One of Cushman & Wakefield's top executives is set to retire by year-end, making way for a new leader of what the global brokerage calls the fastest-growing business in the services sector, which includes managing apartments and single-family rentals.
Rick Graf plans to step down on Dec. 31 as president of U.S. multifamily asset services for Cushman & Wakefield. He is to be replaced by Woody Stone, who is now the executive managing director of national operations and client services for the Dallas-based multifamily division.
In his new leadership role, Stone will oversee about 4,700 employees throughout the country for Cushman & Wakefield, which is the third-largest U.S. apartment manager, with more than 172,000 units under management spanning more than 800 properties in 50 states and Washington, D.C., according to the National Multifamily Housing Council's 2022 top managers list.
The leadership transition has been in the works since before Chicago-based Cushman & Wakefield acquired Dallas-based Pinnacle Property Management Services LLC in early 2020 in a deal that gave the brokerage's multifamily management business a national reach. Graf led Pinnacle as its president and CEO for decades before the acquisition.
Graf is retiring after a 48-year career in the industry, including as a former professor of real estate in the Dallas County Community College District and serving as chairman of the National Apartment Association in 2021.
The beginning of the conversation about Graf's succession plan and bringing in Stone's expertise happened prior to the Cushman & Wakefield-Pinnacle deal and was a "very intentional process," said Marla Maloney, president of asset services for the Americas for Cushman & Wakefield, in an exclusive interview with CoStar News.
"It was a difficult transition during COVID, where we integrated the two firms virtually in March 2020 in a clumsy way when you are not able to meet in person, but we embraced change and challenged the status quo," Maloney told CoStar News. "It feels like one team today, and I sincerely mean it. We have made mistakes together, and we win together. This is the fastest-growing segment in the services business."
Stone, who has worked alongside Graf for 14 years, has been overseeing and helping the multifamily property management platform expand even as it confronts rising costs. In his new role, Stone will report directly to Maloney and provide oversight of the vision and long-term growth of the firm's multifamily asset services division while managing a spectrum of assets for major institutional clients throughout the United States.
The continued growth of this part of the real estate services firm's business is aided by the help of Cushman & Wakefield's capital markets team's deal flow, Maloney said.
"This is a people business and we have really hired some fantastic leaders with new ideas coming in," Maloney added.
One growing sector of the multifamily division is the single-family rental market, with Cushman & Wakefield offering property management to purpose-built rental properties ranging in size from 50 units to 200 units. Like apartments, Stone said, the burgeoning single-family rental part of the business follows national population migration trends with a focus on the Sun Belt and Midwest.
As the deal flow for trades has slowed this year, Stone said the team is staying focused on "strong market fundamentals." Even though housing affordability is top of mind for his team, Stone said the rent-to-income ratios don't seem out of balance yet.
"We hope to deliver the value and homes that make our residents feel like they are getting a value beyond the rate," Stone said, adding there have been hard conversations when residents are presented with double-digit rate increases on lease renewals. "We are focused on making sure we are providing a great living experience in great neighborhoods."
Meanwhile, Maloney said Graf set the bar high for success in multifamily management, serving as a "steady-handed leader" during the pandemic, bringing new measures, including touchless technology and self-guided tours to residents.
Graf began his real estate career in the Midwest, where he worked part-time as a teenager picking up trash and changing light bulbs at an apartment complex, he told an industry publication. Part of Graf's job at Cushman & Wakefield over the past few years has been building and retaining employees, from maintenance workers to on-site managers.
Graf said he has always approached the business as a builder, which is what his father and grandfather were in the development business.
"That ethos is incredibly important to building business and relationships," Graf said in a statement. "I am confident that Woody will continue leading and developing this platform with that core tenet."