Ray Washburne joins host Terry Montesi on Leaning In for an in depth conversation about real estate, leadership, and the evolving landscape of Dallas. Ray reflects on his early entrepreneurial years, the lessons that shaped his investment approach, and the principles that guide his work across sectors from hospitality to mixed use development. He and Terry dive into the transformation of Highland Park Village, the challenges and opportunities within downtown Dallas, and the broader economic signals influencing commercial real estate today.
They discuss:
- Ray’s early path into real estate and the mindset shaped by growing up in Dallas
- The strategy behind acquiring and revitalizing Highland Park Village
- Why reputation and long term relationships drive success in Dallas and Washington
- The future of downtown Dallas and major projects that could reshape the city
- How consumer behavior, construction costs, and AI are influencing the real estate cycle
- Challenges in office, adaptive reuse, and where new opportunities may emerge
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Transcript
Ray Washburne: I always tell these kids, and I’m sure you do the same, I go, I don’t need a computer analyze real estate deal. If I can’t do it on the back of an envelope, it’s not a deal. I mean, there’s a lot of simplicity to real estate.
Terry Montesi: Today. On Leaning In, I’m joined by my old friend, Ray Washburn, CEO of Charter Holdings, co-founder of the Mrow Restaurant Group and principle of the recently formed Gillen Property Group.
Ray’s career spans, commercial real estate, hospitality and public service, including leading the overseas private investment corp for the first Trump administration. We’ll discuss the state of the economy, the evolution of retail and mixed use, the Dallas economy and its downtown dilemma, and how all these things are shaping the next decade of commercial real estate in Dallas and beyond, and maybe even a little about our political system in Washington today.
Hey Ray, thanks for joining me today. Looking forward to having a conversation with somebody I’ve known. For, let’s add it up, 40. Uh, some ideas. It’s a long time. We’re
Ray Washburne: mid forties. Mid forties. So yeah, it’s
Terry Montesi: been a long time. So thanks for joining us today. Looking forward to, uh, having a great conversation.
Ray Washburne: We’re better. Terry, uh, you’ve, we’ve known each other long to be through about four really bad economic cycles about that. Exactly. Yeah,
Terry Montesi: exactly. We’re both still standing, so Yeah, that’s good for both of us. So, Ray, I wanna start by having you tell our folks about your background and how you, how you got here, because I, I know a lot about your background, how you got to where you are today.
Ray Washburne: Yeah, sure. I’ll, I’ll, I’ll be quick. But I grew up in Dallas, went to Highland Park High School, went up the street to SMU, and you know, I like to say, tell people I was infected with the spirit of Dallas because going to school in the late seventies, early eighties, death when Dallas was booming, oil was off the charts.
The, the TV show, Dallas was the number one show on television. Real estate was booming. The SNLs were just starting to really pump money into the economy and it was crazy. People just getting outta college or really in college were making incredible money and driving around and, you know, four 50 s SL Mercedes and spending money like crazy.
So it really was a very enthusiastic time to be in Dallas. But my father was in the banking business and, and their bank was having some issues. So I basically, I was the fifth of six kids and I was given a choice. Either my sister could go to college or I could go to college and they would pay for one of ’em.
And so my little sister went to Suwanee and I went to SMU, which is not cheap. And so I had to figure out a way to pay for it. So I got my real estate license when I was a freshman at SU. Went to work for a guy named Don Tobin, who was a shopping center developer of Dallas back in the late seventies. And, but I wasn’t making any money.
And so to be able to pay for school, I started a carpet business there. I did carpet installation into the freshman dorms and. Apartments around SMU and really I was able to pay from SMU being a [00:03:00] door-to-door carpet salesman. And then I got the vending machine contract and a number of apartment complexes like University Gardens and other ones close by.
And that was my spending money during the week. And then I’d get up every morning to go work. And then I went to work for the Joe Foster Company, which is a pretty good sized brokerage shop in the early eighties and worked there. And then when I got outta college, I went to, you know, I had an opportunity to buy some rent houses and fix stuff up and just kind of the traditional way of, of rolling along.
But really I’m infected with the spirit of growing up in Texas and Dallas, I mean SMU as I was in Eric Dickerson’s class and were, you know, winning all the football games. My high school was winning state championships. So I mean, I just really, everything I was around were winners. And so you got up every morning ’cause you wanna be part of that at that, that whole ecosystem.
Terry Montesi: That’s fun. And obviously the entrepreneurial spirit that Dallas is all about. You, you, you and I have both been infected with that bug for a long time.
Ray Washburne: Sure. And you know, Terry, first time I think I met you to brag on you a little bit. I think you, you were at Huff Brows, but I think you were starting to do build a suit, blockbuster stores, and I think you were doing ’em in Memphis.
I’ll never forget, I think we sat down one day you were looking for money, not realizing I didn’t have any money, but uh. Money from people. And so, I mean, you, you had, you, you were, you came from, you were cut from the same cloth. It was like, find something new, Blockbuster’s a new thing. And, and, uh, I, I always remember that time you, you gave me the pitch and I was like, okay, this is kind of interesting.
Uh,
Terry Montesi: yeah. And, uh, and neither, neither of us believed that we couldn’t do anything, you know, so. That’s right. That’s right. That’s pretty right. Thanks for reminding me of that. Hey, you know, you’ve, you’ve been successful across multiple sectors, investment types, from Charter Holdings to Mrow to how Park Village, to your time with the, uh, first Trump administration running opic and recently forming Gilland Property Group.
Share some of your core principles, lessons learned, that have gathered your, uh, investment and leadership philosophy.
Ray Washburne: Well, you know, one is first integrity because in, in Dallas, even though it’s a large city, it’s actually a small town. And if you one time try to. Try to screw somebody around or mess with a contract or a closure or something like that, your reputation can be sly very, very quickly.
And you’re pretty much outta business in this town, even though it’s a huge city. So very early on, especially for your younger listeners on, on this show, is it, it takes you a lifetime to build a reputation. Just takes one bad deal or I mean one bad. It really a bad deal isn’t the problem. So the way you handle it and, and the transparency you have.
So I think very early on I learned about transparency and integrity and building a reputation that you, people wanna know, they can depend on you. And a handshake is a handshake. Now their other markets like maybe New York or that isn’t as important. It’s really their transactional per deal here. It’s really a lifetime, [00:06:00] a body of work over a lifetime that builds that.
And so reflecting back on all the time you and I have known each other, it’s. Really, we, we, we can look back, you know, I bought properties from you before. I’ve been a tenant of yours before. And it’s all, it just comes down to people looking in the eye, knowing you’re gonna do what you say you’re gonna do and, and, uh, having that kind of reputation.
So I’d say that was the biggest thing. And, you know, when you go to Washington, I, I served for four years administration. Before that I was the national financial chairman for the Republican Party. So I’ve traveled the country extensively and in DC you find out Washington is a very transitional town. I mean a transactional town.
