The son of Texas billionaire and entrepreneur Ross Perot—the man who upended the 1991 presidential race with his unorthodox campaign—H. Ross Perot Jr. grew up at a time when north Texas was undeveloped, largely agricultural land, offering a blank canvas for the dreams of corporate visionaries. Every Sunday after church, his father would pile Perot Jr. and his four sisters into the family’s Lincoln and drive around Dallas, showing them the newest piece of land he had purchased and discussing his ambitions for it.
“That’s where I learned real estate from my father,” Perot recalled, sharing this memory and others from a storied life in business and real estate at a luncheon for ULI Foundation governors held in Dallas at the recent 2016 ULI Fall Meeting. Chairman and founder of Hillwood, a privately owned company that develops industrial, commercial, and residential real estate in the United States and Europe, Perot sat in conversation with ULI Foundation governor Clyde Jackson, cochair of the Fall Meeting sponsorship committee and chief executive officer of Wynne/Jackson.
While Perot Sr.—a legendary figure in American business and politics—never pushed his son into business, his decision-making and priorities clearly influenced his son. Perot watched his father build the corporate campus of Electronic Data Systems (EDS) from scratch, complete with an on-site daycare facility, gas station—critical during the 1973 Oil Embargo—golf course, country club, and tennis courts. “This was at a time when you really took care of your team,” Perot noted. After Perot Sr. sold EDS to General Motors for $2.4 billion in 1984, Perot Jr. expanded the family’s business into real estate investment and development, launching Hillwood in 1988.
One of Hillwood’s marquee developments, the 18,000-acre (7,300 ha), mixed-use AllianceTexas, was one of the highlighted projects at the Fall Meeting, with a sold-out tour of the campus and a concurrent session devoted to it. Perot credits the success of AllianceTexas to availability and affordability of land in north Texas as well as the pro-growth mind-set of the state’s political leadership. When Facebook wanted to build a $1 billion data center as part of the Alliance campus and was looking for tax incentives, Perot and others brokered the deal with Governor Greg Abbott and others in the middle of the legislative session.
“These guys had a lot going on, but they stopped in order to bring new jobs and companies into our state,” Perot said, describing this can-do attitude and ever-present optimism as the “foundation of the Texas spirit.”
Perot, who copiloted a helicopter that circumnavigated the world in 1982, is passionate about aviation. He pioneered the development of industrial airports with the Fort Worth Alliance Airport, built through a public/private partnership with the city of Fort Worth and the Federal Aviation Administration in 1989. While the initial proposal was for a modest municipal airport, Hillwood’s aviation clients expressed the need for state-of-the-art cargo and corporate aviation services and logistics facilities. “We helped the public sector build the airport, but we brought the private sector to the table,” Perot said. “Alliance evolved into an industrial airport concept because that is what the industry wanted in the marketplace.”
When asked to comment on the length of the current real estate cycle and what headwinds lay ahead, Perot lamented the widening gap between supply and demand for housing, worsened by labor shortages, lack of training in the construction trades, and tightness in construction lending. While banks may be choking housing supply, their reticence in lending in may have an upside: “It’s probably good the banks are holding back a little bit,” he said. “They’re making it hard to get construction loans. That’s hard, especially for Texas developers because if you give a Texas developer money, we’re going to build, build, and build. But the banks are kind of holding us back. And that’s good and should prolong this economic cycle.”