AMREP Corporation: A History of Land Development and Media Services
Founded in 1961 as The American Realty and Petroleum Corporation, AMREP Corporation is a diversified public company headquartered in Princeton, New Jersey. Traded on the NYSE under the symbol AXR and serving as a component of the Russell Microcap Index, the company operates across two distinct sectors: land development and media services.
Over the decades, AMREP has evolved from an aggressive interstate land seller into a regional developer and a major player in the publishing fulfillment industry. Led by CEO James Wall, the company manages a complex portfolio of assets and subsidiaries.
Key Facts
- Founded: 1961
- Headquarters: Princeton, New Jersey, USA
- Primary Subsidiaries: AMREP Southwest Inc. and Kable Media Services, Inc.
- Major Project: The development of Rio Rancho, New Mexico
- Media Standing: Operates one of the second-largest subscription fulfillment services in the U.S.
- 2010 Financials: Reported revenue of US$ 120M with total assets of US$ 212M.
Land Development and the Growth of Rio Rancho
AMREP's real estate operations are managed through AMREP Southwest Inc. The company's most significant venture began shortly after its incorporation when it purchased 55,000 acres of land north of Albuquerque, New Mexico, establishing the town of Rio Rancho. By 1971, the company expanded this holding by acquiring an additional 35,000 acres.
Initially, AMREP targeted retirees and out-of-state vacationers using an aggressive sales strategy. Potential buyers were shown a promotional video titled "Your Golden Future," which framed the land as a high-value investment. However, because AMREP held such vast quantities of land, the resulting oversupply kept property prices low, rendering the homes poor investments for many early buyers.
Following legal challenges in 1977, the company shifted its strategy to target local residents of the Albuquerque area. This new approach focused on providing low-cost housing and stimulating local economic growth. AMREP began offering subsidies, tax reductions, and inexpensive real estate to attract businesses to Rio Rancho, thereby creating jobs and organic demand for housing.
A major success of this strategy occurred in 1981 when Intel established a $50 million manufacturing plant in the area, significantly boosting local employment and real estate demand.
Media Services and Subscription Fulfillment
The company's second major pillar is Kable Media Services, Inc., acquired in the late 1960s as the Kable News Company. This division specializes in fulfillment services—the process of managing subscriptions and distributing publications—for magazines and publishers.
In addition to fulfillment, the division provides marketing and graphic arts services. Kable Media Services grew to become the second-largest subscription fulfillment provider in the United States. In 2009, the division merged its two locations and rebranded as Palm Coast Data.
Legal Challenges and Corporate Pivot
AMREP's early history was marked by significant legal disputes regarding its interstate land sales. In 1975, government regulators sued the company, alleging that it defrauded 45,000 investors of up to $200 million by promising unrealistic value increases on land that lacked a viable resale market.
This resulted in four company officers—President Howard Friedman, Senior VP David Friedman, Executive VP Chester Carity, and director Henry Hoffman—being sentenced to six months in prison, with the company paying a $45,000 fine. A subsequent 1993 civil suit by the Federal Trade Commission led to a $350,000 settlement distributed among 22,000 defrauded buyers.
These events prompted AMREP to cease its interstate land sales business in 1977, pivoting instead toward the local land development model that defined its later success in New Mexico.
Corporate Overview
| Metric | Value |
|---|---|
| Revenue (FY 2010) | US$ 120M |
| Operating Income (FY 2010) | US$ -11.2M |
| Net Income (FY 2010) | US$ -9.48M |
| Total Assets (FY 2010) | US$ 212M |
| Total Equity (FY 2010) | US$ 86.6M |
| Number of Employees (2008) | 2,115 |
Frequently Asked Questions
What is AMREP Corporation?
AMREP Corporation is a public company based in Princeton, New Jersey, that operates in the land development and media services industries.
How did AMREP contribute to the development of Rio Rancho?
AMREP purchased approximately 90,000 acres of land north of Albuquerque, New Mexico, and developed the town of Rio Rancho by attracting residents and businesses through financial incentives and low-cost housing.
What does Kable Media Services do?
Kable Media Services (now known as Palm Coast Data) provides subscription fulfillment, graphic arts, and marketing services for publishers and magazines.
Why did AMREP face legal action in the 1970s and 1990s?
The company was sued for defrauding investors by claiming that interstate real estate investments would rapidly increase in value, despite the lack of a real resale market.
Which major company was attracted to Rio Rancho by AMREP's incentives?
In 1981, Intel built a $50 million manufacturing plant in Rio Rancho due to the incentives offered by AMREP, which significantly increased local job opportunities and housing demand.