It, people you meet aren’t gonna be in the same job 60 days from them or 90 days from them. So people, it’s a real revolving door of relationships. But up there, I’ve learned, now that I’ve been real deep up there for probably the last 25 years, but I’m going up there actually tomorrow morning for a couple days and I’ll end up running a lot of people I know.
And it’s the same thing as I’ll say in reputation here. If you have a good reputation, people will wanna continue to do things with you. You just gotta realize. Average. I always told people that came to work for me, you have an expiration date on your back. The day you start. No one ever business will tell you that you would never hire anybody to work at Trademark.
If you said, you know what, six months from now you probably won’t even be here. Or the average time for somebody at Trademark might be in the federal government. It’s 17 months with presidential appointee. And so with that coming in, I would always tell the people I’d hire, it’s like, you know, it’s how you leave this place.
It’s gonna get you your next job. And as people look back and talk about you in the future. So that’s another case of reputation is everything in Washington. It was just amazed me at how quickly people hop, drive the day they take a job is the day you start looking for the next year and and I always tell people, you know.
The longer your title, the less power you have. So the, the number one title I have is president, number two, vice President, and then three is Secretary of State or Secretary of Treasurer. So the longer the title, the less power you have. So you meet some people that are deputy secretary of this for the northern hemisphere of that, that, and these cards are just unbelievably long.
You realize that guy didn’t have much stroke, so it’s gonna
Terry Montesi: That’s great. So, so you were the chairman. What were you of Opic? I was a,
Ray Washburne: I was a chairman and CEO of the overseas private investment Corp. Which Okay. Was really’s a lot of words. That’s a lot of words there. Ray. No, I, I served with Chairman. Okay.
Chairman. I had a and CEO that’s pretty short. But the, the title, the agency was very, very long. It, it’s a little history on it. It’s really the vestige of the Old Marshall Plan from World War II when the United States went in the European countries and Japan. Kind of get lifted back up the, what happened to in World War II by financing us companies to go in these countries and doing projects.
Since it’s evolved, we did business 180 countries around the world, and [00:09:00] if you wanted trademark, wanted to go build a hydroelectric plant in a third world country like Botswana, but no one had lend you the money, money, but it was a legitimate business deal. We could give lease guarantees, insurance to protect you from, you know, government interference in those countries, things like that.
So it was a fascinating job when we manage a almost $60 billion portfolio around
Terry Montesi: the, around the world. That’s great. I’m gonna shift to, uh, something you and I are both into operating high-end, mixed use places and retail places, which is a different challenge as you’ve learned the last several years than other real estate.
How has that experience shaped the way you think about creating long-term value now? Well over
Ray Washburne: my career, I’ve been involved in every property type, from industrial to hotels, to apartments, to townhouses, a lot of grocery anchored retail in the suburbs to strip centers in the, on the inner city. And when we bought the Highland Park Village 16 years ago, it really was the dog that caught the car because there are very few luxury shopping centers in the country.
And you could probably count on a hand on less than 10 if really, of any substance or size, because I like to say I operate in a dictatorship, not a democracy. Democracy is worth the avenue in Palm Beach that it’s multiple multiples ownership worth a, I’m sorry. Yeah. Uh, rodeo Drive, Beverly Hills is like that avenue in Palm Beach that way in Dallas Plaza is that way.
You have 50 or 60 owners of property. So what I quickly learned was no one really in the country controlled luxury retail, where they own basically every store and you can merchandise. Center to where you don’t have the tattoo, you don’t have to worry about the tattoo parlor going in next door. You can be sure you don’t get chain restaurants in there that dilute the brand.
So I would say that the first lesson learned was that, and the fact you really have to invest in owning a luxury center really needs to be owned by long term, really a family versus a public entity. The reason I say that is if you look at luxury retail around the country, ourselves at the M Park Village shops at Val Harbor in Miami, Americana, Manhattan, long Island, south Coast Plaza in California, all owned by families.
Why is that important? We’re not looking for quarterly results, and so I like to tell people, even though we’ve owned the village 10 years, it took me 10 years to become an overnight success. We bought it, the average rent was $36. The infrastructure was in horrible. So we had to come in and people that had been on site, and you’ve seen, we brick the parking lots, we’ve added trees, fountains, flowers.
People always say, well, I can’t believe you spent millions of dollars on brick. How can you really quantify a return? I said, you can’t what it is, it’s about a it. It’s about a lifting tie. I mean a lifting tide and lifts all boats. Well, yeah, by doing that [00:12:00] encourages people to want to come shop here, the flowers and things like that.
So it’s really you. You can’t say, oh, I put in brick parking lots in, I saw sales increase 20% because that went along with planting mature trees. Not little like I was just a soer plaza. They did not break the parking lot and they put little tiny stick trees that are gonna take 50 years to grow here.
We’ve got big mature trees. So things like that is one thing I learned. Since then, we’re taking that experience to Kansas City. I bought Country Club Plaza a year and a half ago, 16 city blocks, a million square feet. That had really been owned by two public REITs and for the last five or six years, they’d put no money back into it.
And the way a public REIT works, they gotta show quarterly returns to their investors. So they were not pumping stuff in the bridge streets and fountains and flowers. They needed the, the Wall Street analysts wanted to see credit on their rent rows. So they went with people like a PF Chang or a Chewy’s or these chains that people are like, well, we have those in every market in the country.
Why do we want that? They don’t have the local f and b scene. Like in Hot Park Village, we have Cafe Pacific and B Casino and Bistro 31, and a lot of where people will wanna drive from Shreveport or from Fort Worth to Dallas to come try out. And so we’re in the process of a turnover. But Kansas City is the same thing that’s gonna take me about probably five to eight years, become an overnight success up there as well.
We’ve explained it to the people in Kansas City. It’s like. You don’t want us to put lipstick and do this cheap, you want us to do it right and it’s gonna take time to do that. Yeah. So
Terry Montesi: regarding Highland Park Village, tell everybody the, the story is, you know, I was, I was in and around it and when watching that happen and tell everybody the story of, of you and Steven getting involved there and how y’all, uh, the approach you’ve taken and how you’ve been able to optimize that opportunity.
Well, first I think you were probably one of the
Ray Washburne: people who said I paid too much when I bought it. Me, me and everybody else. Right. Everybody else said I paid too much. Yeah. Well, I had operated me casino restaurant here for 20 years previous to buying it. And I grew up down the street, so I spent my childhood coming here.
I also went to school down the street for four years, in which case, not one time when I was at SMU did I come to a Mile East or a mile west and step foot in the Hor Village. I bet you didn’t either. Other than the only reason the girls came here was they had a so called Heralds where they’d buy their clothes.
Other than that, no one came here. So it was really, I knew it as just a sleepy set, but I knew operating a business here for 20 years, it was tired. The rents were way too low. Shockingly, I mean, I was one of those tenants that got those very, very low rents because the landlord wasn’t investing back into the center, so they couldn’t justify charging anymore.
