Aspen Properties: 20 Years Building an Alberta Real Estate Legacy
May 01, 2017
ASPEN PROPERTIES: 20 YEARS BUILDING AN ALBERTA REAL ESTATE LEGACY on the cusp of a 20th anniversary, one real estate developer in Canada is setting the bar for ethics and values in the marketplace: Aspen Properties is creating a legacy of investment success, one project at a time. Scott Hutcheson, Executive Chairman of Aspen Properties, co-founded the company in 1998, after an early career as a National Team athlete and boasting a family history of entrepreneurship (his family was in the lumber business in Huntsville, Ontario). “I had financial training from Goldman Sachs and entrepreneurial experience with another venture, as well as a background in entrepreneurship from my father, grandfather and great-grandfather, and fundamentally I was a risk taker as an athlete—all of that was the proper training I needed to start the company,” Hutcheson reflects. With financial backing and the support of a friend who offered boardroom space for Hutcheson to make calls, he co-launched Aspen. Today, Aspen Properties is one of Canada’s most respected fully integrated, privately held real estate companies, based in Calgary. Aspen owns and manages approximately 2.65 million square feet of office space and 2,327 parking stalls in the cities of Calgary and Edmonton and the company’s portfolio includes eight buildings in downtown Calgary and two in downtown Edmonton, where Hutcheson says “our focus really lies.”
SMART INVESTING FOR LONGTERM SUSTAINABILITY Together with a seasoned board of directors, Aspen has grown to be a notable Alberta investor with a determined and devoted staff. Aspen’s management team focuses on providing value add initiatives, backed by strong financial relationships and capital. According to the company website: “With blended yields from existing operations, new acquisitions, institutional financial support in debt and equity, and the development of new office property, Aspen’s financial platform and management integrity has positioned it for strong, disciplined, conservatively capitalized growth.” Since the company started, Aspen has completed more than $2.4 billion in acquisitions and dispositions involving 129 assets. This incredible growth and experience is the result, says Hutcheson, of having a combination of a great team and great tenants. “I have been fortunate to have some of the best minds in the business on our board, in my partner Greg Guatto, and with our pension fund partner,” he explains. “We bought some promising properties early when the market was just taking off from 1998 - 2007 and have had fantastic capital appreciation over the years.” Being successful is also a result of Aspen Properties being a very focused investor: “in 2005 Aspen sold off some assets (and had over 160 employees) that enabled us to redeploy some capital into one asset class: offices in downtown Calgary and Edmonton—this was hugely beneficial to us.” Aspen still does what the team knows best: “finding undervalued assets where we see some potential that no one else does, and then repositioning these assets in the market or changing the face of the asset,” Hutcheson comments. Oftentimes that means Aspen will simply reconstruct some aspect of the building it acquires, like the lobby, or the company will do an entire renovation. But the choice depends on the quality of the asset and the market at the time. And in Canada, the market has greatly shifted since Aspen started 20 years ago.
BUSTS AND BOOMS In two decades, Canada’s marketplace has seen many ups and downs, especially with respect to the real estate sector. “This market has changed enormously, especially with respect to property ownership. Now, real estate is owned by big REITs and pension funds, corporations and public entities,” Hutcheson notes. “But we are slightly different in that we are privately held and we are on the ground, living in this community and our friends and allies are executives in the oil patch, our lunches are with the people in this community making local decisions, regional policies, provincial politics and oil & gas decisions. The competitive advantage is that the principals of the Aspen team live in Calgary and Edmonton and we never stop thinking about our community.” And while risk is something not outside of Hutcheson’s wheelhouse, Aspen chooses its investments properly and according to potential. The key the Aspen model is that the company is adaptable and can change its plans quickly because it is privately-owned. “We like the opportunity that the volatility of this market presents, in that we have been able to time our positions to buy and sell in changing conditions, and opportunities are abundant in a challenging market, to fleet-footed organizations like ours.”
THE FUTURE IS FAMILY Explained at length by Hutcheson is Aspen’s thoughtful consideration of values and ethics within business on a day-to-day. “We are family first. This is very important in that we are listening to our employees and what their needs are. We want our community and our team to prosper.” Aspen coined the term the “R-LIST”: Respect, Leadership, Integrity, Service Excellence and Teamwork. The company operates according to these core values. “Respect comes first. If we operate according to the R-LIST we’ll renew our tenants more often than not. Our R-LIST applies to our tenant relationships and all the way through to our service providers. We only work with the A-Team. It is evident who the A-Team is within a short time in a meeting,” Hutcheson insists. Aspen counts its suppliers and builders as integral parts of the company’s team: “our partners have been critically important to our success. As a result of those friendships we have a close community.” So what’s in store for the next 20 years? According to Hutcheson, remaining adaptable and forward-thinking is key. “If you’re not rethinking what you and your team are doing often, there are big challenges ahead of you. We try to constantly analyze what we’re doing and how we can use analytics to take advantage of the market and our opportunities. Right now, we are focused on what the future will look like for tenant needs and how we organize space. For instance: How does corporate culture influence or change how an office building is set up? What works for the millennial generation? How can people work and play at the same office building? We will be taking some risks to address those future needs,” Hutcheson explains. And for tenants, he commits to the best client service in the market: “my job is to serve their needs.” To find out how Aspen Properties can be a partner to your business, visit www.aspenproperties.ca.