In 2005, Wood Partners was the top builder on MFE’s annual Top 50 Builders ranking. In 2008 and 2009, it came in fifth on the list. But in a surprise move that shows just how far the construction market has fallen, the Atlanta-based company has decided to shift its focus from development and construction to asset management and acquisitions.
Wood will move the bulk of its remaining development personnel over to asset management and acquisitions. Next year, it will launch a property management division that will manage many of its approximately 15,000 units, excluding units in certain market segments, such as seniors and student housing, and specific geographical markets.
This move is, essentially, a concession that the development market won’t be coming back to its past strength in the near future and that it will be difficult for Wood to sell the projects it has recently built. With the elimination of its traditional method of generating revenue (through the construction and sales of apartment and condo buildings), Wood is having to regroup to bring value to its majority owner—Los Angeles-based CB Richard Ellis.
“I don’t think there’s any merchant developer left standing that isn’t thinking through this stuff like we are,” says Wood’s CEO Jerry Durkin. “To think there will be development capital and that we will get back to starting units at the levels we did over the last five years is foolish in my opinion. We just have to evolve and survive.”