Alex Lepe
Cary Moon, Fort Worth’s newly elected entrepreneur city councilman, is a proud bean counter. The HP 12c financial calculator is his favorite cell phone app, he says. And he’s not ordering pizza with it.
Moon, 45, insists his first deal was the home he bought for himself after he read Rich Dad Poor Dad while in college at Texas A&M, but he concedes his childhood buddy and longtime business partner Blaise Walker has a different idea on that one. Walker says Moon’s first deal came earlier, when the two were tenors in the 18-member show choir at Burleson High School and trying to fund an $1,100-per-student, year-end trip that included Walt Disney World, Sea World, and a Bahaman cruise.
“We had no money,” says Walker, who drove a ’76 Mustang and Moon a ’76 Camaro with a T top, cars whose consistent breakdowns helped seal the friendship. “You always needed a good friend to help push you home,” Moon says. “And both of us knew we’d be paying the favor back.”
So Moon, who played the confident gambler Sky Masterson in Burleson High’s production of “Guys and Dolls” and the outsider Tommy in the “Music Man,” came up with a Valentine’s fundraiser idea: Charge $5 to sing a song to somebody at school, a service he dubbed “Vale-Grams.” For three days, “all we did was sing songs,” says Walker, known to jokingly measure all his investments with Moon against Vale-Grams’ high returns and margins. “We raised $100 a person for each of us.”
That helped put the group over the top. Moon’s subsequent business deals have been slightly more ambitious. Elected to the Fort Worth City Council in May to represent the district that runs from Woodhaven up Interstate 35 to the Alliance Corridor, where he lives in the giant Heritage neighborhood, Moon’s an unusual character on the council for his substantial business-building background.
A former banking executive, he now does commercial real estate deals with his network of as many as 55 partners, many of whom he’s done numerous projects with. Moon is co-founder, minority owner, and CFO of Castle Development Group, a two-year-old Keller commercial real estate firm that reports it’s developed $64 million in projects and expects to start $60 million worth next year. Moon also co-founded Jackrabbit Capital with his three Castle partners to invest 401(k) money in Castle deals. Jackrabbit is now up to $3 million in capital and will close at $5 million; Moon expects the fund will be able to lever that quickly into $30-$40 million in real estate assets.
Perhaps more visibly, Moon and partners have been building a stable of restaurant, bar and entertainment venues, with Moon as largest owner. A Moon-led partnership purchased the Arlington Music Hall this spring and has been working to boost the number of concerts, bringing in Kansas, Brenda Lee, Tanya Tucker, the Oak Ridge Boys, Ronnie Millsap, and Don Williams. The partnership, which bought the adjacent Babe’s Chicken Dinner House building in the deal and became its landlord, also plans next year to build a tavern in the same complex.
Moon has also been at work revitalizing a big piece of downtown Keller since 2010, buying seven properties and investing $6 million so far, with development underway on another $4 million office and restaurant building on two of the lots. A Moon partnership built and opened the Texas Bleu steakhouse in downtown Keller this summer, next to the Keller Tavern, owned by one of his groups. Moon plans to open another new restaurant downtown next year called Luna Loco, or crazy moon. Moon and his partners also own the Trinity Tavern off of Texas 360 in Fort Worth and the Dalton’s Corner restaurant in Burleson.
Moon still owns a portfolio of 14 rental houses that includes his first home, which he purchased in 1995 to live in, and a tax service he founded called TaxTicket, which has 150 clients. Moon is 50 percent owner with partner Richard Beaver.
“People think I’m aggressive,” Moon says. “But I’m very conservative.”
Glitteratti Pictures
Moon, with Fort Worth Mayor Pro Tem Sal Espino
Moon likes to say he has a few rules that guide his investments: Take debt on the real estate, but never on the business on top of it; go for easy-to-understand businesses, pursue high return on investment and focus first on the price. His ROI targets: 18 percent annually on real estate, and 9-14 percent on the associated business.
“That’s hard to get to,” Moon saysof the latter. “That’s why I always like to own real estate. You own the real estate; you combine those two ROIs; it’s a pretty good deal.”
Take a 15-year note on the real estate and 1.25 debt coverage - net operating income as a multiple of debt due within a year - “and you’re going to get an 18 percent ROI or more,” says Moon, who remembers once calculating the ROI on a 2 percent certificate of deposit and being “disappointed.”
Moon’s passion for numbers played a big role in his successful campaign for City Council this spring and now on the council. In the end, Moon, who was president of the 9,000-resident Heritage Homeowner Association, polled heavily from far North Fort Worth, which previously had voted little in municipal elections, winning the election with 60 percent of the vote. He drew from incumbent Danny Scarth’s Woodhaven base, but needed virtually no support from it to win. With people in far North Fort Worth having clamored for their own representative on the council, “I knew the numbers were going to be there,” Moon says.
