One-on-One
BY LORNA PAPPAS
All the Right Moves
From shifting industries to forming partnerships,
Phil Hawkins creates opportunities for DCT
He’s lived in seven cities and worked for three very different
companies, but strong, long-term relationships have tied the
elements of Phil Hawkins’ eclectic background together.
From the bonds he nurtures today as CEO of DCT
Industrial Trust (NYSE: DCT) to the two professional
associations that most shaped his career moves, to the childhood friendships he still maintains—not to mention the
hometown sports teams he’ll see through thick and thin—
Hawkins is driven by deep allegiances and relationships that
he believes are critical to his success, as
well as his professional enjoyment.
Hawkins says the value of the connections he’s fostered with peers, employees,
investors, analysts, capital sources, brokers
and even competitors are key to helping
move DCT, an industrial property REIT,
out of the credit crunch and into new
market opportunities.
Here’s what Hawkins tells Portfolio
about DCT and the relationships that
helped shape his career.
people at all depths of the organization, most of whom
have experienced and learned from previous market cycles.
CLOSE UP
Portfolio: Please give us a quick snapshot
of DCT.
Hawkins: The first three things I think
about are our business model, financial
strength and our people.
DCT’s business model is easy to
understand: we own, operate and develop
high-quality bulk distribution and light
industrial properties in high-volume distribution markets. We’ve got approximately
75 million square feet of assets leased to
about 850 customers, including 15 million
square feet managed on behalf of three
institutional joint venture partners.
We’ve got a strong balance sheet with
relatively low debt maturity over the next
two years. We have a strong team of
Portfolio: How is DCT meeting the challenges of
what has become one of the most severe downturns our
industry has faced?
Hawkins: DCT started preparing at the top of this cycle
with a conservative operating strategy. From a leasing stand-
point, we started focusing aggressively on occupancy rather
than rates. We also decreased our exposure
to development, slowing the pipeline long
before it was common in the industry to
do so. In 2007, we began selling some
properties for, especially in hindsight,
very attractive cap rates.
We further preserved capital and
increased long-term value by reducing
our annualized dividend in the fourth
quarter of 2008.
We continue to recycle capital by actively
selling stabilized, lower growth and/or nonstrategic assets to generate funds for higher
growth opportunities. By the close of the
fourth quarter of 2008, we sold 16 assets for
a total sales price of more than $140 million,
which generated cash to strengthen the balance sheet and deploy in the higher return
activities we believe the market will present.
To facilitate our goal of being a profitable, value-added, successful company, we
will continue to co-invest with third-party
institutional capital entities in traditional
core investment, as well as in more risk-oriented, value-add and development
investments, such as distressed sales and
under-leased or over-leveraged properties.
S TEPHEN COLLECTOR
AGE: 53
EDUCATION: Bachelor of Arts
in Economics, Hamilton College;
MBA, University of Chicago
FAMILY: Wife, son and daughter
HOBBIES: Anything outdoors,
especially hiking, biking, skiing,
snowshoeing, sailing and golf
FAVORITE SPORTS TEAMS:
Minnesota Twins and
Minnesota Vikings
FAVORITE VACATION SPOTS:
Colorado, and his lake house in
New Hampshire
PROFESSIONAL ACTIVITIES:
Director of SBA Communications
Corporation; NAREIT Board
of Governors; member of
Urban Land Institute
FAVORITE BOOKS: “Team of
Rivals: The Political Genius of
Abraham Lincoln” by Doris
Kearns Goodwin and “The
Greatest Game Ever Played”
by Mark Frost
FAVORITE MOVIE: “Miracle”
Portfolio: You previously served as president and COO of CarrAmerica, an office
