Real Estate Succession Planning: The Pérez Family’s Related Group Success Story

The real estate industry is often a family business, with a passion for property development and management passed down from generation to generation. Such is the case with the Pérez family and their real estate conglomerate, Related Group, based in Miami.

Father to Son: Grooming the Heir of the Real Estate Empire

Jon Paul Pérez had always assumed he’d join his father, Jorge Pérez, in managing the family business following his college graduation. Having spent his formative years learning the intricacies of the real estate sector from his father, the younger Pérez developed a deep passion for the industry while watching his father’s success in building luxury condo towers in South Florida. However, Jon Paul’s initial request to join the company was met with resistance from Jorge, who had long-term plans for his son’s induction into the business.

Transitioning to the Next Generation: An Intentional Process

Today, Jon Paul serves as the CEO of Related Group, managing a $40 billion portfolio that spans condos, rentals, and commercial space. His journey to the top, however, was not as straightforward as anticipated. This is a common scenario among ultra-wealthy families seeking to transfer their businesses to the next generation. A study by Brown Brothers Harriman found that 91% of private business owners want their businesses to remain within the family, yet only a third have robust succession plans in place.

Guidelines for Succession: The Pérez Family Approach

The Pérez’s tackled these issues head-on. Jorge and his sons, Jon Paul and Nicholas (president of condominium development at Related Group), have shared their guidelines for successful succession planning.

1. Developing a Genuine Interest

Jorge Pérez insisted his sons should only join the real estate business if they had a genuine love for it. He initiated their exposure to the industry during their childhood, hoping they would develop a passion for it. Both Jon Paul and Nicholas credit their early involvement in the business for their current interest and success.

2. Demonstrating Competence and Commitment

To ensure his sons earned their roles, Jorge established that they must obtain a master’s degree from a top business school and gain five years of experience in the New York real estate industry. This directive was intended to ensure they were fully equipped for their roles and had proven their commitment.

3. Upholding Family and Business Values

Successful succession isn’t just about business acumen – instilling the right values is equally important. The Pérez family has a strong moral compass, and upholding their reputation for doing the right thing, in business and beyond, has been a critical factor in their success.

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