It's a family tradition
Small Business of the Year runner-upCrayton Commercial LLC
Headquarters: New Bern
President: Walt Crayton
Projected 2013 revenue: $756,000
Business: Commercial real estate
My dad always told me, he said, ‘Don’t you ever get in this business,’” Walt Crayton says, reminiscing about a childhood spent cleaning construction sites for his father’s development company. “He said to me, ‘But if you have to get in this business, do something commercial.’” Walt ignored the first part of Frank Crayton’s warning but took to heart the second. Today, the younger Crayton is owner and president of Crayton Commercial LLC, a one-man operation in New Bern that has built or revitalized seven shopping centers since 2008. Last year, then-Gov. Beverly Perdue appointed him to the nine-member N.C. Real Estate Commission, the state’s regulator of real-estate agents. Not bad for a guy who started his company at 25 and is now 31.
“You know, when you’re little, you don’t even know what words like commercial mean. At least I didn’t. My dad just ingrained that into my head. He said, ‘Do something big, do something commercial — that is, if you have to do it at all.’” But Frank telling Walt to stay away from development would be like Hank Williams Jr. asking Hank III to avoid country music. Paul W. Crayton Sr., Walt’s grandfather, founded New Bern-based Crayton & Company LLC in 1950. Frank and brother Skip have kept it going since their father’s death in 1995. Walt’s company shares a building with Crayton & Co. “I was raised in a small business, entrepreneurial environment, and it really is in my blood,” says Crayton, who graduated from UNC Chapel Hill in 2004 with a business-administration degree.
After working two years for Norcom Development Inc. in Charlotte, he was hired by Robert B. Tucker, founder of Concord-based Shoe Show Inc. Tucker has grown the retail chain to more than 1,100 stores by buying and developing shopping centers, often in the shadow of big-box retailers. He would put his company in one storefront and lease the rest. “I mean, what an opportunity,” Crayton says. “I was in my early 20s, and here I was with the owner of a company with an annual revenue of more than $1 billion, hearing him tell stories about how hard it was starting out and what he had to do.” Crayton was responsible for leasing space in Shoe Show-owned shopping centers.
“Walt was just real aggressive in getting those vacancies occupied, and he stayed after a good deal when he saw it,” Tucker says. When Crayton told his boss in late 2007 that he wanted to strike out on his own, Tucker knew his young pupil would be successful. “I didn’t have any doubt about it. You have to have the desire, and he has it.”
But Crayton didn’t foresee the looming economic meltdown. “When I decided I was going to do this in the fall of 2007, things were rocking and rolling. Even when I started the business in late January of 2008, things still weren’t that bad yet. You could see the economy was starting to slip, but I had no idea. I guess if I could have seen the future, I’d probably still be working for Shoe Show.” He allocated $20,000 of savings for startup costs — a 400-square-foot office, second-hand furniture, computer, a phone line — and a cushion to carry him through a couple of years of no profit. He didn’t make one in 2008 but was able to lease space for other developments, generating $7,977 while setting up projects for the next year. “It’s a long process to put a shopping center together before it even breaks ground, much less is completed and stores open for business. You have to identify the property, negotiate the purchase and contract, go through all the permitting, zoning and architecture, put the construction bids together, get all your financing straight.” By 2009, Crayton had secured about $4 million in development loans to build two shopping centers, one in Havelock and the other in Reidsville. Revenue jumped to $346,799 but dipped the following year before steadily increasing to $543,006 in 2012.
Crayton doesn’t deal with high-profile shopping centers with all the bells and whistles. He looks for the oldest, most dilapidated shopping centers in sometimes sketchy places and turns them into attractive, no-frills commercial spaces for discount retailers such as Dollar Tree, Roses and, of course, Shoe Show. Taking a cue from Tucker, Crayton searches for ones near big-name stores. He’ll purchase a property for, say, $500,000, put $2 million into it and then lease out spaces for revenue of about $300,000 a year. “This is going to sound cheesy,” Crayton says, “but I just think it’s cool to find something that’s so run-down and such an eyesore and be able to transform that, put people to work and have customers able to shop, have people working in stores, have a finished product that looks so much better than when it started.”
— Mark Kemp—