Chairman and chief executive
Company: Thomas Properties Group Inc.
Born: 1936; Pembroke, N.C.
Education: B.A., Baldwin-Wallace College; J.D., Cleveland-Marshall College of Law
Career Turning Point: The formation of Maguire Thomas Partners
Most Influential People: His father, Earl Thomas; and his wife, Sally Thomas
Personal: Lives in Brentwood and has been married for 50 years. Thomas has three children and two grandchildren.
Hobbies: Golfing, reading and sports
As chief executive of Thomas Properties Group, Jim Thomas oversees a public company with a 22 million-square-foot office building portfolio and 8 million square feet in the development pipeline. And though the longtime L.A. real estate player has worked on a variety of notable projects from the development of the U.S. Bank Tower to Wells Fargo Center Thomas is now embarking on what might be his biggest project yet. Thomas Properties will develop a 400-acre Universal City site for NBC Universal. The 25-year plan includes production studios, thousands of homes on the back lot and a mixed-use development atop a transit stop. Thomas, a former lawyer, recently sat down with the Business Journal to discuss his business dealings and among other things his time as owner of the NBA's Sacramento Kings and his former partnership with developer Robert Maguire.
Question: What is going on with the Universal City project?
Answer: We've been working with the neighborhood groups telling them about the plans and telling them what we expect to do. We've started the environmental process. There will be full public hearings and everybody will get the details of what we are doing. The production media center and the Metropolitan Transportation Authority transit site, that part of the project hopefully will go first.
Q: So when will there be actual construction?
A: We would like to be able to start the first phase next year. It is a question of how long it will take us to get out of the environmental process. The residential on the back lot will follow that and again it is a question of how long it takes to get out of the environmental process. That project too would be built in phases. The MTA project has two phases and the back lot has multiple phases.
Q: What excites you about the project?
A: One of the great things about the project is it is located right at transit. So what you have is transit-oriented development with the combination of offices on the MTA site and the residential on the back lot. You have a lot going on in terms of smart planning; you have jobs and housing so you have your jobs-housing balance. Plus the projects are green.
Q: Do you see this project as a way to put an exclamation point on your career?
A: I've been very fortunate to be involved in a lot of important projects, especially here in Los Angeles. Among other things, I was chairman of Grand Avenue and worked with Eli Broad to get that started and nurtured that along for four years through the competition and picking Related Cos. I've been involved with the development of Library Tower (U.S. Bank Tower) and Wells Fargo Center and MGM Plaza on the Westside. There are a number of very important projects I've had the good fortune to be involved in. The one you are working on at any particular time is the most important one the other ones are done and you can savor them.
Q: Let's go back in time. Why did you come out to Los Angeles in the first place?
A: I practiced law in Cleveland for about two years and then I became a trial lawyer, trying cases in U.S. Tax Court for the government. I did that for four years and that's how I got to Los Angeles; the government sent me here to try cases. Because of political influence you couldn't have the job in your home state so you had to move out of state and agree to keep the job for four years. I finished with the government in 1969 and went with Greenberg Glusker in 1969 and I was with them until 1976.
Q: You've worked in downtown on and off over several decades. What was it like in the first part of your career here?
A: You had the department stores and there was Pershing Square you'd go there at lunch and all these political guys were making speeches, it was really a fun place to go. Bunker Hill was leveled. The commercial area was down on Spring Street, all the law firms, O'Melveny and Myers and Gibson Dunn. There was a lot of retail downtown. The tallest building in town was City Hall.
Q: Why did you stop practicing law?
A: I practiced law for 20 years. In 1976 I teamed up with Rob Maguire and until 1983 I was also managing my law firm, Thomas Shafran Wasser & Childs. I enjoyed being a lawyer and had no intentions of going into real estate, but Mr. Maguire persuaded me to join him in some ventures and that's how I got involved in real estate.
Q: Did you ever have an inkling your career would take a turn in that direction?
A: While I was practicing law I bought an industrial building so that was my first foray into commercial real estate other than owning homes. The fact that I was interested enough to go buy an industrial building early in my legal career was some indication of a real estate inclination.
