Private Wealth Asset Management attracted two Texas-based Wells Fargo advisors with more than $1 billion in managed assets to join the firm and form a new division focused on clients and families with significant land holdings, many with oil and gas reserves.
Bryan Frazier, previously a senior regional manager at Wells Fargo and now the firm’s new head of energy asset management, and his partner Rodney Kleman, now Private Wealth’s head of real estate management, join Private Wealth Asset Management just months after the now some $6 billion in assets under advisement was formed by several other Wells Fargo veterans.
Frazier told WealthManagement.com that the ability to manage these kind of assets—often farms and ranches that need to be managed and come with drilling rights—brings the firm a rare ability to serve a unique client niche who need to balance the real estate, farm management and more liquid holdings in the energy sector with their overall portfolio. Larger financial institutions and banks have retreated from that space, he said.
“This is a need where Private Wealth felt like a lot of clients were being underserved or not served at all,” Frazier said. “Being able to fill that role and need … and to be able to have that under one roof, you’re not going to find that. I don’t care how big the RIA is in this space. I don’t care if they have $30 to $50 billion under management. They don’t have what we have.”
Kleman, a self-described “farm and ranch kid by nature,” is a Texas native and worked at Wells for 15 years. For much of that time he focused on farm and ranch properties with energy production, while Frazier handled “underground assets,” like the oil and gas holdings themselves.
“As you look at that oil and gas development and then the surface of a particular property, those two activities can be pretty antagonistic if you’re not careful, because oil and gas companies want to maximize their production. The surface owner may want to protect that surface as much as possible” Kleman said. “It’s a balancing act that we’re able to optimize those activities on a given property, and we do see a lot of clients that have both on a particular property.”
Kleman said the move to Private Wealth was a chance to be more responsive to clients’ needs, with less corporate overhead demands on his time. And with many of the firm’s 40 team members in offices across Iowa, Nebraska and Texas, there are other clients that can benefit from the specialization.
“You can go to the Edward Jones’s of the world, and you can go to a lot of these other RIAs, and say ‘I’ve got an equity portfolio I’d like for you to manage,’” Frazier said. “But if you also tell them ‘I’ve got these massive interests in oil and gas, or I’ve got these several farms and ranches I need someone to manage,’ they’re going to look at you and say, ‘I don’t know what to tell you. I don’t have anyone here who can do that,’” Frazier said.
The two advisors will keep their home bases in Texas, with Frazier operating out of Fort Worth and Kleman in San Antonio, but will work with clients around the country.
“At the end of the day, these legacy assets that may have been contained in their families, sometimes for generations, it may not be the biggest part overall of their portfolio,” Frazier said. “But it’s probably the most important.”