Many see twin developers as great asset to city, but some wonder if they've taken on too much.
DEENA WINTER / Lincoln Journal Star | Posted: Saturday, September 6, 2008 7:00 pm
Whizzer and Rip are at it again.
Will “Whizzer” and Robert “Rip” Scott are working the crowd in the clubhouse at Memorial Stadium, where Lincolnites were invited to learn more about the city’s proposal to build an arena and other amenities that could cost up to $300 million.
Normally, the identical twins are indistinguishable, with their spiked, sun-kissed brown hair, relentless smiles and sharp suits. Now they’re easier to tell apart than usual, because Robert has his left arm in a sling under a casual shirt.
Will is happy to explain: Robert was doing wheelies on a bike on the way to the first Husker game. He crashed with his shoes still clamped into the pedals, dislocated his shoulder and spent the game in the ER.
That’s going to cut into Robert’s golf game, Will says gleefully.
They’ve had a friendly rivalry going since Will came out of the womb one minute before Robert, 36 years ago.
But tonight, the Scott twins are very much on the same team — a team that’s trying to convince the citizens of Lincoln to build an arena in the Haymarket.
Chosen by the city to help develop offices, restaurants and condos near the arena, a team led by the Scotts’ development company was selected in part for their charisma, energy and ideas.
And so from now until the spring election, when voters will be asked to build a new arena, the city will rely on these two to help sell its vision.
But some developers and city officials question whether the Scotts can deliver all they have promised and planned.
Just a half dozen years after they started their development company, they own and manage more than 35 commercial buildings and are involved in more than $150 million worth of new projects in eastern Nebraska and Colorado.
Their role in the arena project could easily double that figure.
However, their tardiness on a northeast Lincoln project they partnered with the city on has some city officials questioning whether they’ve taken on too much, too soon.
Left brain, right brain
Growing up west of Denver in Lakewood, Colo., everything was a competition to Will and Robert: Who could get to the bathroom first in the morning? Who could get the last of the cereal?
When they were in the womb, the egg split later than normal, making them mirror images: Robert’s right-handed and Will’s left-handed. The whorls in their hair swirl in opposite directions. They have mirror-image fingerprints.
That’s why when they built a new Haymarket headquarters for their real estate development company, they split a corner office and put a mirror on the door between their offices. The equally divided office ensured neither got more room than the other.
“Who has the better view? I do,” Will deadpans.
For all their similarities and closeness, they have different approaches. Robert is a methodical planner, Will more of a big-picture real estate guy.
“The two of them together are really the whole package: The left brain and the right brain,” said the former head of the Downtown Lincoln Association, Polly McMullen.
They were nicknamed Whizzer and Rip by their mother because they whizzed and ripped around like terrors as boys.
They’d always been familiar with Lincoln because their maternal grandmother, Anne Porter, grew up in Lincoln and graduated from the University of Nebraska-Lincoln. She and her husband, William Porter, retired to Lincoln. That family connection led them to UNL in 1990.
Untapped potential
Even as college students, the brothers saw untapped potential in Lincoln.
They’d watched Denver’s downtown birthplace transform from a slum to the trendy historic LoDo district it is today. They saw parallels to Lincoln’s historic buildings — some of them empty or used for storage — and the desolate rail yard west of the Haymarket, Lincoln’s own birthplace.
After college, Will moved to Des Moines and began a real estate career working for The Principal Financial Group, covering the East Coast. Robert stayed in Lincoln to work for the family’s agriculture investment management company. Will says the family has had “a quarter here and there” of farmland in Nebraska and Colorado for 25 to 30 years.
And then in 1998, their older sister, Katherine “Kit” Scott, died at age 28. While in Buenos Aires, Argentina, on business, she had an asthma attack. She’d never been properly diagnosed with asthma, they say.
The three had long talked about going into business. Kit, they say, was “the brains of the operation,” but now she was gone.
Her death changed their perspective.
“We kind of dug deep and tried to think about what’s most important to us, who we were,” Will says, “knowing life is precious.”
Will moved back to Lincoln, worked for real estate development company Speedway Properties for a few years, and then he and Robert formed their own development company called WRK.
“W” for Will, “R” for Robert, and “K” for Kit.
But the name also stood for “work.”
“You can work for your community,” Robert says.
Chasing possibilities
They see Lincoln becoming as vibrant as Boulder, as colorful as Austin.
“It’s a great place, but it could be a wonderful place,” Will says. “It’s kind of fun to chase those possibilities.”
They say they chose to invest in Lincoln because they thought they could have an impact on the city.
“We’ve made a huge commitment to this community,” Will says.
Their return also was helped by the fact that they both married “smart, strong-willed” Nebraska women.
Will and his wife Tracy have two children and live on Sheridan Boulevard; Robert and his wife Becky are expecting their first child in January and are renovating a home a snowball’s throw down the street.
