Successful local businessman, John A. Dermody, brought his family to Reno, NV, in 1950, when he was offered the regional franchise for the Philco Appliance Company. By 1960, he had sold the appliance business, but kept the building, became a landlord, and turned his attention to warehousing and distribution. From this modest beginning sprang a regional distribution hub. By 1960, John, a charismatic salesman, attracted the first New York Stock Exchange company, Bigelow Carpet, to Reno/Sparks. The Reno/Sparks area's close proximity to California (the eighth largest economy in the world) and its central location in the Western United States, quickly made it a leading hub for West Coast distribution.
Michael Dermody, a graduate of the Gonzaga School of Law, joined his father's two-man company, John A. Dermody, Inc. - already the preeminent industrial developer in the region. Michael and his father would work together for more than 30 years.
Quickly recognizing that the best way to grow the business was through great customer service, Michael began to vertically integrate the company, and as a result formed United Construction Company and D&D Roofing with key partners who were as committed to quality and customer service as he was. As Michael would say, "The two biggest problems that you can have in a building are the floor and the roof." Michael and partner Tony Taormina formed what would become one of the largest industrial construction companies in Nevada when they created United Construction Company (UCC). The company gained tighter control over product quality and delivery for Dermody Properties/DP Partners customers. UCC and Dermody Properties/DP Partners have been partners for more than 35 years and still provide outstanding customer service. As Tony Taormina says, "It’s where the promises are kept."
The company developed its first speculative building, in addition to its already-successful build-to-suit (BTS) business. This platform was the beginning of what would become a long history of BTS and speculative development through prudent market selection, timing and conservative judgment, a strategy that would be seen again and again in the years to come.
As the company grew and diversified, Michael Dermody became President and CEO, and its name was changed to Dermody Properties.
Vertical integration continued, providing opportunities to assist clients with financing, construction, development, and leasing under one roof. After the recession of 1981, with fewer developers in the market, the company emerged with a 50% increase in market share and a more diverse portfolio, made possible through its innovative approach of one-stop shopping for clients. Dermody could provide “under one roof” leasing services, land control, financing and construction. This model would eventually be followed by other developers nationally.
The company built its corporate headquarters based upon unparalleled customer service and one-stop shopping under one roof. At the same time it developed its first master-planned business park on 200 acres acquired from the University of Nevada, Reno.
The company officially formed the Dermody Properties/DP Partners Foundation, to put into place the structure and the process to give back to the communities in which it does business. The Foundation was funded by the profits generated by the hard work and dedication of all employees at Dermody Properties/DP Partners, and in fact, funding decisions are still made by a committee of employees each year. With a focus on the arts, education, and family, as well as a special emphasis on children and the elderly, the employee-managed Foundation provides on average more than $100,000 in donations per year to various organizations, and has in its first 10 years of operation, donated more than $2 million in funds to more than 230 worthy non-profit organizations and community causes.
In an effort to grow a family business and provide even better customer service, Michael steered the company into a long-term partnership with the California Public Employees’ Retirement System (CalPERS), the largest public pension plan in the country. This unique general partnership was ahead of its time, for a modest, private development company like Dermody Properties/DP Partners, to partner with a large public pension fund. This partnership with CalPERS consistently earned above average industry returns for the 14 plus years it existed.
As Dermody Properties/DP Partners expanded its national presence, it would form additional financial platforms with other major partners, including the California State Teachers Retirement Fund (CalSTRS), and Lazard Frères & Co. These institutional partnerships would become the springboard for the expansive growth that would occur during the 1990s and early part of the next century by bringing flexible financing options to match the ever-changing needs of its real estate clients. Clients appreciated Dermody’s creativity and this in turn sustained many long term relationships still enjoyed by the company today.
Dermody Properties/DP Partners, like many in its industry, investigated the option of going public. However, consistent with its philosophy, it chose to maintain its high level of customer service as an entrepreneurial, privately-held development company.
