John C. Goff: Real estate, investments lead to success in varied career

John Goff

John C. Goff

Business Executive of the Year

For 49 years, Texas Wesleyan University has presented the Business Executive of the Year. The Fort Worth Chamber of Commerce and the Fort Worth Business Press are partners in the award presentation.

“John Goff is an outstanding business leader who has made an incredible mark on the Fort Worth community and beyond,” Texas Wesleyan President Frederick G. Slabach said. “His business sense and keen understanding of real estate and investing make him most deserving of this prestigious award. It truly is our honor to recognize him and celebrate his accomplishments with the Business Hall of Fame.”

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The event supports the Thomas H. Law scholarship program benefitting business students at Texas Wesleyan.

The most important lesson John C. Goff learned from his long and successful career in real estate and investing is that timing matters. A lot.

“Timing trumps everything in business,” said Goff, the 2018 Fort Worth Business Executive of the Year.

As chairman and CEO of Crescent Real Estate and president of Fort Worth-based Goff Capital Inc., Goff presides over a business empire amassed through diligent planning and impeccable timing.

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Goff’s crowning achievement, the move that cemented his reputation as a pillar of the commercial real estate world, was his decision to sell Crescent’s portfolio of 54 office buildings just ahead of the Great Recession.

Goff had no way of knowing that a financial meltdown was imminent but he sensed that something was brewing in 2007. Relying on his instincts, Goff chose to sell the REIT that he and investor Richard Rainwater had established with an initial public offering 13 years earlier. Morgan Stanley paid $6.5 billion for Crescent’s portfolio in 2007, which turned out to be the peak of the real estate market. Goff walked away with a tidy profit just ahead of the Great Recession and the collapse of real estate and financial markets.

Then two years later, Goff was unexpectedly approached by Barclays Capital, a lender to Morgan Stanley for the Crescent purchase, to form a partnership that would allow him to buy back devalued Crescent assets and help Barclays recoup some of its loss.

With the Barclays financial obligations resolved, the partnership ended last year and Crescent Real Estate returned to Goff’s control.

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This episode is the defining achievement of Goff’s career.

“The entire Crescent story, from sketching the strategy on a yellow pad, getting Richard Rainwater to help [acquire] the properties, taking the company public and the ultimate sale for $6.5 billion, then buying it back two years later,” is amazing, Goff said.

“Today, it’s a wonderful company with so many dedicated and talented people.”

Goff counts teamwork as one of the leading contributors to his success along with “hard work, integrity, honesty and humility,” he said.

“An outsized ego can be very dangerous,” he said.

Another key to Goff’s success is planning. “I love to plan … and we constantly adjust,” he said. “A man without a plan, plans to fail.”

Goff, 63, grew up in Lake Jackson, south of Houston on the Texas coast. Like many communities in that area, Lake Jackson owed its existence to Dow Chemical, where his father worked.

As a youngster, Goff enjoyed “taking things apart and seeing how they worked.” He also liked to build things as well as to hunt and fish and play sports.

From a young age, Goff was ambitious and eager to become successful.

He got his first job at age 13.

“I worked at a lumber yard, at an apartment complex, as a home builder, had a used-car business – anything I could to make money,” Goff recalled.

It was his love of tinkering that guided him into electrical engineering at the University of Texas at Austin. But after a summer internship he realized that he would prefer to become an entrepreneur.

Goff changed his major to accounting and graduated from UT in 1977. A job in the Fort Worth office of Peat Marwick (now KPMG) brought him to Fort Worth, where a business relationship with Rainwater – another instance of good timing – transformed Goff’s life.

A Fort Worth native, Rainwater earned his MBA from Stanford University, where he was classmates with Sid Bass. He agreed to take the job of managing Bass family investments, shepherding the family’s inheritance into a multi-billion-dollar fortune.

In 1987, Rainwater started his own company and hired Goff to be involved in investing in public securities, private equity and distressed debt across a variety of industries, including oil and gas, health care and banking.

“Richard changed my life,” Goff said of Rainwater, who amassed a fortune of nearly $3 billion before his death in 2015 from a rare degenerative brain disease. “He was a wonderful partner – good times and bad.

“He believed in me and never questioned my final decisions,” Goff said.

In one of his earlier deals, Goff convinced Rainwater to invest in the commercial real estate broker founded by Dallas Cowboys Hall of Fame quarterback Roger Staubach. Rainwater initially balked but Goff persuaded him to invest $1 million for 20 percent equity because Goff was impressed with Staubach’s tenant representation operation.

Goff joined the board of Staubach’s company and helped guide investment, which produced more than $70 million in profit when Staubach sold his firm to Jones Lang LaSalle, now JLL, for $700 million in 2008.

“John is absolutely fabulous and has great vision,” Staubach previously told the Fort Worth Business Press. “He is a great businessman and I consider him a great friend.”

