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OCT | NOV | DEC 2016

AMERICAN BUILDERS QUARTERLY

CLASSIC FIT,

Jesse Moyer of Levi Strauss & Co. is pioneering a store design to reinvigorate the legendary brand’s retail space

ENTERGY POWERS NEW TRANSMISSION TECHNIQUES CHANGING [WORK] SPACES AT CAREERBUILDER UNDER ARMOUR MAKES A BIG PLAY IN BALTIMORE


1221 AVENUE OF THE AMERICAS NEW YORK, N.Y.


Building Excellence Experience, financial strength and vision. Factors that make The Rockefeller Group one of the most trusted names in real estate. Known for pioneering large-scale urban development, and with a track record of more than 40 million square feet, we remain committed to the selective acquisition, management and development of innovative properties throughout the United States. NORTHEAST SOUTHEAST WEST

DEVELOPMENT OWNERSHIP INVESTMENT

 www.rockefellergroup.com


ON THE COVER

104

JEAN-EOLOGY The legendary Levi Strauss & Co. implements a new retail strategy with the help of Jesse Moyer Cover photo and this page by Sheila Barabad

IN THIS ISSUE

46

LIVE TRANSMISSION Particular attention to protecting the environment keeps Clay Adams on the hunt for new ideas with Entergy

delivering

world-class foodservice and

support service to people

at work.

connect with people. inspire through food. create solutions. live our promise.

visit www.eurest-usa.com for more information 4

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60

MAKING THE BIG PLAY With development of a new headquarters underway, Neil Jurgens discusses how Under Armour is expanding its employee and business base

74

DISPATCHES FROM THE FRONT George Cortez carries the lessons he learned in the military to ensure that CareerBuilder’s employees are as successful as the company


CONTENTS

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CONTENTS

VISION

10 CULTURAL TRANSFORMATION How LoyaltyOne’s Janine Reaburn is bringing change to the work culture for the company’s employees 15 SAN FRANCISCO TREAT Erik Selvig discusses the new Dropbox headquarters and the new opportunities it presents to the workforce

54 NEW LOOK FOR SUNY NEW PALTZ The future looks bright for New Paltz State University of New York as John McEnrue walks us through renovation and new work on the horizon

80 HOW CONVENIENT Bill Bishop discusses the factors facilitating The Parker Companies’ growth 83 QUESTION EVERYTHING How Will Martin tests the status quo at Health Management Systems to help the organization grow while also saving money 87 CORE FOUNDATION A background in retail construction is helping Charles Morse poise Core-Mark International for further expansion 90 WITH FRESH EYES Charles Spencer reflects on his first year with the government service company Engility

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94 FROM MARYLAND TO RUSSIA Mehran Seifollahi discusses life on the road and easing AstraZeneca’s MedImmune into the Russian market 97 MICHIGAN’S FAB THREE Steve Robinson, Todd Wyett, and Greg Erne discuss Versa Development’s roots and growth in the face of the Great Recession 101 IT’S IN THE BANK Umpqua Bank’s Tony Bailey uses his “Rule of Threes” to further propel the company’s success

Photo: Courtesy of DBI Architects (bottom)

VIEW FROM THE TOP

NICHE

17 HEALTHY GROWTH Joelyn Gropp leans on her architectural background as NorthBay Healthcare moves forward in California


BUILD

CONTENTS

22 BIGGER IN TEXAS Jill Pearsall talks about the expanding campuses and reach of Texas Children’s Hospital throughout the Houston area

36 MAPPED OUT Kevin Phoenix discusses the C.R. Bard projects that have crossed borders and boosted the company’s profile throughout North America

28 A FINE BREW Canada-based DAVIDsTEA is seeping into the US market, and Shane Morrison discusses the company’s ingredients for growth

42 NEXT WINDOW, PLEASE Justin Ashby is helping SONIC Drive-In to find new markets and build on its momentous success

65 THE ANTIDOTE TO OPEN Innovative technology is transforming Cisco Systems into an open space that provides choices 68 SHAPING UP IN SHEBOYGAN Sheri Murphy of Acuity says a certain amount of fun figures into the expansion of company headquarters

Photo: Greg Epstein Photography (bottom)

REVISION

FINISHES

33 SPIN IT ON Akira Bryson explains how recycled materials keep Flywheel Sports on track as it arrives in new locations

111 CHECK THE RESULTS Jeff Stabenow and his team are creating a healthy landscape in Iowa for ACT employees

124 RETAIL REIMAGINED Alan Shaw explains how everybody wins thanks to the strategic partnerships of Sears Holdings

114 EASY BEING GREEN Geisinger Health System is focusing on green systems to achieve an innovative level of care, according to Alan Neuner

128 SMOOTH OPERATOR Bret Cunningham puts a new and refreshing spin on the Smoothie King brand

120 THESE GO TO ELEVEN Gene Chesterton discusses the teamwork and effort that goes into projects at Eleven Western Builders

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EDITOR’S LETTER

The Right Fit

Photo: Sheila Barabad

There was a 15-year period in my life in which I never wore blue jeans. It wasn’t for any principled reason or even because of discomfort. When I was a sophomore in high school, I’d run out of clean jeans before my mother got around to doing laundry that week. We didn’t have a particularly strict dress code at my school, but I knew that pants were definitely required. So I grabbed a pair of khakis I hadn’t put on since receiving them as a gift the previous Christmas, and ran out the door. Later that day, a girl commented on how nice I looked. I didn’t have a crush on this girl—or even the remotest desire to impress her—but my mind immediately equated this compliment to, “Girls like khakis.” Taking this conclusion to a ridiculous extreme (as teenage boys are wont to do), denim of any kind was henceforth banished from my wardrobe in a very specific—if misguided—ploy to someday secure myself a mate. Although it can be difficult to change the way you do things, it’s pretty easy to fall into a rut of repetition. You can pin a lot of things on teenage stupidity, but surely by my late twenties, I should’ve been smart enough to know that donning a pair of blue jeans for a day or two every so often probably wouldn’t sentence me to a life of celibacy. For Jesse Moyer of Levi Strauss & Co. (p. 104), “change” is a big part of his job description. Moyer helped a legendary company that has more than a century’s worth of history modify and adapt to a changing landscape with a new store design that engages a new generation of customers. He tells us he relishes the challenge because “the magic happens outside of my comfort zone.” It’s a good lesson to remember (and one that’s repeated throughout this issue) as executives find themselves in an ever-present struggle to adapt and take advantage of any opportunity that can boost their company’s bottom line. It doesn’t mean every step outside of a comfort zone pays off, but when it does, they must also remember not to let those successful steps become their new comfort zone. In other words, be wary of sticking too diligently to your routine. Otherwise, you’ll be 15 years into said routine when the woman who will become your wife asks, “Why don’t you ever wear blue jeans?”

AMERICAN BUILDERS QUARTERLY CREATIVE

SALES & ACCOUNT MANAGEMENT

VP of Creative Kathy Kantorski

VP of Sales Kyle Evangelista

Editorial Directors Megan Bungeroth Cyndi Fecher

Director of Sales Operations Philip Taylor

Managing Editor Paul Snyder Associate Editor Kelsey E. Ingram Correspondents Melissa Anders Kristen Bahler Zach Baliva Julie Edwards Peter Fabris Chris Gigley Russ Klettke Kelli Lawrence Jeff Link Keith Loria Becky May Urmila Ramakrishnan Kat Silverstein Jennifer Smith

Content & Advertising Managers Marty Gaieck Nathan Meginnes Lindsey Peters Dale Schutt

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SUBSCRIPTIONS + REPRINTS

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Financial Analyst Mokena Trigueros Junior Analyst Amanda Paul


INDEX

Index of People & Companies PEOPLE & COMPANIES

ABC ACT, Inc. 111 Acuity 68 Adams, Clay 46, 130 Ashby, Justin 42 Bailey, Tony 101 Bishop, Bill 80 Bryson, Akira 33 Butterfield, Paige 111 CareerBuilder 74 Chesterton, Gene 120 Cisco Systems 65 Core-Mark International 87 Cortez, George 74 C.R. Bard 36 Cunningham, Bret 128 DEF DAVIDsTEA 28 Draper, Milton 87 Dropbox 15 Eleven Western Builders 120 Engility 90 Entergy 46, 130 Erne, Greg 97 Flywheel Sports Inc. 33 GHI Geisinger Health System 114 Gropp, Joelyn 17 Hayward, Lani 101 Health Management Systems 83

New Paltz State University of New York NorthBay Healthcare

54 17

PQR Pearsall, Jill Phoenix, Kevin Reaburn, Janine Robinson, Steve

22 36 10 97

STU Schaefer, Anne Sears Holdings Seifollahi, Mehran Selvig, Erik Shaw, Alan Smoothie King SONIC Drive-In Spencer, Charles Spillman, Brad Stabenow, Jeff Texas Children’s Hospital The Parker Companies Umpqua Bank Under Armour

111 124 94 15 124 128 42 90 111 111 22 80 101 60

VWXYZ Versa Development Wilson, Chris Wyett, Todd

97 111 97

ADVERTISERS JKL Jurgens, Neil 60 Levi Strauss & Co. 104 LoyaltyOne 10 MNO Martin, Will 83 McEnrue, John 54 McGinty, Alan 65 MedImmune 94 Morrison, Shane 28 Morse, Charles 87 Moyer, Jesse 104 Murphy, Sheri 68 Neuner, Alan 114

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Abitat 38 Arbee Associates 93 Burford’s Tree, Inc. 53 Burns & Scalo Real Estate 123 CBRE 86 CIC Construction Group 40 Coastal Construction Corporation 32 Dacon Corporation 38 Day Mechanical Systems, Inc. 113 DMM & Associates, LLC 50 DN Tanks 118 Duro-Last 44

EBS Builders Entergy Compass Group EvensonBest FlagShip Fluor GovanBrown Construction Managers hardison/downey construction, inc. hitplay ikon.5 architects JLL JT Nakaoka Associates Architects Lee & Associates Mid-West Electric Company Mortenson Construction NexCore Group OA Development PieperPower Plano-Coudon Construction PLH Group Prime Principal Builders Rapt Studio RESCOM Architectural, Inc. Resource Design Interiors Retail Construction Services, Inc. Security Signs Seerco Steelcase T&D Solutions LLC TCL Partners Corporation Tellepsen Terracon The Rockefeller Group Triumph Specialty Construction, Inc. Tweet/Garot WB Interiors YORK® National Accounts ZF Energy Development LLC

35 53 4 57 14 96 13 50 13 57 123 127 89 26 72 21 79 72 64 53 110 14 14 131 21 32 103 100 93 49 132 25 82 2 89 72 123 44 117

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VISION

A NEW VISION FOR

NORTH AMERICA With a new headquarters on the horizon in Toronto and new space in the Chicago area, LoyaltyOne is changing the work culture for employees, and Janine Reaburn is at the heart of that transformation

J

anine Reaburn started out as an interior designer, working in corporate office design for large insurance companies before she made the move to facility management. The gulf between the two disciplines isn’t that wide, she says. “As a designer and in my current role, people are the main focus,” she says. “Time must be put in at the onset of a project to really understand the needs of the client.” Reaburn is now a key team member for LoyaltyOne, a global leader in designing and implementing coalition loyalty programs, customer analytics, and services for Fortune 1000 clients throughout the world. She’s also at the heart of one of Toronto’s most dynamic developments— in the form of an office that will serve as a new home to more than 1,000 associates—complete with leading-edge technology and design features meant to support innovation and collaboration in the city’s Distillery District. It’s that kind of dynamism that drew Reaburn away from interior design and toward LoyaltyOne in 2008. “What attracted me was the company’s unique culture, strong commitment to sustainability, and its entrepreneurial environment—not

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to mention the number of young associates with lots of energy,” Reaburn says. “At the time, they were building out a LEED-certified call center. I hadn’t worked on a LEED project before and wanted the experience.” As the company’s director of real estate and facilities services, Reaburn responsible for LoyaltyOneis: Design Development the real estate strategy for the company as well as day-to-day facility operations at each global location and the corporate responsibility strategy, which includes people, community, and environment. She oversees a team of 10 and describes her management style as rather informal. “I have a strong team,” she says. “They are all knowledgeable in their own areas. I like to give them room to grow and develop.” The move to LoyaltyOne’s new headquarters is slated for 2017. The company will take over six floors of a 16-story “smart” building. The core and shell of the building will have LEED Gold certification while the commercial interiors will have either LEED Gold or Platinum certification. The design of the new headquarters will be an open concept, with no individual offices. There will be space for both focus work and group work. Designers incorporated a variety of exciting fea-

Rendering: Gensler

by Julie Edwards


VISION

EASING THE TRANSITION LoyaltyOne prepares employees for a move to the new HQ with a concept space To help associates become familiar with the features of the new workspace before moving to LoyaltyOne’s new headquarters, the company created a concept space in its current building. Associates can choose from a number of different work space options, although there are no individual offices. “You can always find a great space to work, and there are many that allow for new surroundings and new opportunities for collaboration, which is a big part of our focus [on] stretching yourself and personal development,” says Janine Reaburn, director of real estate and facilities services. “We are literally taking thinking outside the box to a new level.” This completely wireless environment includes a large collaboration space, meeting rooms, and small focus rooms. Furniture can be moved around as needed.

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“We have sensors on the desks and in meeting rooms to see which work settings are most popular,” Reaburn says. “The first group didn’t use the big collaboration space much, while the second group used it all the time. That showed us that different teams need different spaces.” Various departments cycled through the concept space for six-week stints and provided valuable feedback for moving forward. Reaburn says she’s encouraged by the positive response. “I think what will make the new space a success is because we have really involved associates from different departments and levels of the company in the process,” she says. “Comments such as, ‘It reduced my e-mail traffic by 30 percent—I can’t wait to move to the new space,’ are really rewarding.”

LoyaltyOne’s new HQ building in Toronto’s Distillery District will be a 16-story “smart” building and is slated to open in 2017.

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11


axonometric VISION

Development

“Our goal is to make better use of our space and to create transformational space. We’re changing the way we work—not just picking up what we have and moving it to a new location.” Janine Reaburn Director, Real Estate & Facilities Services

12

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tures, including raised floors, under-floor HVAC, three patios, exposed ceilings, and floor-to-ceiling windows. Each floor will have a café area. Coat closets and lockers will provide associates a place to store their personal belongings. A large atrium between the second and third floors will host town hall-style meetings and company celebrations, as well as the provision of additional work areas. Shuttle service will be provided between the building and Union Station in downtown Toronto. Enhanced technology will make virtual collaboration effective whether it’s with another floor, another building, or even another country. “Our goal is to make better use of our space and to create transformational space,” Reaburn says. “We’re changing the way we work—not just picking up what we have and moving it to a new location.” Reaburn’s involvement in the project has been comprehensive. She’s been involved since the beginning and played a part in “site selection, lease negotiations, hiring the consultants, working with the steering committee and project teams (internal and external), and understanding the vision for

the new space.” Though she has had a great deal of help and received considerable input on the project, she admits it’s a rather big undertaking. “I feel like a big part of me has gone into the success of this project—and I know that my colleagues and team have equally given it their complete and total commitment,” Reaburn says. “We want to create a real showcase, one that will still be current 10 years from now.” Her reach also extends to the United States. Another project Reaburn is working on is a new space for LoyaltyOne’s Precima team in Rosemont, Illinois, which is just outside of Chicago. The company recently leased about 6,000 square feet of space, and as of press time, is planning the move for 2016. The Rosemont space will incorporate some of the same design features as the new headquarters space, including the open-concept workplace, a variety of work settings, and technology to let associates seamlessly participate in meetings locally, regionally, or with the head office. “From a brand perspective, it’s important for us that no matter where [you enter] a Loy-

Rendering: Gensler

ATRIUM CONNECTION


LoyaltyOne’s new HQ will be an open concept with no individual offices, encouraging employee interaction.

strategy. implementation. support. technology partners for the next generation workplace.

hit-play.com

hitplay

altyOne office—whether it’s in Toronto, Chicago, or the UK—you will find a consistent look and feel, with our brand resonating throughout,” she says. Evolving the company’s working environments ties to LoyaltyOne’s continuing commitment to excellence for its employees, Reaburn says. “We’re so proud to have been recognized as a top employer even prior to these exciting milestones,” she says. “Suffice it to say, the new headquarters and the Chicago project symbolize a new chapter for LoyaltyOne, one that promises to be cutting-edge and collaborative.” April 22, 2016

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“It’s exciting to partner with such a progressive organization and leaders like Janine that have a truly collaborative approach.” —Kevin Rauch, hitplay Established in 1994, Govan Brown is Canada’s leading interiors construction management firm with offices in Toronto, Ottawa, Calgary, Edmonton, Vancouver, Winnipeg, Halifax, and a partnership office in Montreal. Our expertise is building out retail, commercial, hospitality, and corporate space across Canada. Since our inception, we have built more than 40 million square feet of space.

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PRINCIPALBUILDERS.COM

BUILT TO USE Our Work is Our Word

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倀爀漀甀搀 琀漀 瀀爀漀瘀椀搀攀 戀甀渀搀氀攀搀 猀攀爀瘀椀挀攀猀 昀漀爀 䐀爀漀瀀戀漀砀

圀攀 䴀愀欀攀 䔀瘀攀爀礀 䘀愀挀椀氀椀琀礀 愀 䘀氀愀最猀栀椀瀀 眀眀眀⸀昀氀愀最猀栀椀瀀椀渀挀⸀挀漀洀


VISION

A TRULY CREATIVE SPACE Dropbox’s Erik Selvig just finished the opening of the company’s new headquarters in San Francisco, which offers increased opportunities for creativity and collaboration by Kat Silverstein

H

ow do you find office space in the heart of San Francisco’s South of Market district and turn it into the type of workplace that attracts in-demand tech talent, increases productivity, and allows for a rapidly expanding workforce, while staying within budget? Ask Erik Selvig, global head of facilities for Dropbox, a leading provider of file-sharing and collaboration services. Selvig recently checked off each of these boxes as he complet-

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ed the company’s move to its new headquarters in the sought-after area. “San Francisco is an aggressive market,” he says. “We had to find the right space and be able to move on it quickly. We took on what seemed like a massive amount of space at the time, but with our rapidly expanding workforce, by the time we got the space fully designed, we were worried that we would outgrow the building before we could even get it completed.”

In an effort to be as efficient as possible with space and to ensure that Dropbox would have room for its growing workforce, the company’s design team made the decision to reduce personal desk size just before construction started. This allowed the company to add density without reducing common space and amenities. “We want people to get away from their desks and collaborate,” Selvig says. “What we’re trying to do is create an environment that makes people happy to be in the office, but also drives productivity.” Dropbox’s team of architects and planners intentionally included just one restaurant in an office that serves hundreds of plates per meal. That way, Selvig says, everybody bumps into each other. “The chance meetings and encounters that happen by creating more common spaces can actually lead to more productivity and product innovation,” he says. To that end, there is also a library, gym, and other common areas that are equipped with Wi-Fi. Creating common, collaborative spaces isn’t just important for staff productivity, but it’s also an important recruitment tool in San Francisco’s competitive technology sector, where hiring good talent is a constant challenge. “We need to give our employees compelling spaces that delight the eye and the user, but are also functional and managed efficiently,” Selvig says. In his many years managing facilities for different start-up companies, Selvig learned that both function and affordability need to come before amenities and “wow” factor—no matter how fierce the competition for talent might be. “In San Francisco, real estate is incredibly expensive,” he explains. “In a tech environment, you need to make sure the amenity mix you have makes sense for the business. If you have a conference center that ends up just being used once a week and you are busting at the seams, is that a good use of space? “It is not enough to have amazing spaces— you have to also ensure you are providing value for the money committed to real estate. I am very aware that every dollar I spend is one less dollar we can invest in the business. With

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VISION

“It is not enough to have amazing spaces—you have to also ensure you are providing value for the money committed to real estate.” Erik Selvig, Global Head of Facilities

CAREER SNAPSHOT Graduated from California Maritime Academy and started his career as a marine engineer working on ocean-going vessels Moved into the building trades, working as a building engineer in a hospital and then managing teams working in high-rise environments Managed facilities and operations for tech companies and start-ups with a focus on culture building, sustainability, and operational efficiency

that in mind, I must ensure that the space can grow and adapt to employees’ needs—so I’m always open to convert any underused space into a more efficient use.” Dropbox also had efficiency in mind when the team chose a building that offered cutting-edge sustainability technology. The new headquarters is actually two separate buildings that were designed to function as one during the build-out. Both buildings were built to LEED standards and incorporate features such as collecting rainwater for toilet flushing, green roofs, super-efficient HVAC systems, and LED lighting. “Although sustainable building was not a driving factor in our build-out this time around, we were lucky to have such great base buildings as a foundation,” Selvig says. “Smart developers are adding these features in from the start, making it easier for tenants to build sustainably without huge investments.” His past experiences continue to inform his career in multiple ways.

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“I look at victories I’ve had and mistakes I’ve made, and find ways to use that to inform future projects,” he says. “Probably the most important lesson I have learned from working with design and construction teams is that you need a lot of voices to ensure you create a space that works for everyone.” In order to make sure the design fits the employees, the local Dropbox office manager is heavily involved in planning the building facilities and design for any office construction project. “The office manager has a lot of input into this project, so the space works for the people that will be working in it,” Selvig says. “Although there are certain themes that run through our corporate design philosophy, the team on the ground is in the best position to reflect their local culture and design an office that suits their needs.” Selvig’s management style puts a lot of trust into his employees and contractors, and he says he’s lucky to work for a company that has an extensive recruiting and interview process. He believes it’s helpful to ensure that all employees are self-motivated and good at what they do. “At Dropbox, we hire the best and the brightest, so I can give them direction and then leave them to execute,” he says. “Giving people self-determination and control goes a long way. It’s been a very successful strategy for me.”

