COVER STORY, JULY 2005

BUILDING THE WAY
Contractors reveal their secrets to success in today’s construction industry.
Lindsey Walker

In an up and down economy, many companies in the real estate industry have struggled to remain above water during the past few years. However, with a little strategy and planning, contractors in the Midwest have found it possible to maintain – and even grow – business in today’s economic climate. Heartland Real Estate Business recently spoke with several of these contractors about their past successes and future plans.

S&B Construction

Founded in 1973 by George Broadbent and Bob Skinner, Indianapolis-based S&B Construction began as an in-house contractor for Broadbent and Skinner’s retail development company.

“They couldn’t get a contractor to really get with the program in terms of understanding the nature of retail, such as changes that can occur and the importance of deadlines,” says William Cooper, president of S&B Construction. “They felt that they could do as good as any of the contractors that they’d hired up to that point, and they’d be able to control what was being done and when it was being done.”

These retail developments were S&B’s sole ventures until 1995 when the company decided to branch out and begin doing third-party work.

“We wanted to take some of the knowledge and expertise we had, primarily on the front-end of projects, and help other clients get projects developed and built,” Cooper says.

S&B Construction completed the 28,000-square-foot Fishers Town Commons, which is located on 116th Street just west of Interstate 69 in Fishers, Indiana, last March. The $1.7 million project is currently in leasing stages.

“We’re currently going back and rehabbing a number of theaters that we built,” he says. “And, we might do more self-storage or religious projects in a given year, but retail is overall the one type that we build more than any other.”

One such retail project is Fishers Town Commons in Fishers, Indiana. S&B completed the 28,000-square-foot center, which is located on 116th Street just west of Interstate 69, in March and is currently in the leasing stage. The company built the approximately $1.7 million project for The Broadbent Company.

Cooper credits the company’s success to its service-oriented attitude and its teamwork approach to projects.

“We try to get involved with the owner at the inception of the project rather than when plans are done,” he says. “That way, we can be a part of helping them get it to the start of construction and provide expertise, particularly from a budgeting and scheduling standpoint.”

To have continued success, S&B has created several short- and long-term goals.           

“We want to continue our commitment to being a service-oriented company,” Cooper says. “We want to increase our up-front, pre-construction services, and we want to increase our team approach. We just think we can service clients better. We want to grow the company to a $100 million company.”

McShane Construction Corporation

James McShane formed McShane Construction Corporation in Rosemont, Illinois, in 1984 as an integrated design/build construction firm. With a primary focus on the commercial construction market during the past 20 years, McShane has been active in the construction of industrial, office and multifamily projects in both suburban and urban settings.

“Within McShane Construction’s first 5 years, the company was recognized as one of Chicago’s premier providers of industrial design/build construction,” says Jeffrey Raday, president of McShane Construction.

McShane is demonstrating its experience in industrial construction with its current project for Chrysler Group. The company is building a 500,000-square-foot JIT (Just in Time) Sequence Center on 39 acres next to Chrysler’s assembly plant in Belvidere, Illinois. The project, which features 105 truck docks and approximately 221,000 square feet of trailer parking and truck marshalling area, is scheduled to be complete in October.

The company has recently begun building within the healthcare market, providing services for medical office buildings, ambulatory surgery centers, centers of excellence, diagnostic imaging centers and specialty hospitals.

Raday attributes several factors to the company’s growth and success. From having team players to maintaining a client-focused outlook, McShane combines a variety of strengths to remain competitive in today’s construction industry.

“The team members of McShane Construction are the firm’s most valuable assets, and their efforts have formed the cornerstone of the firm’s success,” he says.

In the future, McShane hopes to expand into new markets and increase the firm’s overall volume of sales and revenues.

“The firm continues to maintain its commitment to quality, safety and client satisfaction while creating new opportunities for future growth and expansion into new market sectors and locations,” Raday says.

Alberici Construction

St. Louis-based Alberici began in 1918 as a small contracting firm, bearing the name of its owner John Alberici. After being in business for more than 80 years, Alberici has become a family of companies that offers construction and construction-related services to a variety of industries worldwide.

Last December, Alberici Construction completed the conversion of a 50-year-old manufacturing facility located at 8800 Page in St. Louis into a 115,000-square-foot office building for its parent company, Alberici Corporation.

