Illustration of Blake Hutcheson, chief executive officer of Oxford Properties Group Inc., the real estate arm of the Ontario Municipal Employees’ Retirement System.ANTHONY JENKINS/The Globe and Mail
I am meeting Blake Hutcheson, the CEO of Oxford Properties Group Inc., at his office for lunch, but as I walk up to the Bay Street tower a stream of people is rushing out and a guard shoos me away from the main doors.
The building, which is also home to the head office of the Royal Bank of Canada, is having a fire drill. When I reach his office, Mr. Hutcheson, 52, has just returned from outside.
Our lunch meeting is in his office, at his request, so I'm surprised he didn't just hunker down inside. But Mr. Hutcheson, who runs an organization that manages $27-billion of real estate assets, has an appreciation for all of the little things that go into making office towers, shopping malls and hotels work. And Oxford, as one of the owners of this landmark skyscraper in Toronto's financial district, runs the building. Besides, he says, participating in the fire drill is just the right thing to do.
Indeed, as we talk, I get the sense that Mr. Hutcheson never strays too far from the right thing to do.
That doesn't mean he won't take risks. Oxford was the first developer to publicly unveil plans for a potential $3-billion casino complex in the heart of Toronto, before the city had decided if it even wanted a casino.
But he won't press his agenda at any cost. As the casino debate heated up in the early months of this year, some of the players went to great lengths to lobby local politicians and influence public opinion. Not Oxford.
"I would say I'm very proud of the way we conducted ourselves," Mr. Hutcheson says. "We went out and said, 'If the city wants one, we're here with a catcher's mitt.'… We never weighed in on whether they should or shouldn't, and all the way we never said anything I regret."
Oxford's proposal would have seen the Metro Toronto Convention Centre, which the company bought in 2011, turned into "Oxford Place" in one of the largest urban redevelopment projects in North America. It would have included retail, office and residential space, and a revamped convention centre. But city council ultimately decided against allowing a casino.
Oxford has shelved its plans to redevelop the site for the time being. "But we're okay," Mr. Hutcheson says. "The main thing I really cared about is I just wanted to make sure we conducted ourselves professionally; it was a sensitive issue."
In some ways, Mr. Hutcheson was destined to run a real estate company. His first development project came at age 25, in his hometown of Huntsville, deep in the heart of Ontario's cottage country. He built a courthouse that his family still owns and leases to the province.
"I realized that you could get debt against value, as opposed to construction costs," says Mr. Hutcheson, who still hasn't had more than three bites of the grilled chicken, quinoa and salad we've been dining on. "And that you could actually borrow 100 per cent of the construction cost for a good development project. And I thought real estate was easy."
It spurred him to pursue a master's degree in real estate development at Columbia University in New York, where he was exposed to guest lecturers like Donald Trump and legendary developer William Zeckendorf. His best friend there was Mark McGoldrick, who would go on to earn the nickname Goldfinger at Goldman Sachs where, according to the Wall Street Journal, he "delivered a big chunk of the firm's 2006 profits."
After Columbia, Mr. Hutcheson and Mr. McGoldrick worked at a small development company that Canadian Imperial Bank of Commerce had started. Mr. McGoldrick left to go to Goldman, and Mr. Hutcheson left to join the real estate brokerage that would become CB Richard Ellis. He would eventually lead the Canadian and Latin American operations, with responsibility for 2,500 employees.
Fourteen years later, his old friend called with a new opportunity. Mr. McGoldrick had left Goldman and was looking to start a private equity firm called Mount Kellett. Mr. Hutcheson joined the venture, which launched in 2008, and began commuting from Toronto to New York to head up its real estate investments.
By this time, he was a family man, married to Susan Farrow Hutcheson, whom he had met during high school. ("I had a crush on her when I was at Upper Canada College, but she was always dating someone else and so was I, so I didn't really get a chance to capitalize on it until 1992," he says. "I took her out on one date and said, that's the mother of my children.") The couple had two children and commuting from Toronto to New York was taking its toll.
"I've been told I was Porter [Airlines'] best customer for two years," he says. "If I tried to get home for one of my kids' soccer games I'd literally fly home, go to a soccer game, get back on an airplane."
In 2008, the financial crisis wreaked havoc on the global economy and on the real estate business. Mr. Hutcheson was scouring the world for distressed properties while helping Mount Kellett set up offices in Mumbai, Hong Kong and London. "It became clear to me that I either move my family [to New York] and make that my life or get home," Mr. Hutcheson says. He took the top job at Oxford, the real estate arm of the Ontario Municipal Employees' Retirement System, one of Canada's largest pension funds, and started in early 2010.
When he took the helm at Oxford, OMERS was in the midst of a transition, shifting its asset mix from stocks and bonds to investments in real estate and infrastructure. That makes Oxford, and Mr. Hutcheson, increasingly important to the fund. It's also one of the more profitable units, posting a 16.9-per-cent return last year, while OMERS' portfolio of stocks and bonds generated a 7.5-per-cent return.
In the years since Mr. Hutcheson has taken the helm, Oxford's growth rate has been spectacular. In 2010, he set a goal of roughly doubling assets under management in five years, from about $16-billion to about $30-billion (that's $10-billion of equity, $10-billion of debt and $10-billion in partnerships). Two years later, it's already getting close.
Mr. Hutcheson made a splash in his first year, with the purchase of a 50-per-cent stake in Hudson Yards, a high-profile project on 26 acres in West Manhattan that includes office, retail, hotel, residential and school developments and will be the basis for a new neighbourhood near Midtown.
This year, it struck a prestigious deal with The Crown Estate, a British real estate company that manages the Windsor estate and other property of the Crown, to build a 260,000-square-foot office and retail complex in London's St. James's Market.
"We're changing cities," he says. His travel schedule continues to be punishing, with regular visits to New York, London and Paris.
It's a work ethic that seems bred in to him. Mr. Hutcheson's grandfather and his brothers turned their father's planing mill into a hardwood flooring company that employed hundreds of people in a town that, at the time, had a population in the thousands. His father built roads, farmed and sold beach volleyball sand that was used in the Olympics.
Mr. Hutcheson maintains close ties to his extended family, speaking to one of his older brothers, Scott, the CEO of Calgary-based Aspen Properties, nearly every day and to his father nearly as often. His sister lives a couple blocks away in Toronto.
As we chat, he pulls out his notes for a speech he's giving to some key employees the following day; it talks about character, honesty, integrity and ethics. It refers to a culture that is "a little bit Wall Street and a little bit Huntsville."
CURRICULUM VITAE
PERSONAL
Born in Huntsville, Ont.
On his brother Scott running the real estate firm Aspen Properties: "Oxford's bigger. And you can say that in the paper."
Married with two children, 14 and 16.
EDUCATION
Earned a BA in political science from University of Western Ontario.
Has a graduate diploma in international relations from the London School of Economics.
Earned a master's degree in real estate development from Columbia University.
CAREER
Worked for a CIBC development operation for five years.
Spent 14 years at CBRE, where he became head of Canadian and Latin American operations.
Was head of global real estate at Mount Kellet Capital Management.
Sat on various boards and commissions, and is currently on Ontario Premier Kathleen Wynne's transit investment strategy advisory panel.
HOBBIES
Played lacrosse his whole life; still returns to Huntsville a few times a year for tournaments.
Was a competitive ski racer.
Runs 10 to 15 miles a week.
"I love John Irving books. He married a distant cousin of mine. But my big thing is I read biographies."