A note from Principal Builders It’s not enough to build something beautiful. We know the real measure of success is a company’s ability to operate, maintain, and easily utilize the spaces we’ve built for them for years to come. From day one, our ideas and solutions are designed with the end user top of mind. Flagship Facility Services delivers bundled janitorial, maintenance, staffing, and subcontractor management services for Dropbox’s new corporate headquarters in San Francisco, managing its services with a flexible, high-touch approach and leveraging strategic partnerships to deliver preferred pricing for the amenities that help the company retain its most effective employees.


VISION

BUILDING A

HEALTHY FUTURE

Joelyn Gropp’s architectural background helps her keep NorthBay Healthcare on track to maximize patient care for today and beyond by Chris Gigley

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VISION

A running track on the second floor will overlook the entry lobby at the 110,000-squarefoot Vaca Valley Wellspring Fitness Center. The fitness center will also include a junior Olympic lap pool surrounded by tinted glass to let in natural light.

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VISION

“On occasion, when we run into an architect who feels they can’t solve something, I’ll get my papers out and do it myself.” Joelyn Gropp, AVP, Real Estate & Facilities Development

Portrait: Ryan Bates

J

oelyn Gropp understands the importance of building strong foundations. She trained as an architect at Carnegie Mellon and launched her professional career in the field. Although she’s now assistant vice president of real estate and facilities development at NorthBay Healthcare System (a nonprofit organization based in California), Gropp’s career began at Ratcliff Architects, where she specialized in healthcare, institutional, and educational facilities. It was during her time with Ratcliff when she chose to make healthcare her sole focus. Even now, the architecture background comes in handy—particularly when hiring architects and contractors for NorthBay’s various real estate projects. “It’s helpful to be able to understand the quality of what we’re getting,” Gropp says. “On occasion, when we run into an architect who feels they can’t solve something, I’ll get my papers out and do it myself.” A more important by-product of her time as an architect, however, might be her ability to communicate. Gropp says she can explain architectural details in layman’s terms to executives and others outside her department. She also knows how to ensure that the architect and contractor stay on the same page throughout a project. “Often, architects are seen as these high-minded designers who have their heads in clouds, and the contractor is the practical one,” she says. “You really need to make them a team by making sure they respect what each brings to the table.” Before taking the NorthBay job in 2003, Gropp spent four years as the regional facilities

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planning and construction manager at Catholic Healthcare West, and two years as the principal architect at CPMC Sutter Health. At NorthBay, however, she had to build a new facility development department from scratch. “We were growing as a system and really starting to build new buildings from the ground up,” she says. “It seemed like we needed to have a department that would put standards and a system together for delivering these buildings. We started talking about a department, and people got used to hearing about it.” To start, Gropp compiled a list of prequalified contractors and architects. She also took

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VISION

TRADING SPACES: Q&A with Joelyn Gropp You got your degree in architecture. What about that field interested you? Originally, I was thinking of going into art in college. I applied to the art program and thought, “I won’t always feel creative. Maybe I should pick something with more technical aspects.” That’s why I picked architecture. Are you glad you did? It was a great decision. One of the things I like about it is that while I like the art form of a building, it’s something you can actually engage in, walk through, occupy, and have an experience. It’s a great artistic medium. What led to your transition into the healthcare industry? When I moved from New York to San Francisco, two architecture firms accepted me. One focused on housing. The other, Ratcliff Architects, focused on healthcare. I picked healthcare and I’m so glad I did. When the economy goes through cycles, there is always work in healthcare.

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a step back and looked at the brand perception that NorthBay leadership wanted to maintain, and how the design of its new buildings could support it. Soon thereafter, her department was born. That department now includes three managers, three maintenance techs, a project coordinator, and an executive assistant. Gropp handles real estate development, the system’s capital construction program, and facility maintenance. She currently leads the $200 million expansion of the NorthBay Medical Center Hospital, as well as the development of the 110,000-squarefoot Wellspring Fitness Center in Vaca Valley. When it opens later in 2016, the center will include a track, pool, weight training facilities, and offices, as well as a three-story, sunlight-filled lobby and the relocated NorthBay Cancer Center. “It’s going to be a game-changer in our industry,” Gropp says. “The idea is that someone who comes in to see a doctor on the clinic side can get a prescription for exercise and do it right here. We already have one doctor who is planning to meet her patients on the track and talk with them while they’re walking.” She’s also enthusiastic about the system’s twoyear master space plan, an effort to organize operations and space on the ambulatory side that will provide the best patient experience, backfill space vacated by two other projects, and develop a standard lean clinic module for consistent care. “We’re trying to separate the patient flow from the back-of-the-house flow, similar to Disney’s onstage/off-stage philosophy,” Gropp says. “When you The Lobby Pavilion will be the first building constructed in NorthBay Healthcare’s multiphased expansion project.


PROGRAMMING | DESIGN | PROCUREMENT PROJECT MANAGEMENT | INSTALLATION

can separate the two, it creates a more efficient working environment for employees and doctors and a calmer environment for the patient.” Hovering above all this is a massive initiative to replace all the older parts of the hospital building by 2030. “It’s difficult to stay relevant in an industry that changes so rapidly and where it takes so long to design and build a new facility,” she says. “The other challenge is consistency. When so much time goes by, leadership changes and architects change—and we want it all to look the same, but also up to date.” It takes a solid vision to make sure all of these needs are met. Luckily for NorthBay Healthcare and its patients, Gropp has it. NexCore Group develops healthcare facilities for hospitals, health systems, and physicians. We solve complex real estate challenges through innovative building solutions and creative financial structures. In a rapidly changing industry, NexCore has the expertise to deliver quality environments and flexible spaces that help grow your business, lower expenses, and mitigate risk. Each year, more than 2 million patients walk through our buildings, which have been designed to help providers facilitate the diagnosis, treatment, and prevention of disease. “

We are Proud to Partner with NorthBay Healthcare & Look Forward to Working With Them into the Future. RESOURCE DESIGN INTERIORS

PH 415-777-0202

WWW.RDI-SF.COM

Working with NexCore on the NorthBay Wellness Center project has been a wonderful experience for us as architects and designers. They have been great supporters of the design team and design process. NexCore understood where value could be added throughout the project, and they came along as partners with us and really looked at what was best for the project.

TRANSFORMING

HEALTHCARE

CK Lin

SmithGroupJJR Architects

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BUILD The Woodlands Campus for Texas Children’s Hospital is expected to be complete in 2017.

The Woman Behind the Rapid Expansion of Texas Children’s Hospital In her 14 years with the organization, Jill Pearsall has seen Texas Children’s Hospital expand its facilities for more patients and widen its reach in the Houston area

BY BECKY MAY

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Hospital


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Central Plant

Parking Garage

Rendering: FKP Architects

Outpatient Building

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JILL PEARSALL HAS ALWAYS FELT THAT only those who work within an organization can really understand the guts and the core of the company. It was this mind-set and some fortuitous timing that helped her transition from working for an architectural firm to taking on an in-house role in facilities and design. Pearsall started out as a manager at Houston Methodist Hospital. Three years later, she joined Texas Children’s Hospital as assistant director and has since worked her way up to her current position of assistant vice president. In April 2016, Pearsall hit her 14-year milestone with Texas Children’s Hospital. Looking back at countless projects, she says the execution of Vision 2010, a $1.5 billion initiative that was the largest expansion ever by an independent children’s hospital in the given

time frame, was her biggest accomplishment to date. Pearsall remembers her initial reaction after the announcement was made back in 2006, and laughs as she recalls asking her boss, “How are we going to do this?” Nevertheless, through exceptional project management and constant communication, Vision 2010 was not only a success but completed under budget. “You look at it as eating the elephant one bite at a time,” she says. Vision 2010 consisted of building four separate components. The Jan and Dan Duncan Neurological Research Institute, for example, is dedicated to helping find and develop treatments for neurological diseases. The second facility, the Pavilion for Women, provides medical services for women—particularly services for expectant mothers, starting before conception and continuing through delivery.

“We run everything out of my office to let us keep our finger on the pulse and make sure everything is consistent.”

Since opening in 1954, Texas Children’s Hospital has added 577 beds to its system’s facilities.

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Rendering: FKP Architects

Jill Pearsall AVP, Facilities Planning & Development


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BUILDING WITH TEXAS CHILDREN’S HOSPITAL SINCE 1953

Texas Children’s Hospital Neurological Research Institute

Texas Children’s Hospital West Campus

Texas Children’s Hospital North Campus www.tellepsen.com

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a

In the Works Jill Pearsall’s current priorities lie with two largescale projects: [a] The Woodlands Campus, which will be the second community hospital for Texas Children’s Hospital, and the vertical expansion of [b] Pediatric Tower E.

The Woodlands Campus

The Woodlands is a combination of a five-story hospital, six-story medical office building, seven-story parking garage, and central plant filled with chillers, boilers, emergency generators, and fuel tanks. The site spans 22 acres and is expected to reach completion by 2017.

b

Pediatric Tower E

Pediatric Tower E is a 19-floor vertical expansion of 640,000 gross square feet for critical care medicine and surgical services. The expansion will include four floors dedicated to pediatric intensive care unit beds, three floors of cardiovascular intensive care, one floor of catheterization labs, one floor for the Texas Children’s Heart Center clinic, among many other areas. The new tower is expected to open in 2018.

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Rendering: FKP Architects

Expected to open in 2018, Pediatric Tower E will be a 19-floor vertical expansion of existing space for Texas Children’s Hospital.

Another component of Vision 2010 was the vertical expansion of the Feigin Center. The expansion built eight additional floors to the existing 12-story center. The final piece of the ambitious project was the addition of the first suburban hospital designed for children to meet the growing need of the West Houston area. Pearsall attributes the successful completion of the project to her team, which consists of nine project managers and 16 additional staff members. “I often say to my project managers, ‘If you aren’t doing today what you need to be doing in 2–3 months, then you are behind schedule,’” she says. Prior to Pearsall joining the team, Texas Children’s Hospital outsourced much of its project management staff, which was one of her first assignments when she started. Pearsall dedicated the first five years to handpicking a project management department. She says having the right team in place is especially critical when dealing with accelerated growth like the kind Texas Children’s Hospital has experienced in the past several years. “We’ve added about 2 million square feet since I got here,” she says. “Since I have been here, Texas Children’s has grown into a pretty robust healthcare system.” That’s not just an insider’s opinion. U.S. News & World Report ranked Texas Children’s Hospital among the nation’s best children’s hospitals. In the past 10 years, Texas Children’s Hospital has treated nearly 1 million children. The hospital first opened in Houston in 1954 with three f loors and 106 beds, but the system has since grown to include 683 beds. Yet it hasn’t just grown on its original hospital grounds—it has since expanded into the Houston community. Immediately after wrapping up Vision 2010, Pearsall began strategic growth for another community campus. She says she’s noticed a trend in terms of shifting how healthcare is provided to individuals. “In 2012, we opened our Pavilion for Women, which was a whole new business venture for Texas Children’s,” she says. “Through that women’s hospital, we have gone out into the

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community with smaller offices offering obstetrics care closer to home. We’ve grown quite a bit in the community as well as the main campus.” Despite the rapid expansion, she and her team still keep a close watch over every project for Texas Children’s Hospital. “We have way more tentacles to our organization,” Pearsall says. “We run everything out of my office to let us keep our finger on the pulse and make sure everything is consistent.”

As far as future initiatives go, Pearsall is constantly thinking about how the changing healthcare industry will affect what will be on the agenda next. She has seen an uprising of community healthcare facilities and treating patients closer to their own homes. Nevertheless, predicting the future can be difficult when planning for projects beginning 8–10 years ahead of completion time. Her only advice? “Keep looking ahead and anticipate what is happening,” she says.

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Photo: Steph Polic

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Most DAVIDsTEA locations are found in shopping malls, and all feature a tea wall, merchandise wall, and beverage station to attract customers.

Steeped in Success Shane Morrison on expanding Canadian retailer DAVIDsTEA south of the border BY JULIE EDWARDS

SHANE MORRISON’S PASSION FOR ARCHITECTURE AND CONSTRUCTION GOES BACK AS FAR AS HE CAN REMEMBER. His grandfather and father were builders, and his uncle owns an architectural firm. He put himself through college while working for the family business and graduated from Boston’s Wentworth Institute of Technology with a degree in construction management. After stints with different construction companies, including Hoyts Cinemas and Sonesta Hotels, Morrison opened his own construction consulting firm in 2006. In 2012, he joined Canadian retailer DAVIDsTEA as the company’s senior construction manager. “I was finishing a contract consulting with another Canadian retailer that was expanding into the US when a colleague heard that DAVIDsTEA was looking for a construction manager and recommended that I contact them,” Morrison says. “There was just something about DAVIDsTEA that intrigued me. It was a young company with tremendous growth potential. I was impressed with the brand and the company’s passion for tea.”

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“We take pride in the way we maintain our stores. We want them to always be customer-ready.” Shane Morrison, Director, Construction & Maintenance

Shane Morrison says his favorite DAVIDsTEA beverages include Nepal Black, Matcha, Cinnamon Rooibos Chai, and Strawberry Rhubarb Parfait iced tea. “We make it fun and have something for everyone,” he says.

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DAVIDsTEA sells teas from around the world in addition to its tea-making products, tea accessories, and fresh cups of hot or iced tea to go. “It was my interview with cofounder David Segal that really made me want this job,” Morrison says. “He has endless energy, high expectations for his company and the people that work for it—and he supported both in a manner that did not allow you to do anything but succeed.” Today, Morrison is the company’s director of construction and maintenance. He is responsible for the planning and construction of all new stores as well as renovations and maintenance of more than 200 existing stores. He supervises the design, construction, and maintenance staff; develops and manages the annual capital, repair, and maintenance

budgets; negotiates contracts; and manages the company’s national purchasing programs. He also works in conjunction with the company’s real estate team to support the review and approval of new sites. “The real estate team chooses sites based on traditional factors such as demographics, traffic count, and cotenancy—they also spend a lot of time visiting sites to make sure locations have the right feel for DAVIDsTEA,” Morrison explains. Once sites are approved, Morrison’s team takes over and manages projects through completion. Morrison oversees a staff of seven that consists of a store designer, project manager, four maintenance managers, and a department coordinator. “We are all driven, hardworking, and proud to be part of this team,” he says. DAVIDsTEA stores all have a similar look and feel, but each is unique in terms of shape and size. Though the stores run from 500 to 1,400 square feet, most are in the 1,000-square-foot range. About 80 percent of store locations are in malls, with the rest in street-front locations or lifestyle centers. “Each store has three unique focal points— our iconic tea wall (where our tea tins are displayed), our merchandise wall, and our beverage station,” Morrison says. “The design is clean, bright, and inviting. Our marketing/ merchandising team seasonally launches whimsical new patterns for our packaging and hard goods. The stores are designed in a way that allows our merchandise to be the shining star.” The first DAVIDsTEA store opened on Queen Street in Toronto in 2008. Morrison’s team is on pace to add about 40 new stores in 2016, and recently started renovating the organization’s first stores by cleaning, painting, doing repairs, and updating the aesthetics. “We take pride in the way we maintain our stores,” he says. “We want them to always be customer-ready.” Morrison recently faced an interesting challenge at the company’s Mall of America location. “Our store is on the main floor above [an] aquatic life tank,” he says. “We have a considerable amount of below-slab plumbing in our stores, and access to install our waste piping was nerve-racking to say the least. Imagine being a plumber on a scaffold connecting pipes to the slab above you while a 12-foot shark swims a few feet below you. Our design team and GC worked closely with mall management to develop a layout and plan that

Photos: Steph Polic

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DAVIDsTEA at a Glance Founded: 2008 Cofounders: David and Herschel Segal Headquarters: Mount Royal, Quebec, Canada

minimized the amount of piping installed over the tank and helped design access and protection measures that eliminated risk to the sea life below while keeping workers safe on the scaffolding above.” The company also has its sights set on energy efficiency. Morrison says he’s particularly proud of the LED retrofit program that’s been put into place. In addition to having all new stores since 2014 be designed and constructed using only LED light fixtures, the program in 2015 turned its attention to converting the

lighting in all existing stores built before 2014 to LED. “We’ve reduced our operating costs, our maintenance costs, and our carbon footprint,” he says. “We rarely—if ever—have light bulbs out.” Morrison says the most rewarding part of his job is watching the company grow and succeed. “We truly are a family with a common goal of bringing joy to our customers’ lives, one cup of tea at a time,” he says.

Number of Locations: 215 Additional Stores Opening in 2016: 18 Number of Employees: 2,640 (United States and Canada) Types of Tea Sold: More than 150

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ECOFRIENDLY EXERCISE Akira Bryson incorporates sustainable building practices into Flywheel Sports Inc.’s new fitness studios BY MELISSA ANDERS

FLYWHEEL SPORTS INC.’S FITNESS STUDIOS SEE A LOT OF ACTION. The sheer number of people who use the exercise equipment and the amount of sweat that hits the floors means the building materials have a high turnaround rate. So it makes economic sense for Flywheel, a New York-based chain of fitness studios that offer indoor cycling and barre exercise classes, to take a sustainable approach to building its facilities. It also makes sense from a corporate responsibility standpoint as Flywheel and its well-informed, high-income-earning customers are interested in protecting the environment. “The company has always been a forward-thinking company,” says Akira Bryson, director of construction at Flywheel. “As we find better ways to incorporate sustainable practices, we can certainly do that.”

Recycled materials, including acoustic paneling and rubber floors, are used throughout Flywheel locations.

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“I’m not really a desk guy. I love the building process because you are taking a concept, an idea, and making it physically real.” Akira Bryson, Director, Construction

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placements include the rubber floors, which get broken down by sweat, and HVAC filters, which need to be replaced monthly (instead of the more typical three-to-six month timeframe) because the studios put so much stress on the air-conditioning system. Bryson says the company took a cue from California’s stringent Title 24 electrical lighting requirements and incorporated those measures into its lighting package for studios around the country. The studios feature low wattage, energy-efficient LED lights. While the bulbs require higher upfront costs than incandescent bulbs, LED lights don’t need to be changed as often. “Technology has also helped us along too,” he says. “Old-school LED lights were very cold. Now we can get very warm LED lights.” Improved technology has also allowed the company to reduce its use of wiring. Bryson says he hopes to go completely wireless for the bikes at some point in the future. For now, the company has removed the need for a power feed at each exercise bike in favor of a low-voltage connection to the machines.

Bryson and his team are also investigating ways to minimize energy and water use. The studios’ hot-water systems are put under a lot of stress when 20 or 30 people all need to take a shower at the same time. He says he’d like to use on-demand water systems, but he’s waiting for the technology to catch up, since existing systems can’t keep up with the studios’ current volume. Another challenge Bryson has to manage is the fact that many of Flywheel’s studios are located in existing buildings, so the infrastructure doesn’t always lend itself to efficient water and electric systems. California presents additional work, as the company has to list all building materials—even down to the type of glue used—in order to pass green inspections. However, Bryson says that requirement has been good for the company’s bookkeeping. One of Flywheel’s newest studios is located in a LEED Gold-certified building on Astor Place in New York City. Bryson ensured the company’s construction practices didn’t impact the building’s

By the Numbers

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Number of Flywheel locations as of February 2016

15

Total number of new Flywheel studios projected to open in 2016

5,000–6,000 sq. ft. Average size of new studios

Photo: Flywheel

Bryson is responsible for creating budgets, seeking bids, and managing the construction of new studios nationwide. Yet he’s no stranger to the fitness industry. Prior to his time at Flywheel, Bryson spent two years as senior project manager at Equinox, where he oversaw construction of the company’s 35,000-square-foot gyms in the United States and Canada. He began his career on the architectural side of construction, working for various firms after receiving his architecture degree from Cornell University. As architectural work shifted toward the computer and away from the drafting table, however, Bryson found interest in the onsite and problem-solving opportunities available in the construction administration field. “I’m not really a desk guy,” he says, explaining that he appreciates both the artistic and engineering side of design and construction. “I love the building process because you are taking a concept, an idea, and making it physically real.” Many of Flywheel’s studios are concentrated in New York and the East Coast, although the company is quickly expanding in California and along the West Coast. Flywheel is also opening studios in Texas and Arizona, and is making a big push toward the Midwest. Recycled materials are used throughout Flywheel studios, from the acoustic paneling down to the rubber floors. The company relies on acoustic design and construction to reduce the impact of the loud music played during cycling classes. “We still are looking at using a lot of recycled materials and trying to change our entire materials library for all sustainable material and recycled material,” Bryson says, adding that the company wants to maintain “a very refined, fresh look.” The use of recycled materials has become especially important for the company, since its studios have to frequently replace certain equipment and furnishings. Common re-


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Although most Flywheel studios are concentrated along the East Coast, including this location in Washington, DC, the company is opening studios across the United States.

Photo: asicophoto

LEED status, and Flywheel complied with stringent rules for dealing with waste and separating recyclable materials. Bryson says that was a “breath of fresh air,” since it offered a better organized system for dealing with waste. He credits contractor EBS Builders with delivering great work on the Astor Place project, and adds that the company has been a go-to contractor because it understands Flywheel’s attention to detail and its fast pace. “It’s been a fantastic building to work for in certain respects,” Bryson says. “They have an incredible amount of building systems that we can tie into directly. It’s a gorgeous location right on the corner; it’s just a really nice space. It’s definitely going to be one of our flagships in terms of beauty.” Tony Bonaduce, president of EBS Builders, is proud to be working with Flywheel at several locations throughout the New York market. “Although EBS Builders is located in the New York market, we do work throughout the eastern United States, and look forward to expanding our partnership with the client in a much larger area, as we do with many of our clients,” he says.

