It was a busy 2013 for Klein Enterprises, a longtime family-owned real estate business in Baltimore.
The company had six projects in the works last year, including apartment developments in Owings Mills, North East and Fells Point, and it expects to announce four new plans in 2014. This month, the Social Security Administration started moving its 1,600 employees into new offices completed by Klein and development partner JGB Companies on Wabash Avenue near the Reisterstown Road Metro station.
Daniel Klein, the 32-year-old president of Klein Enterprises, started with the company while in high school, sweeping parking lots on his grandfather's properties with maintenance crews. He shared his thoughts about the business today.
Your company finished 2013 with a lot of projects: the Broadway apartments, the Social Security building, and you have plans to break ground on four more in 2014. How did the firm weather the recession to emerge with so much activity?
Being a multigenerational family business, we take a long-term approach to owning real estate. Because of this, we tend to be more disciplined in our pursuit of deals, which had us questioning a lot of the activity that was taking place from 2004 until 2009. My late grandfather, Philip Klein, and my uncle and business partner, Michael Klein, have seen every economic cycle imaginable, for better or worse. This allowed us to realize that the most successful companies are ones that plan for emerging from recessions stronger than they were before. We are more active than we have ever been, and this is the result of us continuing to work hard throughout the downturn, trying to identify opportunities that were created by being in the bottom of an economic cycle.
Your Marketplace at Fells Point project on Broadway takes a best-of-both-worlds approach architecturally, preserving the historic facade while being a dense, modern apartment building. Why don't developers do this more often, and will your firm do it again?
The Marketplace at Fells Point is a very unique project that is likely a first for Baltimore. There are countless examples of historic buildings in Baltimore that are preserved in their entirety, but I can't think of other examples where only the facade is preserved, allowing for modern infrastructure, systems and amenities to meet the demands of 21st-century renters. We are developing this project in a joint venture with the Dolben Co. and we all very much believe that the end justifies the means. Other developers don't do this more often because the economics are difficult to justify and the construction is far more difficult than a traditional project. We are exploring additional opportunities in Fells Point and other neighborhoods in Baltimore City, and I wouldn't be surprised if our experience on this project will allow us to successfully replicate this strategy on other projects in the coming years.
Klein Enterprises started out doing suburban strip malls, but you and your family live downtown and are part of the trend of young professionals living in the city. How does that shape the kind of projects you're interested in and the kind of stores you're hoping to attract?
It absolutely shapes what projects I'm personally interested in, and hopefully that carries over to what interests my partners as well. Most real estate developers pursue projects in areas they are familiar with, and that's why most of the successful projects in Baltimore are done by Baltimore-based firms. Developers are, at their root, community builders, so I hope that Klein Enterprises can continue to find projects that make Baltimore a better place for its residents, workers and tourists. Regarding retail in Baltimore, my wife constantly educates me on what's missing, so for domestic peace alone, we hope that we can bring in new concepts that appeal to the needs of people who actually live in the communities where we own properties.
You're the fourth generation in your family to be in the real estate business, but when you left Baltimore for Boston University, you didn't think you would come back. How did your grandfather persuade you to return to the family business, and what would you ask him today if you could?
My grandfather was the most intelligent man I've ever had the opportunity to learn from. He was 86 when I graduated from college, and we both realized that time was precious. The decision to move back to Baltimore and work in the family business wasn't driven by wanting to return home, but rather wanting to continue to learn from my grandfather and spend valuable time with him. The knowledge I gleaned from him in my first year was the equivalent of a Harvard MBA. Additionally, my uncle has been working in the business for over 35 years, so I've been able to learn a tremendous amount from him as well. Back to my grandfather: If he were here today, I'd love to get his feedback on what we as a company have done in the four years since he passed away —the good, the bad and the ugly!
What's your favorite kid-friendly Baltimore activity?
We live near Federal Hill Park, which is the crown jewel of public spaces in Baltimore. Our favorite place to take our children is to [the park], where we play on the swings, in the sandbox, chase dogs around, meet friends for picnics, watch the American Visionary Art Museum summer movies on the hill and so much more. All this is done with no lines, the best panoramic views of our beautiful city and, greatest of all, it's free for everyone who wants to experience it!