Kelley Bergstrom — national notable in real estate investment — has transformed an industry, while never losing sight of his down-to-earth values.
There are people whose roads to riches are the stuff of books and movies.
Kelley Bergstrom is clear: That’s not him.
“I’m not some guy who threw a shovel in the backyard and oil started flowing out,” says Bergstrom, Chairman of Bergstrom Investment Management; formerly CEO and president of JMB Properties Company; formerly real estate development manager for IBM; formerly Army captain; formerly (with a few stops in between) Saturday milk delivery boy at Anderson Erickson Dairy during his high school days in Des Moines.
Bergstrom, whose parents bequeathed only their roll-up-your-sleeves work ethic, solid Midwestern values and stockpile of canned goods, is very careful to point out that any success has come, well, from being very careful.
His is a story of diligent research and calculated risk, of conservative investments and fiscal prudence, of seeking advice and then actually following it. If his success story ever made its way into a book, the title might be “Get Rich Slow.”
I think college really opened up the world. You got to see the possibilities of what you could do, where you could go, what the rest of the world was doing. I always appreciated that, because I think it gave me some real opportunities.
— Kelley Bergstrom —
“It goes back to my Iowa days,” says Bergstrom, speaking by phone from his home in the middle Keys. (He and his wife of almost 50 years, Joan, also own the home just north of Chicago that they purchased early in their marriage.) “I always observed there were two types of farmers in Iowa. The ones who were really successful and the ones who weren’t. They both complained a lot about everything, but the guy who managed his debt came out way ahead.
“Agriculture and real estate have a lot in common.”
His two daughters, raised on a mantra of financial moderation, grew up with chores and part-time jobs. But their father was neither tightwad nor stick-in-the-mud. He was generous with time, says Allison Bergstrom, now president of Bergstrom Investment Management in Chicago, and a UF, DePaul and Cornell grad. “Even though there were a lot of demands on his time, he was always at our swim meets,” she says. And he was generous with money, too, but experiences trumped glitz — so education and travel, yes; designer handbags, no.
That value on education and experience would transcend their family and touch countless students. Bergstrom is now a philanthropist of note at both of his alma maters, Iowa State and the University of Florida.
“Prior to going to Iowa State I’d been in two states in my life, Iowa and Minnesota,” says Bergstrom, whose name adorns a commons area at the Ivy College of Business at Iowa State and the real estate center at the Warrington College of Business at Florida.
“I think college really opened up the world. You got to see the possibilities of what you could do, where you could go, what the rest of the world was doing. I always appreciated that, because I think it gave me some real opportunities.”
From Dairy to DMZ
Bergstrom’s childhood sounds like a page out of Boys’ Life: a crew-cutted youngster, his father a dairy worker and his mother a homemaker, spending the Eisenhower years careening down the hills of Des Moines in a soapbox derby car, camping out with his pals by the creek, and holding meetings of the neighborhood military club in his dad’s shed.
This military club benefited from an unusual addition to the Bergstrom yard. Bergstrom’s father, somewhere in his travels around town, got his hands on an old German World War I Maxim water-cooled machine gun, complete with tripod. Playing army would never be the same. Much to Bergstrom’s mother’s relief, the gun was soldered shut, but the boys lugged it around and even perched it on a hill overlooking a highway. (This placement resulted, years later, in a visit from the FBI preceding Nikita Khrushchev’s tour of Iowa in 1959.)
“I can’t think of anyone in the state of Iowa who had a 50-caliber machine gun from the Great War in their backyard,” says Bergstrom. “It was a badge of honor.”
A lifelong friend, Gary Hauge, jokingly attests to Bergstrom’s early aptitude for business. When Hauge’s father wouldn’t buy him a coveted P-61 Black Widow model, Bergstrom offered to loan him the money. “I paid him back,” Hauge says. “It was $2 or $3, and he said, ‘You owe me another quarter.’ He’d charged me interest!” (Bergstrom got the quarter, Hauge says, but not before also getting a headlock.)