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ALL OVER THE MAP How Kevin Phoenix of C.R. Bard’s Global Facilities Group anticipates the needs of a rapidly expanding company throughout North America

C.R. Bard is already considering expansion options for the Bard Access Systems Divisional HQ Building in Salt Lake City.

Salt Lake City, Utah

BY CHRIS GIGLEY

C.R. BARD, INC. HASN’T STOPPED GROWING SINCE KEVIN PHOENIX ARRIVED IN 2001. As director of global facilities, Phoenix has seen the medical device company’s sales rise from $1.5 billion to $3.4 billion by the end of 2015. The company’s need for more real estate increases in conjunction with those sales, and Phoenix says he has anchored himself to a set of long-held criteria at C.R. Bard, which was established 108 years ago. “Every project we work on must fit into some absolutes, one of which is our set of corporate values—quality, innovation, integrity, and service,” he says. “We want to create a productive environment for our employees, protect them from harm, and protect our supply chain to customers.” Those tenets, and the use of strategic facility planning, have helped Phoenix stay on track on an array of different projects that each come with its own unique set of challenges. He discusses some of the highlights here with American Builders Quarterly.

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BARD ACCESS SYSTEMS DIVISION HQ SALT LAKE CITY Completed in 2007, this project was motivated purely by the massive growth of the Bard Access Systems division. Given its rapid growth, Phoenix says, the old divisional headquarters building simply ran out of space. This compelled the division to move to a 185,000-square-foot location—more than double the size of the old one. “This was a relatively easy one for us in that we were taking employees from a cramped, dingy space and moving them into a roomy and totally renovated space,” he says. “The challenge at Bard is staying ahead of our growth. That building has already filled up again.” With a lease that runs into 2021, Phoenix says his team is evaluating future expansion options.


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DAVOL DIVISION HQ WARWICK, RHODE ISLAND Founded in Providence, Rhode Island, in 1874, Davol is Bard’s oldest division. Before 2008, it was based in an old commercial industrial building that lacked the best lighting and space for its tenants. The company approved a project led by Phoenix to move them into their current dedicated office building—a first-of-itskind experience for him. “We wanted to create a workplace where people wanted to go to every day,” Phoenix says. “Where they enjoyed the daily workplace experience and being productive. We took a clean-sheet approach and built a very attractive—yet cost-effective—building.” The key to the whole design is the atrium, a central three-story glass enclosure that lets in an abundance of natural light. Additionally, most offices in the building are situated on the interior to allow more light to come through the building’s exterior windows. “The entire first floor is dedicated to labs and research, but from the outside you’d never know it,” Phoenix says. “The facility still looks and functions like an office building. I think we really hit the mark on that one.”

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Warwick, Rhode Island

Kevin Phoenix says that from the outside, you’d never know research work is done in the Davol Division HQ.

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KEVIN PHOENIX AND DACON Both are committed to quality, integrity and dependability…in the way we work and in the built environment.

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“You have to get the right people from a crossfunctional team to tell you what is needed from their unique perspective. Once you have that team together, then you have to foster communication and listen more than you talk. That’s critical to getting the information you need to ultimately be successful.” Kevin Phoenix Director, Global Facilities


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HUMACAO MANUFACTURING FACILITY HUMACAO, PUERTO RICO Phoenix says his proudest accomplishment during his tenure at Bard was completed back in 2005. Damage to the previous Bard manufacturing facility from Hurricane Georges in 1998 prompted the construction of the new plant, which remains in operation today. The main challenge of the project was ensuring future hurricanes wouldn’t hurt the company’s Puerto Rican operations again. “The new facility had to be cost-effective and aesthetically pleasing,” Phoenix says. “It also had to withstand the direct hit of a Category 4 hurricane, and we had to make sure the design was flexible.” With the company’s growth, C.R. Bard wanted a plant that could make just about anything— including devices it didn’t foresee making at the time. If that wasn’t challenging enough, there were also a few physical hurdles. “The site selected had some of the toughest soil conditions the team has ever worked with,” Phoenix says. “It wasn’t good weight-bearing soil. We had to truck in loads of good structural soil and implement a surcharge soil compaction technique where we put the bad soil on top of good soil and let it compact naturally for months. We used that as the foundation of our final building foundation.”

Humacao, Puerto Rico

The Bard Humacao Manufacturing Plant was designed to withstand a Category 4 hurricane.

Neighbors also had to be taken into account. The plant stands next to a housing complex, so the design of the site and support equipment was important. Activity in the facility couldn’t disturb the neighboring community, and the aesthetics of the building would also have to complement the surrounding areas. “It turned out to be a beautiful facility that our employees and neighbors are thrilled with,” Phoenix says. “It’s probably our finest location.” Industry Week magazine agrees. It recently named the facility “2015’s Best Plant.”

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HARNESSING DIVERSITY Throughout his professional career, Kevin Phoenix has helped mentor and develop people and foster sound leadership practices and workplace diversification. He learned these virtues the hard way, however. Phoenix says that early in his career, he tried to tackle projects on his own, whether he understood the people his work would ultimately affect or not. It didn’t take long for him to realize he needed help. “You have to get the right people from a cross-functional team to tell you what is needed from their unique perspective,” he says. “Once you have that team together, then you have to foster communication and listen more than you talk. That’s critical to getting the information you need to ultimately be successful.” Phoenix said it’s a tough lesson to learn because disagreements are inevitable. “It seems easier to take four people you already know that think similarly to you,” he says. “But you have to put in the effort to realize you have strengths based on experience but also limitations and prejudices. I want to build a team that supplements who I am.” He says it’s important to choose a support team that has a diversity of opinions, ages, and cultural backgrounds. It’s particularly crucial to be inclusive of the local culture as well, even when you’re talking about a region of the United States. Phoenix says you have to be prepared to hear things with which you disagree. “At the end of the day, the project deliverables and deadlines must be achieved, and the project manager is the captain of the ship,” he says. “Your job is to listen to your team, but you have to have the confidence to make the ultimate call on issues when the time comes to do so.” CIC Construction Group (CIC) is a general contractor with more than 33 years of experience in medical devices, biopharmaceuticals, and industrial projects. Our integrated construction services include: preconstruction services, construction, self-performed trade work in civil, structural, and architectural works, and design-build. CIC has offices in San Juan, PR, and Raleigh-Durham, NC. In 2004, CIC started a longstanding relationship with C.R. Bard, building a new 223,000-square-foot, state-of-the-art medical devices manufacturing facility in Puerto Rico. Since then, CIC has completed more than eight additional renovation projects to accommodate the manufacturing of new products. CIC’s mission is to provide excellence beyond expectations.

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Juarez, Mexico

The Juarez Manufacturing Plant opened in early 2016. Even though the plant was built in Mexico, C.R. Bard made sure construction was in compliance with US process safety codes.

JUAREZ MANUFACTURING PLANT JUAREZ, MEXICO Shortly after C.R. Bard agreed to acquire Rochester Medical in 2013, executives knew the company would need the additional capacity in order to handle production of Rochester’s catheters. When C.R. Bard settled on a site in Juarez, which is about 20 minutes south of El Paso, Texas, Phoenix and his team met a new set of obstacles. “We build to US standards for safety and functionality—[and do so] globally where feasible,” he says. “Some local codes there were not up to that same standard as US standards in some areas. We used an organization in Pennsylvania to implement process safety design that would be in compliance with US process safety codes. A building with our specifications was a new requirement for the Mexico-based builder.” At the same time, Phoenix and his team needed to learn the manufacturing process for a product C.R. Bard hadn’t produced before. The catheter-dipping process uses flammable chemicals, which added another element of risk to the project. Although the timeline was tight, Phoenix can breathe a little easier now. The factory opened right on time in early 2016.

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In Short Order

SONIC Drive-In’s Justin Ashby on achieving growth through new markets, conversions, and controlling costs BY JULIE EDWARDS

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With more than 3,500 locations already open, SONIC Drive-In is still chasing further growth with up to 60 new locations planned for 2016 and an upcoming move into the Hawaiian market.

Photo: David McNeese

WHEN YOU THINK OF DRIVE-INS WITH CARHOPS, MOVIES SET IN THE EARLY 1960S —say, American Graffiti—might come to mind. Outside of the cinema, however, the carhop is alive and well in SONIC Drive-In locations around the United States, and it’s an integral part of the restaurant’s experience. As the largest chain of drive-in restaurants in the country, SONIC serves about 3 million customers each day. Justin Ashby, the company’s vice president of design and construction, brought a master of science degree in construction management from Texas A&M, as well as considerable construction experience—mostly in the retail QSR segment—to SONIC when he joined the team in 2015. “I was attracted to the company because of its very aggressive growth plan and heavily entrepreneurial spirit,” he says. “I was enticed by the challenge of bringing my 25 years of experience to take the company’s development program to the next level and ramp up unit production to meet growth goals.” Ashby’s responsibilities include concept development, architecture, engineering, and construction management. In addition to setting strategic direction for his department, he assesses pipeline and workload needs, allocates and augments resources as necessary to meet growth commitments, and oversees an in-house team of nine designers, construc-

tion managers, and administrative support that provides a wide range of services for franchise partners. “We also complete a few corporate-owned locations every year where we provide a turnkey development service for the brand,” he says. Ashby describes his management style as collaborative, and adds that getting a team to buy in to that collaborative spirit leads to greater productivity. “I’m proud of my team,” he says. “They’ve embraced the idea of figuring out how to get more done without exponentially increasing staff. They keep a positive attitude and get positive results. We saw good results last year and are continuing the momentum this year.” That momentum only seems to be building. As of 2015, SONIC had expanded into its 45th state, Rhode Island, and recently announced plans to expand into Hawaii. “The company is searching for the perfect site for its first Hawaiian location and determining how best to integrate the SONIC brand with the spirit and culture of Hawaii,” Ashby says. This effort requires a little more planning than continental-US locations, as the company has to identify local resources to assist in design and construction as well as solve logistical problems such as getting branding elements (signage and canopies) into place. That includes determining whether to produce those elements locally or ship them in from the mainland. Another area that SONIC is moving into is cobranding with convenience stores. “We’ve already opened t wo locations with Love’s Travel Stops, and there are more on the horizon with Love’s as well as with Exxon and Cef-

“I’m proud of my team. They’ve embraced the idea of figuring out how to get more done without exponentially increasing staff. They keep a positive attitude and get positive results. We saw good results last year and are continuing the momentum this year.” Justin Ashby, VP, Design & Construction

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SONIC Drive-In by the Numbers

3,529

drive-ins in 45 states

50–60 stores

planned to open in 2016

~3 million

customers served daily

1 million+

drink combinations on the menu

¾ acre

average site size

1 acre

average site size of locations with dine-in service

16 stalls

average in freestanding drive-in locations

$5 million+

donated to education through Limeades for Learning with DonorsChoose.org

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“We’re taking advantage of conversions and cobranding opportunities—all while staying true to our core strategy of being America’s drive-in. The sky’s the limit.” Justin Ashby VP, Design & Construction

Photo: Sonic, Portrait: KJane Designs

SONIC Drive-In recently began opening cobranded locations with other companies, such as Love’s Travel Stops.

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co,” Ashby says. The cobranded locations are already demonstrating success, so the company is developing prototypes that align with Love’s standard travel stop layouts. SONIC is also expanding into more urban markets, such as Newark, New Jersey, where it opened its first location in 2014. “Space is often at a premium in urban locations, but we design them to be accessible by car, and we keep the drive-in stalls [when] possible,” Ashby says. To choose sites for its restaurants, SONIC uses sophisticated market planning and market-research processes, then leverages that with the franchisee’s knowledge of the local market. SONIC offers franchisees significant support, providing not only site design and development assistance, but also an operations model that has been proven successful. Building a store from the ground up takes six to eight months on average. Conversions are generally faster, taking three to four months on average, although that depends on the configuration a nd c ond it ion of the existing property, as well as on municipal re qu i rement s. W he n pic k i ng sites, SONIC considers factors such as bidirectional flow—whether it’s easy to enter and exit the site—as well as visibility of the location. “ We have a d i f fe r e nt iate d offering that at-

tracts guests—we serve all day long, so we’re not as heavily dependent on traffic direction as some other brands are,” Ashby says, adding that the company’s primary indicators of a successful location are sales, traffic, and profits. “We use internal and customer-facing performance metrics and adapt business models and designs accordingly. For locations with dine-in service, we have additional performance metrics.” Even with the success and momentum built up in recent years, Ashby says SONIC always needs to make sure the economics work. “There’s a constant battle to keep costs under control,” he says. “We’re trying to mitigate the impact of inflation. We’re refining our prototypes, trying to make sure our buildings are right-sized. We’re testing more cost-effective materials and even exploring alternative construction methods.” As far as the future of SONIC, Ashby says there are still states and markets that haven’t yet been tapped, and the company has no shortage of ideas to keep its momentum rolling. “We have many avenues for serving customers—stalls, drive-through, dine-in—so we can adapt to the needs of local markets,” he says. “We’re taking advantage of conversions and cobranding opportunities—all while staying true to our core strategy of being America’s drive-in. The sky’s the limit.”

Known as the “World’s Best Roof,” the Duro-Last roofing system is perfect for any flat, low-sloped, new, or retrofit application. Our custom, prefabricated accessories and flashings—combined with either prefabricated Duro-Last deck sheets or roll goods—allow for a watertight roof installation that doesn’t sacrifice aesthetics. With five manufacturing facilities and more than 70 tech reps across the country, along with industry-leading warranties, the Duro-Last Roofing system is a great long-term investment. Contact Information: 800-248-0280; information@duro-last.com

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NICHE | ENERGY TRANSMISSION

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Clay Adams on his multifaceted career with Entergy and some of the recent projects that change the way the industry thinks about powering life

BY PAUL SNYDER

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arly in Clay Adams’ career, his director of operations challenged him to learn as many things about the different aspects of energy generation, transmission, and distribution as possible. Adams listened. In his 16 years with Entergy, an integrated energy company headquartered in New Orleans, he’s worked as a transmission area planner, capital budget coordinator, distribution project manager, supervisor of asset management program design, and manager of substation design. He’s worked on projects that have traversed every kind of terrain, had to restore power to communities hit hard by extreme weather, and found new ways to bring energy to areas that have outgrown their supply and distribution sources. In his current role as director of project management and construction, Adams is helping lead Entergy through some of its most complex and meticulously planned projects yet. Most people might not think about the front-end work it takes for the lights to come on with a flip of a switch, but for Adams, that might mean shutting down city streets and the interstate through downtown New Orleans. It might mean using helicopters in Arkansas to transport material, workers, and build structures so that construction work doesn’t threaten an environmentally sensitive area. It means finding new sources of energy to keep rates low for customers and updating aging infrastructure in Texas and Mississippi as these states continue to grow. It sounds like a lot, but Adams says it’s part of the job. “As I progressed from assignment to assignment, I continued to draw on the experience from that previous assignment and look for ways to broaden my impact as well as my knowledge of the business,” he says.

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RECONDUCTORING IN NEW ORLEANS Construction timeline: July 2015–March 2016

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downtown, and the creation of a transmission construction plan where Entergy used special crews to work on energized lines just outside the Ninemile 6 Power Plant. All of this came in addition to the complications of working in a city that’s below sea level and has a complex drainage and flood protection system. Beyond just specialized crews, Entergy employed around 180 workers on the project. Adams says the key to organizing such a coordinated effort is engagement through early and frequent communication. No matter how large or small a team member’s role, he says, they have to feel and understand how critical they are to the project. “From my point of view, when all of the team members—regardless of their role—feel accountable and included, not only are we effective and fully engaged, the work we do is more fun,” he says. “It’s really magical to watch it all come together.”

Entergy increased wire capacity on about 12 miles of transmission line in and around downtown New Orleans.

Photo: Courtesy of Air2

AS PART OF ENTERGY NEW ORLEANS’ POWER TO GROW PLAN, Adams and his team recently increased the wire capacity on roughly 12 miles of transmission line through urban communities that surrounded and included downtown New Orleans. The project allowed more power to flow into the city from the company’s new Ninemile 6 Power Plant. For Adams, this was a bit trickier than a traditional transmission line upgrade. “The upgrade projects carried unprecedented reputational risk with our community,” he says. “They carried unprecedented occupational safety risk with a large amount of—as you can imagine—transmission line construction over energized distribution serving our customers. Then there were significant public safety risks of overhead construction on busy city streets.” The project required working along New Orleans’ levees at the Mississippi River, closing the interstate highway that runs through


SAFE I QUALITY I DEPENDABLE I EXPERIENCED I PRODUCTION A partnership between two entities that share ideas and concepts together to insure a win/win situation for both sides is what drives success in project saf ety, organization, and timely completion. Clay and his team are always open to ideas and strategies that lead to a successful timely completion of proj ects. The management team at T&D Solutions LLC. are always eager to work side by side with the Entergy management team in order to assure a safe work environment for all employees and the public, as well as delivering a dependable and reliable proj ect completion. Sammy Christian T&D Solutions LLC. - President

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SOMETIMES A TRANSMISSION LINE CAN BE BUILT OR UPGRADED ALONG A COUNTY HIGHWAY without having to stress too much about the environmental impact that construction might have. Then again, sometimes the areas where the transmission lines run cut through wetlands, hiking grounds, lakeshores, and other areas where large-scale construction could result in significant environmental damage. That’s why Entergy opted to limit boots and machinery on the ground and chose instead to suspend workers and materials by helicopters as it upgraded the Hot Springs Milton–Carpenter Dam transmission line, which winds its way through Arkansas. “This was probably my first example of such largescale use of helicopters on one of our transmission line projects,” Adams says. “However, we’ve since deployed a similar execution strategy on two additional projects that were located in sensitive, scenic mountain terrain as well as wet river bottoms in Arkansas.” Adams says he and his coworkers are sensitive to protecting the integrity of areas where people hike, fish, swim, or have any number of fond memories, because he and his team members also live in those kinds of environments. “Some of the communities we serve are well-known tourist destinations,” he says. “They possess a lot of natural beauty, which brings people in from all around the country, not only to visit, but also to live here. . . . We believe the infrastructure we provide should never jeopardize that value.” Although Adams says that employing helicopters and suspending workers and materials to complete upgrades is the most extreme example of Entergy’s environmental commitment, the company has every reason to do similar work and investigate other noninvasive strategies when it comes to future projects. “It’s the efforts of significant upfront planning and preparation and then the measured, calculated execution that really makes us successful in protecting the environment while progressing our system,” he says.


Photo: Courtesy of Air2

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ENTERGY TAPS SOLAR POWER

“From my point of view, when all of the team members—regardless of their role—feel accountable and included, not only are we effective and fully engaged, the work we do is more fun.” Clay Adams Director, Project Management & Construction

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Photo: Courtesy of Air2 (top)

ENTERGY NOW HAS PILOT PROJECTS UNDERWAY IN MULTIPLE AREAS to study the feasibility of utility-scale solar generation. In Mississippi, the company launched three solar installations in three different locations— each capable of generating 500 kW of energy from the array of solar panels. In New Orleans, the company selected a contractor to begin construction in 2016 of a 1-MW solar generation project with state-of-the-art battery storage technology to help compensate for cloud cover. On an even larger scale, the company has entered into a power purchase agreement that will lead to the construction of an 81-MW photovoltaic solar energy generation facility that should be online in 2019. When complete, the project will generate enough electricity to power roughly 13,000 homes.


CLEARING • CIVIL • CONSTRUCTION MATTING • EROSION

FORD R U ’

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Together, we power life. Join our team. Entergy is hiring. We power lives and livelihoods throughout our region. It’s a big, rewarding job. Learn more at entergy.com/careers.

A message from Entergy Corporation ©2016 Entergy Services, Inc. All Rights Reserved.

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NICHE | UNIVERSITY CONSTRUCTION

REMINISCENT OF A TIME GONE BY Through a mixture of targeted renovations and new construction, John McEnrue is helping lead a development boom at New Paltz State University of New York not seen since the days of Governor Nelson Rockefeller BY JULIE EDWARDS

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ocated near the Shawangunk Mountains, roughly 80 miles north of New York City, New Paltz State University of New York is one of the 64 campuses in the SUNY (State University of New York) system. It’s a system for which the late New York Governor Nelson Rockefeller was a strong advocate. “He consolidated the system and created the framework of the campuses,” explains John McEnrue, SUNY New Paltz’s director of facilities design and construction, who adds that after Rockefeller left office in 1973, many SUNY facilities built in the 1960s and 1970s were left to deteriorate.

That pattern of neglect began to change about 10 years ago, thanks to renewed interest in public universities, which offer a quality education at a lower cost than private schools. The administration of SUNY New Paltz—which has about 6,500 undergraduate and 1,000 graduate students—could see that physically improving the campus was essential if the school were to remain competitive. “Students already understand what a college or university offers academically prior to visiting for admissions tours, but ultimately it’s how the campus looks and is maintained that will attract, and subsequently retain, them,” McEnrue says.

The renovation of the Wooster Building puts it on the path to receiving a LEED Gold designation.

When McEnrue joined New Paltz 11 years ago, there was no grand plan in place for improving the campus, but a landscape master plan and a facilities master plan were developed. “The landscape plan was to make the campus more pedestrian friendly,” McEnrue says. “We moved parking to the perimeter and added more green space, more walkways, and more lighting. We also carved out space for future projects, which we are currently developing. In terms of the facilities master plan, we realized we were about 400,000 square feet shy of space compared to peer institutions of similar student body size—that took into account classrooms, library space, faculty offices, and residential space. We’re in the process of rectifying that now.” McEnrue is at the heart of that effort. In his role, he’s responsible for developing long-range strategic facilities initiatives as well as overseeing planning, design, new construction, renovation, replacement, and deferred maintenance for academic, athletic, residential, and administrative facilities. He works closely with John Shupe, assistant vice president of facilities management, who McEnrue says “has provided truly inspirational leadership and a collaborative team approach and environment.” McEnrue also has a team that includes registered architects, architectural designers, construction managers, and a clerk administrator. Together, the team that McEnrue calls “a very talented, dedicated group of professionals,” has overseen a spate of work not seen since the days when Gov. Rockefeller held office.