So one night in December of oh eight, my wife and I came up here to see the Christmas tree lights were on at me, [00:15:00] and we never, we had very young children at the time, so we never really left. But I said the lights had just come on. I said, let’s go see how me casino’s looking. I was having dinner and my, one of my waiters came over and they called me Al hee because you know boss.
So they come over, they go L hee, this table gentleman over here about two tables over are talking about buying the Han Park Village. I was like, there’s no way that’d be like Jerry Jones putting a for sale signed Dallas Cow. You know? It would just would never happen. And the Miller family had bought the village in 1976 for $5 million.
And so it was like, there’s just no way they’re selling it. They had a lot of family members involved. So just then, and I believe God’s hand is in everything, Henry Miller himself comes walking by the table just as the way walked away and he came by the table and said, Henry, he was getting to go pack. He said, he said, hello, we talked about the lights.
I said, listen, I hear you’re selling the village. He just turned white as a sheet. He goes, whatcha talking about? I said, well, I just kind of heard that. He goes. I didn’t say anything. Call me tomorrow at five o’clock and turn around and walk out the door. I was like all night long. I spent thinking about it.
The next day, five o’clock, I called him, he said, how quick can you get over to my office? You know, the wheels were screeching and I got over there as quick as I could and sat down. It had been on our contract. Now people forget, this is when the great financial crisis was happening. This is in December. I don’t remember the exact time of Lehman Brothers had gone down.
Bear Stearns had were going bankrupt or had gone bankrupt. Everybody was terrified. This is all the world was
Terry Montesi: ending. That was Le Le. The Lehman crash was September oh eight and you were four months later,
Ray Washburne: so four months later. Yeah, and so the family was, wanted to get out. They had 18 family members kind of eating out of the till here.
So every, some tenants were, you know, having lots of trouble. Retail sales were really bad and really bad Christmas. So I went in and, and I always tell these kids, and I’m sure you do the same, I go. I don’t need a computer analyze real estate deal. If I can’t do it on the back of an envelope, it’s not a deal.
I mean, there’s a lot of simplicity to real estate. And I just sat across the desk from him. I worked out a deal in an envelope that value stood up, shook his hand and walked out the door and we had a deal. And so I got in a contract in January about two weeks later. I mean, I, I had, I was afraid Ward would get out, it was for sale and some other people would pop it in.
So I kept totally quiet, which is tough for me to do. And got two weeks later, got under contract, went all the way till April, was coming home from the Rangers opening game, and Arlington with a car full of kids. Got a call from HFF, my mortgage and the company, the the bank in Germany that was gonna do the loan for us backed out.
And I was hard with a million bucks, I think, or maybe $2 million. I find a lender to come in and I ended up putting a deal together. I got the family to take back a first loan. I’ve got Harlan Crow to lend me a second. And I put an equity on top of that. So I just, I, I really, it was [00:18:00] a, it, no bank was loaning money for anything, as, you know, in the spring of remember.
And the only way I could do it is the family had a lot of equity in it and they really wanted to get it sold. So first thing we did, you know, to get, like I said earlier, is the dog to cut the car. You know, we closed it May 20th of oh eight, and then we got on a plane, my wife, my brother-in-law, and my sister-in-law, and we flew to New York and just started going around the Chanel and our tenants saying, or me saying, what do you think, you know, what do y’all wanna do?
And they’re all like, well, the center’s a horrible shame. We might all go to North Park. So I knew immediately we had to put money back in the infrastructure. So we started doing that and then we started visiting again. Global financial crisis. Banana Republic was, was the largest tenant other than Polo, believe it or not.
They had 10,000 feet. Between Honor bar today and the theater. Yeah. And sat down with ’em. They were paying $32 a foot and they said, we’ll stay if you cut it to 25 a foot. I go, nah, this isn’t the way this is gonna go. We turned around, cut the spaces in the five different tenants, which are there today, like Love Shack pants, you others, and we started leasing space for $75 a foot and then $85 a foot.
Today. My average rent when I bought the center was $36. The last lease we did was $600 and so that’s our quoted rate. Now we’re probably gonna go to six 50 later this year and you know, the repealing we’re crazy. I can’t believe we can achieve that. But the same gross sales in the village have gone from 82 million a year.
This year they were close to 700 million. I think we’ll push to a billion dollars in the next three or four years with pretty much the same square footage. But we’ve replaced tenants that were like wrap tie shop, doing 800,000 a year with a Rolex store. Do it. You know, 30 plus million. I mean, it’s so, it’s the same square footage we’re get a lot more productivity at.
Terry Montesi: Yeah. And y’all have done a, y’all have done a great job and it, it’s, it’s been fun and amazing to, uh, to watch and be a little bit of an insider getting to hang out with you from time to time. So, yeah, well done. Well, the interesting
Ray Washburne: thing about it, people think it, it really, it was here, someone just had, it was like when Michelangelo carved the David, they asked him one time, he go, well, how did you do that?
He goes, well, you know, it was a huge piece of marble. He said, well, he is inside of there. I just had to get him out. And so when he carved, when he carved it, and the same with the village. If you look at the demographics of Dallas, when I got outta SMU, you and I got out, there’s probably a million and a half people in Dallas-Fort Worth over 8 million today.
And so just from the sheer number of people in this city having a unique shopping experience where you feel safe and unique and is clean and is a fun place to hang around, you know. Yeah. What we’re trying to achieve.
Terry Montesi: Well, you talked about doing a lot in Dallas and knowing Dallas and, and being heavily invested in Dallas in multiple sectors.
Share your view of the future of DFW and Dallas in [00:21:00] particular, and its potential future potential for real estate investments.
Ray Washburne: Well, I mean, I, you know, the Chamber of Commerce answer to that always is greatest airport. You know, DFW I think has more nonstops internationally than any airport in the world.
Now, love field, not many cities have two massive airports very close to each other that, that you can use. So central time zone, all those things. But really it’s having good government, clean government to where you can go down. It’s frustrating for everyone to get building permits, things like that.
Because of the volume of work being done, but there’s not a bunch of hanky panky going on like in Chicago or a lot of other markets. I mean, you, you can, you can get things done here and it’s a very transparent business community. As I was saying earlier, people, people know who you’re dealing with. So someone calling in that do business per, it’s everyone’s one where of separation to finding out if somebody’s legit or not.
And so, uh, I think that says a lot to this market. Other markets, you don’t know who you’re being in a lot of cases. Yeah. Now, as far as Dallas going forward, you know, we do have issues. The city of Dallas in our downtown area, Dallas is the city of Dallas. Not, not the metropolitan, just the city of Dallas is really a series of spectacular neighborhoods everywhere from Lake Highlands, Lakewood, Kesser Park, and Oak Cliff to M Streets, the Park Cities, Preston Hollow.
I mean there are a lot of great neighborhoods all supported by property tax and. The core downtown, which has been our primarily property tax payer for, since the beginning of time, is losing value on a daily basis. So the ability to tax a building like the Bank America Tower, which today it’s 2 million square feet, if you were replace that billion a day, it would be a billion dollar building.
