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On Leadership: Ryan Witges
The president of Agracel, Inc. shares his Illinois-based firm’s successes and insights into industrial development in the Midwest, South and Southeast over the next few years.
Development: Tell our audience about Agracel.
Ryan Witges: We are an industrial real estate investor and ground-up industrial development company with a focus on manufacturing in rural America. Our core business is build-to-suits, expansions and acquisitions. We own properties in more than 20 markets throughout the Midwest, South and Southeast. We are active in the capital markets and constantly look for buildings that can be purchased well below replacement cost, whether vacant or leased. With inflation taking off, we find there is good value to be had in existing properties.
Ryan Witges
Because we work in all areas of industrial development, we are extremely agile. Depending on what is going on in the marketplace, we can quickly move into ground-up development, or in times when there is less new construction, we can focus on acquisitions. We are a relatively small company with fewer than 30 employees, so we can make decisions and pivot quickly. That is the key to our continuing growth and success.
Development: The company started out working in small towns and cities. Could you talk about that?
Witges: Agracel was established in 1986. Our headquarters is in Effingham, Illinois, population 12,221. We enjoy working in rural America, and we are a strong partner to the communities we serve. As a real estate developer, we are a resource for these communities. We want to be the first call that officials make when they need real estate expertise. At the same time, we don’t shy away from bigger markets.
Development: What drew you to a career in commercial real estate?
Witges: When I was young, I loved to play baseball. I went to college on a baseball scholarship and played a couple of years at a community college in southern Illinois and two years at Indiana State University. I majored in business management, however, because I knew I wouldn’t play major league ball. During my junior and senior years in college, I got a job working for Agracel as an intern. After graduating from college, I was fortunate to be offered a full-time position. That was 2006. Over time, I grew to love commercial real estate and Agracel. Real estate makes the world go around, and I cannot imagine doing anything else.
Development: Agracel now has multiple offices in the Southeast, the Gulf Coast states, Nashville and the Ohio Valley region. As you add new offices and new people, how do you maintain the strong and motivated company culture you and your predecessors have built?
Witges: It is a challenge to maintain company culture. We are in constant communication with our satellite offices. We make frequent visits and encourage them to come back to the Effingham headquarters as often as possible. While our people are incredibly busy with work, many of our employees are at that stage of life where they have young children and children in school. We encourage a healthy work-life balance at Agracel, which our employees appreciate. We want people to take off time to attend their children’s events, whether school or athletic related. We stress the importance of taking a vacation because we do not want our team to get burned out.
Development: What does leadership look like to you?
Witges: I lead by example. I am not big on speeches or micromanagement. We hire hardworking, talented people, provide them with the resources they need to succeed, then let them go to work.
Development: What is your primary role as president of Agracel?
Witges: Until the end of 2023, I held the title of chief operating officer and president. We promoted Mark Keller, who has been with us as director of construction for almost 10 years, to COO. In my position, I am still involved in deal flow, and one of my main duties is to make sure that our projects are progressing as they should. Another part of my role is banking and investor relationships. I keep a thumb on the pulse of the company, with a focus on short- and long-term strategy.
Development: What qualities do you look for when hiring senior staff?
Witges: Our approach is to promote from within. That way, we know what we are getting. We want self-starters and highly motivated people. We get both by hiring from within.
Development: Since the retirement of Jack Schultz, the former president of Agracel, and your assumption of that position, what has been your greatest leadership challenge?
Witges: I have been very fortunate. In addition to Jack Schultz, I worked with Dean Bingham, who continues as our CEO. I have Dean’s ear, his advice and his leadership to help us make big decisions. COVID was a big challenge for us because no one knew what to expect. But we stayed active in the market through the pandemic and, in fact, had some of our most successful years during that period.
Other major challenges have included rising interest rates, the increasing cost of construction, longer lead times and supply chain disruptions. Fortunately, Team Agracel has risen to the challenge successfully.
Development: When internal conflicts arise or mistakes are made, how are they handled at the company?
Witges: For us, the best way to handle conflicts or mistakes is to meet them head-on and resolve them. Bad news travels fast, so we want to get ahead of it, have a discussion, resolve the issue and move forward.
Development: What is your outlook for commercial real estate over the next three to five years in your markets?
Witges: We are very bullish. We follow several different indexes, and we feel very strongly about manufacturing in the United States, specifically in the Midwest, South and Southeast. From 2013 through 2017, we averaged about $50 million in new construction and acquisitions annually. From 2018 through 2023, we averaged about $100 million annually. Looking ahead, we want to bring our annual volume to a whole new level.
Development: What has been the best advice you have received during your years in the commercial real estate business?
Witges: The top people at this company, Jack and Dean, shared with me early on the importance of personally investing in industrial real estate — an opportunity I have taken whenever possible. The employees of Agracel are very fortunate because we are now an ESOP (employee stock ownership plan), thanks to Jack Schultz. Jack had the vision to make everyone in the company a millionaire, and that plan is in motion through the ESOP, which gives employees an ownership stake in the company. Twelve percent of the company is owned by the ESOP, and that will grow in the future. Jack knew what investing in industrial real estate had done for him and his family, and he wanted to share that with employees at the company. In addition, we offer additional avenues for our employees to invest in our projects. In most cases, we have 100% participation.
Development: What advice would you offer to a new person coming into the business today?
Witges: Make sure you listen and learn and take advantage of the resources at your disposal. Start investing in real estate as soon as possible. Relationships are key, and everyone is in a sales position.
Development: Jack Schultz and Agracel have been great friends to NAIOP over the years. Has NAIOP in return helped you advance your real estate career or helped you hone your leadership skills?
Witges: Both Dean and I are involved in the NAIOP National Forums program. It is a diverse group of individuals from across the country. We share best practices and growing pains, and we learn from each other. NAIOP has been extremely helpful to our company, and we encourage everyone to get involved in NAIOP.
Development: Being president of Agracel is a demanding job. How do you relax in your time away from work?
Witges: Family is important to me. My kids are very active, and my wife and I spend a lot of time at sporting events, some of which we coach. We also love to travel, spending time outdoors at the pool, lake, beach and mountains, and generally just being active. Snow skiing and mountain biking with the entire family and riding dirt bikes with my boys are all great resets.
Ron Derven is a contributing editor to Development magazine.