WOOSTER BUILDING RENOVATION DURATION OF PROJECT: 3 YEARS COST: $36 MILLION AMONG THE PROJECTS ASSIGNED TO MCENRUE’S TEAM, along with the State University Construction Fund (SUCF), is the renovation of the Wooster Building, which was originally built in the early 1970s in a style that lacked a certain aesthetic. “The facility had large concrete walls,” McEnrue says. “It was dark and cavernous and not energy-efficient. We stripped it down to its frame, and it has become one of our greatest success stories. It’s become a pedagogically advanced facility. There’s natural light throughout all three floors. We installed a dining center,

americanbuildersquarterly.com

and the building’s on the path to receiving a LEED Gold designation.” One of the unique features incorporated by the architectural firm, Croxton Collaborative, is a solar timeline in the main atrium. The staircase rises above the timeline, beneath a skylight. Some of the steps on this staircase are lit by the sun, according to the path it travels along the sky between the summer and winter solstices. “On June 21st, you can see the sun on the top step, while on December 21st, the sun shines on the bottom step,” McEnrue says.

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OLD MAIN EDUCATION BUILDING RENOVATION DURATION OF PROJECT: 3 YEARS COST: $33 MILLION BUILT IN 1907, the Old Main Education Building had, over the years, been stripped of most of its original architectural elements. “It had carpeting and fluorescent tube lighting,” McEnrue says. “It had morphed into a 1950s and 1960s-inspired facility by the time we started working on it.” McEnrue and his team, along with SUCF, turned a wing that was once a former gymnasium into three floors of faculty offices and smart classrooms with state-of-the-art technology. “We also restored the early-20th-century aesthetic appeal—with crown moldings, hardwood floors, schoolhouse pendant lights, and chair railings,” he says. “In fact, we received a local village restoration award for it.”

SUNY New Paltz received a local restoration award for its renovation of the Old Main Education Building.

The New Science Building will also serve as an arriving point for faculty, staff, students, and visitors.

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“Students already understand what a college or university offers academically prior to visiting for admissions tours, but ultimately it’s how the campus looks and is maintained that will attract and subsequently retain them.” John McEnrue Director, Facilities Design & Construction

Working closely with the architect, designer, and SUNY team, EvensonBest helped establish furniture and finish selections that uniquely represent the design and functionality objectives at the college. The resultant spaces depict a true reflection of the mid-century origins of the campus blended with the modernday furniture needs of the students.

NEW SCIENCE BUILDING DURATION OF PROJECT: 2.5 YEARS COST: $48 MILLION Besides renovation work, McEnrue and the SUCF also are overseeing new construction. As of press time, construction on the new science building was scheduled to wrap in December 2016. “There wasn’t a previously defined border between the surrounding residential neighborhood and the campus, so you never had a sense of arriving at SUNY New Paltz,” McEnrue says. “Our landscape master plan picked this location as a space for academic development and we chose science. We tore down two buildings that housed international studies and geography, and we removed a parking lot to create the space.” The project’s architectural firm, ZGF, incorporated a unique feature by covering the exterior of the building with slate. “The architects took their inspiration from the slate on the old stone house roofs in the village of New Paltz,” McEnrue says.

Campus Commons State University of New York at New Paltz

ikon.5 architects 864 Mapleton Road | Princeton, NJ | www.ikon5architects.com | 609-919-0099

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SOJOURNER TRUTH LIBRARY RENOVATION DURATION OF PROJECT: 2 YEARS COST: $14 MILLION A change in behavior precipitated the renovation of SUNY New Platz’s Sojourner Truth Library. “Historically, students studied alone for the most part,” McEnrue says. “But now, the faculty prefers students to work in groups. So, on the main floor, we created group study rooms with smart technology and furniture arrangements that promote interactivity. But there are also places that offer privacy, if students want to study alone.” The lower levels have more places where students can study quietly, and enjoy a pretty fantastic view. “The library is bermed into the side of a hill,” McEnrue says. “As part of the renovation, we removed many of the concrete walls on the west side of the building and replaced them with glass so that students may now look out on the Shawangunk Mountains.” Impressively, the library remained open and in operation during the renovation process. “We coordinated our work in collaboration with the dean of the library, and pulled off a relatively smooth renovation,” McEnrue says.

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Concrete walls were removed from the Sojourner Truth Library and replaced with glass to improve views.

Thanks to the sustainable features implemented in Ridgeview Hall, the project is on track for LEED Gold status.


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“My team is great. They truly want the best services and products for our clients—the faculty and students of SUNY New Paltz.” John McEnrue Director, Facilities Design & Construction

A LOOK AHEAD

RIDGEVIEW HALL DURATION OF PROJECT: 1.5 YEARS COST: $33 MILLION Another new construction project underway at SUNY New Paltz is Ridgeview Hall, which, as the name implies, looks out over the Shawangunk Ridge. “We created student housing with modern amenities, as well as a café where students can eat in or grab and go,” McEnrue says. “The café is very popular.” At press time, McEnrue told us that Ridgeview Hall is on the path to LEED Gold designation. The residential campus projects at New Paltz State are done in collaboration with the Dormitory Authority of the State of New York.

americanbuildersquarterly.com

EVEN WITH SEVERAL PROJECTS UNDERWAY OR ALREADY UNDER ITS BELT, SUNY New Paltz still has plans for future work. These plans include a $20 million renovation of an existing residence hall, as well as construction of a 20,000-squarefoot engineering facility to accommodate the school’s new mechanical engineering program. Projects on the university’s wish list include another academic facility that has more classrooms and faculty offices, renovating the Smiley Art Building, and renovating the outdated pool. McEnrue says there are challenges to his job, such as managing expectations and having to prioritize all that needs to be done in terms of deferred maintenance. Nevertheless, he says it’s all rewarding. “I love coming into the office every day,” he says. “My team is great. They truly want the best services and products for our clients—the faculty and students of SUNY New Paltz.”

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FINISHES

In addition to celebrating its athletes, hallways in Under Armour’s new HQ campus feature large windows to provide natural light and frame views to the water outside.

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Executing a

SOLID GAME PLAN As Under Armour continues its meteoric rise, Neil Jurgens discusses the $4 billion sports apparel company’s efforts to create an expansive, highperformance campus to consolidate its workforce, engage the consumer, develop the brand, and drive innovation Text by Zach Baliva / Photos by Jeffrey Totaro

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The new HQ campus features open spaces to promote collaboration between employees. Under Armour’s backof-house functions are now housed in a renovated Sam’s Club store on the new HQ campus that measures 170,000 square feet.

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t’s one of the most iconic scenes in the history of American cinema. Martin Brody calmly tends to his day’s work at sea when a massive shark rises suddenly from the water. He stares in disbelief, retreats, and deadpans the now famous line, “You’re gonna need a bigger boat.” In some ways, the scene is a perfect metaphor for corporate real estate executive Neil Jurgens’ experience at Under Armour, where he is working with founder and CEO Kevin Plank, among others, to design and build an expansive and unprecedented waterfront headquarters campus. When Jurgens—the company’s vice president of corporate real estate, who has previous large-scale experience with companies such as Macerich and Disney—joined Under Armour in April 2013, Plank already had visions of taking the $2 billion company to $7.5 billion by 2018. Nevertheless, when Jurgens analyzed its existing real estate plans, he noticed trouble lurking just below the surface.

Under Armour already has a planned unit development (PUD) that contemplates an additional growth of 600,000 square feet, but with revenues increasing by more than 30 percent and the company’s head count on the rise, Jurgens knew having the right space would become especially critical. “Real estate is expensive, and changes drive costs up,” Jurgens says. “You want to make the right decision from the start while looking long term.” When he met with Plank to discuss the CEO’s goals for the next 20 years, Jurgens started a growth analysis and came to a dramatic realization—Under Armour needed a bigger real estate plan. In early 2016, Plank’s private real estate company, Sagamore Development, announced plans to turn more than 250 acres of Baltimore’s Port Covington waterfront into a mixeduse venture. Under Armour will take 50 acres of that space and transform it onto an all-encompassing HQ campus featuring a sports stadium, high rises, and a man-made lake. “We’re starting with a clean slate and designing a full campus environment from scratch with no legacy buildings to restrict the creative process,” Jurgens says. “We’ll be able to create the exact home Under Armour needs, and the campus can grow along with the company.” Under Armour will complete the headquarters, which will eventually house 10,000 “teammates,” in at least four stages over the next 20 years. Today, about 85 percent of those teammates occupy open floor plans. Jurgens expects that number to increase and relishes the opportunity to create work environments that both reflect and enable Under Armour’s brand and mission. He’s working with designer and architect Bohlin Cywinski Jackson to capture natural light, build in flexible spaces, and use authentic materials such as concrete, steel, and wood. Additionally, 100,000 square feet of process innovation space will change the way Under Armour creates its shoes, apparel, and accessories. “Bringing this space on site will be huge for us, because everyone will work together in a much more natural way,” Jurgens says. After redeveloping the company’s existing campus 70,000 square feet at a time, his

THE NEW HQ 10,000 employees (current HQ holds 1,800) 5,000 cars 12,000 external jobs supported 4 million square feet 4 phases 50 acres 7,000 seats in the sports stadium 2.9 million square feet of office space 100,000 square feet of manufacturing space 500,000 square feet of amenities 2020 projected first phase delivery


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UNDER ARMOUR ON THE MOVE In January, Neil Jurgens and his team executed a move that sent about 475 Under Armour teammates from multiple offices to one new location. To prepare, corporate real estate leaders created an executive steering committee. As moving day approached, those leaders met with human resources and key department personnel to discuss needs and logistics before implementing move management teams. In doing so, the real estate team fostered goodwill and generated a sense of excitement. Those once hesitant to the move knew what to expect, appreciated a chance to provide input, and ultimately became the project’s biggest champions. The move, which occurred over four separate weekends, went off without a hitch.

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“This new home helps us adapt to the market and move in what we believe is the right direction for the company.” Neil Jurgens VP, Corporate Real Estate

Under Armour - Ivory Shell Renovation

CONGRATULATIONS Neil Jurgens and the Corporate Real Estate Team for your global leadership from your local partner Plano-Coudon Construction.

Your Vision. Our Mission. P: 410.837.2570 F: 410.837.2571 W: www.plano-coudon.com

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teams have learned exactly what touches each business unit needs. Now, they can bring those nuances together in one location to promote collaboration. Sales people, wholesale partners, and stakeholders can tour the innovation group and adjacent areas to discover what’s on the horizon. While the project will elevate the Under Armour brand, the city of Baltimore will also reap the economic rewards, as the complex will either create or support an estimated 12,000 jobs. Additionally, by opening the secure HQ’s waterfront area to the public, Under Armour will help revitalize a forgotten industrial corridor that’s been a black hole swallowing other attempted developments. Under Armour is building public access to the site’s lake and will host exhibitions at onsite locations that include a 7,000-seat stadium and an NCAA-rated track. Jurgens and his colleagues are in talks with the city and the state of Maryland to develop public transportation options that will bring employees and visitors to Port Covington. That move is just one of many steps the company is taking to address sustainability. The complex will also generate some of its own electricity and also employ a unique water infrastructure to draw water from the middle branch of the Patapsco River. Once filtered, the water will help cool campus buildings before returning back to its source. Those efforts, along with rainwater reclamation, will help reduce the campus’ potable water requirement by an estimated 80 percent. The project, announced in early 2016, is generating excitement at Under Armour’s existing Tide Point headquarters, a landlocked area that houses nearly 2,000 teammates. “This new home helps us adapt to the market and move in what we believe is the right direction for the company,” Jurgens says. “It will become an asset that allows us to stay nimble so we’re not locked in to an old way of thinking or doing business.” Just after the announcement regarding Port Covington, Under Armour released its financial report for the last quarter of 2015. Full-year revenues jumped 28 percent to $3.9 billion. Stock prices are up, and the growing company is hiring hundreds of people each year. Things are looking up at Under Armour, and Jurgens is confident he’s creating the right space to support the company’s continued success.


FINISHES Cisco’s layout provides collaborative spaces, such as this meeting room, but also provides employees with other choices to consider.

When Open Isn’t Operational

Alan McGinty of Cisco Systems says the company’s workplace layout offers its employees something an open office can’t: choice by Kristen Bahler

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he open office is dead. Or at least it should be, says Alan McGinty, senior director of the Global Workplace Innovation Group at Cisco Systems. The concept, designed as a means of squeezing workers into a smaller footprint under the auspices of collaboration, offers no more flexibility than a cubicle farm, he says. Companies that want to drive engagement and compete in the talent wars need to empower employees to participate in the design of their own workplace. “The open office is an abject failure,” McGinty says. “You can’t throw a knowledge worker into an open environment and expect them to get their work done. You have to provide people with the choice of what kinds of spaces they can work in, and what kind of technology platforms they can use.” At Cisco, the solution is “neighborhoods,” or distinct spaces around the office, floors,

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and building that serve different needs. It varies by team, but McGinty—who designed and implemented the “Cisco Connected Workplace”—says most locations have separate areas for heads-down working, reflection, privacy, collaboration, creativity, and formal meetings. Work stations aren’t stagnant; desks are on wheels and can be realigned to fit a team’s changing needs. As a result, the company’s culture, which has flexible work policies that allow employees to work when they want and where they wish, corroborates its enthusiasm for structural discretion and choice. Of course, there are also options when it comes to technology. Cisco, an industry leader in the hardware, software, and service offerings that power Internet networks around the world, houses more than 80,000 global employees. Enterprise platforms that provide online communication, telephony conferencing, and VPN access bring them closer together.

“We have nearly 500 sites worldwide,” McGinty says. “In order to stay connected with teams around the world, in-person meeting experiences and next-generation technology capabilities keep teams working closer together, and more productively.” McGinty, for his part, has more than 20 years of experience in real estate, facility, and design management. In 2008, he was recruited by Cisco from Rockwell, the industrial automation company where he spent nearly 12 years as head of global real estate. Today, he’s known as Cisco’s “workplace futurist” and is responsible for molding an office that meets the needs of “the next generation of employees,” he says. That means combining physical workplaces with advanced technology, leading energy management and sustainability initiatives, and providing Cisco employees with the power to choose what their workday looks like. Some of Cisco’s enterprise capabilities, such as company-wide instant messaging,

Photo: Steve Ryan

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2007 25% 2012 2017

40%

CARBON FOOTPRINT REDUCTION Cisco’s Connected Workplace has enabled the company to reduce its global real estate portfolio and support carbon footprint reduction by 25 percent in the five years ending in 2012. By 2017, the firm expects it to be down by 40 percent from its 2007 baseline.

Alan McGinty says companies need to digitize their workplace to be successful, advice which Cisco has taken to heart.

“You have to provide people with the choice of what kinds of spaces they can work in, and what kind of technology platforms they can use.” Alan McGinty Senior Director, Global Workplace Innovation Group

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high-definition videoconferencing, and ubiquitous wireless access have quickly spread throughout the connected workplace. Others, such as physical spaces that can recognize employees—called “intelligent proximity”— seem straight out of science fiction. “When I walk into a meeting room at Cisco, it recognizes me,” McGinty says. “The phone becomes ‘mine.’ I put my computer on the table, and it pops up on the screen.” There’s more innovation on the horizon— such as the telepresence robots that travel from office to office, taking on the face of a remote employee that needs to communicate to a coworker. Additionally, there will be rapidly evolved lighting systems that give “infinite control” over fixtures through controlled networks, as well as sensors that allow administrators to measure real-time occupancy to get a better understanding of how the building is being used. “We’re in the midst of a technological revolution,” McGinty says. “Companies need to digitize their workplace to be successful—providing converged networks, building automation systems, occupancy sensing, security and lighting systems . . . all of these things are rapidly entering the market, driving operational efficiency and employee engagement up.” At Cisco, forward-thinking design has won over millennials—“the most important challenge” for any modern company, McGinty says. In other words, it meets the desires of a rapidly evolving global workforce. “Businesses around the world spent decades housing people in veal pens,” he says. “If you showed young talent an old cube farm and said, ‘This is where you’re going to be working,’ they would turn around and walk out the door before you finished that sentence. We need new workplace models that drive innovation, collaboration, and well-being.”

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FINISHES Created by artist Robert Kuster, the Seven Sisters sculptures hanging in Acuity’s headquarters are between 12 to 15 feet in diameter each and together contain more than 14,000 hand-blown glass tendrils.

Presenting an Even Better Place to Work Sheri Murphy discusses the complete overhaul of Acuity’s Sheboygan, Wisconsin, headquarters—intended to drive employee engagement, foster collaboration, and prepare the company for future growth by Urmila Ramakrishnan

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Photo: Sheila Barabad

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“Many of our employees tend to be fairly new college grads. They are new to the business, and we pride ourselves on training them from the ground up to be experts in our industry.” Sheri Murphy VP, Services & Administration

Photo: Sheila Barabad

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heri Murphy has seen the insurance company Acuity evolve for 27 years. When she first started, people came in, did their work, and went home. Now, in the 18th year of a new management team and culture, she sees that employees are finding a deeper meaning in their work. Murphy works as the company’s vice president of services and administration, and when she was tasked with a major expansion of the company’s headquarters, she made sure the reworked facility reflected the attitude of its employees. She saw the need for a multifaceted space that reflected a dynamic and collaborative team. It all started in 2004 with a massive addition to Acuity’s existing headquarters. She worked with Eppstein Uhen Architects when planning the structure, and that initial experience catapulted Murphy into Acuity’s current project, a multitier expansion at a cost of more than $150 million, which increases the building to more than 1 million square feet—not including parking structures. This project started almost four years ago and has been as multifaceted as the company itself. In 2014, Murphy’s team started by putting up stand-alone structures and additions to the headquarters, building a redundant data center, constructing a parking lot, and erecting the world’s tallest pole—upon which visitors can see the American flag. As of press time, the entire project was slated for completion in mid-2017, and the East Element is just one of many forays into Acuity’s sense of collaboration and creativity. Within the East Element is a 2,000-seat auditorium called “Theater in the Round.” Murphy hopes it will foster a communicative culture and serve as a functional space for the company’s quarterly town hall meetings. The theater has a stage in the center, so audience members surround the speaker on all sides. No seat is more than 70 feet away from the speaker. There are also display panels inside the auditorium and a Jumbotron above the stage, which allows everyone to see what’s happening on the round stage. The segment also includes a new office wing, another parking structure, and a training complex on the west side of the building.


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The complete renovation of Acuity’s headquarters is expected to wrap in 2017.

THE ELEMENTS OF EXPANSION SQUARE FOOTAGE

COMPLETION DATE

HIGHLIGHTS

Redundant Data Center

5,300

June 27, 2014

Supports business resiliency and resumption

Shell Space Build Out

47,900

November 26, 2014

Build out of shell and core space from 2004 expansion project, added 300+ workstations

South Parking Structure

192,800

May 27, 2015

Fully covered, four stories, 640 stalls

South Central Utility Plant and Tunnels

16,550

May 27, 2016

Two plants provide full campus redundancy on all systems—normal power, gas, water, heating, cooling, and emergency power—and create a complete loop through the various tunnels

New Loading Dock

6,200

June 27, 2015

Necessitated by master site plan and utility relocation

Servery Expansion

1,600

March 7, 2016

Increases serving and register lines to improve offerings

Southeast Office Addition

112,000

July 2016

Provides 300+ workstations for employees

East Galleria

76,000

July 2016

Home to the 2,000-person auditorium in the round, pre-function space, board room, and executive offices

North Parking Structure

194,000

June 2016

Fully covered, four stories, 640 stalls

North Central Utility Plant and Tunnels

21,200

June 2016

Full campus redundancy on all systems (power, gas, water, heating, cooling), and creation of a complete loop through various tunnels.

West Galleria

56,500

YE 2016

Establishes training complex, adding 17 training rooms and labs, and expands dining space

Fitness Center Expansion

16,550

YE 2016

Triples aerobic/spin rooms, doubles locker room space, accommodates massage rooms, adds rejuvenation and consultation spaces

Northwest Shell Space

112,000

YE 2016

Establishes infrastructure to allow for efficient addition of future seating capacity for 300+

North Building Renovations

240,000

Q3 2017

Upgrades mechanical, electrical, fire alarm, paging, security lighting systems, ceilings, flooring, and finishes

Photo: Curtis Waltz

ELEMENT

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Proud to help build our community

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We are Honored to be a part of Acuity’s Construction Team

PieperPower: The Power to Serve

Commercial Healthcare Institutional Industrial Residential Water/Wastewater Cell Towers Automation

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Acuity’s headquarters can be made to sparkle for various evening and nighttime events.

The company’s training complex will contain 17 rooms featuring tiered spaces and movable walls—the largest training room can house up to 900 people. With Acuity’s addition of 700 people in the past five years, this space will enable effective training of its relatively young staff. “Many of our employees tend to be fairly new college grads,” Murphy says. “They are new to the business, and we pride ourselves on training them from the ground up to be experts in our industry. We invest a lot of time in them upfront and every year on an ongoing basis.” In other words, spaces such as the training complex are not only useful, but necessary. Perhaps one of the more unique elements of the project is that there aren’t break rooms spread out around campus. Acuity’s headquarters will only have workspaces and collaborative areas. These collaborative spaces comprise the heart of the campus, where the auditorium, training complex, dining area, and a 45-foot rock-climbing wall reside. Murphy says her main task has been finding a way to artfully combine work and play. She found one way through a major expansion of Acuity’s exercise facility, which will add 16,000 square feet to the existing 10,000-square-foot space. The expansion, which will accommodate current and future employee growth, will also feature aerobic, spin bike, and massage rooms. One of the most playful features of the updated headquarters is a 65-foot Ferris wheel called the Charity Wheel. A smaller Ferris wheel was part of a gala in 2013 that raised hundreds of thousands of dollars for

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a local neonatal intensive care facility. The event had a circus theme, and Acuity set up the wheel in the event space. Today, the new wheel is a reminder of the company’s lighthearted attitude. “The wheel is an iconic element that crosses generations and envelops whimsy with purpose,” Murphy says. The Charity Wheel is at the heart of the campus, which continues to host major fundraising charitable events, spelling bees, and youth development seminars. Local law enforcement has also used the space as a training facility. Acuity has even opened its doors recently for a local SWAT team drill. It’s one of the many opportunities the company takes advantage of in order to use its facility to give back to the community. First and foremost, however, Acuity is a place to work, and Murphy says she hopes the revitalized headquarters gives employees the environment and tools they need to do an amazing job for the company’s customers.