Now on the council, Moon’s bringing his business background to bear. As new chairman of the Woodhaven tax increment finance district, Moon’s held the board’s first two meetings in five years, with directors deploying $117,000 this fall for street lights, signs, and other aesthetic improvements in the struggling neighborhood. Moon also is chairman of the Alliance tax increment finance district, and that board is deploying $8 million over the next several years.
“My philosophy is deploy capital up front,” said Moon, who’s working on building support in the Woodhaven portion of the district, from which Scarth won re-election several times. “Then we will make that money up over a short period of time.”
As a banker, “for decades, I sat on the business side of that government desk and brought development to underserved areas,” he says. “We have to have a bag of tricks to encourage development, and then we have to market that bag of tricks.”
One no-cost program he’s working on helping to implement next year at the Woodhaven Country Club: a swim team that will compete against other teams. “It’s a tremendous opportunity for kids” on the east side of Fort Worth, underserved by pools, Moon said. “It’ll be a tremendous asset for the community.”
Former City Council member Becky Haskin, who broke ranks with many of her Woodhaven neighbors and supported Moon during the election, gave Moon a wish list that included nonstop conversations with residents, dealing with nagging code compliance issues, and promoting economic development.
“Leverage incentives to find capital and the right buyers,” Haskin, who is preparing to move to the Keller area to be closer to her grandchildren, said of what she expects from Moon. “He does that all the time.”
Moon grew up in Burleson; his father was an engineer and mom a church secretary. When it came time for Moon to go college, he chose Texas A&M, even though his dad was a Texas Longhorn and declined to pay for Moon’s A&M education. “It took me 17 years to pay off my student loans,” Moon says.
“I’m glad he did make me pay my own way,” Moon jokes. “This now-family standard makes for an easy conversation with my daughters now when they say they want to go to TCU.”
At A&M, Moon majored in sociology, minored in accounting, and served in the Aggie Corps of Cadets. “I saw Top Gun when I was 17,” he says. While in school, a friend urged him to read Robert Kiyosaki’s Rich Dad Poor Dad - the bible of many entrepreneurs for its eschewing of traditional educational and career paths as traps and urging of risk-taking – and The Richest Man in Babylon, a book that gives financial advice through stories set in ancient Babylon.
Moon started his post-college career as a management trainee for Enterprise Rent-A-Car, learning what he says were invaluable basics of running a business. “You ran your branch; you have responsibility for customer service and your sales. You could see your P&L. Those are things I still do every day,” Moon says.
He’d also resolved to start buying real estate, one home per year and using the cash flow to finance the next deals, a Rich Dad strategy. His first deal in 1995: his own home. “I just knew I needed roommates to help me pay for it,” he says.
For his second rent house deal, Moon paid $65 to advertise a three-bedroom, two-bath, two-car-garage home in Arlington, even though he didn’t have one. “I just wanted to see what the response would be,” he says. “I got 50 phone calls. I went out and bought a house. That’s how I started doing more.”
Moon bought new from Fox & Jacobs. Elsewhere, he bought two homes where he paid a nominal fee and took on the loan payments. He bought from people he knew who were in financial trouble; he bought one per year through 2004. “Your opportunities are there in front of you,” he says of another Rich Dad point. “You don’t have to search for them.”
In 1998, he earned his securities license and moved to NationsBank as a branch manager from Enterprise. Moon spent 13 years in banking, going into community banking in 2006 and working at two community banks before becoming CEO of American Bank in 2008 and 2009. “At NationsBank and Bank One, I was just real aggressive in sales,” Moon says. On the side, he started his tax service in 1999. And in 2004, he began applying his one-project-per-year strategy to commercial real estate. He built four buildings for Enterprise (“that’s how I got into commercial real estate”), owning the real estate and serving as landlord.
In 2008, Moon created Moon Financial Corp., the managing partner in all of his limited liability companies. In 2010, he and partners opened the Trinity Tavern, the first of the restaurants and venues Moon has majority interests in today.
Moon already owned a Quizno’s, and he’d gone into a Double Dave’s pizza restaurant with Walker, but they sold the franchises when Trinity Tavern’s early sales came in strong, Moon says. The bar-and-restaurant business’ profit margins are higher – franchises’ 6-9 percent fee, plus marketing expenses were big challenges - and they decided they needed to the own the real estate.