In a rebounding economy, Dermody Properties/DP Partners had by this time, developed major distribution facilities on the West Coast, the Midwest and in the Mid-Atlantic, thereby being able to serve customers nationwide. Dermody Properties/DP Partners hit its stride of developing 3 million square feet per year. One of its long-time clients, Owen Distribution Company (ODC), grew into a large national third party logistics company. It expanded across the country, and of course, its landlord and partner in success was Dermody Properties/DP Partners.
Dermody Properties aligned with financial leader Lazard Frères & Co to grow its coast-to-coast industry platform. At the same time, the company created an additional brand to reflect this nationwide expansion, DP Partners. DP Partners has become well known, eventually becoming recognized as one of the largest private development firms in the nation.
Dermody Properties/DP Partners created a new platform and formed its partnership with the California State Teachers Retirement System (CalSTRS). CalSTRS, already an investor in the Lazard Frères Opportunity Fund, wanted to create its own national industrial portfolio and, of course turned to Dermody Properties/DP Partners. At that time, it was the largest real estate transaction done in the history of CalSTRS. This powerful partnership would grow to a portfolio of 25 million square feet.
Understanding that the flow of logistics is the core of quality industrial development, Dermody created the LogistiCenter brand. It represents the essence of quality distribution, where infrastructure, demand and customers meet. Today, LogistiCenter is a national brand, a registered trademark, owned and developed by Dermody Properties/DP Partners. It represents the company’s business philosophy for meeting Corporate America’s supply-chain requirements for Class A industrial distribution facilities, including warehouses, manufacturing, assembly, processing, and research and development.
Continuing its pattern of creative real estate solutions, Dermody formed an innovative joint venture with the village of Sauk Village, IL. Today it is the 325-acre LogistiCenter at Sauk Village industrial park providing over 1.5 million square feet to its customers.
Dermody Properties/DP Partners again makes national news when it sells its portfolio of 25 million square feet to ProLogis (NYSE: PLD). This transaction, in retrospect, would be especially significant in real estate history, given the unanticipated national economic recession that would begin within a few months after the event.
Never content to rest on its laurels, the Dermody team retained 500 plus acres of land from its portfolio and continued development to serve its customers. The 518 acres of entitled, development-ready land would become the foundation of its new growth in the future. The organization pursued a more flexible, entrepreneurial style of development. Four of Dermody Propterties/DP Partners' offices in Portland, OR, Reno, NV, Chicago, IL, and Philadelphia, PA became headquarters for the company’s Northwestern, Western, Midwestern and Eastern Regions, respectively, to manage national portfolio and development efforts.
Dermody creates a joint venture with the financial firm, Great Point Investors, LLC, who is advisor for Ohio Public Employees Retirement System (OPERS). This development, centered around LogistiCenter at Logan, in New Jersey, has created a number of successful leaseholds and real estate transactions, as evidenced by the 2010 sale of a 600,000 plus square foot building occupied by Kimberly-Clark.
Dermody Properties/DP Partners creates its annual Thanksgiving Capstone Gift. Responding to the even greater needs of families in difficult times, the program provides a major gift to a non-profit organization each year during the season of giving thanks. Recipients are determined by the company’s executive management team. The first year’s gift was $250,000 to the Food Bank of Northern Nevada. Each year since it has provided a major financial gift to a very effective – and deserving – non-profit.
Partnerships with local governments, financial organizations, economic development organizations and others continue to expand, benefiting all involved in each alliance. More than ever, the challenging economic times demand unsurpassed customer focus and the Dermody team’s 35-plus year history of excellent customer service has created a foundation on which to go forward. Today, the portfolio has a 90 percent occupancy rate, and continues to build relationships a handshake at a time.
Douglas A. Kiersey, Jr. joins Dermody Properties as president of the firm, with the responsibility of managing the company's capital, acquisition, development and property management activities nationwide. Mr. Kiersey joins Dermody Properties after 27 years in the industrial development industry with extensive experience in 14 major U.S. markets.