Rozansky & Kay Construction Co., a local developer with more than $500 million worth of projects in the works, will be split up at the end of the year, long-time partners Alan I. Kay and Allan E. Rozansky announced yesterday.
Kay said he is buying out his partner of 26 years because he plans to expand the business nationally. Rozansky's business interests lie with local, rather than national, development, Kay said, adding, "Some people just don't want to go bigger."
Neither partner would comment on how much Kay will pay for Rozansky's interest in the company, but a source close to the deal said the purchase price is "in the millions" of dollars.
Kay will become the sole owner of the Bethesda firm, which will be renamed Alan I. Kay Co., and he will purchase Rozansky's interest in projects that are now under way. Each partner will maintain his interest in the buildings they have developed together, Kay said in a telephone interview yesterday.
With $577 million in projects planned or under construction, the company last year was named one of the 20 largest developers in the nation by Building Design & Construction magazine.
Along with plans for additional developments in the Washington area, Kay said he plans to expand nationwide. Hotels, shopping centers and multi-use complexes are being considered for southern Florida and southern California, he said.
Rozansky and Kay said that the buyout was amicable and that they had no disputes. Rozansky "has expressed a desire to pursue other goals that the daily demands of the construction business prevent," Kay said. "We have not only been in business together for 26 years, but we have been best friends since boyhood, and continue to be."
Rozansky, who will retire from the firm as of Jan. 1, said that he hasn't decided what to do next, but wants to decrease his activities, stresses and pressures. Although Rozansky expressed his desire to reduce his development activity, he said he may start his own construction company in the future.
Five of the company's projects, worth more than $300 million, are along Metro's Red Line route in Montgomery County, including the eight-story Bethesda Office Center off Wisconsin Avenue and Twinbrook Office Center, a six-story complex in Rockville that includes an office building and the Holiday Inn Crowne Plaza.
Kay's new company will continue development of the $160 million Bethesda Metro Center, a complex scheduled to open in November over the Bethesda Metro Station. It consists of a 12-story Hyatt Regency Hotel, a shopping arcade, a public plaza, a 17-story office tower and an ice-skating rink.
Other Rozansky & Kay projects include the $75 million multibuilding Tysons Dulles Plaza, a 448,000-square-foot office park at Springhill Road and the Dulles Access Road in Tysons Corner; the $28 million Woodmont Office Center, and the $35 million Ballston Common Office Center.
The partnership between Rozansky, 51, and Kay, 50, began in 1959 as a real estate development organization specializing in multi-family residential projects. The firm built more than 13,000 apartments and has diversified into the construction and management of office buildings, mixed-use complexes and office parks.