Iowa Realty Co. Inc. has always been a Knapp thing.

Founded in 1952 by Bill Knapp, headed by his brother, Paul, for two decades, and for another 23 years by Paul’s son Mike, the family has presided over the operation and guided its reign as the largest real estate firm in Iowa.

All of that changed in November, when Mike Knapp announced that he would take a role as chairman emeritus and turn leadership of the company over to a public accountant and a marketer, neither one named Knapp.

Mike Knapp is at ease.

“I can’t think of anybody who has been at the helm of our company who has been more comfortable in the transition of our leadership,” Mike Knapp said. “When I took over, I think they would have been frightened to death.”

They might not be members of the Knapp family, but Kim Bakey and Brennan Buckley are trusted hands who have become part of the fabric at Iowa Realty.

Bakey, who was named CEO of HomeServices of Iowa Inc., Iowa Realty’s holding company, was chief financial officer for 22 years and before that handled the Iowa Realty accounts when she worked for Central Life Assurance Co., which owned the real estate company in the 1980s and 1990s.

Buckley joined Iowa Realty as marketing director 10 years ago. He was named senior vice president and general manager two years ago. That promotion provided the first indication that Mike Knapp was working on a succession plan.

They bring unique talents to a company that has embraced change and fostered growth during its 64 years. Knapp expects that pattern to continue.

“They’ll work incredibly well together. They’ve been working together for years,” he said. “To me, that was one of the critical elements of the transfer of power, to make sure those people who will be taking over the decision-making can work together for years.”

Two small examples: Iowa Realty plans to launch an advertising campaign in March that will emphasize the emotional side of the homebuying experience, and for the first time, the company has adopted a mission statement that expresses its core values.

As for Knapp, he really isn’t going away. He’s still in the office several times a week, but when the mood strikes him, he can putter around on his John Deere tractor or cast a lure to the largemouth bass that he says are undergoing a population explosion in his farm pond.

“As (my uncle) Bill says, ‘Emeritus comes with no responsibility and less authority, and at the same time an opportunity to stay engaged and interested,” Knapp said.

Bakey said she doesn’t think about the fact that, for the first time ever, there won’t be a Knapp at the top of the company.

“Holy smokes, I can’t think of it that way,” Bakey said.

Founder Bill Knapp has thought about it that way. Even so, he has complete confidence in his nephew’s ability to put the right people in charge of the company.

“It is odd to think that there is not going to be a Knapp running it after 60-some years, but I know Mike has someone good taking it on,” he said. “But it is an odd feeling.”

What’s in a name?

Bill Knapp founded the company in 1952, along with partner Billy McKain, after Knapp picked up the business from a previous owner. Knapp got the company in exchange for commissions he was due. He then brought in McKain. That partnership didn’t last long.

“I never wanted it to be called Knapp Realty,” he said. 

He discovered that the name Iowa Realty had been claimed at some point in time, but went unused. Knapp snatched it up and registered it with the Iowa secretary of state’s office in February 1956. By that time, Iowa Realty already was the largest real estate company in the state.

Knapp said he had the good sense to step back and watch others build the company. The late Ken Grandquist would be one. But Knapp points primarily to his brother, Paul, as the man who built the company and his nephew Mike for keeping it at the top of the Iowa real estate market.

“They’ve really kept it going,” Bill Knapp said. “I just stayed out of their way and let them do their job. … And by God, it took off.”

Along the way, there were ownership changes that provided the deep pockets that allowed the company to prosper.

In the early 1980s, with interest rates chewing up home mortgages and the farm crisis looming, Knapp decided he needed a partner. He found it in good friend Roger Brooks, who was president and CEO of Central Life Assurance Co.

Central Life bought 80 percent of Knapp’s shares in Iowa Realty and agreed to buy the remaining shares a few years later.

“I knew that I wanted to be a partner with somebody so that no matter what happened, you didn’t have to start over. If you go broke, you lose respect, you lose your confidence and you can’t borrow money,” Knapp said. “I always wanted to be in something that I could control. That’s why I never wanted to be a farmer; you can’t control anything.” Knapp grew up on a farm near Allerton.

