TRANSCRIPT

Commercial Real Estate Network Luncheon Speech July 2018

Thank you, I have got the truncated bio of Mr. Wilson, I’m gonna try to go through this real quick, I think it’s worthwhile for me to read this so that you guys who are kinda familiar with Mr. Wilson will kinda get an idea of what he has been up to theses 90 years and I’m sure he will come up and expand on it, here we go Mr. Wilson is a Real Estate developer for 61 years suring up the Welcome Group, landlord to 4,000 sq. ft. of manufacturing, industrial facilities in 87 locations in Texas.  First projects in the 1950’s and 1960’s were master plan communities called Jamaica Beach and Tiki Island in Galveston County both of which are now separate cities.  He later developed shopping retail centers, hotels and downtown office buildings, awards included being inducted into the Texas Business Hall of Fame receiving the lifetime achievement award of the Houston Business Journal and awarded an honorary Doctorate Degree from the University of Houston where he was a BBA grad in 1949.

He received a University of Houston distinguished alumnus award in 1970, the University Bauer College distinguish alumnae award in 1996, distinguish alumnus award in 2005 from Texas Southern College and distinguish alumnae award from the University of Texas in 2018.  In the past he was Chairman of the Board of 2 Houston Banks, was Chairman of the American Stock Exchange Company, was a Board member and owned 10% of the Houston Astros Baseball Team.  In March 2018 he celebrated his 90th birthday, he is a long time Chair of the Board of Regents of the University of Houston, Chairman ascribed to 2 Tier 1 and Chairman of its political action Committee, he is Director Emeritus of Houston Partnership having served a long time as Higher Education Chairman.

In the 1950’s and 60’s he served in the Executive office, let me slow down here you need to get this, in the 50’s and 60’s he served in the Executive Office under Presidents Dwight D. Eisenhower and John F. Kennedy, he witnessed the atom bomb test in Nevada and the hydro bomb test at Bikini Atoll in the Pacific.  In 1958 he was awarded the Arthur Fleming Award as one of the 10 outstanding young men in Federal service out of 600 who received this award in 1948 welcome was on the list of notable 20 along with Astronaut Neil Armstrong, Defense Secretary Robert Gates, Senator Elizabeth Dole, Sen. Daniel Patrick Moynihan, Chairman Paul and TV networks John Chancellor.  He was invited to speak at a joint session at the New Mexico Legislator, he was appointed Special Ambassador to Nicaragua by LBJ Lyndon B. Johnson after World War II he served for 2 years as a Naval Officer in Japan having graduated first in his class in Officer school, he married his college sweetheart on the day he graduated from the University of Houston 69 years ago, they have 5 kids, 1 grandkids, 16 great grand kids, one of which is in college, Mr. Welcome Wilson Sr. (applause)

Thank you Andrew I am so pleased to be here everybody, I spoke to this group about 5 years ago, Stewart Morris Sr was in the audience then too and I’m he sure is one of my elders, one of the very few that’s left, he and Gerald Hines are about the only ones that’s left. I’m gonna speak about the early days of real estate in Houston, Texas and then I’m gonna conclude by speaking about some of the Presidents that I had known.

I will speak for about 20 or 22 minutes and take 10 minutes of questions so please be thinking about questions to ask.

Commercial Real Estate Network

Harry S. Truman

I’m gonna talk about the early days of real estate, I came here after World War II to attend the University of Houston, I graduated from Brownsville Junior College now called the University of Texas Rio Grande Valley and came to the University of Houston as a junior in 1946 right after World War II. I had been drafted 1945 during World War II and I had my orders to report for the draft on September 17, 1945, Harry Truman the President, dropped 2 atom bombs on Japan a month before in August, the war was cancelled in a week, my orders were cancelled, and I went to a second year in Brownsville Junior College before I graduated.

When I came to the University of Houston it was 18 years old and I was 18 years old and today now 72 years later, it’s 90 and I’m 90.  Bill if you hear me talking about happy hour, I’m talking about a nap, Andrew I never thought I would live to see the day when I would say, oh to be 75 again.  I was taught to respect my elders and Stewart Morris Sr is one of the few I have left.  Now what was Houston like in 1946, first of all there was 1/2 a million people in the Metropolitan Houston area, 1/2 a million, today there are 6 1/2 million in that part of Houston, 6 1/2 million.  The leader in real estate was Jessie Jones, Jessie Jones was from Houston and had been and served under Roosevelt and Truman in the office of the Secretary of Commerce in Washington.