Q: Did college prepare you for a business career?
A: My first year I went to Catawba College, a small school in western North Carolina, on a basketball scholarship. But, my dad got ill and I had to come home to Cleveland and support the family. So then I went to Baldwin-Wallace College in the suburbs of Cleveland. There was no more basketball, there was work. I had to be a contributing member of the family. I double majored in economics and political science.
Q: Why did you decide to go to law school?
A: It's been a long time. I can't remember why I went to law school.
Q: I bet you a lot of new lawyers say they can't remember why they went to law school.
A: When I first went to undergraduate school I was going to be a doctor; then I was going to be something else. By the time I graduated I was going to be a lawyer. Somehow it evolved.
Q: Does your law degree still come in handy?
A: To some extent it is a curse if you are the CEO and you are not the general counsel. Obviously with the legal training you probably look at things a little different and are more inclined to read documents or do things that have a legal imprint. I think my law experience was very helpful for my career.
Q: You've been working for decades. Do you still keep long hours?
A: I get up at 5:30 a.m. Because we have properties on the East Coast and the Southwest I am often on the phone in the car, because I can talk to those people while I am driving into the office. I get to the office by 6.30 a.m. and have a series of meetings in and out of the office. The day ends at 6.30 p.m. or 7 o'clock. My goal is to finish by 5:00 p.m. That's a typical day when I am in Los Angeles. We have properties across the country so I am often traveling to other cities. I fly about 300 hours a year.
Q: Do you like to reflect on your projects and savor them? After all, you can see the U.S. Bank Tower from your office window.
A: I don't know if I'm more reflective (than others) but I've been fortunate to have a lot of great opportunities. Saving the library, that is something that Rob (Maguire) and I are very proud of. We came up with the idea of transferring the air rights off the library site to build Library Tower and Gas Co. Tower because at the time there was a plan to tear down the central library and put high rise towers on it. It would have been a disaster for downtown. Now we have the beautiful library and these are the kinds of things that make a city.
Q: Do you feel civic leadership is a duty?
A: I don't know whether it's my duty. The thing I am really focused on right now the future of office development in particular and commercial development in general is green. All of our new development is green. I think that from an office viewpoint that is pretty well settled. All major new office buildings will be green; it is silly not to do it in my judgment. The big challenge is the existing buildings. To have any real impact you are going to have to deal with the existing buildings. That is a focus we have, how do you recycle existing buildings to make them green and energy efficient?
Q: What is your relationship like with Robert Maguire these days?
A: We are friends with a long business relationship. To some extent we are competitors. We aren't closer. When we were there (at Maguire Thomas Partners) our offices were side by side. We were probably together four hours a day for every eight hour work day. Now he has a big company to run and I have a big company to run. We occasionally see each other.
Q: As the former owner of the Sacramento Kings, are you still a Kings fan?
A: I think I'd be surprised if I cease to be a Kings fan. My wife is a great fan. She watches three or four games a night. When I come home the TV is on. One of the great things about being on the West Coast, the East Coast plays at 4 o'clock. By the time I've gotten home she's watched a couple games.
Q: Are there any parallels between owning a sports team and the real estate world?
A: It is a wholly different thing I think. In real estate I am used to negotiating deals. When I bought the team and had my first big contract negotiation I called up the agent and the way you do it is you get all the stats. So if it's a small forward you get the stats for all the small forwards. So I say, "OK this is what your player is making and this where your player falls. So if you are the No. 4 small forward (statistically) you should be paid between No. 3 and No. 5." The answer was, "Well, we are going to perform at the No. 2 level." I say, "But you haven't ever performed at the No. 2 level." So I bring a solution from the business world: "We will pay you at the No. 4 level and if you perform at the No. 2 level we will give you incentive compensation."
Q: How did that go over?
A: This negotiation was on the phone and there was dead silence and finally the agent says, "I have never been so embarrassed in my life that you would propose such a ridiculous idea." The thrust of the negotiation was: the player won't be happy if you pay him at the No. 4 slot. He's got to be paid to be happy. He doesn't want to have to perform to get it. The test is, are you happy. That is pretty hard to deal with.
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