By Suzanne Heyn
Late one night at W.M. Grace Companies’ office, Tom Grace wanted to leave, but not before his father and company owner, Howard. Tom walked through the office, turning off everybody’s lights. Howard could hear Tom grumbling, “Money doesn’t grow on trees,” about the wasted electricity.
Howard recalls that moment of cost consciousness when asked why Tom will be successful. “His mindset is already thinking like an owner,” said Howard.
Howard worked hard to teach his son the value of a dollar. In high school, Tom had to choose — play sports or get a job. Tom chose sports, playing football, baseball and basketball. His dad supported him, coaching football and cheering him on at games.
Later, when Tom graduated from the University of Arizona, Howard wouldn’t let him work for the family company until he gained experience elsewhere. Tom moved to Chicago, finding a job after handing out resumes and networking at an International Council of Shopping Centers event. He “dialed for dollars for a year and learned the hard way how to get turned down.”
Howard finally sent Tom an email, letting him know the Phoenix market was rising. “We’re finally going to start attacking some deals, and I’d like you to come back,” Tom recalled the email saying. About two years ago, he returned to start with the family business.
“Development is really hard for a young guy to get into,” said Tom of his time in Chicago. “There’s not a lot of opportunity unless you’re bringing something to the table.” Not to mention it was 2009, the market was tight. “Nobody was hiring, let alone bringing on a new guy that didn’t have a portfolio of tenants or property with him to bring to the table. I got lucky by getting the job.”
Howard also speaks of luck when detailing the Grace Companies’ evolution. When Howard’s father started the company in 1967, it offered general contracting services. The company built roofs for a department store chain, ultimately becoming the chain’s general contractor and building about 100 stores nationwide.
In 1971, Grace Companies started to build 40 shopping centers for a New Jersey-based company, but the owners embezzled money and bled the company dry.
“We convinced the banks to loan us the money to finish the projects, and overnight became a developer,” said Howard. Grace Companies sold most of the shopping centers to repay the banks, but the handsome profit inspired the company to stay in development. Grace Companies still completed construction work until last year, when it officially stopped.
Howard is happy that Tom joined the company, and hopes that more of his father’s grandchildren follow suit. “It’s a big deal to my sister and I that something our parents started keeps on going,” said Howard. “As I get older, I have a much greater appreciation for companies that have been around for the second and third generation. It’s a lot tougher than I anticipated.”
Even though at the office, Howard is the boss and Tom the employee, the two shed the hierarchy outside of work.
“That was one of the big concerns when I came back,” said Tom. “How do you separate father and son versus employee and employer?” The two occasionally grow frustrated with each other and argue. Ultimately, Tom says he knows Howard is the decision maker.
No matter how ardently the two argue, nothing matches the fights Howard had with his father. “My father was one of those iconic, old-school screamers, yellers,” Howard recalled. “He had a big heart, but he wore his emotions on his sleeve.”
After an argument on a Friday, Howard would type up a resignation letter and hand it to his father. By Sunday, his father would call and ask him to return to work on Monday.
“My dad was brutally honest,” said Howard. “He didn’t need a contract. He just needed a handshake. That part I got from him.”
As the decades move on, contracts have gotten longer and technology more complicated. But in Grace Companies, family is still family.
“He’s a good, young man,” Howard says of his son. “I’m very proud of him. I can see that he’s learning every day and he’s enjoying it.”