When Roger Greenberg succeeded his uncle Irving as CEO of Minto Group in 1991, he knew running the family business was never going to be a one-person job.
Irving and his brothers Gilbert, Lorry and Louis founded Minto in 1955 and built it into the one of the city’s largest and most prominent real estate development companies. After Gilbert Greenberg, Roger’s father, died unexpectedly of a heart attack in 1980, Irving ruled the company with a firm hand for the next decade.
“Irving was an incredibly bright individual – the smartest guy I’ve ever met in my life,” Greenberg told a crowd of more than 100 on Thursday evening during a Q&A session at TD Place. “But he was also an extremely tough, tough, tough taskmaster. He did not suffer fools gladly.”
In a candid and often humorous one-hour talk hosted by the Toronto chapter of the Urban Land Institute, the 63-year-old real estate executive and partner in the Ottawa Sports and Entertainment Group discussed everything from the proposed redevelopment of LeBreton Flats to the Ottawa Redblacks’ thrilling Grey Cup victory in 2016.
He also shed light on arguably one of his biggest achievements as Minto’s boss – reorganizing the firm after Irving’s death to help pave the way for a second generation of Greenbergs to follow in his father and uncle’s footsteps.
Growing the family business
Irving Greenberg’s death from cancer in 1991 left Roger, then 35, in charge of a growing firm with far-flung operations in Ottawa, Toronto and south Florida. Although he’d worked closely with his uncle for several years, the younger Greenberg said he didn’t exactly feel like a well-groomed heir apparent.
“My biggest prerequisite to becoming the CEO of Minto at the time was … my last name,” he said, eliciting chuckles from the audience. “I had no training, no experience to be CEO. We had no succession plan.”
“My biggest prerequisite to becoming the CEO of Minto at the time was … my last name.”
Greenberg, who controlled his late father’s 50 per cent stake in the company, quickly realized he’d need support from the entire family to help Minto succeed in the next generation and beyond. A company that had held just one board meeting in the previous decade was soon scheduling regular shareholders’ meetings and providing detailed financial updates.
Greenberg told the audience that the most successful family businesses are the ones that make everyone feel like they have a stake in the business’s future by keeping family members informed and constantly grooming future generations of leaders.
“Unfortunately, you see these same stories being repeated – even this week – in family businesses, where family members are complaining about lack of knowledge, lack of access to information,” he said, making a veiled reference to auto parts magnate Frank Stronach’s lawsuit against his daughter Belinda.
“I went 180 degrees the other way. No one would ever be able to say that we did anything that they weren’t aware of.”
Deciding it was time to give the next generation more say over Minto’s future, Greenberg handed the CEO’s reins to former chief financial officer Michael Waters in 2013. Now the company’s executive chairman, he continues to help map out the firm’s long-term strategy while leaving its day-to-day operations to Waters, 48.
Succession by REIT
Succession planning was also at the top of the Greenberg family’s mind when Minto spun off its rental property holdings into a publicly traded real estate investment trust earlier this year. Minto Properties continues to own a majority stake in the new entity.
Greenberg said creating the Minto REIT serves two purposes: It provides capital for future growth and gives the Greenberg family the financial resources to cover the inevitable estate tax bills that will arrive once members of its second generation begin passing away.
“We borrow millions, if not hundreds of millions of dollars (to pay for future real estate projects),” he explained. “We don’t have cash sitting around. So if one of the shareholders, when the first one passes away, has a big tax bill to pay, how are we going to pay it?
“The REIT was an opportunity to try to deal with two issues at the same time.”
Responding to questions from the audience, Greenberg later addressed other issues, including the proposal to redevelop LeBreton Flats.
“I’m happy that it’s being done,” he said. “It’ll certainly add a lot of rejuvenation to the downtown core. I hope it happens sooner than later.”
One of LeBreton’s key financial backers is John Ruddy, the executive chairman of the Trinity Development Group and a partner in OSEG. Ruddy was slated to join Greenberg on stage Thursday, but his flight from Toronto was cancelled due to fog at the Ottawa airport.
A non-profit organization devoted to urban planning issues, the Urban Land Institute plans to launch an Ottawa chapter by next year. ULI officials say about 70 people have already signed up to be members of the national capital branch.