Commercial Real Estate Network

Jesse Jones – United States Secretary of Commerce

Let me give you an example of his influence, I knew him by the way, in downtown Houston in those days there were 9 hotels, Jessie Jones owned 7 of them.  There were 12 office buildings in downtown Houston, Jessie Jones owned 9 of them, he owned the biggest bank, he owned the biggest radio station, he owned the biggest newspaper The Chronicle, he was Mr. Houston.  I remember Mr. Jones very well, he was tall, dignified always wore a double breasted suit even when it was not in style I will never forget one day I saw him in front of the LaMar Hotel where he lived getting into his chauffeur driven car to got to the office, which was about 6 blocks down the street in the Bankers Mortgage building and he was not in a limousine because he was so tall he would bump his head when he got in the limousine, so it was a Ford Convertible and what Mr. Jones would do chauffeured around town in a Ford Convertible because he was so tall.

There were other great leaders in those days such as Gus Wertle, Insurance company man, H. R. Cullen, oil man, R. E. Bob Smith an oil man, George Strick, George R. Brown, James Elkins, Johnny Crooker a Fulbright & Jaworski, Freeman Crooker and Leon Jaworski, Col. Bates, Capt. Baker of Baker Botts I knew them all, if you want to know how somebody in their 20’s gets to know the top leaders of Houston ask me during the questions.

E. Bob Smith was the largest land owner in Harris County, he owned about 30,000 acres, he was the largest land owner in Fort Bend County as well.  He owned a couple hundred acres just west of Brownwood it’s now called both sides of the West loop at Westheimer.  I will never forget in the early 50’s I drove with him out to see a piece of land that he had just bought way out in Westheimer and he had paid $1200.00 an acre for 500 acres, later he acquired a total of 7000 acres that went all the way to Richmond, Texas.  So, we get there, and we looked at this land and I said well, you know it’s a shame, here I am just getting into the real estate business and all the good deals are gone and he said, you silly peckerwood, if you wanna know what a peckerwood is ask me during the questions (laughs).  You silly peckerwood don’t you realize the boom in Houston has only begun, he said banks will now lend you money on raw land, they would never do that before, never and he said the boom of Houston has just begun, he was right.

I waited and the land we looked at is now called Westchase, it’s both sides of the west belt for 3 miles.  Let’s get back to me being 90 years old for a minute, it’s not all that bad, everything I buy comes with a lifetime guarantee (laughs), the older I get, the better I was (laughs).  I know history is gonna treat me kindly because I have written it after everybody else is gone.  My first real estate development was Jamaica Beach in Galveston, now how could somebody in their early 30’s get the money to start a development, well now I’ll tell you how.  In Galveston nobody trusted anybody with a note, so everything had to be for cash, so we bought 300 acres of land down in West beach, R. E. Bob bought it for cash and sold it to me for a dollar and a half and then I paid something when I sold something.  Then I needed money to put in streets and utilities, so he co-signed my loan at the Bank of Commerce for $250,000.00, they didn’t even ask me for a financial statement because he signed the back of the note, it was a little bitty note about this big.  Well I had no idea what a great favour he was doing for me and that was the last time.

Commercial Real Estate Network

Jamaica Beach, Texas

But any way we started Jamaica Beach, my partners in Jamaica Beach were my brother Jack, Bill Sherrill, later a member of the Federal Reserve over in Washington for many years, Johnny Goyen later Mayor Pro Tem of Houston for 22 years and Jack Valenti, later the President of the Motion Picture Association of America for 40 years.

Commercial Real Estate Network

President Lyndon Johnson and Jack Valenti in 1965 *Photo Credit – The New York Times

Valenti was a great guy, godfather to my son Craig, Jonny Goyen was the Godfather to my son Welcome, but it was a good group.  I made every mistake known to man in the development of Jamaica Beach, for example I priced the lots on the government 90ft wide $3500.00, well I sold out in 2 days. (laughs)  And then I couldn’t sell anything else and then it sat there, my lots were too big because people on the weekend don’t want to spend their time mowing the lawn so I put in streets in between each street and cut the lots into half and sold them for $625.00 each for 1/4 of an acre, finally sales took off, Jamaica Beach today is a huge success, there are multi-million dollar houses there, it’s a separate city.

I also developed Tiki Island in Galveston, and my partner Bill Sherrill (phone rings) my bookie (laughs) noticed driving to Jamaica Beach that there was this piece of land on the right at the causeway.