Despite encouragement from his parents, who preached the value of education, Bergstrom was an indifferent student until junior high. It was there — under the spell of the gifted Mr. Drake (history) and Mrs. Williamson (English and Latin) — that his world view began to shift. Those teachers helped him “understand the flow of things,” he says. More importantly, he learned that there actually was a flow of things and that if one connected the dots and looked for the patterns one would more likely meet with success.
At East High School, Bergstrom played center and linebacker and joined the yearbook staff and Junior Achievement. He also buckled down academically, graduating in the top 15 percent of the Class of 1960. It was during high school, too, as he worked alongside his dad at the dairy, that another role model emerged in dairy founder and president Iver Erickson. In a sea of sterile white uniforms, Erickson, natty in a dark suit, stood out. But he stood out for another reason as well. Despite being management in a union operation, he was well-liked by everyone.
“He just seemed to be a guy who had a great persona and who obviously did quite well,” says Bergstrom. “That impressed me.” He took an important lesson from Erickson: the person in the suit doesn’t have to be a jerk.
Bergstrom arrived in Ames, Iowa, as the Vietnam War was heating up. He promptly became an “activities jock,” rising to president of Pi Kappa Phi and serving on the Interfraternity Council, among other roles. These exercises in collaboration, negotiation and consensus-building — “eye-opening experiences,” he says — gave him his first real taste of leadership. He also enrolled in the ROTC, a requirement at the time for all able-bodied male students at land-grant universities.
But these were tense times for young American men, and although Bergstrom majored in accounting and finance, he became a commissioned officer upon graduation. It was a calculated move, designed to put him on the slightly more predictable path of the officer ranks and avoid the gamble of the draft.
“Also, all of the male members of my family had served in World War II,” he says, “so a tradition of service was there. That made it feel good.”
Thirteen of those months on active duty were spent in Korea with the Army 7th Infantry Division. Oddly, it was amid the rural stretches and rice paddies abutting the demilitarized zone that his life in commercial real estate was born. Several officers worked in that profession in civilian life and Bergstrom became intrigued by the complexity of the work — buying land, putting deals together, hiring contractors, leasing and selling. “It’s very entrepreneurial,” he says. In 1967, after researching the options for MBAs with a real estate concentration, he arrived in Gainesville on the G.I Bill to study under noted professor, real estate department chairman and textbook author Alfred Ring.
In addition to learning the ins and outs of real estate and the art and science of appraisals, he absorbed management case studies. Many of those supported what he’d seen in Iver Erickson back at the dairy: It’s about the people. Paying attention to employees — soliciting their opinions, involving them in the process — is good for everybody and, not inconsequentially, for the bottom line. He carried those lessons into the workforce.
Whether it’s ruminants or rentals, there’s no room for shortcuts or laziness in the business world.
Bergstrom tells a story of his early days at IBM, a fresh MBA in his arsenal (and maybe a swagger in his step.) Two weeks into the job, he was handed a big box holding invoices worth $850,000 — about $5 million in today’s dollars. IBM was getting ready to pay them, but the boss wanted the new guy to take a look. Bergstrom spent four nights reading leases line by line. This feat of stamina and superhuman focus paid off: He uncovered mistakes that saved the company $125,000.
“Even the nastiest task, the extra things you have to do at night, can sometimes be an instrumental part of getting started in your career,” he says.
Kelley Bergstrom epitomizes the person that I use as a role model with our students.
— David Spalding, Dean of the Ivy College of Business at Iowa State —
Bergstrom rose through the ranks, first at IBM and then, with a workforce of over 3,000 under him, at JMB. His activities attest to his dedication to the industry: He was an initial board member and former chair of the National Multifamily Housing Council and a member of the Institute of Real Estate Management, among other organizations.
For his career ascension he modestly credits luck, plus education, management training courses and some basic practices and tenets: Get into the trenches, understand the problem, set the example, treat people with decency.