Well, today’s probably gonna sell 50 million. It’s a joke. So you put the taxing value on that. So, but you go north of Ross Avenue into uptown, it’s as booming of an area as anywhere in the United States, values and everything else. But our core of downtown is rotting. We don’t have any visionary leadership at the city to work through, which it’s gonna end up being a mass.
If we lose at t, it’s just gonna be a huge downtown residential neighborhood. It could become another great Dallas residential neighborhood, but we need the landscape. The streets break the street. I mean, there are a lot of things to be done that just. People aren’t talking about doing, but I can’t think of a better metropolitan area, Dallas, Fort Worth, and North Texas to be in than anywhere in the country.
Terry Montesi: I think you’re right. So, uh, I know you are kind of right in the middle of what’s happening with the convention center, and I’m sure paying attention and hearing about City Hall and the Mavs and the Stars. Give us, give us some thoughts, what you’re hearing, what you know, what you think a, about how that’s all gonna come down and what that’s gonna mean for downtown.
Well, first we’ll start with the stars.
Ray Washburne: Wherever he ends up going, if he leaves a a, c, the Star’s gonna have to [00:24:00] write a four to $500 million check. Okay? They end up gonna, this mall and this thing. People don’t talk about it. It’s like they all think, oh, Frisco will build a marina, or Plan will build Marina.
Well, you know what? The teams have gotta participate. So will he really show up and write a four or $500 million check or State American Airlines Center for free? And the city would remodel it for him. Okay, so if I’m negotiating with the stars, I mean you’ve gotta look at your leverage points. So I would, I’d play hardball to stars.
If I was the mayor. I’d say, you know, here’s the arena that both teams have an option to buy American Violence Center in 2031 from the city for $1 million. That’s it. For a million bucks. If I’m the stars, I’d go back to City De and say, okay, I’m gonna stay, but you’re gonna spend three or four to the city, not him spend it to turn into a hockey only arena.
Okay. That, that, that kind of solves that issue. ’cause otherwise he’s coming outta pocket $500 million. If you’re him, which, which would you do? Right? That’s on the stars. As far as the Mavericks go. If we don’t get them on the city hall spike. Now listen, I’m an architectural guy, I love architecture. Yeah. I get all of the arguments for keeping the I Pay building, but.
They’re saying it’s 350 million to update that building. I actually went to the opening of it in 1976 with my parents when that building opened. So I was there day one. They put no money into it since day one. I used to be on the Dallas City Planning Commission and met there every Wednesday. So I know that building it leaks, it’s sinking.
There was a lot of problems with it. So the city’s gotta make a choice. We’re gonna spend cut it in half, a hundred, 150 million to keep it or move into one of the dead downtown office buildings like Fort Worth is done brilliantly into the Pier one building and people love that building. It’s spectacular for the city to have tear down down city hall.
Now this is what you have happening in that end of downtown. Now at full disclosure, I own the Dallas Morning News site. I own a thing called Founder Square. I own the Greyhound station. I’ve got some other properties down there as well. So is this self-serving? Maybe not. So just serve that up here. I I, I knew that It’s okay.
Yeah. Yeah. But was trying to break full disclosure. But what’s happening downtown right now is a three and a half billion dollar convention center. They need 3000 hotel rooms built around it. Those are gonna cost at least 600,000 a key. That’s almost $2 billion of new hotel rooms. They’re gonna have to come in, hopefully on one of my sites with the convention center.
Okay. So right there you’ve got five and a half billion I 30 is getting rebuilt south of downtown the canyon between downtown the Cedars with a Clyde Warren Park on top. That’s a billion dollar tech stop property project. That’s just about to start. So that’s another billion to weigh on there. If the Mavericks build their arena, that’s a $2 billion redevelopment.
Dallas City Hall, which now puts that on the tax rolls, which today [00:27:00] City Hall is not. They wanna build an entertainment district around there, which will be 500 billion. Okay, now that’s just started. We’re at about six, six or $7 billion right there. That’s between now 2025 and 2031. In addition to that, Dallas College, the old El Centro has got RFP out, which I’m one of the finalists for, to build them a new downtown Dallas campus.
That’ll be a billion dollar camp. They’ve already floated the bonds. They’ve already got the 800 million to a billion dollars to do it. Fort Worth is doing that with Texas a and m on the south side of downtown. Massively transforms your downtown. Where does that go? Well, I think it fits best on my Greyhound site, on the parking lots around Bank of America, around the existing El Centro site and down in the West end.
You add that on top. What does that bring? Well, they wanna bring, it’s the only college in America that didn’t have a Starbucks or a bookstore, so there’s nothing associated with it. But now they wanna bring in residential, they wanna do more graduate programs. When co, when companies look to move to Dallas, they want to educate their workforce or do they educate them that El Central campus is a horrible facility and so we need a world class facility?
You throw that all that added up what I just said. That’s $10 billion of projects that could be built between now and 2031. Everything is approved and we’re going except for the Maverick deal and the Mavericks will play ball if the city will can deliver the site of city Hall. Now why keep city Hall?
Okay. The preservationist, I get it. The architectural thing, but it’s a facility passes time. It was built at a time when Kennedy, after Kennedy assassination, that Dallas had the show. We were truly not the city of hate. We’re a progressive city. We’re going forward. When it opened was right when Dallas is this takeoff of the TV show.
Dallas and oil and gas and real estate and all, but it’s just passed its time and the repair of it. Anyway, that’s why I’m optimistic on downtown. If we can get leadership at the cities, sit there and go, let’s get all these cats I just talked about. Sit down a table and make this happen. And the Star in the Stars case, the Sands has the money, is willing to participate in a major way, like hundreds and hundreds of millions of dollars million, their arena.
If I’m the owner of the stores, I’m like, why would you go out there? You’re not, you already sell out. You already got a hundred percent season ticket sales. Sounds like you’re gonna sell more tickets up north. You don’t have to write a $500 million check. I just don’t think we have negotiated the city.
Understand how, like Trump, how businesses done, how business can happen, businesses.
Terry Montesi: Hey Ray, if, if, let’s say 70% of what you said happens downtown, $7 billion from. You know, that sort of, uh, you know, central western part of downtown up around to the sort of south central part of downtown. All of that happens there [00:30:00] and, and we know uptown is, is just on fire.
Is that enough to bring back the stuff in the middle? All the stuff in downtown Dallas that’s sort of suffering that old part of downtown? Or, or will you just have sort of a, a northern viable portion that is uptown and a southern viable portion and everything in between will, will suffer? What’s your thought?
Uh, well,
Ray Washburne: one thing is you go, okay, who could possibly be the office users down there? I had to go to a meeting down at the Thompson Hotel, which is the old First National Bank last week. Mm-hmm. Once I passed over to L Rogers, it was probably a good 20 minute stoplight to stoplight, to stoplight. Businesses are not going back into the court.
