Kathy Bonnafe will never forget the day one of her professors announced in class that Combined Properties Incorporated (CPI), a real estate management and development firm operating in the DC metropolitan area as well as southern California, was looking for second year MBA interns. “At the time, I was a starving student working a hodgepodge of jobs to pay my bills while going through grad school,” Kathy reminisces. “I remember walking out of the class, down the hall, and making the decision that I was going to apply. I was only a first year student, but something made me go back and grab the application anyway.”
As luck would have it, her background in information systems consulting was perfectly suited for the internship. Her self-confident and bold approach couldn’t have hurt her interview either, and she got the job. “It paid $18 an hour, which was a fortune to me at the time,” she laughs. Now serving as CPI’s President and CEO, following her intuition and believing in herself that day so many years ago changed her life in ways she couldn’t have imagined at the time.
CPI was a family owned business founded in 1984 to serve as the management company for the family’s portfolio of retail shopping centers. CPI and the real estate were owned by five members of the Haft family at the time Kathy joined CPI in 1990. She helped the current owner, Ronald Haft, pull the company out of bankruptcy and buy out the other family members in order to settle difficult family litigation during the late ‘90’s. Afterwards, she helped to recapitalize the company and commence its growth in Southern California. “Ron’s always been the external face of the company and more involved in strategy, capital allocation decisions, and networking and development, whereas I’m more of the internal face of the company,” Kathy explains today. “Ron is the brand, and I am the culture. It’s been a wonderful opportunity to work for him all these years, growing the business into what we’ve wanted it to become.”
With 42 properties totaling five million square feet and an asset valuation of over $1 billion, CPI’s midsize status is actually becoming quite rare in the commercial real estate marketplace, which is polarizing toward big players and small local developers. Ronald, Kathy, and their team of around seventy employees focus on managing their existing portfolio, but also maintain an active presence in the development world, which has included the major redevelopment of several shopping centers and several new mixed-use properties in California. “Most of the work we do involves redeveloping and transforming existing projects, although we have done some ground-up development as well,” says Kathy. “Our strategy going forward will be to bring in joint venture partners for our new value-add and development deals.”
Growing up in Vienna, Virginia, Kathy’s first job was stacking shoes at a retailer called Shoe Town. She held several waitressing jobs, and in the summers during college she interned with the Federal government. She was able to get loans to put herself through college, but she knew she’d need a job as soon as she was through. Though she thought she’d go into marketing or sales, she instead landed a job with Arthur Andersen doing management information consulting. Two years in that capacity was enough to convince her that her path lay elsewhere, so she accepted a position with Omni Offices in commercial real estate. “My mother tried to dissuade me, and the market was tanking at the time, but I knew it was the right thing for me,” she affirms. “I had always liked real estate and was intrigued by it in college, and though I had no commercial real estate experience, I sent my resume out to every single commercial real estate company in the Washington market, which ultimately led to the opportunity with Omni Offices.”
At that time, the real estate market was going through a major recession, and Kathy knew there was no way she could get the kind of job she wanted without an MBA. “I spent a year working in the marketing and leasing side of commercial real estate but didn’t like it, so my whole reason for returning to school was to get involved in the finance side of the business,” Kathy explains. “I was convinced that commercial real estate finance was what I wanted to do.”
When she was then hired by Ronald Haft, it was at a time when he was letting people go and bringing on new talent. She was tasked with selecting the software that would run the entire business—a mission for which she felt drastically under qualified for but readily assumed anyway. “I remember sitting in meetings where they’d use all these acronyms and real estate terms,” she laughs now. “I didn’t understand a thing, but I used my systems background and training and began reading the source documents. I tapped personnel in the organization to train me, and I taught myself the business.”
There were two software products on the market at the time to choose from—the industry standard and the new kid on the block. Perhaps because she herself was that new kid, she assessed each product’s capabilities and decided to take a risk by recommending the new software. “There I was, this 25 year old recommending this major investment by the company,” says Kathy. “They went with it, and twenty years later, it’s the gold standard in PC-based retail real estate software.” Her internship was a phenomenal success, and once she finished her MBA, her goal was immediately realized when she was hired on as a full-time financial analyst.
After serving a year in that capacity, she accepted an opportunity to transition into a position as Manager of Acquisitions. Through the following year, she and a colleague completed two acquisitions sourced by cold calling owners. She then seized an opportunity in the capital markets area to help the company refinance its debt and place new debt on its properties. “Again, I worked really hard, and I was able to learn how to finance successfully,” she remarks. She then moved from Director of Capital Markets to Assistant VP of Capital Markets, and then to VP. That was followed by Senior VP of Capital Markets, and then CFO. Kathy then ultimately had the opportunity to run the company as Executive VP before she was made President at age 35 in 2000. The title of CEO was added in 2011.
It’s no secret that Kathy wouldn’t have arrived where she is today without that bold attitude that has always characterized her approach to life. “This boldness really stems from intuition, which I think I’ve always had and have never been afraid to listen to,” she points out. Intuition, however, would be nothing without a strong work ethic, which Kathy has in spades. “I was always known as the person who gets it done—on time, on budget, and well,” she reports.
This trademark stems from a somewhat troubled family background. Her alcoholic father was ill for most of Kathy’s childhood, and her mother had become emotionally detached as a result. Learning to care for herself as a child, Kathy became fiercely independent at a young age. She excelled in school and athletics. “I knew I would go to college,” she reports. “I didn’t know how I’d pay for it, but I knew I’d go. I had learned at an early age that there wasn’t much I couldn’t do. From the dysfunction of my family situation came a lot of strength, and I’m thankful for that.”
In advising young entrepreneurs entering the business world today, it comes as no surprise that Kathy emphasizes the importance of listening to the voice that speaks within the confines of one’s own head—that voice which may be little, but has the most important things to say. “I applied to that internship not because I knew they’d hire me, but because in my gut I knew it was the right thing to do and I had nothing to lose,” she points out. “All through my career, I’ve been very confident and unafraid to ask for what I want as I plan and implement my vision. That voice in my head is the reason why.”
Still, however, Kathy readily acknowledges that there is a fine line between brashness and rashness. She was relatively young as she ascended the corporate ladder at CPI, and as such she had a lot to learn. “I may have been confident and effectuating, but I also made a lot of classic leadership mistakes,” she confesses. “It’s important to do your research and homework while you’re listening to that inner voice.” Once she felt she had assembled a rock solid team at CPI, Kathy addressed this issue head on three years into her presidency by hiring an executive coach to help hone her leadership skills. “I knew how to put a strategic plan together and how to tactically implement, but I didn’t know how to lead people,” says Kathy. “My coach really helped me put the mirror up so I could see how other people were experiencing me.”
What does it mean to be a natural leader? For Kathy, learning to be a better leader meant learning to be more herself—to let go of the persona of perfection she was emanating and instead govern without a mask. “Today, I am very much myself,” she remarks. “Interestingly enough, allowing myself to be myself has actually shifted the focus away from me. The biggest fundamental shift I’ve made in my leadership is to no longer ask what people can do for me, but what I can do to serve my people. It’s not about me, it’s about them—making sure they have the tools, techniques, training, support, guidance, and direction they need to be successful.”
This transition in her focus also links directly to another message Kathy passes on to young people, which is the importance of having a support system. “The friendships and relationships you develop in your mid- to late twenties are extremely valuable,” she points out. “The next thing you know, you have this network of people who have become senior VPs or presidents in their companies, which is exceedingly helpful and exceedingly fun.” When the voices of peers and mentors can supplement that internal voice in helping one navigate one’s professional journey, that same audacious spirit that saw Kathy through hers might be discovered in all of us.