Commercial Real Estate Network

Tiki Island, Galveston, Texas

  It was about 6 inches out of the water, so he thought it was owned by the State of Texas like everybody did and he checked it and it turned out it was owned by 5 individuals in Galveston including the Goody family.  So, he came to me and he said, look with the canals there we will have enough fill/dirt from the canals to raise the level of the lots to 5ft. and it’s only 45 minutes from Houston, so we can sell first homes, and this is the second homes.  So I thought it was a good idea, I didn’t like the name Tiki Island, so I hired somebody to come up with a better name and they came up with Buccaneer Bay which I think was perfect for Galveston but Sherrill was adamant saying it was his project, so I called it Tiki Island, and now there is a $4 million house on Tiki Island, it’s a big success and I was in there in Tomales having lunch about a year ago and a guy I know walked up to me and said Welcome you developed Tiki Island right and I said yes, he said remember we had 1200 lots, 10 regular and 2 oversized lots, I said I remember the very well, we sold them for $18,000 each, he said I just bought one  of them for 1/2 a million dollars.  I should have kept a couple (laughs).

My contemporary developers at the time were Walter Fisher who developed sub divisions, Gerald Hines who is developing 2 storey office buildings on Richmond Avenue, Jilan White developer Apartments, by the way the word multi-family had not been invented in those days we called it apartment business.  Errol Farve was a (18:38) developer, Mr. Swain, Jimmy Lyon, Jimmy Lyon was better known as owning the River Oaks Ban and Trust but he had to put his money in real estate and his specialty was simple he would go next to a sub division that was successful and then he would buy land next door and he would put in lots with no amenities whatsoever and sell them for cheap and was very successful.  I then negotiated his sale of his bank when he got cancer to BBOT, not BBOT,BBA.If you wanna know anything about those developers they were all good friends of mine, me during the questions.

In my day I thought there was not enough dignity being a resort developer, so I decided to go into the apartment business, we didn’t call it multi-family and so we built 6 apartment projects and every one of them Andrew, I started construction in the booming market and opened in a slump. (laughs).  Our first project was Kings apartment on I10 except I10 wasn’t there, it was known as Bikini road, then I developed Fox Hall apartments, it’s still there on the I10 in chilly rock, by the way Johnny Goyen who was Mayor Pro Tem got Chilly Rock punch through to connect with I10.  By the way politics is very important in real estate, believe me politics is important, if you want more details about that I will tell you, ask me during the questions.  Fox Hall apartments, I sold them 50 years ago, I probably made $650,000 or something which I needed at the time I’m sure but the point is, now 50 years later it still 100% occupied 50 years, the mortgage would have paid off twice, the cash would be falling and I would be living in Aspen, that’s why we never sell  anything anymore.

Welcome Jr joined the business in the 70’s and we developed retail centres, downtown office buildings and with TCP, that’s Texas Commercial Properties we bought $5 billion dollars’ worth of empty office buildings during the 80’s, during the bust and then we leased them out and then sell them.  And our partners were always Wall Street types and so after 3 years or 5 years they wanna sell the property, so they can get their Christmas bonus, so like I said we don’t sell anymore.  We also own a construction company KDW it’s called, I’m the ‘W’ and we at any one time will have $100 million worth of construction under way, it’s been very, very successful, we are now building a $25 million facility which my company will own near Katy, Texas for a German company called Man Diesel it’s a project that you could hear a lot about, it’s 14,000 acres owned by a billionaire from Indonesia called Twinwood, you will hear a lot about Twinwood in the future.

Twenty-one years ago, having made mistakes in every field in real estate I got into the industrial company business, and now we built about 300 projects and we still own 87 of them in Texas, most of them Houston.  And it’s about 4 million sq. ft. and that is for sale.  Along the way Gov. Rick Perry appointed me to the Board of Regents at the University of Houston and I ended up as Chairman for a long time and my proudest moment was hiring Renu Khator as President, she is wonderful beyond words and now the University of Houston is known all over the world.

I would like to talk briefly about some of the Presidents I have known, I have known 6 Presidents very well and I have met 2 others including Donald Trump, but I can’t say I know Donald Trump.  But let me say this about Donald Trump, if the election were held today he would be re-elected in a landslide, you never know that from reading the Houston Chronicle, but I guarantee you Donald Trump has the support of Americans, I attended his inauguration and I have been to 5 or 6 inaugurations and I am used to seeing everybody looking like me, suit and tie etc. and at Donald Trump’s inauguration a totally different crowd showed up, blue jeans, boots, jackets totally different crowd, he has mobilized people across America that had never participated before.