Just a few years after forming their company, the WRK logo is stamped on many signs in downtown Lincoln, and the Scotts are becoming known for renovating historic buildings that retain or re-use the original materials, but add contemporary touches.
“The charm and character in old buildings is not something you can recreate,” Will says.
The company has grown quickly to eight employees — many of them Nebraska natives lured from more exotic locales.
They have a lot in the works:
* A large housing and commercial development in Ashland called Whitetail Run, which hasn’t broken ground yet.
* A 155-acre development anchored by a new hospital in Beatrice.
* A plan to redevelop historic buildings on more than two city blocks in the Haymarket and south of the Haymarket.
* They believe their Block 85 project — the renovation of three historic buildings and construction of a fourth south of the Haymarket — may be the first LEED-certified platinum (the highest level eco-friendly designation) renovation of a turn-of-the-century building in the country.
What have they done so far?:
* They converted the old Greyhound bus station at 10th and P into a bank.
* They partnered with the National Arbor Day Foundation to redevelop the former Plaza 4 Theatre into a contemporary building with leaves imprinted on the outside grating and stamped into the sidewalk.
* They partnered with the city to convert an old telephone switching station into a police station in northeast Lincoln, near 49th Street and Huntington Avenue.
* They prepared the “ugly and tired” Lind Building at 12th and P streets for a tenant.
As if those weren’t enough, they recently expressed interest in developing the University of Nebraska-Lincoln’s planned research and development corridor, Innovation Park.
Too much, too soon?
Privately, some city officials, developers and economic development boosters question whether WRK has too much going on.
One major project WRK was supposed to develop is now in limbo. In April, Gallup announced $13 million plans for an expansion in Lincoln; WRK owns a minority interest in one of the buildings and was to be the developer.
But on Friday, Ken Mar, corporate treasurer for Gallup, said, “Right now we’re kind of in a holding pattern.” The reason, he said, was “nothing that we want to make public.” He would not comment on WRK’s status with the project.
Asked about the project, Will says, “It’s not going in the direction I want it to go. I hope it’s not dead.”
Councilman Jon Camp has publicly implied WRK may have too much going on, noting in an interview that “their name is appearing everywhere.”
“They keep building up,” Camp says. “I keep thinking, ‘Why don’t they finish what they start?’”
He voted against their proposal to redevelop a Haymarket block into a boutique hotel and arts center because they’re behind schedule on a promised mixed-use building near the police station they developed in northeast Lincoln. WRK broke ground on the project Friday, two months after Camp’s public rebuke.
Camp dismisses the suggestion he’s threatened by the new kids in the Haymarket District, where he was a pioneering developer and owns eight buildings. He says he’s just looking out for taxpayers’ interests.
“I have nothing but something to gain by having more people invest in Haymarket,” he said. “I have my plate full. I don’t have competition; I’m just trying to keep my properties up.”
But he also takes swipes at the Scotts, suggesting they haven’t actually completed many projects.
“I’m just saying, ‘What have you done?’” he says. “Arbor Day (building) is sitting empty.”
The Arbor Day Foundation is the primary tenant in a building at 12th and P streets, but the retail spaces are vacant.
Will and Robert Scott say they’re trying to take the “high road” when it comes to Camp’s criticism.
“We welcome constructive criticism and choose to ignore criticism that appears to be driven by agenda,” Will says.
The former Downtown Lincoln Association head, McMullen, says she’s surprised Camp is so critical of people who are following in his footsteps.
“I’m disappointed to hear it, because Jon, in his day, took on some amazing, daunting redevelopment projects in the Haymarket. I would think he’d be as pleased as I am to see that a new generation of talented developers has come along and is willing to do the same thing.”
But Camp isn’t the only one who has questioned WRK. Councilwoman Robin Eschliman also publicly chided WRK for their tardiness on the police station project.
She first met Will about eight years ago, when the two real estate brokers worked to lure technology companies downtown with a tour of buildings.
“We were such renegades,” Eschliman says. “At the time, nobody had done anything like that.”
She says WRK has done good work but says, on the police station deal, WRK got a government lease at above-market rental rates because the company agreed to take the “huge risk” of developing office and retail in the low-rent University Place neighborhood.
If WRK doesn’t follow through with their end of the deal, it becomes a sweetheart deal, she said.
And she, too, wonders whether they can deliver on all their promises.
“The biggest concern I’ve had about Will and Robert is just don’t take on too much.”
Not on their own
WRK attributes the delay in the police station project to turmoil in the capital markets, low rents in the area and skyrocketing construction costs.
“We don’t ever settle,” Will says. “If we’ve got to do something halfway, we choose not to do it.”
Will admits he never imagined they’d be taking on this much work so soon, but says a lot of development work is done on the front end and they have the help of partners.
Some people wonder how they’re able to pull off all their projects financially. The Scotts credit their “tremendous lender partners.” Robert says people need to realize they’re developers: they put projects together and make sure they work, but they’re not out doing the digging and building.
They also appear to have some family resources.