They’re just not okay. If I was king for a day, I would take our Luster Justice center, that huge jail complex we have on the Trinity. Which is fastest useful life. They need about a million square feet. For a newer facility, I’d take one of the downtown bills to turn it into the jail and the county courthouse.
Take all that mess, clean that up. Now we have an incredible development site overlooking the new Trinity River project we’re doing that takes care of one bill that could take the entire Renaissance Tower off the market and put thousands of jobs into downtown Dallas lawyers, all those types. Second, I would go to, I would go to HUD or somewhere I, I’d take, if I was mayor, I’d fly right up, meet secretary Hud, who’s from Dallas, Scott Turner, great guy.
And I’d sit there and say, what are the tax halls we can do to change, to create incentive for people to take the rest of these buildings to turn ’em into loss? Alright, a piece of sheet rock costs just as much downtown Dallas as it does in Frisco. So what is it? What. You, you, you and I talked about this before, it’s kind of subsidy or density.
The city either has to do a subsidy for something or they gotta give you more dense. It’s the only way lot of sub out. Well, in this case, they need to, I would accelerate depreciation in some sense, and I think the federal government should do this set of a 33 year depreciation on goods and things. I would do a one year just like this right now, if I build a new meat casino, I can write off the cost of rebuilding that restaurant in first year.
So there’s a big encouragement to spending money on that. If you gave real estate people the incentive to spend hundreds of millions of dollars on 10 improving and turning the loss, but you got to write off your investment in one year ’cause you were taking the risk to do all that. I think people would, it’d be a a land rush to go downtown to do it.
Terry Montesi: We have an affordable housing crisis. Yeah. So that, that’s been, uh, something our, our system has been slow to solve for sure. Let’s see, let’s go to the economy. Talk about that for a second. So, you know, you’ve, you’ve talked about how the economy sends mixed signals, consumer inflation, uh, interest rates, and you and I’ve talked about a number of times that as a active restaurateur, you sort of [00:33:00] mid-priced and, and your restaurant peers, how you have a real time look at the consumer.
So how are you, how are you interpreting the signs that you’re seeing in the economy today?
Ray Washburne: Sure. Well, I’m, I’m on the board of Red Lobster, which is about 700 locations in the United States. Total middle class, probably lower middle class customer. I’m chairman of the board of Sunoco, which is the largest, we have more gas stations than anyone in the United States.
We have 15,000 gas stations. If you guys know Sun. Sunoco. Mm-hmm. We sell 15 billion gallons of gasoline a year, and so we’re large. So I get a lot of consumer data on driving habits, which is everybody. Mm-hmm. Red Lobster, how are people doing in the middle of the country? And then I also own MI in Dallas, which is a higher end customer on a, you know, higher end.
A casual dining customer. Higher end than a Chili’s, but not a Or upper middle. Yeah. Upper middle. Upper middle. So the way we gotta see the world right now, it’s a khap economy, which means the high, high end is boom, is off the charts. Okay. Heading up. And that’s like how our bills, were up about 12% this year.
And here my mic casinos are up. But you look at the other side of the, of the K where the downward leg is going and you’ve got, I I’ll, sorry, with Red Lobster, I was for, to bought that outta bankruptcy last year. So we’d already gone BK because of that. Close a bunch of stores. Sales are very, very flat. And the middle class customer just isn’t spending money.
I mean, they’re, they’re, they’re scared. Or they’ll go out and they’ll get an one beer and an entree, but they’re not getting an appetizer. Two beers, a salad and an entree. They’re purely no appetizers and those things. So the consumers spend is down. But if you look at top line numbers, you go, that’s interesting.
’cause sales for most casual dining is, is pretty good. Well, the customer counts are down crossing across the industry, and we’ve all raised prices about 20% since the pandemic.
Terry Montesi: Yeah.
Ray Washburne: So if you look at, okay, well prices are up 20%, sales are flat. Well, what’s going on with consumers spending less, you know, that’s not good.
Rolled off, that’s not good. Now on the Sunoco side, on gasoline sales, we’re the largest seller of diesel in the country, which is trucks, 18 wheelers and just normal gasoline for cars two years ago. Average price United States is about three 80 gallon. Today, it’s 2 84 Now. Let’s forget California, that’s in the fives, but the rest of the country, what does that tell you?
Our gas sales are down 2% from gasoline side, but gas is down 30%. Well, that means the consumer has less money than my waitress of Red Lobster. Even though gas is down, 30% has less money to spend to go drop around. Okay. That should be a deal. On the other side, on diesel sales, which we’re the largest seller, that is what drives American commerce, we’re up about [00:36:00] 5% in diesel sales.
So what does that tell you? Well, that tells you that we are importing less things because we’re moving things within the country, more from manufacturing plant in Ohio to a warehouse in Nevada, that those primarily on trucks, you know, trains as well, but on trucks in the past, they come in on ship to Long Beach, be put on a train.
Train from Long Beach to Dallas, and then they distributed it locally. But we’re getting a much more longer haul trucks. So that shows you the economy. Domestically. The tariff thing really isn’t affecting, it’s really being shifted quickly. As an example, in our restaurants, we took all our plastic wear paper, all that stuff is being made in Vietnam.
We’re now doing it all domestically at the same price with the tariffs put on it, but it’s all brought it back to the United States. So we’ve shifted a lot of things back here at Red Lobster. All our, uh, shrimp was coming from China. We shifted it all to India, uh, to the Chinese tariffs, and then we started tariff India.
Now we’ve shifted it all down to Guatemala, Honduras, and, you know, along the coast we’re the largest buyer shrimp in the world. Well, we’re just gonna, it keeps getting closer and closer to us, and we’ve totally boxed out the Chinese. So how do I look at the economy of that? The Lowing customer is really tapped.
Look at credit cards are at all time high. The high end consumer is fine. I mean, they’re, they’re doing just fine and, and, and they’re spending money. This AI thing, who knows where, where it goes if, you know, everyone thinks it’s gonna wipe out lawyers and things like that, you know, maybe basic contracts.
But if you, if you’re a bankruptcy lawyer or any kind of contract negotiator, I mean, you gotta have someone, there’s an old saying you want a young doctor and an old lawyer. The reason why an old young doctor, he knows the new things going along. You want an old lawyer ’cause they understand case law and negotiating tactics, the way people act and things like that.
A computer doesn’t, doesn’t have that kind of thinking thing. So, yeah, I don’t know. It’s pretty interesting where, where all that plays out.
Terry Montesi: Yeah. Well, thanks. And, and what are you paying attention to right now as you look at the economy, different metrics where we and that tell you where we are in the cycle and, and how to kind of think about investing?
Ray Washburne: Well, I’ll, I’ll, I’ll speak on, on, on the real estate side. It’s so crazy expensive to build anything today, and I’ll, I’ll use an example, like a Red Lobster to build one ground up. You ground lease a piece of land used to be, you know, a million half dollars. You could build a building and you do two and a half million of sales and you can make, you know, decent profit.