“Our recently completed new corporate office in St. Louis is a great example of this,” says Steve Olson, senior vice president with Alberici. “The project is registered with the U.S. Green Building Council and we are expecting to achieve Platinum LEED certification. Currently, there are only a handful of platinum-certified buildings in the world.”

Alberici’s key to success has been and continues to be its dependability, according to Olson.

“We always honor our commitments and complete even the most demanding projects to the client’s satisfaction,” he says. “Some of our best references come from the projects that were the most difficult and that we had problems with. All contractors will have problem projects; our clients really appreciate the way we have responded to the problems with solutions.”

In light of the recent trends in the construction industry, such as more sophisticated owners/developers with more specific expectations and more sophisticated contractual agreements, Alberici has adapted to become more formal in the way it manages projects in order to fully meet its client expectations.

“Our goal on every project we undertake is to bring owners new and unexpected value to construction services,” Olson says.

KCC Group Design + Build

Jacob Kiferbaum founded Deerfield, Illinois-based KCC Group Design + Build in 1994 to be a single source design/builder provider to both developers and brokers in the industrial and commercial markets, and that ideal remains a key goal for the firm today.

“With our service, we believe our clients achieve significant cost savings, scheduling efficiencies, early guaranteed cost identification and, most importantly, accountability,” says Paul Chuma, Jr., president of KCC Group Design + Build. “Our management team is comprised of five executives who are all involved in the day-to-day activities of every single KCC project, both in the field and in the office.”

It is this dedication and commitment that has led KCC Group, which offers full-service design/build and build-to-suit construction services to the distribution, food/beverage, office, healthcare, hospitality, residential, institutional and retail markets , to succeed.

“Besides having the best employees, enough cannot be said about having the right design team, subcontractors and material suppliers for each and every project,” Chuma says. “It is unrealistic to think that every project can be done perfectly, but you have to place high expectations on yourself and your team to make sure you exceed each client’s expectations. That smallest hiccups during a project can have significant impact of your client’s perception of project success.”

In order to maintain a good reputation with its current clients as well as generate more business, KCC Group relies on word-of-mouth.

“We recognize that, while Chicago is a large market, it is extremely competitive and word travels fast,” he says. “We believe that our best tool is what is being said about our last completed project. We take great pains to explore all the possible ways to add value to the process or the project itself to make it the best possible experience a client has had.”

KCC Group does the majority of its work in northeastern Illinois, and any out-of-area work is client-driven.

“Typically, [out-of-area work] is a result of successful project deliveries for clients in the Chicago metropolitan area and their desire to not have to rebuild a team to complete a prototype project,” he says.

One of KCC Group’s most recent projects was a 66,000-square-foot facility for Total Living Network. The building, which includes two fully equipped digital cable television studios and accommodations for a third, is situated on 38 acres at 2880 Vision Court in Aurora, Illinois. KCC Group completed the project last July.

Babco Inc.

Formed in 1965, Chicago-based Babco Inc., began as a retail-focused general contractor. As the company grew, it generated more and more high-profile jobs, such as the Gucci and Tiffany’s stores on Michigan Avenue in Chicago, and eventually grew into new construction for office buildings, hotels and nursing homes facilities, even building Oprah Winfrey’s television studios, office and several condominiums.

What sets Babco apart from the rest of its competition is that the company is known for doing the difficult job, according to Wes Brown, executive vice president with the firm.

“When people have a really difficult, time-pressured, detailed, fancy job, they turn to us,” Brown says. “We seem to excel at and get more of these types of jobs.”

Babco has achieved this reputation by being flexible, focusing on the client and setting out to complete every job on time and within the budget.

“Our focus is the client because we are always looking for repeat business,” he says. “That’s how we’ve built a lot of our history.”

While Babco has been active nationally in the past, since the downturn in 2000, the mid-sized firm has focused solely on the Chicago metropolitan market. This more centralized focus has generated less volume — yet more money — for the company.

“For years we did a lot of traveling for hotel work all over the country,” Brown says. “We’ve found that we’re more economical and we make more money by staying closer to home. We have less volume than we used to, but we’re servicing our clients better.”

One project that the company recently completed in Chicago is the Hyatt Regency Chicago located at 151 East Wacker Drive. Babco remodeled 1,400 of the hotel’s guest rooms in a five-month period. The firm is now going back to renovate the lobby and bar area, known as the “Glass Box.”

With projects such as this under its belt, and several more in the pipeline, Babco has a positive business outlook.

“People come to us because they want final product,” Brown says. “That’s our key to success.”

©2005 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.