Growing retail chains let developer Hutton skip recession

Growing retail chains let developer Hutton skip recession

December 28th, 2011 by Mike Pare in Business Around the Region

Oliver Perdomo, executive vice president for the Hutton Co., Karen J. Hutton, CEO of the Hutton Co. and Geoffrey W. Smith, president of the Hutton Co., from left, speak about their company's growth.

Photo by Dan Henry/Times Free Press.

Karen Hutton says she's thankful her Chattanooga-based development company has picked the right clients.

Amid the worst downturn since the Great Depression and its aftermath, her firm has built scores of stores for such growing businesses as Family Dollar, O'Reilly Auto Parts, AutoZone and Tractor Supply Co.

"Thank goodness we didn't get Movie Gallery," said the chief executive of Hutton Co. about the operator of the Hollywood Video rental chain that sought bankruptcy protection and is closing hundreds of stores.

HUTTON CO.

Founded: 1998

Location: 736 Cherry St.

Key executives: Karen Hutton, CEO; Geoffrey Smith, president; Oliver Perdomo, executive vice president

Staff: 53 employees, including about 40 in Chattanooga

Source: Hutton Co.

Hutton Co. and its Hutton Construction Co. sibling, are benefiting from working for what one executive termed "recession-proof" clients.

"Even through the recession, they've continued to grow," said Geoffrey Smith, who recently joined Hutton Co. as president after working for shopping center developer CBL & Associates Properties Inc. in Chattanooga.

For example, Family Dollar recently outlined plans to open 450 to 500 stores in its current fiscal year. The company opened 300 stores in its previous year.

O'Reilly has grown to become one of the top five auto parts chains in the country with more than 3,469 stores in 38 states.

Competitor AutoZone recently reported first-quarter earnings rose 11 percent as the largest U.S. auto parts retailer posted better-than-expected revenue growth.

Brentwood, Tenn.-based Tractor Supply Co. bills itself as the nation's biggest retail farm store chain with more than 1,054 stores in 44 states. Last year, the company put up 41 stores nationally with an estimated $50 million development cost, officials said. Next year, officials plan to push that count to 65 and $80 million, they said.

Hutton, who grew up in Pulaski, Tenn., said in a recent interview in her downtown Chattanooga offices at the Heritage Center that her goal is to put up 100 stores annually.

"Growth is an understatement," Smith said about the path of Hutton Co. "Our challenge is to keep up with the volume."

Smith said said the "next great frontier" for the company is California.

"We're following our clients' footprint," he said.

Hutton said her company traditionally has done more business outside Tennessee than inside.

Some clients, she said, are opening more locations in the urban centers of cities such as Atlanta, Orlando and Phoenix.

"We're doing the toughest sites," said Hutton, whose business purchases land, develops it, holds property and also brokers it.

Smith said Hutton Co. is aiming to diversity to expand the business further.

"A year from now, we hope the client list here has a couple of extra names," he said.

Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318.