Let’s go back to the Presidents, Dwight Eisenhower is the first President I knew and worked for and when I first met him, the Mayor of Houston had sent me to Washington to attend a National Defense Conference and Eisenhower spoke, he was President, I was startled because he’s pink, I don’t mean his policies I mean his face, his face is pink and the reason is he played a lot of golf and he had she kind of skin that does not tan so he is always pink, and every time that I saw him after that he was pink.

My headquarters was in the Dallas Fort Worth area when I worked in the Executive Office of the President, it was called the Office of Defense Mobilization, there were 3 branches of the White House, the Council of the  economic advisors, the bureau of the budget and the defense mobilization and I also had an office in DC the Executive office building next door to the White House and from my office desk I could see at 5:00 o’clock in the afternoon, the President of the United States hitting golf balls.  Every afternoon he was out there hitting golf balls and I can’t tell you what a warm feeling that made you have that the country is in such great shape that the President is out there hitting golf balls.

When I was with the Executive Office of the President, my rank was a GS 17 in the Civil Service, that might not mean a lot but the equivalent rank in the military is a 3-star general, I was 30 years old, being over my head has always been my policy (laughs).  I served briefly under John F. Kennedy and JFK came to my hotel room and that make me sound very important in 1960, let me tell you he had just been nominated for President by the Democratic Convention, that was in August.  And I was in Washington DC in December with a man from New Mexico who was Director of Civil Defense for New Mexico so we were staying at the Congressional Hotel in the Capital, so we decided to invite the New Mexico Congressional delegation, 2 Congressmen, 2 Senators over for a drink in our suite.  At the last minute we got the idea of inviting John F. Kennedy and he came, the most charismatic man I have ever met in my life and it all had to do with his smile, Andrew his smile was so genuine, so warm it was just wonderful, it would just melt you and just a tone followed him around everywhere he was and he stayed in the room about an hour and we had a nice visit and then I was with him again when he came to Houston not to announce but to dedicate the United States space craft centre in Houston and we had a ceremony in Rice, you might remember it and the Mayor had put me in charge of the event, so I was there, I didn’t admit this for 50 years but I had been in charge of the seating on the podium behind the speaker, we had about 40 dignitaries, including me so I placed myself so that when the 100 cameras were pointed at JFK I was sitting over his shoulder (laughs).  And to this day about once a year I will see a clip on television of that speech and I am still there. (all laugh)

The night before Kennedy was assassinated he was in Houston and the Mayor put me in charge of the Airport arrival and the motorcade downtown and I got a zillion stories about that, so if you want to know more about it ask me.

First time I met Jackie Kennedy, lovely, lovely lady and also, he was coming to speak at a banquet for Albert Thomas, our Congressman and I was in charge of the seating at the banquet, so I put myself and my wife right in front of Jackie.  Of all the Presidents I have known I knew Leonard Johnson the best because he was a Texas Senator when I was with the Executive Office of the President, he was later majority leader of the senate, he was Vice President of the United States and then President.

Let me tell you a story and I will conclude with a story, in the spring of 1963, remember that date, spring of 1963 I got a call from Jack Valenti, Jack Valenti handled the campaigns advertising, he was an advertising agency guy in Texas and he had married LBJ’s long time Secretary, married Margaret Wiley and they were living at River Oaks, so Valenti called me and he said, the Vice President is gonna be in town and he wants me to invite the guys to come over Sunday for a drink, the guys were my sister’s husband Archie Bennett and the 5 guys who developed Jamaica Beach including Valenti so I lived on River Oaks boulevard this time, Valenti lived on San Antonio right around the corner, so I went over to his house arrived last and I walked in and I looked over at the fire place LBJ was sitting in an overstuffed chair drinking decaf coffee, one cup after another so I got a glass of water and I went over and sat down in the over-stuffed chair next to him, and you know how it is when you talk to somebody important, you try to figure out something of significance to talk about, so I said Mr. Vice President Kennedy has sent the Civil Rights Bill to Congress but it seems to be dead, and let me tell you why it was dead, in the East Coast, in the Mid-West and in California they threw their Congressmen and Senators out after 6 or 8 years, threw him out and the South re-elected them for life.

