Batavia Enterprises, Inc.: Passing on the passion
Apr 28, 2017 11:40AM ● Published by Neighbors Magazines
Gerry & Austin Dempsey, Photo by Tim Sullivan
by Ben Scott
Fox Valley residents unfamiliar with Batavia Enterprises, Inc. (BEI) will certainly recognize the properties they own and manage, such as the historic Newton House, the Wilson Business Center and the Tower Business Center downtown Batavia out of which Neighbors Magazines operates. A mainstay of local economic growth, Batavia Enterprises defines itself as a leasing and management company dealing in industrial, retail, commercial and residential properties. But the enterprise also has a rich local history as a family business three generations deep, its story beginning in the middle of The Great Depression when BEI founder Larry Dempsey took a train from Pittsburg to Chicago after landing a job at Sears and Roebuck.
“He worked himself through the ranks at Sears during WWII,” said Austin Dempsey, Larry’s grandson and current vice president of BEI. “He was one of the guys that Sears would have go out and acquire controlling interests in local manufacturing businesses. He worked with the business owners to make tanks and planes and bombs and cannon shells and that type of stuff.”
After the war, Larry moved his family to the Fox Valley area and began working with business owners to divest their interest out of Sears. At this point he saw an advantage in owning some of these local manufacturing facilities, and in 1959 he and a couple of partners started Batavia Enterprises.
“He fell in love with that can-do spirit, the entrepreneurial spark,” Austin explained. “That’s prevalent out here, all the way from Aurora to Elgin—these communities have been around a long time and have a history of manufacturing, production and innovation.”
Larry and his partners first purchased the U.S. Wind Engine and Pump Company facilities from the United States government, properties which served as wartime munitions factories. Larry also made his first lease in 1959 with Pamarco Global Graphics, a customer that remains with BEI to this day.
“That’s how we started,” Austin said. “It was a side-business for my grandfather to help these business owners with their real estate to keep their businesses going.”
In an article written for the Harvard Business Review, George Stalk, Jr. and Henry Foley note that “Some 70% of family-owned businesses fail or are sold before the second generation gets a chance to take over. Just 10% remain active, privately held companies for the third generation to lead.” (hbr.org).
Bucking the trend, BEI gained momentum when Larry’s son Gerry Dempsey joined the business in 1980. Indeed, Austin said his family still lovingly refers to BEI as his grandfather’s hobby, and that it was his dad who professionalized Batavia Enterprises.
Throughout the 1970’s Gerry rose quickly in shopping mall management and gained invaluable experience under the mentorship of two shopping mall pioneers, Jim Rouse and Al Taubman (founder of Woodfield mall, which Gerry managed through its early years).
Gerry’s career was on an accelerated path in 1980, and he was contemplating new job offers in Detroit and California when his father, Larry, suggested he move back to his hometown roots and help with the small family real estate business.
“I was managing a mall with over 150 stores and over 200 employees. To this day, I am not sure why I listened to my dad, but I am glad I did. We didn’t have any money. A few hands had to do the work of many. It took a long time to generate revenue and build a team. I am not sure how smart I thought my dad was then…now I look back and know he was a genius. And I think he would be proud of how I have grown and managed the business.”
“My dad took some of the buildings and fixed them up and got them rentable,” said Austin. “He put 50 hours a week in of really trying to build a company and bring a team on. Before that it was my grandfather, a couple of his friends and a guy who was a handyman. My dad was really the one who made it a true company.”
In the mid-80s BEI hired Dan Stellato as part of the effort to bring on people who had good experience and a knowledge and passion for real estate.
“They hired a number of folks. Dan not only survived but he rose up the ranks and now he’s president of the organization, which is great,” Austin said.
Austin also points to Stellato’s hiring as evidence that family members are not necessarily guaranteed top positions at BEI.
“We’ve never been one to say, ‘you’re the next in line so you’re instantly going to get the position.’ At the end of the day, part of the key to success of companies making it from one generation to the next is that you gotta figure out who’s got the passion, the skill set and the desire to really go in and do it. In the family business, you have to work harder, smarter and faster than everybody else because everybody just assumes you haven’t had to work a day in your life.”
For his part, Austin worked at other companies to gain experience and prove himself before joining BEI as vice president 10 years ago. Today, along with his responsibilities running the sales and revenue side of the business, Austin doesn’t shy away from getting hands-on when unusual problems crop-up. He described the way he stepped in a few years back when a rash of vandals cut down flags hanging from BEI properties.
“The only way to put them back up was to get to the top of the flag pole 60-plus feet in the air and re-thread the rope through. We had a lift but none of our guys wanted to do it because it was a little windier that day. And I said, 'well I’ll do it.' So I jumped in the lift and went to the top of the flag pole and threaded the line through, fixed it, and then drove to the next property. You do what you need to do to keep the ship going.”
Another key to BEI’s success is their reputation for exceptional customer service, as well as the tight-knit, charitable connection the enterprise has with local communities.
“We look at ourselves as good corporate citizens,” Austin said. “At the end of the day we’re all in this together. This is our town. I live here, I work here. I’m ferociously loyal to here. So we do what we can to help out those groups and those organizations that we think make an impact.”
Philanthropically, Batavia Enterprises raised nearly $300,000 in 2016 for local organizations and charities. The business has also donated spaces for groups such as Batavia Access, Fox Valley Hands of Hope, Anderson Animal Shelter and Batavia MainStreet.
Austin is especially proud of his father’s involvement in the founding of downtown advocate Batavia MainStreet, an organization Austin helped get stabilized funding and for which he has served as a two-term president. And Austin also takes pride in being one of the founders of Water Street Studios.
“Water Street is an amazing addition to the community and has helped define what Batavia is,” he said.
Additionally, Austin has made personal efforts towards bolstering the local business ecosystem through an entrepreneurship accelerator he started called the Fox Valley Entrepreneurship Center. The accelerator helps Fox Valley area companies strengthen their businesses, and Austin said that most companies see a 50 percent increase in their sales 12–24 months after getting involved with the Center.
“We need to do everything we can to preserve the quality companies we have here because it provides jobs,” he said. “It provides money for you to eat and socialize and entertain and makes people want to come to the area. It keeps our ecosystem strong and we’re trying to do that in Illinois where it’s not an easy place to do business.”
That BEI has itself remained a cornerstone of the Batavia business community for nearly 60 years is a testament to the company’s adaptability and the Dempsey family’s personal business philosophy.
“At the end of the day, you have to make the world a better place than the way you found it,” Austin said. “That’s been taught to me from my grandfather and my dad. And that’s part of our mantra here. We want to make our community a better place.”