PieperPower has been, and continues to feel, both fortunate and proud to have the opportunity to participate in this state-of-the-art Acuity headquarters expansion project in Sheboygan, Wisconsin. This Acuity project is further defining a landmark that will be a fixture in this Wisconsin community for generations to come. “We partner alongside our customers to ensure their success with our integrity, dedication, and performance providing the value they demand. Our people are our power. Our employees are empowered to make a difference for future generations, and we are the most diversified, employee-owned company in the industry.” —John Kletti, Senior Project Manager, Pieper Electric, Inc.

A message from Mortenson Construction: We are inspired by a compelling purpose: building structures and facilities for the advancement of modern society. In partnership with Sheri Murphy at Acuity Insurance, we are doing just that—bringing Acuity a workplace that supports their organization’s continued growth, embodies their culture, and advances their business. Read more at www.mortenson.com

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TRANSITIONING FROM FUNCTIONAL TO EFFECTIVE With more than a decade at CareerBuilder to his name, George Cortez finds himself at the heart of a culture change as the company extends its global reach Text by Paul Snyder Portraits by Sheila Barabad

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CareerBuilder’s Chicago offices are undergoing a major renovation, and George Cortez plans to bring the “wow” factor—as he has with other recent CareerBuilder projects.

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“I’m coming up on 11 years with CareerBuilder,” he says. “When I started, we were figuring how we were going to consolidate from our office near O’Hare Airport to our current downtown corporate HQ offices in Chicago. Now we’re in a position where we’re constantly raising the bar. Before, we weren’t techy, we were just functional. Now we’re techy, functional, and effective, with value engineering as a core concept.” The company’s growth is also landing it some prime real estate. In addition to the downtown Chicago office space, Cortez points out the recently completed Newport

Photos: Courtesy of CareerBuilder

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or five straight years, George Cortez declined an incentive-based, all- expenses-paid vacation on behalf of CareerBuilder that swung through Hawaii, the Caribbean, and Cancun, Mexico. Instead, he sent members of his team in his place. In the sixth year, two of the company’s corporate leaders recommended he accept the upcoming trip. “They basically said, ‘You’ve passed on this for five years—you’re going to go,’” he laughs. “My wife and I had an amazing trip and vacation.” It might seem strange to some to pass on such a trip and send coworkers instead, but for Cortez, CareerBuilder’s director of real estate and facilities, it’s just a remnant of his military service. A Vietnam War-era veteran who served from 1970 through 1972, Cortez says he still lives by the rule that he learned in uniform of the “three Ms”—“mission, men, and me—in that order.” In the professional career he has enjoyed since, whether working for Motorola’s corporate real estate division for 14 years or now with more than a decade under his belt at CareerBuilder, Cortez says he always wants to make sure the job gets done, his team is treated fairly, and that the entire team—not just himself—is rewarded for its hard work and dedication to the company. Considering the amount of ground CareerBuilder now covers, there could be plenty of accolades to share. When American Builders Quarterly spoke with Cortez, he was heading to Atlanta to help with the opening of two new offices—a 23,000-square-foot space in Buckhead and another 23,000-square-foot space in Norcross, each of which took nine weeks to complete. At the same time, Cortez recently finished logging hours for offices in locations as globally spread out as Singapore (a 10,000-square-foot office space), South Quay (a 30,000-square-foot office just outside of London), and Newport Beach in California. Cortez says the past few years have been particularly productive in terms of development for the largest online job site in the United States, which is as heartening as it is bemusing.


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“We’re in a position where we’re constantly raising the bar. Before, we weren’t techy, we were just functional. Now we’re techy, functional, and effective.” George Cortez, Director, Real Estate & Facilities

CareerBuilder’s South Quay office in the UK features projection screens in the hallway that feature various color patterns to create an ambient effect. Common areas designed to drive employee engagement and collaboration are becoming a standard feature of CareerBuilder offices throughout the world.

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Lessons Across Hemispheres Global travel might have started for George Cortez during his time in the military, but it certainly hasn’t slowed down since. Before joining CareerBuilder, he spent 14 years with Motorola when the company was “booming—number one in the mobile category,” and covered the company’s expansive territory that stretched from Canada all the way down to South America. During that time, Cortez says he not only learned important lessons about managing real estate, but also learned lessons about developing the processes and systems that go into place—covering everything from creating leases to space plans. “All of that I brought with me to CareerBuilder,” he says. His global reach has grown too. Beyond covering the Americas, Cortez has overseen office projects for the company in Singapore

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and the United Kingdom, and had to learn the different ways of doing business abroad. His work in the UK presented an interesting challenge in terms of bringing the office online. Cortez says that in the United States, it typically takes 90 days to get a fiber-optic signal to a network circuit to bring a CareerBuilder office online. In the UK, however, that process can take six months. This difference in timeline might keep the company from taking a cookie-cutter approach to all of its developments around the world, but it also keeps Cortez on his toes and thinking ahead. “There are different international laws,” he says. “I work closely with a team of professionals. I listen to the architects to learn what we can and can’t do. If we can’t do something, I ask why, and we collaborate on creative solutions and ideas to overcome the issues.”

George Cortez says CareerBuilder has seen major changes in Chicago, where its corporate headquarters is now being renovated for major upgrades.


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Beach location as an example of how the company now adds the “wow” factor in a cost-effective manner. “You’ve got ocean views from the two sides of the office and Fashion Island (a highend shopping district) right there,” he says. “It’s absolutely beautiful and we didn’t break the bank.” Even on the inside, CareerBuilder spaces are getting aesthetic upgrades. The company’s South Quay space in the UK features projection screens in the hallway, each of which displays multicolored patterns for an ambient, mood-setting effect. There’s also plenty of room for open, collaborative spaces to drive employee engagement—a feature that Cortez says is becoming standard across all CareerBuilder offices. The number of projects on Cortez’s plate has kept him busier than even he thought possible. He admits he strongly considered

retirement last year, but with the activity on the company’s calendar, he was encouraged to stick around and help bring more CareerBuilder offices to life—not that he minds. “The best part of my job is my daily communications with leadership,” he says. “From the CEO, to the CFO, to the VP of HR—it’s a treat to work with this group of individuals. It’s the best leadership team I’ve ever worked with in my entire career.”

OA Development specializes in buying and developing thriving commercial properties, including office buildings, industrial warehouses, and flex properties. The company is known for its savvy pairing of local and global capital with high-quality commercial properties in the Southeast and Central Midwest regions—creating opportunity in a new era of investment and risk management. OA Development has acquired 15 commercial building in the last six years, bringing the company’s total square footage acquired to more than 1.8 million square feet. www.OADevelopment.com

The Summit 180,000 SF, 7 stories Peachtree Corners, GA

Congratulations George Cortez! Director of Real Estate, Career Builder americanbuildersquarterly.com

OA Development is thrilled that our friend and associate George Cortez is being recognized for the many qualities that make him a leader in his field. Career Builder has done an excellent job of investing additionally in their office space, and we are proud to partner with them. OCT | NOV | DEC 2016

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MORE THAN CONVENIENCE Bill Bishop, vice president of real estate and development for The Parker Companies, says continued innovation is critical to growth by Peter Fabris

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What are some of the biggest challenges that Parker’s faces in terms of expanding its brand? Although we’re not as large as many convenience store operators, we are highly profitable, especially for the size of our market areas. Many factors affect strategic store growth, not just actual store count. Will you acquire units? Will you concentrate on new-to-industry sites? How long will municipal approvals take? And how receptive will municipalities and residents be to having additional convenience stores built in their neighborhoods? In our industry, the typical convenience store offer is not necessarily welcomed, but if you concentrate on being best in class, eventually you’ll face less resistance. What design improvements have you implemented to bring a sense of cohesion to your different locations, especially as the brand has its sights set on future growth? There has been a concerted effort to increase the uniformity of the store size and offer. We’ve

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Photo: Christine Hall Photography

ill Bishop became vice president of real estate and development for The Parker Companies in July 2014. The company operates 44 Parker’s convenience stores in the Southeast, and has ambitious expansion plans. American Builders Quarterly recently spoke with Bishop about his challenges and the importance of the development executive role.


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“Many operators grow store count aggressively, but the best operators will also develop their business model while growing. We’ve done just that.” Bill Bishop VP, Real Estate & Development

developed a new branding image and have updated our building architecture, interior finishes, our logo, and our signage. The offer has also been changed; there will be two basic offers—one featuring a true convenience store, and a second featuring a proprietary food service program. Many will feature food service and a new drivethrough concept. We will be building more food service stores in the near future than we currently operate, and many will feature the new drive-through program. The architectural features and appearance of the buildings have changed, and the interior finishes have been upgraded with warmer colors and materials. We’ve also added architectural additions to break up lines of sight inside the store. Signage has been upgraded to feature the new logo, and with the expanded food service program, we’ll be perfecting our menu boards to efficiently purvey those foods as quickly as possible. From a real estate and development standpoint, what would you say are the keys to Parker’s growth? The preferred way to grow will always be new-to-industry construction. I think that in these competitive times, with many retailers concerned about the viability of building “bricks and sticks” stores, getting back to the basics of using science and sound site selec-

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tion will continue to be profitable and desirable. If you know the proper fundamental techniques of how to grow, those skills will transfer across all lines of real estate, and help become a strong base for your asset management plan. Few disciplines have as much determination on corporate profitability as the real estate department. Given the competitive nature of the industry that you alluded to, how do you think the role of retail development executives will change in the future? We’re all challenged with growing strategically, and having a solid asset management plan is becoming far more important. You need exposure to more of the population, but you have to do it effectively. You have to know where you are positioned properly in certain markets and perhaps less so in others. You’ll need to make tough decisions about where to increase your capital expenditures or where to save dollars. You also need to cultivate and constantly improve relationships with your architects, general contractors, and other contracted services, such as engineering and environmental firms.

You’ve spoken to us before about the importance of partners and consultants in the work that you do. What do you look for from your consultants? We work closely with Terracon, a national provider of environmental and geotechnical services that also performs construction special inspections and material testing. We work with one of Terracon’s better offices, under the direction of Bill Anderson, and they have an excellent geologist named Rick Ricci who has helped us resolve some serious environmental issues. For example, he was able to take three potential sites that were contaminated with chlorinated solvents through the brownfield process, allowing us to develop what will become highly profitable stores. Those sites would otherwise have sat vacant, and little would have been done to clean them up. It’s also challenging to manage sites that have underground storage tanks—fuel additives change, and the regulations for retail fuels storage change, you need sound environmental advice. You need good advice from all service providers including civil engineering firms, and we have one of the best in the region in Thomas & Hutton. Building along the coast is always more challenging than building inland. The soils are different, there are wetland issues, and storm water management can be incredibly difficult. Many municipalities require architectural changes such as “low country” architecture, which means your exterior finishes need to be made of hardie board or

Accountable Growth By the end of 2016, Parker’s fast-paced growth will take the regional convenience store firm from 36 stores when Bishop started, to 54 stores—a 50 percent growth rate within two years. All 10 stores needed for the 2016 growth target are under agreement, with many nearing the end of the entitlement process. Additional units are already in process, and work has already started on the pipeline for 2017.

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concrete clapboard, all while remaining hurricane resistant. If you don’t have a knowledgeable civil engineer, you have no chance to be successful. You mentioned that new stores, including new builds, will have slightly higher than a 20 percent ROI. What steps do you take to ensure that, and how challenging is it to make sure each new store achieves or surpasses that rate? Having a solid store growth strategy is the first step. A plan to cover your chosen market, which strategically selects the correct sites with the highest traffic and the right combination of daytime population and residential backup; you can’t just pick sites that satisfy the physical characteristics you look for in a site. The due diligence period should also be used to confirm that you selected the proper site and should not just serve as time to seek approval of the development. At that point, if your sales projections are modeled correctly, the ROI takes care of itself. If you have the proper rollout plan, I do believe it will shorten your store maturity time and help new units achieve desired results faster. What’s been the most surprising challenge you’ve faced since joining Parker’s, and how did you go about navigating or solving it? The challenge that we face right now is finding qualified general contractors who can help us build faster and more efficiently than we are doing currently. We want to improve our relationships with our existing general contractors but to also develop new ones. What’s your advice to other real estate and development executives that are trying to build a national presence with their brand? Perfect your brand image, then develop your relationships with your contracted professionals and listen to their advice. Then use that to develop a better store offer and grow your market share. What’s your outlook for the next few years? Many operators grow store count aggressively, but the best operators will also develop their business model while growing. We’ve done just that. Our new units are on progressively better sites with higher visibility and an increased probability of selection. With one or two possible exceptions, the sites we open in 2016 will do significantly higher volume than past years, and that’s the improvement that you strive for.

As the Parker Companies expands, updates to building architecture, interior finishes, logos, and signage have been implemented across several Parker’s locations.

Resourceful. Responsive | Reliable

We want to congratulate our partner Bill Bishop with

Terracon is an employee-owned engineering consulting firm with more than 3,500 employees providing environmental, facilities, geotechnical, and materials services from more than 130 offices with services available in all 50 states. Terracon currently ranks 35th on ER’s List of the Top 500 Design Firms. For more information, visit terracon.com.

The Parker Companies.

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BATTLE TESTED Will Martin of Health Management Systems leveraged his military experience to become an expert at facility management while improving team performance and saving his employers money by Chris Gigley

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iring managers often narrow their focus to job-specific skills when trying to fill particular roles. Will Martin says he’s glad those who have hired him have been more open-minded. Otherwise, he might not be one of the foremost experts in corporate real estate and facilities management today. Martin, director of real estate and facilities at the Irving, Texas, headquarters of Health Management Systems (HMS), has saved companies—HMS included—millions of dollars by challenging the status quo. In fact, at HMS, he set the status quo he challenges today, reorganizing the entire real estate and facilities department from the start.

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His current profession might seem like a far cry from his time at the US Military Academy at West Point and as a platoon leader with the Army Corps of Engineers, where he served from 1993 to 1996. However, Martin says the principles he learned then still guide him. “I chose the engineers because it was infantry with a bang,” he says. “We did a lot of work with minefields and explosives.” Martin says planning explosive charges was surprisingly exact—carefully measuring how much explosive was needed to create the desired effect. The rest of the work tended to be backbreaking, and included moving dirt and digging fighting positions for tanks.

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He also led his platoon on missions to clear minefields for tanks and install razor-sharp concertina wire to defend battle positions. Although these were precise skills to master, his practical training didn’t translate so clearly to any single post-military career path—or so it seemed. “When I left the military, my focus in every job interview was, ‘You can take me—a guy who’s a proven leader who has the ability to learn—and teach me how to make a widget easier than you can teach someone who knows widgets about leadership and problem solving,’” he says. Martin recalls this ability to adapt showing itself in his first job with Emerson Power Company, for which he worked in quality control.

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“The first day, I walked past a display of motors and didn’t know what they were,” he says. “But it didn’t matter what the product was because my skills with process and people translate very well to anything.” Martin says West Point taught him the value of doing the “harder right” instead of the “easier wrong.” In other words, “Do things right the first time.” He also learned about leadership in the military, primarily how success is largely influenced by putting everyone on his team in the best position to succeed. “When I’ve taken over teams, I assume they want to be there and want to be successful,” he says. “My whole focus is to find out how the organization is running and make sure everyone knows how their roles fit in the overall vision. So often, they don’t. They’re just doing daily tasks and reacting to issues.” Martin’s management approach has worked everywhere he’s been. At Emerson, he earned his ISO 9000 certification and led his team to pass an external audit in his first year. After moving to Procter & Gamble (P&G) in 1997, he earned two promotions in six years while successfully delivering multimillion-dollar projects and lowering repair and maintenance costs by 30 percent. He says he comes into every role challenging the way things have always been done. “I tell my teams up front that I will question everything,” he says. “You don’t get to assume that the old way is the best way.”


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“I tell my teams up front that I will question everything. You don’t get to assume that the old way is the best way.” Will Martin Director, Real Estate & Facilities

P&G outsourced him to Jones Lang LaSalle, which eventually led him to a new assignment with Affiliated Computer Services (ACS) in Dallas in 2007. On the ACS account, Martin created a facility management organization to support more than 300 sites and established a new budget and vendor management program that saved the client more than $2 million. He delivered similar improvements in stints with Dallas-based Dean Foods and Santander Consumer USA Inc. Still, he says his role with HMS is the broadest yet. “In other roles, when I managed the facility side of the business, I didn’t get involved in the brokerage side or the lease-planning

side,” he says. “My focus was to operate the buildings once the leases were completed. Now, I manage both the real estate projects and the facility side, which is what excited me the most about this role.” Martin received training and earned his master of corporate real estate with a workplace focus (MCRw) last year. Meanwhile, he winnowed the number of facilities HMS leased from 40 to a more manageable and efficient total of 26. Although the job pushes him every day, Martin’s military background and subsequent experiences in facilities management have prepared him for the array of challenges he faces now.

Challenge Convention, Save Money Will Martin discusses the savings he’s brought to HMS

ELECTRICITY “We’re saving 15 percent on our electric bill just by negotiating. Texas is deregulated, so you can shop around and get the best rate. We hired a consultant, and with my previous experience understanding electric utility services, were we able to work together and get the best deal.” PRINTERS “Another significant area of cost is printers and copiers. When I walked in to interview here, I noticed they did not have a program because there were printers everywhere. I implemented a printer program where we use multifunction printers with Canon. We have reduced the number of devices significantly and reduced our overall costs 20 percent.”

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COFFEE “An area of spending that is often overlooked is coffee and break room supplies. Some people think if you decide to offer free coffee, then you just accept the costs. They don’t think about bidding it out. We bid it out, saved 10 percent, and standardized our services across the portfolio.” CUSTODIAL SERVICES “We were unhappy with our janitorial vendor. The team preferred to work with the current vendor rather than risking a transition to a new vendor. After bidding the work, we were able to save 15 percent and improve the service levels at the same time.”

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The south entry reception area of HMS corporate headquarters in Irving, Texas.

“I can go from talking to the CEO about location strategy to having to deal with a spill in one of The HQ facility’s atrium can be enjoyed at all our buildings that levels of the five-story needs to be cleaned building. up,” he says. “My job goes quickly from strategic to tactical, and in the beginning I felt like I was being yanked in every direction.” Tough as that may seem for some, this is a guy who once led teams that dug holes for tanks and figured out how to clear minefields. The figurative minefields of real estate and facilities management are, comparatively, a relative snap for Martin. “A concept I learned in the military was field expedient,” he says. “When you inevitably end up in situations where you don’t have all the parts you need, you come up with a field expedient method to make it work. That mind-set has served me well in business because things don’t generally go according to plan.” As your trusted advisors, CBRE’s Occupier Services Team puts our perspectives, connections, and market expertise to work to deliver exceptional outcomes that drive value and growth. We have the vision to see what’s next and the know-how to make it happen, producing distinct advantages for our clients through world-class real estate solutions.

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REAL AdvAntAgE, RECOgnIZEd.

