Safeguard Properties uses a nationwide network of contractors — this one is in Columbus, Ohio — to maintain and clean up foreclosed properties.
From behind the desk in his spacious office, Robert Klein sees a foreclosure crisis in full swing.
Outside his door, a sea of cubicles fills the 75,000-square-foot nerve center that is Safeguard Properties, the company he founded. On a recent workday, hundreds of employees monitored the thousands of contractors who look after millions of homes around the country in various stages of foreclosure.
“In the business that we’re in, we see the devastation that this does to families. We actually see what it does, where people are uprooted,” says Klein, 59. “It’s a monster of a problem.”
That monster problem, as it turns out, has been a major boon for Safeguard. Few businesses have flourished as much during the housing crisis as the one headquartered inside this ordinary office park in a leafy suburb 15 miles south of Cleveland.
Klein, who grew up in Brooklyn and drove a taxi for five years, moved to the area in the 1970s to run a produce company he bought from his uncle. He eventually sold that business and started Safeguard Properties in 1990 with a single employee.
What began as a small regional firm has become the largest privately held mortgage field services company in the nation, with more than $600 million in income last year. It has 900 employees and 10,000 contractors operating in all 50 states, the Virgin Islands and Puerto Rico.
Safeguard completes an average of 1.2 million work orders a month, doing such things as mowing the grass, replacing windows, cleaning out vacant houses after an eviction or fixing them up to prepare for resale. That’s nearly double the pre-crisis volume for the company, which bills itself as a one-stop shop.
Klein and his colleagues grow sheepish when talk turns to the success they have reaped in the wake of economic collapse. They note that the business had grown steadily before the financial calamity.
But even Klein acknowledges that the national wave of foreclosures has boosted his bottom line. “A lot of people say, ‘Robert, you must be doing great. The foreclosures, the timing. . . . ’ And they’re right.”
Even so, the question troubles him, he says. He explained it this way in a speech to vendors this summer: “Doing the right things for clients means serving their best interests. In fact, our company’s mission is ‘safeguarding our clients’ interests.’ It isn’t ‘grow business from a housing crisis.’ ”
Given the recent boom in business, particularly while so many others are suffering, Klein could have quietly enjoyed the profits and kept the company under the radar. Instead, he has maintained a high profile, speaking and writing frequently about housing issues. Safeguard sponsors national conferences, such as one in Washington next month dedicated to property preservation and featuring industry executives, municipal officials and employees from government-backed mortgage giants Fannie Mae and Freddie Mac.
Along the way, Klein has become a powerful figure in the mortgage world. And also something of a paradox:
He has butted heads with local officials angry about the blight in their communities and frustrated by abandoned properties and unresponsive banks. And yet he has invested in expansive databases to track vacant property ordinances and aid code enforcement officers. He has been called a shill for the banks whose mortgage abuses helped create and exacerbate the crisis. And yet he has brought together disparate groups in search of constructive ways to end it.
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