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Adam K. Troy and Keith B. Key, managing partners and founders of Columbus, Ohio-based Omni Management Group Ltd. (OMG), managed to get by with a little help from a friend.
Founded in 1996, OMG is a real estate development firm that specializes in urban projects. Its portfolio, valued at roughly $50 million, includes four apartment buildings and four office buildings. Sales at the 20-person firm, which are derived primarily from renting out the properties, increased from $2.5 million in 2000 to $4.2 million in 2001, and it anticipates $7 million in sales for 2002.
But this would not have been possible without a little help. In 1999, the firm needed $600,000 in financing to exercise an option to acquire land it needed to build a community healthcare development. Troy and Key found themselves out of sorts after being denied additional financing from their bank. “We were at our wit’s end,” says Troy.
They turned to an industry mentor and father figure for help, Frank Kass, CEO of Continental Real Estate Development, a real estate development firm in Columbus. Kass knew Troy and Key for about six years, having worked in the same circles. He sat down with the pair and reviewed whether the deal made sense. The duo managed to convince Kass that it was a viable money-making plan, and, in turn, he introduced OMG to a bank that agreed to finance the acquisition. “He really helped us out a lot,” says Troy.
Other projects by the company include Low Income Housing Tax Credit Program (LIHTC), which uses tax credits to build and/or rehabilitate low- to moderate-housing developments, which are based on income. Since 2000, the Danter Co., a Columbus-based real estate research firm, reports that $378.7 million was allocated in the U.S. and territories for LIHTC. In the Midwest, where OMG does the majority of its work, $87.3 million in tax credits were used to upgrade or create 1.1 million affordable-housing units.
OMG plans to stick with that strategy and expects to expand its business. Key and Troy say they’ll continue to tap the knowledge of industry mentors, and will rely heavily on their banking relationships to finance the projects. “Unless you can get banks to provide financing, you’ll always be a contractor or architect,” says Key.
Omni Management Group Ltd., 3433 Agler Road, Suite 2000, Columbus, Ohio 43219; 614-509-6664