Well, today, construction costs, it’s about three and a half million dollars to build that building. You know, it’s gone up by a factor of two. Okay? Sales are pretty much the same. As I was saying earlier, liquor sales have gone down in that lower casual bond for about 19% to about 11, 12% margin is really getting squeezed, so it makes [00:39:00] no economic sense to build casual dining restaurants.
That’s why you see the Chipotle of the world all doing so well. Everyone’s moved that direction. We’re looking at, we build a lot of highrise apartments. We’re building a huge project called The Knox in Dallas right now, which is, its Ma. We bought that project out before the pandemic. Fortunately with the con, what that means is we price everything out before the pandemic, but we’re really gonna doing some highrises now.
And you, you just can’t price them. They make no sense. You look at, so people that are holding projects in, in this huge refinancing bubble’s gonna hit 27, 28 for people that have these three, 4% mortgages on commercial properties. I don’t know if it’s better just working my handicap and wait a couple years.
Yeah, seriously. And see if the banks start taking stuff back. But if you own a great piece of land for apartments to go up, no one can pencil it out. Our Our Deal downtown, these hotels, we wanna build the convention center. I mean, the city’s gotta subsidize. Doesn’t make any sense. If you travel around the country, and I travel a lot, I travel every week.
You go to St. Louis, Memphis. Are these Birmingham, Alabama, the only construction cranes you see in the air are for public, pro public projects. Hospital, school, air airport, things like that. You don’t see a guy, a bank building, a new headquarters building. You maybe see, you see a lot of ai D bill. I mean, it’s really hurting the construction business right now, the development business.
’cause they’re taking all the materials away for us. Yeah, keeping inflation up. And I was with, I won’t name the title company, one of the largest title companies from Texas last week. Having lunch with him. He said they were having the biggest year in their entire history. Biggest one of the biggest in Texas, 80% of the business is AI data center.
Terry Montesi: Data centers. They’re doing a well. The cost of those Abilene, the cost of those, it’s so high. You don’t have to do many of them.
Ray Washburne: Oh, the one in Abilene, he did a $25 billion project. Their title cream was $41 million. One title, but think $25 billion. All the concrete steel. Everything gets taken away from us wanting to pave a parking lot.
That’s the inflationary thing in this economy right now. People think AI is deflationary in our business. It’s inflationary.
Terry Montesi: Yep. Uh, I want to talk about office. I know you have some experience. Oh
Ray Washburne: yeah, I got some now.
Terry Montesi: Yeah. So, Ray, office space continues to face headwinds, and I know we’ve discussed that you’ve done a little office investing, as have we.
What, what are you hearing? What’s your outlook on the future and are you considering any of the big adaptive reuse strategies that, uh, others are looking at?
Ray Washburne: Well, adaptive ones of taking existing building, doing it, as I was saying earlier, they make no economic sense unless you get some city subsidy. I mean, they’re just none at all.
I mean, I, I looked at an office building in Dallas last week. It’s called three Fours Plaza Next Medical City, 1516 Story Building, 380,000 feet. You could buy it for $30 a foot, [00:42:00] $30 a foot. I mean, it’s great. Tell everybody why. Okay? And there’s another building. Well, Glen’s going for like $65 a foot replacement costs.
If you told me today, you gave me those plans, go build that building. It’s $600 a foot. It’s on for 13 5% replacement costs. Why? Well, one is most of the systems in these buildings are shot. You gotta put in new roofs, new elevators, new HVAC systems. A lot of people don’t realize is these garages are sold.
They can’t hold EV cars and EV cars like four times the way of a normal car. And so these garages are all gonna need to be strengthened and savvy buyers are looking at that going, if this thing’s too much ev, they’re gonna collapse garages. So you gotta put money in to reshore your garages. They’ve got tenants that have have to, the TI is 80 to a hundred dollars a foot.
Same as if you’re in uptown getting 60, $70 a foot in office rent. You’re in the suburbs getting 18 to $20 a foot, still 80 bucks. So, I mean, there’s no income at all for the ti so there’s no useful life limit. So am I pessimistic about it? Totally. Am I enthralled by it? Absolutely. I mean, bottom fishing guys like me look at that and go, my God, I can buy a building for $9 million.
That’s huge garage. Like, how does it not work? And tenants today are from a recruiting standpoint, we we’re building a building on Knox Street with MSD right now and, and Tramell Crow Company, 88 bucks a foot. And it was a hundred percent pre-leased, a hundred percent pre-leased. Okay? And you look at that and go, my gosh, that’s incredible.
You can buy a building called Uptown Tower, just sold on Central, not a mile away building, just sold for like 70 bucks a foot. And they, they can’t get $20. It’s like, because the people sign the $88 lease when they’re recruiting a kid outta college. They want to be, they no longer look at it as on the expense side of the equation.
It’s on the hr. Side of the equation, the hiring side, the employment side.
Terry Montesi: Employee satisfaction.
Ray Washburne: Yeah. So whereas if you got a, I’ve got a building on North Central myself, the only really action we’re getting are like small law firms and the big floor, the big plated people, they’re terrified to sign a lease.
’cause everyone’s afraid AI’s gonna knock their knees out. So everyone’s kind of waiting to see how does AI affect your business? We, if you’re in the claims processing business and insurance, your business might be in just absolutely gone in two years.
Terry Montesi: Yeah. Back to real estate, when you. Think about just real estate investing and like you said, you’ve looked in owning a lot of sectors.
What, what differentiates the winners and losers? You know, the, you mentioned in there’s, there’s winners and losers in different categories earlier. As you look forward, you know, when you thinking about investing, where are the winners? What’s gonna differentiate the winners from the losers? Okay, I,
Ray Washburne: I’m gonna go back.
You [00:45:00] and I have been in this business for a long time and been through many cycles. When you and I got in the business, we could go find a piece of property, put a deal together, do maybe a 10 prep, 50 50 split. Yeah. And these athlete, these, uh, asset allocators were the big institutions. You might find an insurance company or somebody going with you, but it wasn’t a big pie of investors.
It’s primarily, you know, taking the tin can around a lot of your friends, maybe a couple wealthy guys. It’s turning such an institutionalized business now that a cow stirs or a major pension fund is where the market is going today. You take them a project, you say, Hey, I want you to invest this deal. And they say, you know what?
We own part of the operating business over here. This company over here is at operate shopping centers. So they operate or we’re partner with big institutional. Apollo says, that’s great. We already have an apartment business that we own, like Cadillac Fairview bought Lincoln Property Company for apartments.
Used to be you could go tap in on to. And teachers today, they’re like, no, that’s okay. We got enough apartments. So we hear, you know, but maybe we’ll buy the deal front. You know the deal. So what we’re, the way I’m viewing the world right now is we have a unique operating platform here. We’ve redeemed our business dealing property.
Terry Montesi: And I like Ray, I, that’s a classic Dallas story, how you named that business. How many, how many friends have your, you and I have named their businesses that way. Tell, tell everybody how you named that business. Yeah, you asked by street. Yeah. For Street. And it was available friends then. Oh, in Emerson, Harvard.