Robert, Will and their mother, Jean Jennings, are officers in a nonprofit foundation their grandparents established, the Anne and William Porter Foundation. Although Will calls the foundation “a tiny little thing” that they’d like to “ramp up,” it reported $3.3 million in assets last year, according to IRS forms.
The records indicate the foundation has invested in WRK in recent years and made thousands of dollars in contributions to local groups such as the Arbor Day Foundation, Downtown Lincoln Association and UNL Alumni Association.
Tanning salons, coffee shops and bars
Critics like Camp wonder about all the vacancies in WRK buildings, like the Lind Building and empty retail slots in the Arbor Day building.
But WRK says it doesn’t just take any tenant. They try not to duplicate existing downtown businesses and try to stay true to the Downtown Master Plan, so they’ve turned away tanning salons, coffee shops and bars on P Street, for example.
They also don’t want tenants to cycle in and out of their buildings and won’t take a tenant unless they know they can succeed in the space, they say.
They’ve purchased a piece of property on every block of P Street from 11th to 15th streets, and held onto some for more than five years while waiting for the right tenants.
“We’re taking a risk and we’ve turned down the fast bucks,” Robert says. “We’ve turned down probably 10 users.”
Their commitment to eco-friendly construction attracted Devon Seacrest to the company. The son of prominent development attorney Kent Seacrest returned to Lincoln three years ago after attending high school in New York and college in Seattle.
He says WRK tries to improve the community through long-term investment strategies.
“It’s nice to work for two guys that don’t make every single decision based on money,” Seacrest said. “There are other important things. There’s a lot of projects we’ve done … that haven’t made a lot of money and could’ve lost a lot of money.”
Their project director, Josh Berger, says the Scotts are eternal optimists.
“Everybody thinks that they’re these super-rich guys and they have a front to try to get what they want,” Berger says.
“But the reality is, they’re the two most genuine guys I know. They will talk to Chancellor (Harvey) Perlman with the same tone, the same respect as a guy pouring concrete in front of their building.”
Taking a ‘huge risk’
Lincoln developer Kent Thompson says he doesn’t see much value in investing in downtown — which he thinks has been artificially propped up by city subsidies — and thinks the Scotts are taking a “huge risk.”
He says it’s still a “huge question” whether they can pull it off, but if the Scotts’ instincts are on target, they could reap “tremendous rewards.”
“They’re brave guys,” he says.
And Will learned a lot about financing and underwriting, Thompson says.
“Will is a very capable guy,” he says. “He could do a lot of things in real estate. … He has two strong attributes: He has a lot of cash (and) his timing is fabulous.”
And Thompson says their partner in the arena-related venture is a smart one: Former Husker All-American offensive lineman Zach Wiegert. After a dozen years in the NFL, the Fremont native became Midwest representative for Utah-based real estate development company Woodbury Corp.
Woodbury owns and controls more than $1 billion worth of commercial buildings, with more than 8 million square feet of retail, industrial, office and hotels in seven western states.
Woodbury and WRK are equal partners on the arena-related development. Wiegert said Woodbury has relationships with all kinds of retailers nationwide.
“We have more than enough capabilities to get these projects done,” Wiegert says. “They’re not in it alone.”
The Scott twins were acquaintances of Wiegert’s during college.
“They have a real loyalty to Lincoln,” Wiegert says. “People in Lincoln should feel fortunate to have them. They’re good guys.”
‘A blessing to the city’
McMullen — who is now retired and living in California — first met Robert when he served on a fraternity board with her husband, Bruce. Robert was just out of college when her husband fell ill.
“He was so generous and thoughtful to my husband,” McMullen said. “When he couldn’t drive, he’d pick him up for meetings. Or have a meeting that was convenient. Bruce thought the world of Robert.”
Her husband died the week before Christmas in 2000. She asked Robert to speak at his funeral.
A few years later, Robert and Will came to McMullen when they were thinking about starting their development company.
“They were very excited about downtown and about Haymarket,” she said. “They verbalized doing exactly what they’ve been doing.”
She said she’s met developers all over the country, and the Scotts “stack up with the best of those.”
“In my 10 years at DLA, those two starting their development firm was one of the most exciting things that happened,” she said. “In my view, any city in the Midwest would kill to have two young guys like this doing what they’re doing.”
Indeed, they’ve been contacted by other communities and they’re considering projects in Colorado and Arizona.
McMullen likens them to the brother-sister duo from a small Iowa town, Todd Heistand and Tammy Barrett, who founded NuStyle, a company that helped revitalize Omaha’s downtown.
“I think the Scotts are that good,” McMullen says.
She believes the Scotts could help mold Lincoln into “the kind of city everybody talks about,” like Madison, Wis.
“The ingredients are definitely coming together for Lincoln,” she said. “I think the Scotts can be a big piece of that. I think they’re a blessing to the city. They are the right people for this time.”
Reach Deena Winter at 473-2642 or dwinter@journalstar.com.