CBRE congratulates our valued client, Will Martin of HMS, on this welldeserved recognition in American Builders Quarterly. CBRE’s Global Workplace Solutions combines superior execution with our extensive knowledge of markets, industries and asset types to deliver scalable solutions for our clients. How can we help transform your real estate into real advantage? For more information contact or visit: Mike Cleary, Senior Vice President +1 214 979 6598 cbre.com/dfw


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EXPANDING THE BRAND

A background in retail construction has helped Charles Morse as Core-Mark International poises itself for growth throughout the United States by Urmila Ramakrishnan

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Photo: Kaia Kegley

n New York, it’s the bodegas. In Tampa, it’s the mini-marts. Go into any big city, and there will be a 7-Eleven, Kwik Stop, or Speedway in sight. Convenience stores are a steadily growing segment of the food industry as the nation becomes increasingly urban. These businesses work to meet increasing demands for fresh and frozen foods from consumers who rely on them more than before to meet needs that typically had been filled by traditional big-box grocers. Due to this demand, Core-Mark International, a consumer-goods distributor and marketer, has focused on providing fresh and frozen foods to convenience stores, which in turn has increased its own growth. The company’s most recent undertaking includes a partnership with 7-Eleven, for which, at press time, Core-Mark says it aims to provide tobacco, candy, health and beauty aids, grocery items, and perishable and frozen goods to 900 western US stores by fall 2016. Charles Morse, Core-Mark’s director of facilities management and planning, concedes that 900 stores is a large goal. The partnership with 7-Eleven will affect three of the company’s divisions, and a lot of its planning and effort has been put toward preparing those divisions for a project of this scale. Core-Mark finished its design phase in March 2016 and worked to prepare the buildings for an initial summer rollout. The initiative includes an expansion of the Las Vegas

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CHARLES MORSE’S CAREER TIMELINE 2004–2006 Project manager of special projects store construction at Target

2002–2006 Works as Target Corporation’s regional interior construction coordinator

2010 Earns MBA from University of St. Thomas School of Business Completes an extreme store makeover in Tustin, California

2011 Receives project management certification from the University of Minnesota Earns Property Development MVP award

2008–2015 Senior project manager for new US stores, distribution centers, and store remodels at Target

warehouse division, which will be relocated to a new 230,000-square-foot building in order to handle the increase in volume for 7-Eleven and other customers. Morse’s team is responsible for assisting all of the company’s divisions with their capital planning, design, and execution on facilities, equipment, and assets. He also handles all real estate lease negotiations from existing locations, relocations, and expansions. He recently rolled out multiple projects in support of the company taking on a new client, Murphy USA. The initiative impacted 10 different divisions within CoreMark, and his team had less than three months to identify scope, investment, and the vendors needed in the multiple buildings to complete building upgrades before the Murphy USA business went online in January. He attributes his success at Core-Mark International to his experience at Target Corporation. Before joining the company, Morse spent 13 years at Target, and during that time saw the brand expand from 1,000 stores to more than 2,000. “I had some very unique experiences at Target that I probably [will never] see again,” Morse says. One of those experiences was leading a full Target store remodel that was completed in five days, as opposed to the traditional 15 weeks. He says that feat was accomplished by closing the store for a week—like an “extreme makeover” you would see on TV. He was also involved with the opening of new food and dry distribution centers in the United States and Canada that had heavy investment

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MARCH 2015 Joins Core-Mark International

in different technologies and automation. The experience taught Morse how to handle the ever-changing, fast-paced environments of both sectors. “What you do today is no guarantee of what you’ll do tomorrow,” Morse says. “It really applies with any consumer-driven industry. You have got to be constantly looking ahead, planning ahead, and seeing what opportunities there are to help you grow as a company to remain relevant and stay successful. Otherwise, there is plenty of competition out there that’s looking to steal that share away from you.” Milton Draper, Core-Mark’s director of investor relations, says convenience stores now represent about 34 percent of all retail outlets, and according to a Convenience Store News trade-site forecast study, these retailers expect to see a 5 percent increase in sales by the end of 2016. This makes it even more important for Core-Mark to stay ahead of the game. As technology constantly drives change for many retail and distribution entities, Morse seeks to implement newer technology items that will lead to efficiency. Many of the buildings and systems today are using technology that’s been around for 20 years, he says. In 2016, Core-Mark managed to test and implement robotics and other equipment that requires less maintenance, upkeep, and servicing. “We’re looking to automate tasks versus requiring more manual labor to do it, which will move Core-Mark toward a push environment rather than a pull,” he says.


The hope is that this push to be technologically driven gives Core-Mark the edge when focusing on the company’s main growth driver—the fresh and frozen sector. In the past, Morse worked with all sectors of this division, including three of the largest projects in Los Angeles, Spokane, Washington, and Tampa. He hopes to continue the growth of that division by continually adding to its freezer and cooler rooms to meet customer volume and demand. Morse also handles some organic food supply, which he sees as an area that’s poised for growth in the near future. “The company’s projected growth rate for 2016 is 20 percent,” Draper says. She adds that Core-Mark is in growth mode, and that depends on continually being customer-centric and leading with integrity and family. Morse says he’ll do all he can to diversify knowledge and support that growth. “Even though this is a decentralized company, you don’t ever feel like you’re out on an island by yourself to sink or swim,” he says.

TSC

www.TSCbuilds.com

Congratulations to Charlie Morse on his new position as Director of Facilities & Planning! We look forward to building on our long-standing relationship with Core•Mark. Full Service • Design/Build • General Contracting Cold Storage Facilities • Specialty Construction Warehouses • Offices • CNG

Triumph Specialty Construction, Inc. 6225 W. Howe Road • DeWitt, MI 48820 • 517-624-6000

David Newton and Lee & Associates are proud of our 20 year strategic relationship with Core-Mark. We look forward to working with Charles Morse as we continue to maximize the value of Core-Mark’s real estate portfolio. With over 30 years of service, The Newton Service Team represents Tenants and Buyers of Commercial Real Estate on a local, regional and national basis. Lee & Associates is the largest broker-owned firm in the country, with 53 locations across the United States and over 800 brokers nationwide. Lee & Associates provides a wide range of specialized commercial real estate services. For more information, please visit thespaceformula.com 1004 W. Taft Avenue, Suite 150 | Orange, CA 92865 | dnewton@lee-associates.com P 714.647.9100 | F 714.543.5285 | Corporate ID #01011260 | BRE License #01041650 americanbuildersquarterly.com

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Engility’s new space at 80 M Street in Washington, DC, features a collaboration area that includes a coffee bar.

UP TO THE

CHALLENGE Charles Spencer, director of corporate real estate and facilities for Engility, reflects on his success during the first year in his new role by Keith Loria

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Photos: Courtesy of DBI Architects

When pure-play government service company Engility acquired the defense contractor TASC in 2015, it brought together two leading and complementary businesses to create a top-tier government services company. As each entity was roughly a $1 billion-plus company, the acquisition was structured similar to a merger—and Charles Spencer, then working as senior manager of corporate real estate at TASC, was tasked with leading the combined portfolio of both legacy entities. Those portfolios consisted of approximately 115 domestic leases, occupying about 2.2 million square feet of rentable space, and an additional 22 leases around the globe. “With respect to the scope that I’m held accountable for, I manage the entire lease

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portfolio, all facility operations and construction management for all our locations,” he says, adding that his 25-member staff ranges from office support to project managers. “Ultimately, the value of my team is being able to provide prompt and efficient day-today support for the end user. This is done while also being able to align with the business accounts to translate business needs into real estate solutions while reducing our overall real estate spend.” Upon being promoted to Engility’s new director of corporate real estate and facilities in February 2015, Spencer made a to-do list of what needed to be done and has spent the better part of a year crossing off the items one by one. “I inherited an opportunity-rich environment of excess space that was primed for significant disposition,” he says. “That presented fairly straightforward decisions for Engility leadership. However, there were several examples of where opportunities for consolidation weren’t obvious and the impacted account had an invested interest of ensuring the true utilization was obfuscated. In these scenarios, the guidance to my team was to focus on the tangible components of the decision, as we can always quantify the risk or savings in a real estate deal. “I’m confident if my team presents a compelling business case, that ultimately the correct decision will be made by our leadership. I have been In addition to areas that fos- fortunate enough ter collaboration, Engility’s to serve under leadnew HQ project features privacy kiosks for employees ership that creates who need to focus. the environment

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Engility’s space in the 45,000-square-foot building at 80 M Street provides each person about 175 square feet of usable space.

t he compa ny ’s h ig h l y sk i l le d professionals and the highly skilled professionals it hopes to attract going forward. It also accomplishes overall cost reduction by rightsizing the square footage. In addition to the upgrades on the aesthetics front, Spencer’s solution provides about 175 square feet of usable space per person, and an abundance of open and collaborative space throughout the office. This solution has been used in two projects so far—the 45,000-square-foot 80 M Street building in Washington, DC, and the first phase of Engility’s own 100,000-squarefoot corporate headquarters in Virginia. Over the next two years, he says Engility plans to expand the concept in a dozen of its flagship locations throughout the United States.

that allowed me to deliver a reduction of $14 million in spending from the previous year.” A well-rounded background in facility operations, project management, and real estate management—all in the defense contracting market—make him the ideal person for the job. “Based on my experience and the particular skill set I’ve acquired, I am able to walk that thin line of aligning with the P&L side of the house to ensure the company establishes a real estate strategy that supports the leadership’s growth strategy,” Spencer says. “All the while doing it in a manner that is cost-efficient to ensure quality cost-control is achieved.” GETTING TO WORK One of his first undertakings dealt with his inheritance of an underutilized portfolio and leveraging this challenge to create opportunities not only for solutions that tackle occupancy, but others as well. “I needed to rationalize all our leases and align them to specific contractual requirements of our programs that occupy the specific lease,” Spencer says. “You can achieve transparency on exposure as well as identify

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where there’s opportunity for consolidation. As lease end-dates and termination options present themselves, there’s now an opportunity to right size the footprint.” The result of that vetting was a three-year consolidation plan to reduce indirect spending by $35 million, which Spencer says is key to creating efficiencies required in the highly competitive government services market. He also faced a portfolio that was severely outdated in configuration, efficiency, and an overall ability to accommodate a modern workforce—a challenge that plagues defense contractors as well. “Typically, this market has been very traditional in regards to office layouts, so it’s been a struggle to move away from that,” he says. “As soon as I started leading the real estate function, my team was tasked by leadership to devise a new workplace strategy model for all new build-outs—not only delivering an office layout that was extremely efficient, but designed in a manner that could accommodate the workforce of today and the future.” By adjusting the new workplace strategy with the lease consolidation strategy, Engility achieves a more modern and highend workplace that’s better aligned with

Perhaps Spencer’s biggest challenge was integrating the two companies’ real estate and facility holdings with a limited amount of help. “Due to the uncertainty of the pending acquisition from the legacy TASC side, I came into this with reduced staff,” he says, adding that Engility’s model was also entirely outsourced and key management and personnel also weren’t onsite. “We didn’t have a lot of overall resources, but it was a great opportunity for us to create, almost from a blank piece of paper, how this should be structured and then find and attract the right talent to make up this organization to support the new company.” To do that, Spencer took what worked best from each model. “Before the merger even took shape, both companies were actually considering ways to consolidate and improve their spaces,” he says. “I ended up adopting concepts from both legacy organizations. Most of my staff is outsourced, yet I hand-picked the talent and have them embedded onsite. I have also aligned key personnel with the business accounts to provide a more streamlined support model.” As he readies himself the next set of challenges, Spencer says he’s excited to help the company continue its success.

Photo: Courtesy of DBI Architects

COMING TOGETHER


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“My team was tasked by leadership to devise a new workplace strategy model for all new build-outs . . . designed in a manner that could accommodate the workforce of today and the future.” Charles Spencer, Director, Corporate Real Estate & Facilities

How To Cut $35 Million As part of a plan to reduce real estate spending by $35 million by the end of 2018, Charles Spencer explains a few keys to achieving the goal: Rationalize every lease and the contractual requirements that justify each lease Identify and determine where the risk, exposure, and opportunities are

POWER OF PLACE

Develop a comprehensive plan that details the specific events that need to occur to accomplish the goal Achieve senior leadership buy-in, then work with each account to execute on the plan “Right when this deal was finalized, one of the main drivers in synergies was the reduction in real estate spending, which was trumpeted in the media post-acquisition,” he says. “I see it as an opportunity to deliver on a goal that is very aggressive. I am very confident with the plan we developed to achieve that goal, and based on year one’s results, we are well on our way and feel confident on delivering all these savings over the next two years.”

We congratulate Charles Spencer and Engility. Arbee Associates + Steelcase provide integrated solutions in Architectural, Furniture, Technology and Workplace Services.

Is your workplace ready? + www.arbee.net

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www.steelcase.com

Photography © DBI ARCHITECTS, INC.

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MAN OF THE WORLD The experiences that MedImmune’s Mehran Seifollahi obtained building pharmaceutical and biopharmaceutical facilities around the globe came in handy when he was called upon to complete AstraZeneca’s new Russian facility by Paul Snyder

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t’s beginning to feel like a long time since Mehran Seifollahi has had a break—not that he’s asking for one. “You like to have a little bit of time to catch your breath,” he says with a laugh. “I’m not complaining. I’m lucky to have been in the biopharmaceutical industry for a long time, going from project to project. I enjoy the excitement of having one project after another.” For Seifollahi, director of global engineering for MedImmune—a Maryland-based biotechnology development company that’s a subsidiary of AstraZeneca—that might mean having to travel halfway around the world to join another project before the one that he’s currently working on has even been completed. That scenario played out in 2015 when Seifollahi was heading a $200 million-plus expansion of AstraZeneca’s manufacturing facility in Frederick, Maryland. MedImmune

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has used the facility since 1999 to make Synagis, which is a biologics medicine used to help prevent a serious lung disease caused by respiratory syncytial virus. The expansion, which adds roughly 40,000 square feet to the existing facility, includes new manufacturing, laboratory, and administrative space to help facilitate the development of additional biologics treatments. “As program director, I was managing that project and a number of others,” he says. “It’s still ongoing, but I was needed [in] Russia to finish another pharmaceutical project there.” So Seifollahi jumped from one $200 million-plus project to another—AstraZeneca’s state-of-the-art forThe expansion to Astramulation and packZeneca’s manufacturing aging facility in the facility in Frederick, Kaluga region of the Maryland, is estimated at more than $200 million. Russian Federation.


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The new facility adds to the company’s expansion of its global manufacturing capabilities and will focus on final-stage manufacturing, packaging, and quality control. Although changing projects before completion isn’t typical for Seifollahi, he says most large projects include other experienced project managers that can step in to keep development on track as others are called upon to bring their expertise to some of the more challenging job sites. Seifollahi’s background, which includes time working on global projects for Merck & Co. and Amgen, made him an ideal fit to bring the Kaluga project to completion in

2016. Development of the new facility had faced numerous challenges due to such factors as securing the required variety of permits related to operating, as well as the turnover of the facility to AstraZeneca. “One of the biggest challenges I face day-to-day is to get all the documentation requirements met,” he says. “The regulation in terms of documentation is to some extent very different and cumbersome compared to what we do in the US or [other parts of] Europe.” That’s not to say that building facilities that house both the research and production of a variety of medicines are taken lightly anywhere else in the world. There are standards that AstraZeneca and MedImmune must meet in terms of compliance with all aspects of current good manufacturing practices, as well as regulatory requirements that are specific to different regions throughout the world. Although these standards must be met wherever the company builds, Seifollahi says

AstraZeneca’s manufacturing facilities must be prepared to handle equipment such as bioreactors.

Aerial: Jeffrey Sauers

Worldly Advice from Mehran Seifollahi “I think working in the international arena, one of the most appreciated experiences you gain is the culture that you work in. Working in Russia, France, Spain, Italy, Scandinavia, the UK, Ireland—it’s all the experiences that are beyond engineering. . . . The things that you cherish are getting to work with people in that country, getting to know their culture, and gaining more respect for that culture. You have to be very cognizant of it and not be over-confident that you know it all.”

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“[We] will be a lot busier than we already are to build the facilities and labs that our scientists need to further develop the science and manufacture potential drugs.” Mehran Seifollahi, Director, Global Engineering

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FLUOR

Celebrating over 25 years working with AstraZeneca from small capital work and engineering to master planning and full facility delivery Together, we’re building a great future.

© 2015 Fluor. All Rights Reserved. ADGV124815

there’s a familiarity to US processes, and that even from a language perspective, building in French-, Italian-, and Spanish-speaking countries presents less of a challenge because of common themes in the languages that can be applied across the board. The Russian language, he says, is different, and requires schooling in the language—something not all employees experienced previously. Thankfully, Seifollahi had. “My first priority [in Kaluga] was to make the team work as one and then to meet all the design and documentation challenges,” he says. “I think we’ve made great progress in that regard.” The Kaluga site is expected to become fully operational in 2017, and at press time, Seifollahi says his work on the project should be complete by the second half of 2016. It might not be clear as to where he’ll go next for AstraZeneca and MedImmune, but there’s no shortage of options. “We have a very exciting pipeline, which means that groups like us—global engineering—will be a lot busier than we already are to build the facilities and labs that our scientists need to further develop the science and manufacture potential drugs,” he says. In other words, there might not be much time for Seifollahi to catch his breath once his work in Russia is done. Nevertheless, he’d say he’s lucky.


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MICHIGAN’S POWER TRIO

How Steve Robinson, Todd Wyett, and Greg Erne of Southfield, Michigan-based Versa Development grew a nationally prominent real estate company from the depths of the Great Recession Interview by Jeff Link

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t’s safe to assume Versa Development principals Steve Robinson, Todd Wyett, and Greg Erne view themselves with a touch of self-awareness. Spend a minute on the company’s website and you’ll find a cleverly posed shot of the triumvirate in pressed Oxfords peeking

out from behind tall reeds, very aware of the camera in what is presumably the untrammeled landscape of a future development venture. One can almost see the shining city on the hill in the gleam of Robinson’s eyes. Although Versa’s enterprising principals may project a casual, lighthearted image to

potential clients, they take real estate—and the due diligence and risk calculation behind it—very seriously. The trio does this by leveraging their combined experience in civil engineering, construction, land entitlement, and site and financial analysis with a preferred development program that pairs Versa with national brand retailers such as Starbucks, Qdoba, SportClips, and Panda Express. All three gentlemen spoke to American Builders Quarterly about their development approach and what it means to southeastern Michigan that the company is growing both state- and nationwide. Take us back to Detroit, circa 2008, when you launched. Can you describe the extent of the property vacancy and price declines you were seeing at the time? Erne: What we were seeing was chaos in financial markets with respect to investors and lenders. That gave us the opportunity to find decent assets that needed a little elbow grease: repetitions with a quick turnaround to lease up, and capital in the $1–10 million price range. That appealed to me. We could execute a deal, manage it, and not have all our eggs in one basket. We could move quickly (Left to right) Steve on distressed property Robinson, Greg Erne, deals with investors and Todd Wyett of and lenders. Versa Development

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Versa Development acquired more than 76,000 square feet of mixed-use space for the Kercheval Place development in Grosse Point, Michigan.

Exactly what sort of real estate opportunities were you seeing back then? Wyett: We had national tenants looking to do more retail in Michigan, but at the time, banks were not lending in America and, in particular, Michigan. Our advantage was we didn’t have a lot of leverage on our balance sheet and could buy land cheaply—at 25 percent equity—and grow in a tight lending market. Some of our first deals came as result of older families that were willing to sell assets at a losing value. They were nervous and wanted get out while they could.

What distinguishes Versa from other development companies? Erne: About two and a half years ago, we did a package deal. A group of foreclosures managed by a receiver were bundled together. We purchased them as a group with the goal of putting up capital and refinancing or selling them: a commercial building, medical office, and flex-office. The thinking was, “Let’s build three bridges, instead of one.” We worked with the receiver to handpick the assets. Dividing the properties this way was effective and added an element of creativity to the process.

“Whether it comes through in landscape architecture, building style, or materials, our eye-level design philosophy blends what the community is looking for with the function tenants require.” Steve Robinson, Principal

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Photos: Courtesy of Craig Kerr (top)

And in other projects, like Pittsfield Place and a repositioned Comerica Tower near your Southfield headquarters, you’ve worked to tailor your approach to the specific needs of the community, balancing aesthetic qualities with economic imperatives. How did you strike this balance? Robinson: What we really do to distinguish ourselves is listen to what the community wants and needs, and then design each project with those desires in mind. Whether it comes through in landscape architecture, building style, or materials, our eye-level design philosophy blends what the community is looking for with the function tenants require. We always balance those two needs and, more importantly, our clients know they can trust us to get it done as promised.


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The Origins of Versa Development Starting a company in Detroit during the throes of the economic recession isn’t a typical beginning to a success story, but that’s where it began for Versa Development. In 2008, Steve Robinson, the son of a Detroit-area builder, was a civil engineer who had successfully applied his construction management training from Michigan Technological University to make a name for himself in the residential development business. He received recognition from Crain’s Detroit Business in 2006 as one of the publication’s “40 Under 40” notable young business leaders. He understood building. He understood investment. He wanted more. He put together a plan to expand on his talents, and grow in the commercial real estate business. That plan was put in motion when Robinson met Todd Wyett, who brought a corporate development background to bolster Robinson’s technical expertise and expand his reach. As former general counsel for Arbor Drugs, Inc., a publicly held chain of more than 230 stores acquired by CVS in 1998 for $1.5 billion, Wyett understood land and infrastructure development from a strategic, legal perspective.

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“I met Steve doing a deal,” he says. “He sold me some dirt, and we decided to form Versa.” Their first deal together was the acquisition of a regional shopping mall—a gutsy move others might have cowed at during a time of mass foreclosures and disinvestment in southeastern Michigan. Nevertheless, neither Robinson nor Wyett balked. “Under the heading, ‘There has never been a famous general in a time of peace,’ we were looking to take advantage of opportunities that presented themselves in the [then] current economic climate,” Robinson says. Greg Erne, founder of Beverly Hills, Michigan-based HELM Realty Partners, had never met Robinson, but he had done deals with Wyett. Erne had an appetite for larger acquisitions—multimillion-dollar retail centers, health clinics, and expansive office developments. Beyond that, he had relationships with the brokerage community and a diversified asset portfolio to help Versa broaden its ambitions. “Both companies were growing and it was a good mix of partners,” Erne says. “We thought it made sense to pool our resources and brain power to grow it all together.”

Versa Development was behind the acquisition and redevelopment of this 4,100-square-foot retail center in Orion Township, Michigan.

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How do you go about choosing sites for retail or office development? Robinson: If the tenant wants it, it’s a good site. Erne: Right. [Laughter] When we look at acquisition of property, whether in Michigan or not, we look for good long-term prospects—high density and a proven development. We’d rather be in a market that is proven and pay a little more than be on the wrong side of the tracks. When flight from density occurs, we’re not afraid of seeking tertiary markets, but we’re selective. We like to own for the long-term. We underwrite to 15 percent vacancy, and strive for 85–95 percent occupancy on most large projects. We’re conservative in underwriting and we beat our assumptions. We don’t try to do more than the market can bear. So how have you been so effective in attracting and retaining your tenants? What’s your secret? Erne: We do a deep dive into all aspects of the property and market. It doesn’t take a ton of time, but you have to ask the right questions. Can we do something someone else hasn’t been able to do? Maybe out-of-state owners didn’t understand zoning. Maybe previous ownership

lacked appropriate capital for maintenance or got deal fatigue and took too long to lease. A lot of it boils down to experience. We all have pretty well-established digestive systems for real estate. If our stomachs hurt, we know something isn’t working. And tenancy is key. If there are other tenants, occupants can tolerate certain inadequacies because they know there are surrounded by tenants driving sales. What does it means to the greater Detroit metropolitan area that Versa is there and growing? Erne: I think that our success in southeastern Michigan, and Michigan overall, where most of our properties are, shows the state has good strong markets within it. We’ve picked out the best markets in the state, like Oakland and Washtenaw Counties, and Grand Rapids. We all have such deeply entrenched experiences, and we do well because we are pretty well educated in the industry. But our success is also a testament to the strength and health of the economy. Michigan, as a state, is very strong, and we see sustainable growth ahead of us. We’re very bullish on the state of Michigan, if you’re in the right market.