Think about all the people we know they have done. Yeah, yeah,
Ray Washburne: yeah. Lakeside. Yeah. All this stuff. So, but what we are are, and I’ve hired a huge team of people from, uh, Heinz. I think we’ve hired 30 people in the last 60, 90 days. We’re going institutions and we’re being approach, like Kansas City was Avalara, it was a large lender that had it.
They realized to take something as specialized at that. There are only a few groups in the United States that understand luxury, you know, historical properties and the scale and actually could put enough of their own capital into it, where you’re just not a pure promoter on the deal. And so much like you’ve got your expertise.
What you’re doing or someone listening to this might have an expertise in industrial. I can’t go to Apollo or someone and say, bag me. I’m gonna go build a warehouses. They’ll go, okay, we own part of Crow lodges, or own part of this or that. But if I go to ’em, and especially retail, we own a block of downtown Aspen.
We have Luxury Center in Charlotte. We’ve got something white Waikiki Beach in Hawaii there. There really no one, there are no reach or anyone that just deal in the, what I call tip of the spear retail. They can go to remains and say, you know, we can immediately call ’em to find out if they’re interested in this deal and come in with this.
So we’re focused on just that for someone else. So where’s the market going? I think if someone is a specialist [00:48:00] in let’s say office, and you can make a credible case for an office building, you got a management leasing platform and development platform, you can make a credible case. It’s primarily because the institutions have all kind of manned up with somebody already in every food group except the one I’m in, because the one I’m in is not a very big group for someone to back into, you know, Asana out of Atlanta is very highly qualified, but they’re more going into like the deep ELs of the world leagues.
They wouldn’t be well set what, what we’re doing here. They, they bought, they bought Victory from us, right? Yeah. Bought Victory. And so they’re pro, they’re well set for that and I think they have an institutional partner to go do those kind of things. If they tried to step up to Island Park Village and deal with the Chanels and Diors, I don’t know where they would go because those, most of those high-end tenants are all owned by families do, or Chanel or they’re, they’re controlled the LVMH by family.
They wanna deal with other families and they wanna know you’re just not gonna lipstick something and flip it. Their multi-generational whole. So our, if I was to bring partners in with me in the future, they would just be high net worth families that say, hey. Again, it’s gonna be 10 years be an overnight success.
But once you get there, it’s owning the Hobart Village or Countrypolitan. It’s almost like owning a sports, you know, they’re famous, they’re legendary, everybody knows them. And once you’ve achieved the mass in the cash flow, it’s like, if I was to sell it, well what do I do then? I mean, you can’t get a better piece of property.
Terry Montesi: Yeah. So, Ray, I just got a couple more questions. Oh yeah. Ask whatever
Ray Washburne: you want.
Terry Montesi: Okay. Yeah. So you, you alluded to AI and and tech and a lot of the hype and beyond that, and if you wanna address that as well, it’s fine. But beyond that, what other trends or innovations do you see that could reshape development, real estate, operations, and even our economy, you know, over the next decade?
Ray Washburne: Well look, people work for experiences. Okay. And so if we look at it from the retail perspective. Which I kind of talked to and, and or the real estate perspective. I was just in Munich in October Fest where my leader hose in had the whole deal with my friends. We have a pro, a bar in Dallas called the KD Trail Ice House.
My partners and I from the Ice house went over there. That’s kind of where the inspiration came from. That’s great. Yeah. But what that kind of shows you, I mean, thousands and thousands, thousands of people. People in today’s world, they’re not working as much. AI is replacing a lot of work. You know, even though people aren’t back to office, a lot of people take half a Friday off and think.
So everyone is looking for something to go do and the Highland Park Village is fortunately one of those places. They don’t mind gonna, the muck bar strolling around. I’m trying to create like a cruise ship. You kind of come on board and we don’t wanna leave. And so people that have pride, and that’s what a downtown Dallas needs to become.
It needs to be. So the experience is so unique. You wanna go there? Well, one thing forward has done that Dallas does not. The stock yards. [00:51:00] That is an incredible, I went by there Saturday, two or three Saturdays ago. I’m staying at the Drover, unbelievable Imop. And I was in San Antonio at the Pearl District.
Unbelievable swamp. I mean, you just packed. Yeah. That’s where I think things are going. And the same in your office problem. If someone has even an old, old office building, you gotta create, what’s it I, I know that you gotta have a great weight room, you gotta have some fun restaurants. You gotta have a bar in there.
You gotta have a golf simulator. You gotta create the experience. People just don’t want to go one place and then just get the car leave now. And I, I can’t speak industrial, the distribution side, it’s getting a lot more that last mile. That’s why industrial is booming so much, is they wanna be closer and closer to the population centers.
But in, in the office game, I, I’ll go, I’m not picking up your hometown in Memphis, but I was up there recently and you had that first Horizon Tower downtown. Who would ever build another office building in downtown Memphis? I mean, zero economic sense. There’s not even any tenants to do it. So how does a town like Memphis take Beal Street?
Try to clean it up and get it to where locals and stuff wanna go there. But that’s kinda where I think things are going. It’s gonna be kind of decoupling Disneyland from buying a tuition, a ticket attendance to go into it at Six Flags, the Stockyards. Anyone can park on the street and just walk around and enjoy all that.
Anyone can walk around the Pearl District. Dallas doesn’t have that. That’s one thing I hope with our new convention center and the American Air, the new Mavericks thing, we can create a sense of place that is unique to where we are. Just like Beal Street, is that where you are? As dirty as it is, bourbon Street is in New Orleans.
I mean, there, there are, you know, great environments to go to. Yeah. That that’s what we are kind of
Terry Montesi: focused on. Great. So you alluded to Washington and you’ve been, you’ve been in private companies much of your career, other than your time in Washington. Tell me about some of the lessons learned in your public sector experience that have, you know, uh, impacted you and, and what you’ve learned about how Washington works.
And give us a, a little look inside.
Ray Washburne: Yeah, well, the swamp exists and, well, what I learned from being up there, I, I was a guy, very few people like me that go up serve and return home most are like lawyers. They might be in private practice of, say, in Dallas, they get a job at DC and they get out, they become a lobbyist and they just work for a firm and, and it’s all there.
That’s, and world dis distasteful. Part of the whole thing is people get into this system that a lot of it’s hopefully gonna get dozed out. But I had guys work for me that are in their thirties and they’re, you know. 28 years old guy. Guy. And his wife’s say 27 and she is the press secretary for senator and he’s chief of staff somewhere in the White House.
And then four years later they reverse roles and she becomes a lobbyist and he becomes, you [00:54:00] know, something else in government. They never leave. And I always tell these guys and go, you’ll make great income collectively. The two of you, by the time you’re 30, will make a million dollars a year. Problem is you live in the suburbs, you have two range rovers, you got three kids, all go to private school, you pay taxes in Virginia, you never get off this treadmill.