The franchise experience could have been unproductive, “but we applied standards on owning our own real estate when possible and invested profits in other real estate projects,” said Moon, who, with partners, still owns the Quizno’s and Double Dave’s real estate today.
In 2010, Moon and his partners started buying property in downtown Keller, “when nobody else was buying,” Moon says. Besides the Keller Tavern and Texas Bleu sites, their purchases include the three-building Main Street Depot, putting in offices and a private event room for rent, and another commercial building, which they rehabbed and leased to the Feedstore BBQ of Southlake. Moon owns 30-50 percent of each deal is always the largest owner.
In 2013, Moon co-founded Jackrabbit and Castle. Partners Matt MacLeod and Andrew Miller lead Castle and are majority owners, and Moon and a fourth partner, Shane Foss, are minority owners. All four own Jackrabbit. Moon estimates he has interests in more than 30 partnerships today.
Castle, which specializes in healthcare, does $4 million-$25 million projects, typically retaining some level of ownership and serving as landlord, and often becoming partners with end users such as physicians. Castle’s working projects today include an urgent care center in Haslet, freestanding emergency room in Frisco, three-story medical-office building on Harris Parkway in the Chisholm Trail corridor, and an imaging center and medical-office building in Tulsa.
MacLeod and Miller, who were doing in healthcare development for another company, sought Moon out when they were considering leaving their employer and founding Castle. “We needed some guys with a balance sheet,” MacLeod says. “You’ve got to be bankable.”
As a banking executive, Moon says he learned about how to structure deals. “He knows if you can’t build the building for a certain amount, it’s not going to be successful,” Walker says. And Moon spent a lot of time looking at business plans and learning a lot about higher-risk deals, where executives set themselves up with high salaries, compromising the business. “Embedded in there is $150,000 worth of W-2 wages for him,” Moon says. By studying business plans, “you learn a lot about the character of people behind them.”
Moon learned a lot about partners and the challenges that arise when partnerships go bad. “I had to schedule back-to-back meetings with partners,” he said. “They couldn’t be in the room at the same time.”
And during the recession, Moon saw a lot. “You had people holding on to their big house that had equity in it that they could sell to pay their debts,” he said.
This led to another of Moon’s investment tenets. “What I’ve always tried to do is create an investment, not a job for me,” he said. “I don’t buy myself a job. I get paid the same way my partners do: through net income. My goals are aligned with yours; let’s go create an investment.”
The Arlington Music Hall deal combined two of Moon’s passions - numbers and music - and illustrate his group’s ability to dissect deals.
Moon and his partners were looking for a location in downtown Arlington for a Trinity Tavern. Neither the Music Hall nor the Babe’s building were for sale, but two lots were, so Moon contacted owner Burk Collins, who renovated the music hall in recent years and brought in Babe’s.
Moon says he didn’t haggle when Collins gave him a price, which Moon doesn’t disclose. “They wanted to have a good steward for their properties,” he said. “I grew up with my dad, picking guitar and singing gospel music, so I’ve been around music my whole life.”
Moon hired Claud Smith, who was his choreographer at Burleson High School, to be the hall’s curator. Smith, a cruise line director in recent years, is working to bump up the number of high-profile concerts, which had been running once a month. Smith will also put together a Christmas show that the hall will own and debut in 2016.
“My goal is to have a concert every Friday night” at the 1,071-seat Music Hall, the former Johnnie High’s Country Music Revue, Moon said.
The new owners also plan to boost the quality of food and beverage served at the deco lounge in the music hall. The lounge also plans to begin taking credit cards at some point.
On one of the vacant lots, the partnership plans the new tavern, which will open next year. It plans to sell the other vacant lot.
Moon says you won’t find him hanging out around the businesses he owns. “I look at the ratios every day,” including labor schedules and cost of goods sold, he said.
Off the clock has changed over the years for Moon and his wife Alisha, who have two children, ages 7 and 9. When he and his friends were younger, they’d go to Aggie games, go duck hunting, and play poker.
They’d go to Shreveport, where Moon would play poker. “Cary’d sit there and he’d look at what was in the pot and calculate the odds of winning,” Walker says. Says Moon: “We played poker before the Travel Channel players came along.” He competed in one World Series of Poker tournament in Las Vegas, finishing 967th.
These days, off the clock means date night on Fridays for Moon, his wife and children; they typically bring in Chinese food and watch “Shark Tank” on TV. And on Sundays, it’s service at First Baptist Church Keller, followed by dinner at Texas Bleu.
Moon’s also still at work on figuring out how many hours he needs to devote to city business. When he took office, his estimate was 20 hours per week. The actual: “A lot more.”