It’s not about having the most units for Ryan ¬McGrath. He’d rather be the best with the units he has.
McGrath, president of Houston-based Asset Plus Cos., says his team takes a disciplined approach in delivering the best living experience to each and every resident—and that hard work has clearly paid off.
Asset’s successful strategy has led the company to grow notably, jumping five spots, to No. 19, on this year’s NMHC 50 Managers list with the addition of 6,650 units to its portfolio in the past year. The firm currently manages more than 51,100 units.
McGrath anticipates the same amount of growth this coming year.
“We’re working on a few deals right now,” he says. “We could double that number—and I think that’s a -realistic goal for us. On the downside, we could hit that or, on the upside, we could do substantially better than that.”
The company, which started in 1986, began as a branch of a savings and loan. When the bank decided to shutter the real estate management part of the company, Asset Plus Cos. was created by some of the bank’s employees. McGrath’s father, Michael McGrath, was one of the founding members of the company, which began by managing all types of real estate, including office and retail.
By 1991, the company decided to take a more pointed approach and focus more aggressively on multifamily third-party management. To that end, Asset acquired a small management company in College Station, Texas, and, in the process, promised to keep the existing staff intact.
“There were only a few people there, and we just kind of made the promise that if the controller of the company was there, then we’d have an office there,” he says. “And we still have an office there.”
It was a smart call: College Station has offered a wealth of opportunity for the company’s growth. Providing housing to the Texas A&M University area alone has led to about 10 deals for Asset.
“It’s really helpful when you build a deal and the university doubles in size since you did your first deal,” McGrath says.
DESTINED FOR STUDENT HOUSING
Asset Plus Cos. was launched into the student housing space when one of the company’s largest clients purchased a property in Lubbock, Texas, and asked the team to manage it.
“He basically said, ‘I have seven other properties that you manage and you’re going to manage this one,’ ” McGrath says. “So we did.”
Thus did Asset make the transition from managing only market-rate housing to grinding on all cylinders with students near Texas Tech University. By 2006, the company was managing more than 36,000 units at 85 properties across the nation, including 18,400 beds of student housing.
“The way I describe [the student side is] that there’s a stop and a start,” McGrath says. “There’s a stop right after move-in; you have a few weeks or month break; and then it’s a sprint. But, on the multifamily side, in some instances, it’s more difficult because it’s more like a treadmill and although it’s not a sprint, it never stops.”
Student management ended up blossoming into a focus for the company and fueled the founding of -Asset Campus Housing, the student housing division of the firm, in 1998.
“We just kind of changed our entire approach,” he says. “We decided that the management could grow and we wanted to be something bigger.”
Today, ¬Asset Campus Housing manages more than 120 student communities, which include more than 70,000 beds. It is considered one of the largest, if not the largest, private student housing companies in America.
Meanwhile, parent company Asset Plus acquired a smaller company, Greystone Asset Management, in 2013 and grew to open additional ¬offices in Houston and Knoxville, Tenn., for more than 2,200 employees.
“We like to think that we’re smart and strategic, but a lot of our success is the result of being smart and strategic and lucky at the same time,” McGrath says.
In an effort to continue growing, and with the goal of becoming the best manager in Texas, the company is opening an office in Dallas and plans to aggressively add to its existing Lone Star State portfolio.
But ¬McGrath and his team also have bigger growth plans.
“We’re actively looking in the Southeast and on the East Coast—that’s our next push,” McGrath says. “With student housing, we’re all over the country already, so we’d like the multifamily to follow.”
SENIORS HOUSING:A BETA TEST
Meanwhile, Asset is diving into a new section of the market in Dallas with the acquisition of a 50-unit -seniors housing development. The team acquired the property with the hope of learning the seniors space.
“We’re experts in the living experience. So, thinking about it from a resident’s point of view, I think we feel like it’s closely related to student housing. There are community events, but it’s a little higher touch than in traditional multifamily,” he says. “In [market-rate], someone comes in and rents a unit and you never see them again, but in the student space you’re getting them involved in events and activities all the time. I feel like the senior space will be more active like that.”
The move into the seniors market proves how much the company has grown over the years. Being able to dive into a new part of the industry without the experience is quite a luxury.
“That entire aspect is new for us,” McGrath says. “So, it’s basically our beta test to figure it out.”
But no matter how big Asset Plus gets, McGrath says his team will always refer back to the fundamentals of doing good business with respect and care.
“The vendors we were working with treated us like we were their biggest client even when we were small,” he says. “We kept that mentality, and we care for our clients that same way.”