EXCLUSIVE: Land-Focused Houston Firms Join Forces In Acquisition Deal

Junction Commercial Real Estate, the Houston-based brokerage  and investment management company led by Managing Partner Reed Vestal, has more than quadrupled its staff in the past three years, growing from four to 20 people over 36 months.

Its latest growth spurt comes through this month’s acquisition of Urban Co. Real Estate, a firm specializing in urban and suburban redevelopment land sales.

Junction had been courting the firm for well over a year, Vestal told Bisnow exclusively. Much of Junction's interest was centered around J.P. Hayes, who co-founded Urban Co. Real Estate in 2020 and previously served as senior vice president for Dosch Marshall Real Estate. 

“We weren't actually thinking about acquiring or purchasing a firm and bringing them in …  We had an individual in mind. It took a long time,” Vestal said. “I've been recruiting J.P. over here for almost 18 months now.” 

Junction CRE built a reputation handling sales and development transactions for large plots of land for industrial and single-family developments since launching in April 2021. Over the past two years, the firm has also developed in Texas and Arizona. 

Meanwhile, Urban Co. has more experience in multifamily and retail land deals, Vestal said. Acquiring Urban Co.’s team will help Junction diversify, a quality that Vestal learned the importance of from his mentor, Jim McAlister Sr.

“He always said, ‘Don't pigeonhole yourself into any type of product,’” he said. “‘When you purchase land as an investor, make sure that you can do more than one thing with it.’” 

Brokerages should also be chameleonlike given the rapidly changing environment of Houston land sales, according to Vestal.

Some brokers like to say they only do infill land sales in the Central Business District of Houston. But in the past two years, there has been very little land traded inside the 610 Loop, he said. 

“So it’s hard to make a living by just doing that,” Vestal said. 

Hayes grew up in Atlanta and moved to the Houston area because his wife is from The Woodlands. He started Urban Co. Real Estate with the intention of creating a boutique firm specializing in buyer representation and listings, he said. 

Many of his deals were off-market. After building up a list of “top-tier clients,” he said he felt ready to grow. 

“We thought it was a good fit to join Junction to further grow the platform that they have, and bring in a little more expertise in certain fields,” Hayes said. 

Hayes joins Junction as a brokerage partner, and his team will continue to operate as a separate unit.

The personalities of the two companies meshed well, making the acquisition an easy fit, Hayes and Vestal said.

“We're both kind of young and hungry, and we see this as such a long-term play,” Hayes said. “The big ambition that I saw with Reed and his entrepreneurial spirit. [He is ] really just wanting to assemble a team that equates to the best in the market.” 

In Hayes' first week in the Junction office, he brokered a $70M to $80M deal for a multifamily development on a site Junction owns, Vestal said. Even though Vestal formerly knew the buyer, Hayes' relationship with him sealed the deal.

“If that's the only deal that we do the next 12 months, he's already paid for himself,” Vestal said. 

Junction has its sights set on further expansion, with high-growth markets like Dallas-Fort Worth, the Carolinas and Nashville as possible targets. But Vestal said adding the right people to the firm will be more important than picking the best locations.

“We're quality driven and not quantity driven,” he said. “We felt like bringing over J.P. and his team, it will help bring in more quality into our office. Not only from deals that they can source, but also to help expand into other markets and help build our brand.”