And every year you got no money left ’cause it’s all gone at tuition’s, taxes, those cars, the country club dues and all. To build true wealth, you have to be someone who owns property or owns business or own hard assets. It’s not being the front of a paycheck. And so what I learned up there is people get into this and these lobbying firms pay so much money.
The hooks in the mouth, they just can’t leave it. ’cause if they end up going back to Nashville or Birmingham or Memphis, they’re not making a million dollars here. It’s like, that’s not the point. The point is to build a long-term asset-based life, not one that’s pure paycheck to paycheck.
Terry Montesi: Yeah. And I, and, and as you know, my daughter was up there when you were there and it, it, it became obvious just being close enough to it that it’s so incestuous.
Like you said, you, you leave and then you know people and they give, they send you business and, and, and you can’t ever get out of that, uh, of that incestuous web, it seems like.
Ray Washburne: Yeah. And, and, and they just, they all intermarry each other. That’s the other thing. Then no one’s like has a, anything involved, someone with ad agency where you’re at told me do ads to the government or, you know, so they’re all interconnected in some way.
And so I learned that up there and I was happy to get away from that. But I still have a home up there. I’m up there a lot and I. You know, it’s, I got Potomac Fever. Once you get up there, you just, I know so many people up there, but I don’t, I used do zero business with the government, but I’m speaking at a conference tomorrow on Latin American business in the United States.
I’ll do family offices for my OIC days. Mm-hmm. I go back once a month and give talks to different groups about that. I enjoy doing that. Then again, they airplane fly back to Dallas,
Terry Montesi: back to reality. Hey, I got a question. I bet you haven’t been asked much, but I’m excited to, to hear your version. ’cause I’m, I’m thinking about mine.
What do you, what do you want your last third of your life to be about? How, how are you thinking about what success will look like going forward? You know, it’s not just investor, but leader, citizen, father, et cetera.
Ray Washburne: Yeah, well, unfortunately, my three kids are great kids. My oldest son is back running. Our family office here.
My second son is at NYU Business School. My daughter’s a senior at SMU and this is all set up and we have a pretty. Robust business here. And you know, we didn’t talk much about our oil and gas business. We’re, we’re very deep in the Permian and natural gas. So our family is really four legs of our stools, oil and gas business, which is a foundational piece.
Real estate, this, restaurants and hospitality, hotels, we own hotels. And then the last part, just private equity at invest and they all are highly interested in [00:57:00] and want to come back. So I think the next three to five years is getting that battle ingrained here. And then my wife and I, we enjoy traveling and you know, it’s like, look, I’m 65, I saw a deal in 60 minutes last.
That said, once you hit 75, it’s like all downhill. And I looked at my wife, I go, I’m running this best 10 years out Hard. Yeah. So I’m not in it down. So No, it’s, it’s great ’cause we’re a family business and I’ll be, I’ll be back up in DC doing some things. I mean they’re doing that. Lots of civically. And then, look Dallas, my biggest concern in Dallas is we are totally leaders leaderless ship as far as our mayors not here, our council, it’s just so much going on and so many great things here, but we don’t have a hard vision of, in the 1960s, we had the first mayor, Eric Johnson, who did DFW Airport.
They built all the links. They got the interstate highway system built. I mean, I looked when I was born in 1960, in what was built in the 1960s that we’re enjoying today. I just don’t see that vision and leadership looking 20 years, 30 years out. From now. And then those guys that did all that were in their sixties, they were all planning for their grandchildren, not planning for themselves.
Well, Ray, perhaps there’s your calling. You might have just discovered
Terry Montesi: your calling.
Ray Washburne: Yeah, I live in Island Park. I’d love to run
Terry Montesi: for mayor of Dallas,
Ray Washburne: but
Terry Montesi: live in the wrong city. Well, but you know, maybe you could make even a bigger impact, not, not be a mayor. Yeah. Hey Randy, I, last question is to share with young folks, when you men mentor young professionals in real estate, you know, what are you sharing with them and, and what are the skills or mindsets that you think are most important for the young leaders of the future?
Ray Washburne: Well, first of all, it’s having a passion for the business. And people would say they wanna go into the real estate business, but they’re really not passionate about it. And the way you have a passion about, it’s you articulate something that you enjoy. And a lot of times I’ll take people and they say, I wanna go to the retail business.
I’ll take ’em a walk around the village, just tell ’em what you see. If they don’t notice obvious things. And it could be. You know, there’s tr like if I see trash on the ground, I always bend over to pick it up. If I walk by and a kid doesn’t bend over to pick it up, I go, you’re not, it’s in your business.
Hey
Terry Montesi: Ray, my dad, you know, we grew up in the grocery business in Memphis. Yeah. And I’ll never forget, I, I don’t think I’ve ever walked through a grocery store way back when with my dad that he didn’t pick up trash all over the store.
Ray Washburne: Yeah. And when we first bought the Village, my kids were very young.
They’re 10, 12 years old and nine years old. And we used to have a Tom Thumb grocery store here, and they, people leave shopping carts all over the deal. And every night we’d come up here, I’d go home and get the kids and bring ’em back. We’d push all the shop carts back and they’re like, I’m so embarrassed.
My friends would say, I go, no, you should be proud. They’re looking at you going, they care. They actually care enough to take their shopping cart or bend over, pick up the trash. But I would say first it’s a passion about it, but just understand the business you and I got [01:00:00] into is not the business they’re coming into.
It’s an institutional business. And if I was young and wanting to be a young Terry Montey going out there, you know, the, the avenues you could take at a very young age, I’ll call in your early twenties, you can do is land because land assemblage, you know, institutions don’t buy land typically. And so getting out and understanding you, putting together some partnerships to buy land and then hustling the entitlements and things like that up, that is something you’re not competing with.
Apollo and those guys, okay, that’s first. I think that’s a, a huge opportunity for people. And the other is getting in and doing these little build suits for people like Dutch Brothers and all these little ones that wanna do these. ’cause those are not big check sizes and you’re not dealing competing with institutional money.
You’re competing with other young hustlers that are out there trying to put those small, just like a young Terry Matis doing blockbusters.
Terry Montesi: Yeah. At
Ray Washburne: the time you were doing it, that wasn’t an institutional deal at all, but you were able to get. Area and build it out, and other guys got other areas of the country build it out.
And it all did extremely well with it. But it took for a young guy to think, I wanna buy the Highland Park Village, or buy a country called Plaza or something like that. Institutions want experience and they want someone with the chops and not the first time.
Terry Montesi: Yeah. Well, Ray, this has been a fun conversation with an old friend and you know, few people can talk Washington and entrepreneurship, real estate investing, oil and gas like you can, and I really am grateful for you joining us today.
Sure. Thank you for having me, Terry. Thanks, pal. Ray, this has been a fantastic conversation. Your perspective balancing entrepreneurship, politics, and real estate investing gives a full picture of what leadership in today’s world looks like. Thanks for joining us. I look forward to continuing the dialogue.