The ‘Village’ of Hathaway
When David Hathaway left a successful career in the field of banking in 1985, he took a chance on creating his own business ventures in real estate. This led to him becoming a developer of single-family homes in Macon, Georgia, and eventually multi-family developments across the Southeast.
After the purchase of a parcel of land that had single-family, multi-family, and commercial lots on it, he sold off the commercial piece, decided to expand his development plans and built the Northridge Subdivision, which featured 240 lots. What he could not have known at the time is that thirty-three years later, he would have built a corporate legacy for his children and future generations of his family.
“My dad is a pretty amazing and remarkable man,” said Partner and Director of Development Nick Hathaway. “People love him; he’s true to himself at the same time. He’s got a very good way about him from my perspective, and watching him and working with him for decades has been an invaluable learning experience.”
Hathaway Development Company Inc. (HDC) was officially founded in 1990. By 1997, its multi-family developments were built under the Hathaway Properties Inc. banner, while some additional supply and service companies were created under HDC to provide a wide network of opportunities for expansion. As the company grew, so did the participation of David’s family members.
In the early 2000s, sons Daniel and Nick joined their father, and a solid foundation of a dedicated team of professionals laid the groundwork for their future success. They were joined by valuable team members such as Thomas Gunter, Director of Development – who has been with the organization since 2011, John Spivey, Acquisitions and Development Manager – who joined in 2005 – and Marzena Demko, Development Associate – who joined in 2004 to assist with both property management relationships and development matters.
These and more shared David’s vision for what the company could be, and Nick attributes many of the company’s successes to the dedication of this core group of individuals. However, at the core of it all, Hathaway has become what it is because of its founder. Not one to shy away from risk or opportunity, David encouraged his sons to follow the same business practices.
In 2009, Daniel and colleague Mike Muggridge saw potential in expanding the construction side of the business in a new market to include third-party construction, so they changed the name of the company to Hathaway Construction Services Inc. (HCS) to more accurately reflect its reputation and experience in construction and general contracting and moved the head office to Atlanta. Simultaneously, a property and asset management company, Provence Real Estate, LLC (Provence), was created, along with a supply company for building materials.
Over the past thirty years, the company has developed, acquired or built over twelve thousand multi-family units, totaling nearly one billion dollars in asset creation in markets across the Southern United States, including Tennessee, Alabama, Louisiana, Mississippi, North Carolina, South Carolina, Texas, and Florida.
The company’s strategy has been to focus on at least one stabilized acquisition per year and two 250- to 300-unit ground-up developments per year in markets where there is an imbalance in supply and demand to ensure there is an opportunity for rent growth and value enhancements. It focuses on four main aspects when conducting business: budget, schedule, quality, and safety – with quality and safety being of topmost importance for both staff and clientele. In fact, every on-site worker that is involved in and HCS project has to complete a ten-hour OSHA safety training course, and for any workers who do not speak English, the course is given in Spanish as well.
“It takes a village. There is a lot of communication between all of our companies and all of our principals,” said Nick Hathaway. “There is a lot of insight that a property management company can provide [to development and construction] before you begin. It also helps that the company’s ‘village’ is all within three feet of each other, so it is hard to miss something,” he joked.
Working with family members and having them responsible for the various branches of the business has made things much easier and more effective from Nick’s perspective. “We have my brother, Daniel, running the construction company, and so, what we present internally on a new development opportunity, we find out right away whether we can afford it,” said Hathaway. “Since we have construction as a part of our team, change-orders and cost overruns, those are things we can always work out internally due to the relationship that we have and the way we’re set up.” Having the benefit of all of these viewpoints gives the company the ability to maneuver and make changes that will not cost the development any of its integrity.
The company also involves its interior designer before it begins construction as well as its architect and Provence to get their input on the development. “We’ll try to marry the concepts of what’s inside the lifestyle center to the exteriors, to the pool, to the overall experience, and try to tie that all into the locality of where we are, and bringing all those people together has worked very well for us,” said Hathaway. “There is a lot of insight and different perspectives that these people bring to the table.”
Unlike other developers, Hathaway has focused on working with many repeat partners such as HFC Interiors and Pucciano & English Inc., to maintain consistency, quality, and budget adherence in its projects. “Fred Pucciano has been our architect for fifteen-plus years, and he has great experience that has been invaluable to be able to lean on as far as [questions and answers] for things that a developer wouldn’t know,” said Hathaway. “It’s wonderful to be able to ask Fred ‘so why exactly would we do that?’ He has the wealth of knowledge and experience that benefits the greater good.”
Hathaway noted that an interior designer may not be the most obvious partner, but feels fortune to have someone that can truly see the vision that the company is trying to achieve and understands how to tie it into a full community. Its designer can look at the demographics of the rental pool in the area where the company is building, and if it has a wide spectrum as far as age and interests, it can be a resource for trying to do something different with the project to attract a bigger client range.
“You have three hundred units, and you want to have some consistency throughout,” explained Hathaway. “But we want it to be open and attractive to a wide audience. So we talk to our interior designer about a concept theme on one floor which may not be appealing to a mass audience but may be appealing to a group of twenty units out of three hundred, where people who are looking for something different may be surprised by something so different in the community,” he said. Working hand in hand with the interior designer helps Hathaway Development to achieve this.
“There are a lot of players on the field right now, and that’s been good and bad,” said Hathaway. The process of finding sites happens pretty quickly, and the company is careful not to purchase sites whose prices are driven up above their true value because there are too many competing bidders.
“Our biggest challenges are finding the sites that you want and the affordability of the sites,” Hathaway explained. “The cost of construction versus the rental rates and the collected dollar versus the loan cost are all taken into consideration. Banks are very conservative now. The dynamic of how the development comes together with the required variables and the physical side where the sites are located can be challenging because they aren’t great or need to be rezoned with city council’s input – all of that comes into play,” he said.
“There’s going to be a point when my father retires,” said Hathaway. “He’s in the office every day, and he offers insight and experience, and so when he goes, we’ll have a change. It’ll be interesting to see how the younger generation will bring their input and vision to the company.”
Nick Hathaway expects that he will still be in development, and his brother Daniel will move between construction and development while working on the equity side to keep friends and family investors informed.
“I’ve got a sister too, Anna Hathaway Browning, who recently joined Hathaway Development, so we have three Hathaways at all times, under one roof,” said Hathaway. “The one thing we’ll do is keep the culture to that simple core business plan, which is to not overextend ourselves and not go after the most expensive, most luxurious costing property with a dream that hasn’t been realized in the market. We will stick to what we do best,” he shared.
“We’ll continue to keep doing what we’re doing. As long as we are able to keep performing and over-delivering, that’s how we try to set it up for the execution to work.”