Goff remained committed to investing in real estate and convinced Rainwater to participate in a deal involving the Crescent office complex, a landmark property in Dallas’s Uptown. The property was on the brink of foreclosure when Goff bought up the debt and entered a partnership with Hunt Oil heiress Caroline Rose Hunt to recapitalize it. Hunt’s Rosewood Hotels & Resorts built the Crescent hotel and office complex in 1986.

That deal led to the 1994 founding of Crescent Real Estate, named in recognition of its origins with the Crescent deal. As vice chairman and CEO, Goff orchestrated acquisitions that led to Crescent’s initial public offering worth more than $500 million that year.

In 1998, Goff founded Goff Capital Partners, a private equity firm that invested in real estate debt and equity.

In its first 13 years, Crescent grew to become one of the largest real estate trusts in the country, providing its shareholders a 15.4 percent compounded annual return, including more than $2.5 billion in cash dividends.

In 2016, Goff combined Goff Capital Partners and Crescent to consolidate all future real estate investment in one entity, Crescent Real Estate LLC, with 110 employees managing assets and investments of more than $5 billion.

Other high-profile business executives whom Goff regards as influential mentors are Mort Meyerson and Bob Stallings.

Meyerson is former president of Electronic Data Systems and former chairman and CEO of Perot Systems. Dallas’s Morton H. Meyerson Symphony Center was named in his honor after H. Ross Perot contributed $10 million for naming rights to acknowledge Meyerson’s 10-year leadership effort to build the symphony hall.

“Mort Meyerson was a mentor who officed with us after EDS and selling to GM,” Goff said. “He was a wonderful mentor on managerial success.”

Speaking of Stallings, executive director of Gainsco auto insurance and chairman and CEO of Stallings Capital Group, Goff said, “He was a very helpful mentor on negotiation/deal-making and public market strategy.”

Stallings and Meyerson both have served on Crescent’s board.

As noted, at the end of last year, Goff regained control of Crescent Real Estate. A year earlier, he launched GP Invitation Fund I to acquire and develop new real estate ventures with capital from investors and wealthy friends.

Crescent’s portfolio includes Class A office space and multifamily and hospitality assets across the country, including the Hotel Crescent Court and Spa in Dallas. Goff bought the hotel, located on the 11-acre grounds of the Crescent office complex, in 2016 with plans for a lavish $30 million upgrade. Crescent had previously owned the hotel as part of its partnership with Hunt in the early 1990s.

Other Crescent holdings include the Dallas Ritz Carlton, adjacent to the Hotel Crescent Court, and McKinney & Olive, a 530,000-square-foot office and retail development designed by architect Cesar Pelli.

Last year, Crescent, in partnership Long Wharf Capital LLC, purchased the headquarters of the Dallas architectural firm Corgan and has a project underway to add a seven-story expansion. That project, The Luminary, will become the tallest office building in the West End Historic District, incorporating historic elements and modern sophistication.

The Luminary will offer 360-degree panoramic views of Dallas from its rooftop terrace.

In Fort Worth, Crescent formerly owned the 777 Main Street office building but sold it more than five years ago to Atlanta-based Cousins Property for more than $1 billion.

While little of Crescent’s real estate activity occurs in Fort Worth, Goff’s family operation, Goff Capital, is focused on significant investment in diverse industries from its Fort Worth base.

“Few people know that the largest investment I have personally ever made is in Canyon Ranch,” Goff said. Canyon Ranch is a wellness resort with locations in Tucson, Arizona, and Lenox, Massachusetts.

“I moved the headquarters to Fort Worth from Tucson. Few people know this company is now headquartered in Fort Worth,” he said. “The company is experiencing significant growth and we currently have over 2,500 employees.”

Goff Capital also funded Wellflex, an oil field service business, which has grown into a $70 million-a-year enterprise. Run by Goff’s son-in-law, Nick Klaus, it employs 230 people in Fort Worth.

Other Fort Worth-based acquisitions include the aerospace manufacturing firms Davis Machine and Omega Research. He has also been involved in oil and gas investments as well as an e-sports team, Complexity Gaming, in partnership with Jerry Jones and the Dallas Cowboys.

Goff family investments also include the documentary film Unbranded, chronicling a 3,000-mile horseback ride across the American West. The film Albert Nobbs, a project of acclaimed actress Glenn Close, also included Goff investment and was nominated for several Academy Awards as well as other film honors.

“The family office continues to grow as my son, Travis, takes on more and more responsibility,” Goff said.

Goff also supports the arts through his philanthropy, including a pet project called B Sharp Music that teaches music and supports an orchestra for low-income students.

Goff and his wife, Cami, have five children and five grandchildren. Goff said Cami has been his rock and inspiration in life. “She has brought a balance to me that I have always had difficulty finding.”

Among his honors, Goff is a member of the McCombs Business School Hall of Fame at the University of Texas. He was named EY Entrepreneur of the Year for the Southwest Region in 2014 and was inducted into the North Texas Commercial Association of Realtors and the Real Estate Professionals Hall of Fame.