 billion sale of the company\u2019s select-service hotel portfolio to Chatham NorthStar, followed by the 2015 listing on the New York Stock Exchange of Xenia Hotels & Resorts (XHR).<\/p>\n
In a display of professional integrity, McGuinness assured that Xenia was set up to thrive after its listing: \u201cI knew with CEO Marcel Verbaas leading the company and the strong balance sheet in place, Xenia would be able to execute on its long-term strategies.\u201d<\/p>\n