So, all the seniority in the House of the Senate was in the South all the Seniority, Chairman of every committee etc., so that’s why it was dead because the Civil Rights Bill was not popular in the South.  So I asked Johnson about it and he paused and I could tell he was trying to decide whether I was important enough to give a real answer to or not and I must have passed the test because he said, Welcome let me tell you a story and he put down his coffee and he said, when we were campaigning for Vice President and President of the United States the Vice President’s entourage was travelling through New Mexico and he said Welcome you know how New Mexico is you travel for hour and hours and you see nothing but cactus, then suddenly you come across a lonely service station sitting on the side of the road, 2 stories couple rooms upstairs, stations downstairs, you stop in there get a coke, fill up with gas, go to the bathroom and then you go on.

So, my entourage of about 7 cars pulled in there and we did all that and then we got ready to leave and one girl is missing, she worked for the majority leader’s office in Washington, we looked everywhere in that service station for her, she was nowhere to be found.  Finally after 5 minutes she walked in the back door and it turned out that she was a block behind the building squatting down behind the bush to go to the bathroom because they wouldn’t let her into the restaurant, she was black, then he grabbed me on the knee and he punched his right hand in my face and he said, Welcome that’s wrong, that is wrong and I will never forget his next words and he said, and when I am in a position to do something about it, I’m going to.  Spring of 1963 six months later the assassination occurs, the Civil Rights Bill had gone nowhere six months afterwards LBJ against all odds got the Civil Rights Act in 1964 passed, the following year the Voting Rights Act of 1965 and later the Federal Housing Act.

So, when people tell me that LBJ had to be dragged into Civil Rights, I know better.  Well that concludes my remarks, I want to mention two quick things, one is the real estate program at the University of Houston, I called a meeting of the real estate leaders in Houston when I was Chairman in General Hines office and every firm of real estate was represented and I proposed a real estate program in the College of Business and then he said but we need a Graduate Real Estate program, all our Vice Presidents have Bachelor’s Degrees, we need a graduate program.  And so, we changed up our plans and now we have a wonderful Graduate Real Estate Program at the University of Houston College of Business, classes are at night, so tell your people if they wanna get ahead in real estate in Houston that’s the place to be.

The second thing is my book, another commercial about my book, Always Welcome is the name of the book and it’s being released 1st of September, less than a month, it can be bought  on Amazon, it can be bought on Barnes and Noble and there are flyers at the back, the picture back there that you will see is the cover of the book, that’s me on top of an office building downtown thinking about my photographer daughter, Pamela, Pamela Francis that’s it we are ready for some softball questions. (applause)

Mr. Wilson will you stick around for a few questions, okay we will take 2 questions and we will wrap it up.

Thank you, Mr. Wilson some of us here have lived for that history most of these guys don’t know to pronounce San Phillipe correctly, it’s not San Phillipe in Houston it’s San Phillipe. (laughs)

Correct, yes sir.

Did you develop Spanish Grande?

I did, and I bought Sea Isle and Treasure Island, Terramar Beach and others, yes sir.

Another story you told me one time about how you came to the University of Houston with your father could you repeat that really quickly.

I’ll make it quick, my father felt like Houston would be the Capital of the world business- wise so he wanted us to go the University of Houston which nobody never heard of in Brownsville, Texas.  The University was 18 years old and so was I.  So when I graduated from Junior College my father took my brother and me to Houston to enroll and I will never forget what he told me when he dropped us off in front of trailer #67 on campus, army surplus house trailers after World War II, the only housing on campus we had, no bathroom, bathroom was a block and a half away, no air conditioning of course and he said boys I paid your first semester tuition, I paid the first month’s rent on this house trailer, $10 and here is $50.00 each and whenever you boys need anything else I want you just to call me up on the phone, whatever you need call me up on the phone and I will explain  how you can get by without it, and we never heard from him financially again. (applause)

Mr. Wilson we would like to thank you so much for speaking to us, it’s a pleasure to have you.

Mr. Wilson has agreed to stick around for a few minutes to answer your questions so please feel free to come up and introduce yourself, please check out his book it’s released on September 1st, is that correct, on Amazon and please look on your flier’s com for the things coming up and thank you so much for coming and we get the best speakers.

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“Welcome’s efforts as an entrepreneur have enriched the community, led to better lives for untold numbers of fellow Texans, and inspired generations of admirers and followers to do greater things. My hope is that through reading this book, you will come to know Welcome W. Wilson, Sr., as I have–as a brilliant businessman, a loving family man and a proud Houstonian.”

Rick Perry
Rick PerryUS Secretary of Energy & former Governor of Texas
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