Brooks had a vision for a financial services enterprise focused on homeownership. With Iowa Realty, he had a company that was already buying land and developing lots and building homes for its agents to sell.

As he suggested, Bill Knapp was focused on buying land and banking it.

He points out that Paul and Mike Knapp worked hand in hand building up the company. They were both top sellers in their day, and they were astute businessmen in what would appear to be the true Knapp vein. They were acquiring other real estate companies, typically market leaders, and they were creating franchises.

“Roger was exploring a financing services model for real estate brokerage, mortgage, title, escrow, insurance, property casualty, development and construction, maybe even life, centered all around homeownership,” Mike Knapp said. There were shared ambitions at play.

Central Life, after merging with Des Moines-based American Mutual Life Insurance Co., ultimately became AmerUs Group Co. But before the name was applied to the insurance company, it was used for the multifaceted real estate division, AmerUs Home Services, Knapp said.

“It’s a strange history,” he said. “But Bill always did the right thing at the right time, and him getting us involved with Roger and Central Life, which focused on building a brokerage that was beyond Iowa Realty in Des Moines …  navigated a path that has put our company in strong hands, in knowledgeable hands.”

Mike Knapp seeks to protect Iowa Realty

By the late 1990s, Brooks had decided that real estate, financial services and the insurance business were not a good fit. He decided to rid his company of all of its non-insurance businesses and put HomeServices and Iowa Realty up for sale.

Iowa Realty observers say that Mike Knapp had a bulldog determination to preserve the company. And as with many things involving the company, there is a good story to tell about how he kept Iowa Realty from becoming just another franchise operation of a national company.

Central Life had met with the ownership of ERA Realty. Knapp didn’t want Iowa Realty to become an ERA franchise.

“I didn’t believe that was the right branding for Iowa Realty,” he said.

Instead, Knapp persuaded Brooks to let him talk to MidAmerican Energy Co.

Knapp had met Alan Wells, then MidAmerican’s chief financial officer, through Mike’s brother, William Knapp II, who was working on a commercial brokerage deal with MidAmerican at Hub Tower in downtown Des Moines.

The three men met to talk about ways Iowa Realty could provide services to MidAmerican customers, especially home security services. The Knapps didn’t know at the time that MidAmerican had acquired a home security firm. Little matter. After the meeting they all agreed to stay in touch, Mike Knapp said.

A few months after the meeting, Brooks decided to sell Central Life’s real estate businesses. Mike Knapp got in touch with Wells, and MidAmerican Energy bought AmerUs Home Services  Inc. in May 1998. Iowa Realty was the backbone of the company and had doubled in size during the years it was owned by Central Life.

A year later, Berkshire Hathaway Inc. bought MidAmerican Energy, including its real estate operation. Mike was named president and CEO of Iowa Realty’s parent, HomeServices of Iowa. Ron Peltier was named president of HomeServices of America Inc., which is based in Minnesota.

To this day, you have to press Mike Knapp to get a sense of his role in the transaction.

“It just happened by the right things happening,” he said.

New leaders know past, plan future

Kim Bakey was working in the background, doing the financial detail work that led up to the MidAmerican acquisition. She had been with Iowa Realty a little more than five years and before that was the accountant assigned to Central Life’s non-insurance businesses. About 80 percent of that work centered on Iowa Realty and its related companies.

“I’ve been able to enjoy the ride for 20-some years with a lot of activity and change and growth,” she said.

The big change was being acquired by MidAmerican.

“We were in the midst of due diligence with one of the key competitors (ERA Realty) in the industry,” she said. “Becoming another division, whether wholly owned or becoming a franchise, was really not the direction that Mike or any of us wanted to see Iowa Realty go. He went out and sought out a buyer, put on the sales hat and went and sold the whole company.

“Those were intense and busy times, but I always had the feeling that we were going to come out OK with it.”