Successful Projects. Lasting Relationships.

It has been our pleasure to work for Todd and Versa over the past twenty years on numerous projects. Seerco values their long term relations in the industry and look forward to future endeavors.

Ground-Up Construction

Founded in 1977, Seerco has been providing quality commercial construction for over 35 years.

Tenant Improvements and Build Outs

Seerco is a preferred contractor for Starbucks, Panda Express and CVS with over 150 drugstores in six states. Recognizing Seerco’s commitment to excellence, numerous developers and retailers have chosen Seerco to be part of their team.

Commercial Remodels

14441 W. Eleven Mile Road • Oak Park, Michigan 48237 • Phone (248) 544-9052 • Fax (248) 544-3173 www.seerco.com 100

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Photo: Boone Speed

Umpqua Bank’s locations, such as this one in Reno, Nevada, are built to be relevant, usable, multipurpose spaces for its customers.

SAFETY IN NUMBERS

As Umpqua Bank adjusts with the changing face of banking and enhances its customer experience, Tony Bailey’s “Rule of Threes” is anchoring the process by Zach Baliva

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H

e looked on as the translators went back and forth in Arabic and Kurdish. It was 2005, and Tony Bailey was purchasing supplies to help the US Air Force rebuild and repair Iraq’s infrastructure. Although he grew up around construction—Bailey’s father and in-laws are contractors—the overseas adventure sparked a new passion for procurement and a knack for leadership. He trained personnel on survival and resistance tactics, led deployment teams, coordinated top-secret clearances, and managed humanitarian project funds. Now, more than a decade later, Bailey has climbed the ranks in the logistics and supply chain world as a civilian. After holding positions at companies such as Procurian and JP Morgan Chase, he joined Umpqua Bank in 2014 to help the $22 billion regional bank solidify vendor relationships, leverage internal buying power, and enhance its overall footprint. The job has kept Bailey busy. He has 30 projects slated for 2016, and to accomplish them, he’s relying on the leadership skills learned in the Air Force. In addition, he’s implementing a tool of his own known as “the Rule of Threes,” which was inspired, in part, by his father. “My dad always said that if you’re always chasing the next best thing, you’re fragmenting your time,” he says. “It’s the old adage of being a jack of all trades but a master of none that drives the rule.” Through his experiences in the Air Force and elsewhere, Bailey understands the value of balancing the time spent on immediate tasks with time focusing on the critical whole. “Looking at the big picture one piece at a time instead of obsessing over everything all at once lets you become an expert in what’s important and creates opportunities around what you really need to focus on,” he says. Air Force officers warned Bailey that if he attempted too many tasks at once, his performance in each area might be mediocre. Instead, they told him, he should find the most important things he could do in any day, week, or year. He should look for measurable, attainable goals, and work to deliver results back to the unit. That strategy anchors Bailey’s Rule of Threes at Umpqua, and he’s working to deliver results back to the banking institution. As senior vice president of real estate, facilities, and strategic procurement, he asks each member of his team to develop three yearly targets that include a financial goal, a collaborative goal, and a personal goal. Each person should find a way to attack operational costs, a method for working across departments, and a means of taking the next step in their career. If each person follows the rule, Bailey says the bank will thrive.

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“We have many projects, but everyone should know the few projects that should take a majority of our time, and I ask each member of my team to tell me what their priorities are,” he says. As a result, Bailey says the approach helps him avoid the temptation to micromanage every person on his org chart. This approach also helps Umpqua realize its vision of “a different kind of bank,” which Lani Hayward, executive vice president of creative strategies, says the company set out to create. “We offer the sophisticated products and expertise of a large bank, but we deliver them with the personal service and community engagement of a community bank and the innovative experience of a great retailer,” she says, adding that Umpqua endeavors to make the intimidating and impersonal world of finance more pleasant and inviting. In other words, Umpqua Bank isn’t just a space for transactions—it’s a relevant, usable, multipurpose atmosphere. As a product of this unique approach, design becomes increasingly important, and the compa-

Bailey’s Rule of Threes

1 2 3

FINANCIAL The financial aspect is all about attacking operational costs. Each team member should look for ways to help their organization remove costs and help stakeholders make smart decisions about where to reallocate savings to achieve strategic objectives. COLLABORATION In this leadership model, each person is expected to take accountability without putting barriers in place and without working in a silo. Collaboration encourages friendly competition, transparency, and unity. Each person should harness the organization’s collective power. PERSONAL Personal goals are communicated, documented, and discussed often.


VIEW FROM THE TOP

“Looking at the big picture one piece at a time instead of obsessing over everything all at once lets you become an expert in what’s important and creates opportunities around what you really need to focus on.” Tony Bailey, SVP, Real Estate, Facilities & Strategic Procurement

ny’s flagship San Francisco store perfectly illustrates what’s different about banking at Umpqua. As with each of Umpqua’s stores—which are built around its customers and communities—the company’s San Francisco location features an award-winning, hightech, high-touch mash-up that remains true to the surrounding community. Clients can park their bike (or borrow one of Umpqua’s), grab a cup of Umpqua Blend coffee, and walk into an open, inviting lobby designed by Umpqua and Huen of Portland, where a retro telephone rings directly to the CEO’s desk. Or, they can interact with a mobile concierge associate to conduct business or access an array of products. Others can make use of Skype-equipped public conference rooms, catch a TED-style talk known as an Umpqua Catalyst event, or attend a showcase on financial services (or sometimes coffee and chocolate tastings) at an adjacent Demo Bar. The store won the Retail Design Institute’s 2013 Store of the Year award. Bailey says the deep roots that each location has in its community is an important part of Umpqua’s culture, and that the company will continue to foster these connections in new ways as it moves forward. “We’re committed to the places in which we do business, and we want to build strong connections,” he says. “The face of banking may be changing, but we’re confident that the community bank will have a great place going forward. We’re not going anywhere.” Security Signs is the Pacific Northwest’s premier sign company. It is very proud of its long-term partnership with Umpqua Bank by providing custom signage throughout the bank’s vast service area. The company’s excellent reputation and professional staff ensures quality signage along with exemplary customer service that emulates that of Umpqua Bank.

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DESIGNING AND FABRICATING CUSTOM EXTERIOR AND INTERIOR SIGNS SINCE 1925

Security Signs wishes to congratulate Umpqua Bank on their continued growth and success. We greatly appreciate the opportunity to be a core business partner, and we look forward to providing quality signage for future projects.

- Kevin Keljo, President

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REVISION When it comes to retail design, Jesse Moyer says he tries to stay ahead of the curve, but he’s also trying to balance that with a connection to Levi’s longstanding legacy.

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How Levi Strauss & Co., the inventor of the blue jean, is revamping store designs to meet changing demands BY ZACH BALIVA, PORTRAITS BY SHEILA BARABAD

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he tough and durable blue jeans that date back to 1873 are more popular than ever before thanks to the innovation of the iconic Levi Strauss & Co. Strauss, who was a Bavarian gold rush merchant, launched his dry goods company in 1853. Twenty years later, he and partner Jacob Davis received a patent for their process of riveting work pants. Together, they slowly built a business based on the sale of denim pants and, over time, that business became a bona fide empire. Nearly 150 years later, the classic garment remains virtually the same—but almost everything else about the business has changed. With online vendors changing customer behavior, and omnichannel distribution, the retail industry is in flux. In response, the Levi’s brand has launched a new retail strategy designed to make the shopping experience effortless for the consumer. Jesse Moyer is in charge of implementing that strategy. He joined Levi Strauss & Co. in 2015 as head of global retail store design as the company prepared to expand its retail fleet of US stores through the use of a new “Pioneer” design concept. Moyer—who spent a decade at retailers L Brands and Gap Inc.—had the scaled rollout experience Levi’s needed. He graduated from Ohio State University’s architecture school in 2006 and started working at WD Partners in Dublin, Ohio, producing construction documents for Victoria’s Secret stores. “I found retail design intriguing because it sits at this unique intersection of architecture, interior design, graphic design, marketing, operations, and strategy,” he says.

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Photos: Rico Schwartzberg

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Framed images and delineated product stories help illustrate Levi’s history in its new Pioneer store locations.

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Levi’s Pioneer stores use specific palettes of wood, concrete, and hot-rolled steel to match the brand’s identity of ruggedness and durability.

A tailor shop in the Brooklyn store enables customers to have their favorite denim products altered and customized to their specifications.

“Consistency and scalable growth will be critical to success. We have to show up in the retail space in a strong, original, and ownable way.” Jesse Moyer Head of Global Retail Store Design

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Eighteen months later, Moyer went inhouse at L Brands as a store designer, where he designed nearly 100 Victoria’s Secret stores in four years. From there, he left to work on Gap’s Old Navy brand before ultimately joining Levi’s. “One thing that propels me forward is that I know that the magic happens outside of my comfort zone,” Moyer says of accepting the challenge at Levi’s. “I am always trying to keep myself moving forward so I can try to stay ahead of the curve.” The Pioneer design concept started as a palette of materials that ref lected the work-influenced heritage of the Levi’s brand in a fresh and modern way. The company wanted to drive home its “fewer stories, better told” tagline by removing all shopping barriers from the consumer experience. “We have a curated assortment of our icons and best products in an easy-to-navigate, bright, and optimistic environment,” Moyer says. To accomplish this, he and his colleagues used industrial aspects such as specific palettes of wood, concrete, and hotrolled steel to match Levi’s rugged and durable brand identity. Although the first iterations of the Pioneer concept played with scale and industrial details such as pipe fittings, the need to democratize the design became clear, and the scale and details became more


Photos: Rico Schwartzberg

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As part of the Pioneer design concept, white has been introduced to stores’ color palette to create a more inviting atmosphere.

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“We have a curated assortment of our icons and best products in an easy-to-navigate, bright, and optimistic environment.” Jesse Moyer Head of Global Retail Store Design

refined. Moyer introduced white into the palette to help make the environment more inviting, and he lowered the perimeter fixtures to make products more accessible. Lastly, a decorative visual layer with framed images, potted plants native to California, and delineated product stories with super graphics five feet wide by ten feet tall connect consumers to the brand’s legacy. The company first unveiled the Pioneer concept in fall 2015 in its new stores in Brook-

lyn and Las Vegas. The successful launch represents the culmination of a massive effort to collaborate across functions like merchandising, planning, allocation, marketing, creative services, operations, brand environment, and store design. “The point was to bring these functions together and look at how we work through a holistic lens to ramp up to a future new store rollout in the United States,” Moyer says. Throughout the process, Moyer worked to de-

liver the best of what he learned at Victoria’s Secret and Old Navy to create a customized rollout strategy suited to Levi’s. For example, at Victoria’s Secret, he learned all the nuances of retail spaces, from the storefront to the stockroom, and what design touches contribute to the consumer journey to make stores work. At Old Navy, he worked on flagship projects, prototype drawings, and global design standards. Now at Levi’s, he’s applying these lessons to deliver designs that will reshape the brand—reinforcing the company’s position as the denim authority while also highlighting other product strengths, such as its trucker jackets and western shirts. The store design will facilitate the expansion of Levi’s priority to become a lifestyle brand. In the changing retail landscape, he says Levi’s has a lot at stake. “Consistency and scalable growth will be critical to success,” Moyer says. “We have to show up in the retail space in a strong, original, and ownable way.”

PROJECT MANAGEMENT | MANUFACTURING | ROLLOUT MANAGEMENT | WAREHOUSING LOGISTICS | INSTALLATION | SUPERVISION Excellence and flawless skill can only be achieved through time. With over 20 years of experience, Prime is a pioneer in the creation of innovative, high quality store fixtures. Our team has the expertise and ability to transform wood, metal, glass, laminate, veneer and acrylic into your ideal retail environment. The impeccable store fixtures we manufacture are a direct reflection of our client’s image, an image that is held to the highest of standards because essentially it reflects yours as well as ours. We established ourselves as pillars of the industry through trust, integrity and partnership. It’s our approach to work; It’s our approach to customers; It’s a Prime approach. If you would like to learn more about our company or discuss a potential project please visit our website or contact us.

3150 Boulevard des Enterprises | Terrebonne, Quebec, Canada J6X4J8 | www.prime-cm.com | 514.509.5039 110

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ACT Scores Top Marks in Sustainable Upgrades Jeff Stabenow and a team of energy, facilities, and project management experts have overseen a powerful and power-saving series of renovations at the Iowa campus of ACT, Inc.

Photo: Christopher Hayes/ACT

BY RUSS KLETTKE

WHEN HIGH SCHOOL STUDENTS STUDY FOR THE ADMISSION TEST THAT COULD HELP GET THEM INTO COLLEGE—the ACT—the focus isn’t just on

math or verbal skills. Students must prepare for multiple subjects. Ultimately, it’s the sum of their knowledge that matters. In that sense, the executive team that manages the administrative offices of the test provider, ACT, Inc., isn’t all that different from the students. Throughout the past decade, the company has transformed its long-established office campus in Iowa City, Iowa, for both pragmatic and altruistic reasons—to increase building-use efficiency, to become more sustainable, and to reflect the changing face of education. The 360-acre campus includes a LEED Platinum-certified building, as well as many oth-

er retrofits to the rest of its buildings to offer definitive energy efficiencies. However, if you say “sustainability” anywhere near pro-environment Iowa City, home to the University of Iowa, you’ll soon find that the term encompasses much more. ACT’s director of real estate and facilities management, Jeff Stabenow, says the company’s recent sustainable real estate program took the efforts and creativity of several team members, including Anne Schaefer, senior program manager; Brad Spillman, senior facilities manager; Chris Wilson, energy specialist; and Paige Butterfield, senior facilities manager. Even with no new buildings constructed on campus in seven years, the upgrades the team provided created a new environment.

Sustainability measures can be found throughout ACT, Inc.’s 360-acre campus in Iowa City, which includes a LEED Plantinum-certified building.

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ACT, Inc. boasts a natural trail system on its campus that extends more than a mile.

3,500 pounds of waste composted per month

4.5

tons of waste diverted from landfills per month

1.65

miles of campus walking trails

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The work started with implementation of a wholesale upgrade of lighting from incandescent bulbs to compact fluorescent, and finally, LED bulbs. The campus also makes use of solar and geothermal energy in an effort that moves ACT closer to achieving its goal of capturing 100 percent of stormwater. The newest building on campus, constructed in 2009, was the first to achieve LEED Platinum status in the state. “It’s a 10,000-square-foot data center that uses geothermal and free cooling systems to dissipate heat produced by the servers,” Stabenow says. For the 1,100 people who work in ACT’s Iowa City office (there are additional leased offices throughout the world), several of the campus changes provide an optimally healthy workplace. “The Tyler building was the main operational building for many years,” Schaefer says. “We renovated it about 12 months ago to class-A office space.” Changes to the office included more collaborative team spaces, as well as individual workstations with adjustable-height desks that allow team members to stand while they work. Schaefer estimates that about 20 percent of the renovation was dedicated to the creation of an employee wellness center. A walk down a curved hallway in the Tyler Building gives visitors an idea of this healthi-

er environment. Red walls, ceiling, and flooring can’t help but energize employees heading to the fitness center, while words such as “challenge,” “knowledge,” “enjoy,” “ideas,” “transform,” “gather,” and “breathe” double as wall decoration and inspiration. For ACT, changing the lighting throughout campus means more than installing a few LED light bulbs. Recently, the company installed new controls to monitor daylight at the Davidsen Building. These controls cut artificial lighting during sunny periods, and have already reduced electrical usage by 15 percent in the (darker) winter months of 2016. The four buildings that make up the core of the campus are on an energy management system to monitor gas, electric, and water consumption. “It gives us live data that allows us to see spikes,” Wilson says. “If a piece of equipment is failing, we can troubleshoot and fine tune. This is particularly helpful in times of high demand.” Taking it a step further, the campus also has a condensing “summer boiler” that shaves 30 percent of gas use in spring, summer, and fall. Some of the energy for the ACT campus comes from a raised 10-foot-by-20-foot solar panel array. The power drawn from those panels is used to provide lighting on a campus parking lot. LED lights are rather stingy, so excess energy from the panels is sent to electric-vehicle charging stations in the company parking lot that are free to employees and the public. Stabenow and his team also place a great deal of emphasis on landscape in the HQ’s Great Plains prairie environment. The grounds and maintenance operations division used native plant species and removed some of the non-native trees to enhance the campus grounds. It’s these measures, along with the incorporation of an Integrated Pest Management program, that serve as an ecosystem-based strategy. Spillman says the irrigation system and best practices defined for the grounds team also helps it move toward that goal of capturing 100 percent of stormwater. “This complements the campus’ hard-won status as an Audubon Certified Cooperative Sanctuary,” he says. The grounds also contain a walking trail system, which fits an entire ethos of employee health at ACT. Butterfield works closely with the company’s talent strategies department to develop the onsite wellness center,

Photos: Don Krueger/ACT

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which in turn supports ACT’s Blue Zone Worksites Project designation for healthy choices engineered into the workplace environment. She’s also heading an effort to implement a workplace-wide recycling effort to achieve zero landfill waste. Each building on campus provides in-office hubs that allow sorting between recyclables, compost, and what can be incinerated off campus. Zero isn’t a number any student wants to see on their ACT, but it’s a score that sustainable office campuses like to achieve. A message from Day Mechanical Systems, Inc.: Working with the ACT Facilities Management team has been a great relationship. The team is consistently willing to put forth the effort needed to make sure that they are providing the most innovative project while still focused on making any project sustainable. Most recent projects include: • Installing high-efficiency modular boilers to reduce gas consumption • Cooling coil condensate for cooling tower make-up • High-efficiency air-cooled chillers that can be utilized anytime of year

® Plumbing, Heating, A/C • Process Piping

Solar panels power ACT, Inc.’s EV stations, as well as exterior parking lot lights. The parking lot includes EV charging stations and newly installed LED lighting.

3,093 40,500 new LED light fixtures

pounds of carpet recycled

Our job is not complete until we have taken all the steps required to attain a satisfied customer! From Project Managers to Field Supervisors, Day Mechanical Systems, Inc. provides our clients the most experienced and professional personnel available. We strive to build relationships on merit and hard work, and firmly believe our project management and field staff is the finest in the Midwest. Our years of experience is the reason Day Mechanical Systems, Inc. is a leading mechanical contractor in Eastern Iowa. Proudly offering these services, and more: • ASME R Code Stamp Welding • Data Center Cooling Design & Maintenance • Design Build Capabilities • Plumbing and Heating Installation & Maintenance To learn more visit us at: www.daymechanical.com

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SAME HEAT, LESS FUEL Cogeneration enables Geisinger Health System to both heat and power its buildings more efficiently, and Alan Neuner, Geisinger’s vice president of facility operations, ensures that the structures are healthy both inside and out BY RUSS KLETTKE

ONE OF THE BIGGEST CHALLENGES FACING HOSPITALS AND OTHER HEALTHCARE FACILITIES IS FINDING THE BEST WAY TO MANAGE COSTS. It’s a goal

of the Affordable Care Act, yet with an aging population—as well as aging buildings—the physical plant of hospitals can be a drag on achieving successful cost management. This is particularly important when it comes to energy use, as the business of medicine uses an exceptional amount of electricity and heat. Nevertheless, Geisinger Health System, a network of 10 hospitals with about 10 million square feet of space spread throughout 350 buildings in 44 counties in Pennsylvania that serves up to 2.6 million people, has managed this problem with surprising effectiveness. Situated in Danville, Pennsylvania—a mostly rural area between Philadelphia and Pittsburgh—Geisinger has the added challenge of serving lower-income and older patients, which is typical of most regions outside of big cities. The American Hospital Association reports that rural hospitals also tend to have less access to capital when it comes time for modernization projects. Yet, as Alan Neuner, vice president of facility operations for Geisinger, points out when speaking to university students, President Obama himself has cited Geisinger for delivering quality care at costs well below national averages.

The Henry Hood Center for Health Research is located in Danville, Pennsylvania. The Glenn D. Steele Jr. Hospital for Advanced Medicine features a green roof adjacent to the lobby’s skylights.

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Photo: Barry Halkin

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In 2009, the president told the American Medical Association, “We have to ask why places like the Geisinger Health System in rural Pennsylvania . . . can offer high-quality care at costs well below average.” Much of the credit goes to administrators, doctors, nurses, and other care providers for achieving this national recognition. What shouldn’t be overlooked is the fact that all this was happening while Neuner found ways to save a lot of money on energy use. For example, he shaved $2.5 million off annual energy costs at a single hospital by switching its campus from a traditional power system to a cogeneration power system. Also referred to as a combined heat and power (CHP) system, cogeneration is a greener, economically efficient means of capturing waste energy from a combustion turbine that’s used to generate electricity; excess heat, previously vented to the outdoors, is redirected to a heat recovery boiler. Excess heat also powers the air-cooling system in the summer, which, in combination with chilled water storage, takes advantage of lower nightly utility rates and cooler air.

SAVINGS YOU CAN SEE Even while medicine has modernized to depend more on electrical power, Geisinger Health’s efforts to increase efficiency has had a remarkable effect on reducing watts per square foot of facility space. Watts/square feet

600 500 400 300 200 100 0 YEAR

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

Photo: Barry Halkin

The adaptable patient rooms on the eighth floor of the Glenn D. Steele Jr. Hospital for Advanced Medicine feature panoramic views for patients.

