The Pettinaro Company is of Delaware’s most successful and dynamic real estate organizations, with extensive commercial and residential holdings across the state. The family company has been a force behind the development of the Wilmington waterfront, controls nearly every rentable square foot in Greenville and most recently acquired Barley Mill Plaza from Stoltz Partners, growth led by CEO Greg Pettinaro, son of founder Verino.
Pettinaro stepped away from his work to give TSD an inside look at his thinking about the future of his business, the local economy and what it means to be a truly local company.
TSD: Your family company started out in building and construction, then moved into property development and management, and now you’ve become one of the most significant landowners in the state, with some of the most valuable holdings in northern Delaware. Talk about the evolution of your business and where you see the focus moving forward.
Greg Pettinaro: My father Verino started Pettinaro Construction Company in 1965 in a small warehouse on Tulip Street in Wilmington. He started out doing basement renovations, paneling living rooms and decks. By the mid 70’s he had grown the company into the largest open shop construction company in Delaware. Pettinaro Construction Company bid and built some large state jobs including Smyrna prison, Hodgson Vocational School, and in the late 70’s Verino purchased his first piece of property on Route 13. That was the start of the development side of the company.
While I had always worked summers on the construction jobs, I started in the office in 1986. I was shown a vacant lot in Browntown and was told to build something on it. It was a birth by fire. Figure out what should go there, design it, get permits, construct and lease it out. It was a challenge but it taught me a lot about the process and people.
Over the years I’ve helped grow the business from a construction company with some real estate to a fully integrated real estate development company. We now only handle construction for our own buildings and tenants. We also handle our own property management, brokerage and architecture.
I took over as CEO in 2000. My goal was to change the company from a sole proprietor to a management team approach. You need one leader but you need managers to run their departments and make the decisions. In my opinion it was the only way to transition to the next generation. We now have a team in place that can lead the company in any direction. They are hands on and customer service professionals. Employees that work here are like family.
TSD: You’ve recently acquired the Barley Mill site from the Stoltz Organization, a property with an amazing location but controversial recent history. Recognizing you can’t get into details about specific potential tenants, can you sketch out your vision for the site? And what is your approach to engaging the community and addressing some of the traffic concerns that have prevented development thus far?
GP: I have watched the Barley Mill site change over the last 10 years. From what was the home to our state’s largest employers – DuPont – to a vacant property with looters stealing copper from the buildings. This is not what I wanted to see driving to and from work every day.
Barley Mill Plaza is currently an office park. It has 557,000 square feet of vacant space. There used to be 3,400 DuPont employees there every day. Within the local office market there is no way to fill up that kind of space and the buildings are old and inefficient. We envision a mixed use development with a combination of retail, office and residential. Not 2.5 million square feet of space that is out of character with the community. We envision a community that is connected with sidewalks and bike paths. A community where you can walk to work, shop and return home. A community that everyone in the area can be proud of.
I know what we propose will not make everyone happy, but I feel we can come to a meeting of the minds on what is appropriate. No offense to the previous ownership, but we live here. I see neighbors while I’m out and about. I want to be able to hear that they are as excited as I am by the prospects for the site.
On the other hand we are in business to make money. There is a certain density that we need to achieve to make the project a success. A project that doesn’t support itself isn’t good for anyone. There is a balance that we’re hoping the community will embrace. We will not be bringing back 3,400 employees and vehicles but I would like to see more than what is there currently.
TSD: This part of the state doesn’t really have a first class mixed use – such as what we see north of the state line in Pennsylvania – do you think that is something that could work at Barley Mill? Is there enough demand in this market?
GP: I absolutely think the area is right for a mixed use development providing you don’t make it too big. I personally don’t feel it can handle two million square feet of space. However, a smaller combination could be one of the best places in New Castle County. CSC is building a new headquarters up the street in Little Falls. Delle Donne is expanding across the street in their corporate center and most of the retail up and down 141 is rented. There is demand for quality residential behind Westover Hills.
TSD: The overall real estate market has not been great locally the last several years – we’ve all seen residential property values hit a wall and of course downtown Wilmington office space has really been challenged. Yet Pettinaro has continued to thrive across both residential and commercial uses and in both the city and county. Still, economic growth in the coming years will be critical to the success of your business and investments – in your view, where do you see that coming from here in Delaware?
GP: Delaware needs a new large employer. Our past “Big Five” are shells of what they used to be. Some companies have taken up part of the slack but we need more growth to encourage people to want to live here. In 2016 we will see a change in Governor, County Executive and Mayor of Wilmington. It’s going to be a great time to rethink what it takes to make Delaware better … to reinvent our economy. We have or had the best banking laws, corporate structure, tax free shopping, an Air Force base, low tax base and beaches. If we can figure out how to improve our public schools and attract business the whole state will benefit.
TSD: As a business person that is obviously looking to be profitable, in a place like Greenville, for example, how do you maintain the right balance between local retailers who could be spooked by higher rents and larger national or regional businesses with deeper pockets?
GP: Greenville is a unique market. It has the highest housing prices in the state. It has a main artery leading into downtown Wilmington. It draws from the local neighborhoods, commuters and shoppers looking for unique shops. Right now we have more local retailers than nationals. A few nationals here and there are good but most of our shops will be leased to area businesses with a quality product. We are always looking for the next retailer to be something different.
TSD: Tell us something people might not know about Greg Pettinaro –
GP: We are a local family. My parents were born here. My three sisters and their families still reside in the area. I went to A.I. du Pont High School. While we are on the larger size of the Delaware developers we try to stay low key and humble. It’s not all about who you know or what political function you went to. At the end of the day what matters is a good family, close friends and respect in the community. I try to pursue this in my personal and business life. Oh, and I also love peaches!