Knapp said she has been a good student of the business.

“Beginning as chief financial officer, Kim was very much responsible for making sure that the actions we all took made economic sense, weighing in as we envision where we want to be,” he said. “Over the years, she has grown to know the title business, the brokerage business, not just the financial wisdom and financial commitment to success. She understands the people end of things.”

Buckley came to the company as a marketing specialist who was a real estate agent at heart, Knapp said.

“His first qualification was that he’s an expert at marketing and configuring programs that help agents and make our programs more effective,” Knapp said. “He likes homes and always has. He doesn’t come from an agent background. He has a great understanding, a tremendous empathy for the agent in the business. He just really understands the life of an agent, the challenges they face every day. He’s just there for them. For him, it’s never been a 9-to-5 job; it’s been 24/7”

Bakey and Buckley were with the company as it weathered the housing crisis and remained at the top of the market.

Iowa Realty had its fourth best year for sales in company history in 2015, and this year will be even better, Buckley said. In addition, the company gained 124 new agents last year, with 44 coming from other agencies, the most in any year for the company.

Bill Knapp said that from the beginning in 1952, the focus has been on agents, and Bakey and Buckley are well aware of that legacy. The agent training program established under Bill and Paul Knapp continues to this day, for example, and is the best in the business, Bakey and Buckley say.

“Our real estate agents, and our employees, they are at the front lines of people’s lives at the most pivotal points in their lives,” Buckley said. “Whether it’s a marriage, a new baby, a divorce, a death, the highs and lows of people’s lives, almost always real estate is a part of that.”

Two of the changes that will occur under the new leadership are adoption of a mission statement and core principles that will reflect the impact the real estate brokerage has on the lives of its customers and an advertising campaign that focuses on the emotions that run through the homebuying experience.

It is worth noting that Bakey and Buckley also felt an obligation to get their real estate licenses when they joined the company. After all, Mike Knapp was a top producer when he was named president.

“I try not to dwell on being the first non-Knapp and what they have accomplished. I only hope I can accomplish what they have,” Bakey said.

 

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Iowa Realty timeline

1952     Bill Knapp acquired the company in exchange for real estate commissions he was due.
1956     The name Iowa Realty was filed on Feb. 22 with the Iowa secretary of state’s office.

1970     Paul Knapp, who had worked with his brother, Bill, at Iowa Realty, is named general manager. Bill Knapp credits his brother with building the company into the state’s largest real estate firm and holding on to that title. Paul Knapp had been one of Iowa Realty’s top-selling agents. His focus was on the residential brokerage, establishing franchises and training agents.

1972     R. Michael Knapp, Bill Knapp’s nephew and son of his brother, Paul, joins the company.

1977     Paul Knapp is named president of Iowa Realty.

1980s   Central Life Assurance Co., led by CEO Roger Brooks, bought 80 percent of Iowa Realty, then later in the decade purchased the remaining 20 percent. Bill Knapp points out with some pleasure that Central Life paid a little more than $1 million for 80 percent of the company and more than $7 million for 20 percent, with the growth of the company accounting for the difference.

1992     Mike Knapp is named president and CEO after working side by side with his father for several years.

1993     Kim Bakey joins the operation as vice president of finance.

1998     After Central Life decided to dispose of its real estate businesses and focus on insurance, Mike Knapp led the charge to find a buyer that would allow Iowa Realty to operate as an independent business rather than as a franchise operation, as had been proposed by suitor ERA Real Estate (legally known as ERA Franchise Systems LLC). Knapp found a willing buyer in MidAmerican Energy Co., now a subsidiary of Warren Buffett’s Berkshire Hathaway Inc.

2006     Brennan Buckley leaves The Integer Group and joins Iowa Realty as marketing director.

2007     Bakey named senior vice president.

2014     Buckley named senior vice president and marketing director for Iowa Realty.

November 2015     Bakey named CEO of HomeServices of Iowa Inc. and Buckley is named president of Iowa Realty Co. Inc. Knapp becomes chairman emeritus.