But those who work with Bergstrom are not so reticent. They say his contributions transformed an industry once beset by reputational issues. And they say his leadership qualities seem inborn — maybe a molecular mashup of the Midwest, state schools, the military.
“In all the years I’ve known Kelley, I never saw him lose his cool,” says Ernest Johnson, who worked for Bergstrom at JMB and knew him in nonprofit work before that. “I never saw him raise his voice. I never saw him criticize someone in front of the group. I never saw him demean someone’s work. I never saw him discourage anyone from trying something new. I never saw him blame an individual if things went the wrong way.”
“I don’t know anyone,” he says, “who doesn’t respect Kelley Bergstrom.”
Giving Back, and Having Fun
In 1994, after 22 years with JMB — working, he says, “in the greatest environment” (Bergstrom seems preternaturally disposed to seeing the best in people and situations) — his division was sold and he was given the option of cashing out. He took the plunge, opening Bergstrom Investment Management.
Kelley is strategic in his thinking, very clear-minded, very focused on the mission and the vision and ‘What can we do collectively?’
— Mark E. Timmes (BSAC ‘79, JD ‘84) and national CEO of Pi Kappa Phi —
Immediately, vows to himself to simplify his business life were broken. “If I was in 25 deals then,” he says, “I’m in 60 now.” Although he shares the load with his daughter, he still works every day. Easter Sunday, for example, between church and dinner, saw an afternoon spent preparing for a visit to a shopping center slated for redevelopment.
And he gives back, both with time and money. He remains involved with his fraternity at a national level, mainly in areas of education and housing. “Kelley is strategic in his thinking, very clear-minded, very focused on the mission and the vision and ‘What can we do collectively?’” says Mark E. Timmes, a two-time Gator grad and CEO of Pi Kappa Phi. “But he’s also very genuine and personable.” (And apparently devoid of airs. Wherever they travel, Timmes says, “Kelley wants to find the Waffle House.”)
At UF and Iowa State, he is lauded by presidents, faculty and fellow volunteers for his vision and involvement — leading Foundation boards, in veterans’ affairs, in business schools. He does not, several have noted, write a check and walk away. “Kelley Bergstrom epitomizes the person that I use as a role model with our students,” says David Spalding, dean of Iowa State’s business school.
Bergstrom is also a strong proponent of both UF and Iowa State’s land-grant mission. “It’s not enough just to do research and teach students,” he says. The state, the community and business must benefit as well. Toward that end, the Kelley A. Bergstrom Real Estate Center at UF actively works to unite academics and industry.
Bergstrom insists he gets as much out of philanthropy as he gives. He enjoys the creativity, the chance to make a difference, meeting interesting people.
Plus, he just likes to work. He has a little more time now for White Sox games when he’s in Chicago; for going to Denver to see his daughter, Melissa Munro, and her husband and children, 9 and 11; for boating and fishing — snapper in the Keys, large-mouth bass, walleye, crappies and bluegills with old friends in Minnesota. (He’s known for his skills at cooking up the catch, too, Hauge says. The secret: pancake flour, peanut oil and potato flakes.) In 2013, Bergstrom and a circle of Pi Kappa Phi brothers, including Timmes, completed a 17-year odyssey and checked a box off their bucket lists: UF games at 13 SEC stadiums (complete with 1 a.m. runs to 13 SEC Waffle Houses.)
Still, the prospect of endless amusements seems to hold little appeal. “I’ve been on cruises before where the guy’s been on the ship for a year,” Bergstrom says. He doesn’t sound critical, just bewildered.
It’s not as if he doesn’t enjoy a good cruise; he and Joan take one every year, stopping in exotic ports of call around the world, and this year they’re treating themselves to two — Cuba and Europe. But a solid year moving from show to shop to deckchair as the world glides by? That’s bliss for some. Kelley Bergstrom just seems to prefer his feet on the ground.