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Green, PEER & Beautiful Custom Designed, Full Capacity Onsite Power USGBC PEER Certified Quiet, Clean, High Tech, Grid Connected & Flexible Energy that fits Design Cheaper than the Grid Wholesale pricing without Wholesale Risk

Energy Design Goes Further With

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“Once we became aware of the Energy Impact Calculator, we became keenly aware that much more than costs were involved. As a healthcare provider, it made all the sense in the world that we take a more holistic, mission-centric approach.” Alan Neuner VP, Facility Operations

The cost to build the CHP system, as designed by ZF Energy Development LLC of Wayne, Pennsylvania, was $5.3 million. With a savings of $2.5 million per year, the system paid for itself very quickly (additionally, half the capital expenditures were offset by a green energy grant from the state Department of Environmental Protection). Neuner says this is phenomenal in terms of healthcare expenditures. “Overall, healthcare operates at about a 3 percent margin, which translates to a 30-year ROI,” he says. “This obviously is much less.” Still, for Neuner, the story isn’t purely

about saving money. He is comfortable discussing the “triple P’s”—people, planet, and profit—that green advocates use in business applications. Through cogeneration and multiple other initiatives, Geisinger can lay claim to reducing emissions that affect global atmospheric carbon levels and air quality in the region the system services. “Coal power plants have the largest impact,” he says, referring to the source of soot, heavy metals, sulfur dioxide, and nitrogen oxides that are emitted from utility power generation in that part of the country. More to the point, those emissions directly impact community health by contributing to chronic and acute bronchitis, asthma, congestive heart failure, chronic lung disease, and pneumonia, among many other maladies. “This really started as cost savings,” Neuner says. “Once we became aware of the Energy Impact Calculator, we became keenly aware that much more than costs were involved.” Practice Greenhealth—a nonprofit organization that promotes environmental stewardship in healthcare—provides that calculator. It’s based on an Environmental Protection Agency analysis of power plant emissions on human health.

DURABILITY FOR GENERATIONS TO COME T H E R M A L

E N E R G Y

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G U Y F R A N K E N F I E L D | E N E R G Y B U S I N E S S U N I T L E A D E R | 972.823.3300 | G U Y . F R A N K E N F I E L D @ D N T A N K S . C O M

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Photo: Barry Halkin (top)

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“As a healthcare provider, it made all the sense in the world that we take a more holistic, mission-centric approach,” Neuner says. The cogeneration scheme has been so successful that it’s now being integrated into a new $18 million central utility plant for Geisinger’s Wyoming Valley Medical Center. Throughout the system, Neuner has assiduously applied the “triple P” approach to facility upgrades. Nine of Geisinger’s structures are LEED-certified, with seven more in progress. Motion-sensor-activated lighting is now used in thousands of offices and exam rooms, and lighting is migrated to more efficient lamps, first from T-12s to T-8s and now to LEDs. Simple changes such as these have a short ROI, and also can positively affect patient care. Neuner notes that there hasn’t been a need to change the thermostat settings. “LED lights actually provide a better read on patient skin tones, which is something doctors and nurses need to assess [patient] health,” he says. Geisinger’s work in energy conservation has been recognized nationally by multiple organizations, including Energy Star. The organization also won the Donald M. Sauerman Award from the Pennsylvania Society for Health Facility Engineering.

americanbuildersquarterly.com

About 30 percent of Geisinger facilities, many of which were added in recent acquisitions, will be modernized in the near future. The work will likely be done in a similar vein of energy efficiency, because Neuner’s success at favorable economics gets him fast-track approval from the company’s CFO. Evidently, the approach works.

The Glenn D. Steele Jr. Hospital for Advanced Medicine is located in Danville, Pennsylvania. Like other Geisinger properties, the Henry Hood Center for Health Research features a green roof.

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Laying the Groundwork Gene Chesterton discusses how Eleven Western Builders has been able to flourish as a result of diversification, client satisfaction, and a recipe for long-term success TEXT BY JENNIFER SMITH / PHOTOS BY GREG EPSTEIN

GENE CHESTERTON IS IN A UNIQUE POSITION TO TALK ABOUT ELEVEN WESTERN BUILDERS AS AN “ALL IN ONE” GENERAL CONTRACTOR, because in

his 14 years with the company, he’s seen it evolve into one. To complement its thriving ground-up and major remodel commercial construction business, Eleven Western Builders added a retail services division in 2002, which has grown ever since Chesterton became part of it. “In early October 2002, I got a call from Kevin Brander asking if I would come over to Eleven Western Builders to work under him and help him develop a hands-on service division for them, which they did not have at the time,” he says. “I started out running small projects for Kevin under our [general contractor] umbrella and, as time passed, we grew the confidence of the company to take on not only larger projects, but small individual projects of our own.” Chesterton now serves as director of retail services for the California-based big box retail commercial general contractor. His responsibilities in that role are numerous and include coordinating manpower for projects, estimating, facility planning, supervising project managers, negotiating store rollouts, overseeing major and minor remodels, and surveying. He also supports a client-based maintenance program that he says helps enhance relationships between Eleven Western and the companies it works for by supporting field teams and rectifying any onsite issues as efficiently as possible. All of it is wound up in the company’s pursuit of providing that “all in one” service.

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Eleven Western Builders handled the update of the Orchard Supply Hardware store in La Cresenta, California. The customer service area of the Orchard Supply Hardware store in La Cresenta before Eleven Western’s renovation work.

BEFORE

AFTER


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RENOVATION PROJECTS ORCHARD SUPPLY HARDWARE La Crescenta, CA Duration: 4.5 months Size: 44,000 square feet ALBERTSONS Carpinteria, CA Duration: 7 months Size: 40,000 square feet VONS San Diego, CA Duration: 11 months Size: 60,000 square feet Photos: Greg Epstein

GOODWILL Redondo Beach, CA Duration: 1 month Size: 4,500 square feet

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AFTER A

BEFORE A BEFORE B

BEFORE/AFTER A The Garden Center at Orchard Supply Hardware received new displays and covering to protect it from the elements. BEFORE/AFTER B The aisles of Orchard Supply hardware received new lighting and displays to showcase ceiling fans along with other hardware.

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AFTER B

“In the retail industry, we have found that turning out a project with all the finishes that make it client-specific to their entity takes a lot more than what a subcontractor wants to put into a project,” he says. “Projects have become more about specs and reading between the lines than just bidding what is seen on a set of plans. . . . Our entire company takes so much pride in reacting to what our clients need and want as we would want someone to react to us.” Eleven Western has two specialty branches—fixture and millwork—that Chesterton says provide its clients with the feeling of a one-stop shop. One of the most important things in the retail industry is how customers react to what the client displays, so it’s important to put together a team that can build and install all the necessary pieces to provide a unique platform—which is what Chesterton says Eleven Western provides its clients. “Never over- or underestimate your clients, their teams, or their needs,” he says. “It’s a very delicate ground that we stand on as a GC and we don’t ever want to be overconfident, which could come off as belittling. On the other hand, we need to present ourselves

with enough confidence so they feel secure in doing business with us and the decisions we make on their behalf.” Delicate though it may be, the ground on which Eleven Western has staked its claim is also strong enough to bring in clients such as Albertson’s, CVS, and Vons. The company is also the go-to contractor for a major nonprofit organization. Although each client is unique in terms of its specific needs, Chesterton says they each get Eleven Western’s undivided attention, craftsmanship, and quality. Even so, as more opportunities present themselves, Chesterton says growth also presents a challenge for Eleven Western. “Because of the uniqueness of our infrastructure, we find ourselves in a place where everyone’s hard work and dedication is influencing this industry to command this type of diversity in a GC,” he says. “We see the opportunities all over the place and we want them—but it needs to be very strategic on how we approach those opportunities because anyone who is challenged with expansion knows it’s very difficult to grow a company and to sustain its growth.” The key, Chesterton says, is having the right team in place that shares common goals and visions with project leadership. It’s a sentiment that rings particularly true to him. Chesterton’s original trade was carpentry, and he started in the industry all the way back in 1993 as a union carpenters apprentice for DCI, a retail commercial builder. With that longstanding background in retail, he says he’s not only proud to lead Eleven Western’s retail services division, but to have been an instrumental part of the division’s continued success. “We have given our internal big construction projects a support system to capture the parts and pieces that often get missed on bids to get these items completed at cost with no premiums to ourselves,” he says. “We have the ability as a large GC to take on small projects.” That kind of diversity, mixed with a unified objective should help sustain not only the company, but also its strong reputation long into the future.

Photos: Greg Epstein

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INTERIORS

LEASE

NOW TM

SOUTHPOINTE

5,000 - 50,000 SF

REMAINING

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YOUR PEERS. TODAY’S PROJECTS. THROUGH EVERY PHASE. For editorial consideration, contact dwatson@americanbuildersquarterly.com

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Alan Shaw brought some of his entrepreneurial know-how to help guide Sears Holdings through a major transition in consumer shopping habits.

A WIN-WIN-WIN-WIN SITUATION ACCORDING TO ALAN SHAW, SUCCESSFUL RETAIL CREATES A UNIQUE ENERGY. He should know. As vice president of real

Alan Shaw of Sears Holdings discusses how thinking outside the “big box” and inviting retailers to share its space produced game-changing results BY KELLI LAWRENCE, PORTRAIT BY SHEILA BARABAD

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estate for Sears Holdings Corporation, Shaw sees that energy up close. “There’s an infectious excitement generated when you see a lot of people going in and out of a store,” he says. Yet his experience isn’t limited to just Sears Holdings, the retailer focused on seamlessly integrating the digital and physical shopping experience for customers. Prior to joining Sears in 2009, Shaw was an entrepreneur who built and sold three real estate companies, including retail, industrial, and development practices. He says his passion was building companies, leveraging real estate with an eye toward maximizing value, streamlining processes, and reinforcing sound strategy. With these passions in mind, Shaw admits he was skeptical of working for the corporate giant. “I was very honest in my interview about being an entrepreneur, not a corporate real estate guy,” he explains. As it turned out, he was the type of guy leadership was looking for anyway. In the early phases of an unprecedented transformation of Sears Holdings, the company welcomed such entrepreneurial minds. At that point, it had been about four years since the Sears/Kmart merger, and about four decades since the increasingly ubiquitous shopping malls had to have Sears, the world’s largest retailer, as an anchor to secure financing, Shaw says. Changing times and changing shopping habits—along with the tremendous success of key retailers such as Walmart, Home Depot, and Marshalls—took their toll on the venerable Sears (founded 1886 as Sears, Roebuck & Co.) and Kmart (founded 1899 as SS Kresge Corporation).

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“We’re being progressive and proactive, but smart and prudent. We are building a worldclass real estate organization with symbiotic benefits to the retail side of our business.” Alan Shaw VP, Real Estate

Both Primark and Dick’s Sporting Goods are among the retailers that Sears has leased space to as part of its effort to shed unused space and generate income.

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Compounding those challenges were 1,300 Kmart locations averaging 100,000 square feet apiece—to say nothing of the 300,000–400,000-square-foot spaces in more than 900 Sears locations. Shaw credits Eddie Lampert, current chairman and CEO of Sears Holdings, with understanding that such massive real estate could build the company back up again rather than drag it down further. Lampert’s idea was to lease space in Sears and Kmart stores to quality tenants, enabling the stores to downsize and reduce inventory as well as costs—but also create a significant upside for the company. “Now, as a landlord and a retailer, we generate an income stream of rent—plus benefits from increased foot traffic from the other retailers,” Shaw says. “Three legs of the stool.” Sears Holdings had been active in buying and selling real estate since the merger, but didn’t have any development experience, which created the perfect opportunity for Shaw, who brought that to the company. Jeff Stollenwerck, president of real estate at Sears Holdings, put Shaw in charge of developing a strategy, which allowed Shaw to utilize his entrepreneurial hat. With the two portfolios amounting to 240 million square

feet of retail and 90 million square feet of warehouse space—none of which Sears Holdings was interested in selling—Shaw had his work cut out for him. Still, there was one more statistic he couldn’t forget—between the two store portfolios, their real estate is within a 30-minute drive of 90 percent of the US population. Everything seemed well-positioned to flourish again, but only if the company could put a plan in place to make it happen. Rather than going for the obvious (focusing on leasing space in the lower-performing stores in C- and D-grade malls) Shaw instead targeted the real estate in some of Sears’ best-performing stores—those which were in highly sought after malls and stores that still had excess square footage. “I considered our space in terms of market demand,” he says. “Where was real estate highly valued by prospective tenants? There remained opportunity for us to consolidate our retail footprint, supply high demand space to a tenant retailer, and benefit from new traffic that the new retailer would halo off to us. . . . There were retailers who wanted to penetrate into the malls where we had stores, yet they were unable to get space. So


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we became this really interesting opportunity for people to lease space.” Beyond the initial issue of simply being taken seriously (“People first saw us as a retailer dabbling in real estate rather than a world-class real estate organization,” Shaw says), there were complex logistical matters, such as dividing stores in a way that gave tenants equitable, accessible space. “Most tenants in malls want to be accessible from the inside, which for us is not always so easy,” Shaw says. “There were literally hundreds of nuances that we started uncovering.” Moreover, mall owners initially feared that Sears would either undercut their leasing rates or lease to tenants the malls considered undesirable. Costa Mesa’s South Coast Plaza—the largest mall on the West Coast— shared these sentiments when Shaw proposed leasing some of the more than 300,000 square feet of space in its store and consolidating it to 250,000 square feet, thus focusing on Sears’ most profitable product mix. “I developed a new store layout for Sears and started working with retailers such as Forever 21,” Shaw says. “But the mall owner needed to consent to the (new) exterior façade. Initially, they really didn’t want us to lease space. Our strategy was unusual, and they were uncertain how it would impact them. It knocked me back a little bit, but I started looking at things from their perspective and working through the issues they had, which—understandably—were all about protecting their asset. And it is quite an asset.” Eventually a deal was struck, and Sears leased to Forever 21 as planned. Today, both locations are enjoying great success on a dollars-to-square-foot basis, with Sears’ jumping double digits within two months of Forever 21’s opening in June 2011. “The mall benefited, we benefited, Forever 21 benefited, and in the end, the customers benefited,” Shaw says. “A win-win-win-win situation. And that set the stage for our having the conversation with other mall owners around the country.” Six years later, Sears the department store and Sears the leasing agent continue to benefit Sears Holdings as a whole, with more than 100 leasing transactions thus far. “We are in a position where we don’t have to take every deal,” Shaw says. “We’re being progressive and proactive, but smart and prudent. We are building a world-class real estate organization with symbiotic benefits to the retail side of our business.”

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TAKING UP THE SPACE Retailers that have partnered with Sears Holdings for real estate: • Dick’s Sporting Goods • Forever 21 • Pinstripes • Primark • Whole Foods Market • XXI

JT NAKAOKA ASSOCIATES ARCHITECTS

Based in los angeles, california, the dynamic retail environment firm JT Nakaoka Associates Architects combines the design and planning aspects of a conventional architectural firm with a consumer-savvy merchandising angle that produces some of the industry’s most acclaimed projects.

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The Fruits of His Labor Bret Cunningham, Smoothie King’s vice president of design and construction, helped rebrand a company with more than 40 years of history BY KEITH LORIA

WITH A DEGREE AS AN ARCHITECTURAL ENGINEER AND A BACKGROUND MANAGING DESIGN/BUILD PROJECTS including large prisons and univer-

sities, working in quick-service restaurants was nowhere near what Bret Cunningham expected from his life. It was an opportunity to work with Starbucks Coffee around the turn of the century and a subsequent decision to relocate closer to his family that led him to Smoothie King in 2008. “I was very familiar with the brand,” Cunningham says. “I loved the product and really thought the brand had the capacity to expand much faster and further than it had. So coming into the position, one of my big fo-

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cuses was to ramp up their ability to expand.” As vice president of design and construction, Cunningham has been instrumental in helping Smoothie King with its recent rebranding, which included not only a new store design which utilizes more natural colors, but also an entirely new logo intended to be more approachable by a larger variety of guests. About four years ago, Smoothie King was purchased by SK USA Inc., and the new owner sat down with Cunningham to discuss the direction of the brand’s image. Telling Cunningham there were “no golden cows here,” the new owner said there was nothing that couldn’t be changed but the company

needed to know which operations should be changed, as many were outdated. Still, one person’s “outdated” could be another person’s “nostalgia,” so he wanted to be able to support any change with valid guest research. Cunningham worked with Columbus, Ohio-based WD Partners to do quantitative and qualitative research on Smoothie King and determine where the company both did well and missed the mark. “I toured a team from WD Partners through our stores in Korea and the United States to gain a full understanding of the history of the over 40-year-old brand,” he says. “I then worked with them to compile a 45-minute survey, which we distributed to and evaluated responses from over 2,000 people in the US, 2,000 people in Korea, and 2,000 people in China in order to get impressions of the company and the smoothie industry.” This was followed by a series of focus groups in multiple cities, comprised of guests and non-guests of Smoothie King, where they were presented multiple logos and were asked what they thought through a series of questions. “We listened to everyone’s reactions and learned, overwhelmingly, that our current logo was viewed as dated and—although not necessarily offensive to men—tended to be too masculine to women,” Cunningham says.


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In addition to complete redesigns of the restaurants, Smoothie King locations now feature a new logo that replaces its “dated” predecessor. The revamp of Smoothie King restaurants includes entirely new color schemes that replace bright colors with natural woods and solid surface counters.

BEFORE

AFTER

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“The lettering was too sharp. The crown in the logo was unrecognizable. The colors no longer represented healthy. They were garish and reminiscent of an old QSR restaurant or a gas station.” In designing a new logo, one of the big challenges Smoothie King faced was the color scheme. What’s often found in the retail world is that shopping centers have designated colors. There are signage restrictions so companies can’t necessarily get the exact colors on the exterior signage needed to make the outline distinguishable. As a result, Cunningham says the company designed a new logo that could accommodate different colors and overlay textures over time. Once the new logo was established, the company began making corrections to the store, taking down the bright, more garish colors that represent sugary, sweet kinds of dessert and softened them. It also added more natural woods and solid surface counters. The idea was to project an image that would represent something healthier than the products associated with plastic laminates and reflective man-made surfaces. “Even the floors were a chocolate brown,” Cunningham says. “If you look closely, they look like crinkled leather. We tried to make each piece of the store align to the responses we received through our research. We still had to bring in some color and we’ve done that through graphics versus doing it through a permanent item in the store. . . . As those graphics change over the next 10 years as trends towards different colors and presentation changes, we can accommodate that a lot easier than we could before.” That’s the kind of streamlining that Cunningham staked his name on in eight years with Smoothie King. In addition to various design work, he’s organized the store life cycle, from design to construction, resulting in substantial savings from previous years. “We’ve got quite detailed instructions for the franchisee and they’re given the program

OFF THE CLOCK Away from the office, Cunningham is addicted to travel and enjoys taking part in local delicacies. “I love the world,” he says. “I’m fascinated with traveling. Every year, I try to find some interesting place to go. I recently returned from a trip through Budapest, Vienna, and Paris. I eat anything. I always challenge people to expand their horizons with food. I think food is an amazing thing created by so many different cultures, and these local foods should be fully explored and experienced when traveling. Too many people get stuck in a rut with what they eat and overlook this fun aspect to traveling.”

when they come on board,” he says. “We send out a set of reminders during each milestone as to what the next steps are. We even give them example schedules for their contractors. We give them photographs of what the store should look like week by week, so when they’re under construction they can bring those photographs out and they can tell if their contractor is ahead of schedule or behind schedule.” Perhaps even more remarkable is the company’s ability to provide such a solid template given the vast difference in store sizes in their various locations. “We have an arsenal in our design department, which allows us to add community tables, more seating, or we also can restrict it to a small footprint such as a freestanding kiosk,” Cunningham says. Several Smoothie King locations, such as one in New Jersey and one in Mount Juliet, Tennessee, have the unique distinction of operating inside former banks with exposed vaults. In the center of the latter is a beautiful vault with a picturesque stainless door. “Instead of trying to demo the vault or simply use it as a storeroom, we’re going to keep that door—obviously fix the door open so it doesn’t close—and we’re going to put a little community table with some chairs in there so people can get together, relax, or hold meetings,” he says. “It’s fun when you find an interesting element within a building that really should stay and be accentuated instead of being hidden through a standardized remodeling process.”

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OUT OF THE BOX

Entergy takes safety into account in all facets of work, from personnel to the environment—hence its use of helicopters to protect sensitive terrain in Arkansas.

SAFE AT HOME (AND AT WORK) It’s not rare to find companies that take employee safety very seriously in the workplace. However, for Entergy, company leaders extend reminders to all employees that safety must be practiced outside the office as well. “There’s a lot of time spent driving or doing different tasks at home,” says Clay Adams, director of project management and construction for Entergy. “It’s important to remember to treat those activities with same amount of diligence, attention, and care that you would on a job site.” Adams provided this advice unprompted shortly before American Builders Quarterly spoke to him about his career and some of the company’s recent work, but he notes that those kinds of safety tips are a daily occurrence at the company—whether employees are onsite or not. On its website, Entergy provides tips for electrical and gas work, indoor and outdoor projects, and even advice on metal readers and copper theft. There’s also an “Electrical Safety World” program loaded with games that both parents and teachers can use to teach kids about hazards around their home and environment. Many companies set goals or speak grandly of accident-free sites, but Adams insists it’s not a dream or big talk. “Zero accidents are possible,” he says. “I’m a firm believer that safety must be personal, and we’ve got to help everyone understand that in what they’re doing each day, there’s an ability that they have, and we have, to work together to identify all the potential hazards.” In other words, we all have the power.

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Photo: Courtesy of Air2

by Paul Snyder


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American Builders Quarterly #63