Construction Choreography: Making The Pieces Fit
Arnie Silverman knew he’d arrived at an important threshold in the summer of 1995, though he had no idea of what waited on the other side.
As president and chief operating officer of Winter Construction, the Atlanta-based company he’d purchased with his brother Bob in 1979, he helped guide an increase in annual revenue from $2.5 million to more than $88 million. Business was booming, but he wasn’t having fun anymore.
At the same time, Silverman was grappling with a heartbreaking family crisis. His brother-in-law Tommy, under the family’s care since suffering a catastrophic job-related head injury, had expressed through sign language that he’d had enough. He wanted to be taken off life support.
Tommy died June 8. One week later, Silverman left Winter.
“This was a very emotional time, and I wasn’t really sure of my direction,” Silverman says. “I figured, at the ripe old age of 47 I was going to sit back and clip coupons. That lasted almost two weeks.”
A friend, Paideia School Headmaster Paul Bianchi, called the recent retiree. Construction of the school library and classroom building was progressing but the assistant headmaster was ill, leaving no one to manage the project. Silverman, who had served on the school’s board and headed its building committee for about 10 years, stepped in as construction program manager to complete the job.
“Around that time, the Winter company had finished the Rialto downtown, and I was at the grand opening when a woman I didn’t know approached me, said she knew I’d been helping Paul Bianchi and said, ‘I need you, too,’” Silverman recalls. She was on the board of St. Jude’s Recovery Center, which had acquired a $900,000 HUD grant for a construction project.
“They’d been working on this thing for almost two years and every time they priced it, it came in at $1.4 million,” Silverman says. “So the architect would take it back, rework it, and it still came in at a million-four, way over budget. They hired me to help them and the first thing I did was fire the architect.”
The project was completed on time for $854,000, and Silverman found his new direction. Now, after 11 years in business, Silverman Construction Program Management (SCPM), a 12-person firm with annual revenues in the $2.5 million range, remains dedicated to serving the nonprofit and community-based niche.
Construction program management is an industry trend that has been on the rise since Atlanta architect George Heery helped lead development of the new profession more than 30 years ago, and the concept has become particularly important to nonprofits, whose construction projects typically hinge on a tight schedule and tighter budget.
A modern commercial construction project is a complex organism with multiple moving parts, and it can easily evolve beyond a resource-challenged nonprofit’s ability to comprehend.
“What I found in my experience is, you need a good program manager to help you speak all of the languages you need to speak,” says Kathryn Hill, who was chief operating officer of and primary point person during construction of Imagine It! Children’s Museum of Atlanta.
“You take your life into your own hands if you don’t have somebody really thinking about all of the various implications,” Hill says. “Not just construction, and change orders and overruns, but all of the costs as you cast this building in stone.”
The Owner’s Advocate
A good construction program manager (CPM) – an owner’s representative in the truest sense – masters the economics and physics of time and space, taking a systematic, all-encompassing value engineering approach to scheduling and budgeting, tackling zoning issues with local governments, negotiating with developers, architects, engineers, general contractors, plumbers, electricians, suppliers, investors and everyone involved from project conception through completion and beyond.
And nowhere is this type of penny-pinching owner’s representative more valuable than in a nonprofit setting – the church purchasing land for a sanctuary, the school building a new library, the museum, the food bank, the homeless shelter.
“Most of these organizations don’t have a construction person on staff, or perhaps they have a board member who is a developer or a contractor,” Silverman says. “In that case, we support them, we do the dog work and they make the executive decisions. Either way, and this has proven itself time and time again, our clients have said that we pay for ourselves by saving them trouble and time.”
A few years ago, Beulah Baptist Church in Decatur, a mega-church with more than 6,000 members, embarked on a $12.5 million sanctuary construction project. It did so without a CPM. It was like flying blind.
“We ran into problems, we didn’t understand the complexity of the contracting business, couldn’t sort out the real issues in a project of this magnitude,” explains Nat Harris, church deacon and chairman of the building committee.
The project was running over budget and behind schedule when the church’s lender recruited Silverman, who brought all the parties together, formed a completion strategy, managed the rest of the project and afterward assisted the church with maintenance and facilities operations.
In September 2006, Beulah opened its Family Life Center, a $13.3 million project that Silverman was enlisted to manage from the start.
“It was like night and day, because they worked us through the maze from the very beginning, long before we broke ground,” Harris says. “I’ve got a lot of project management experience, but in the software industry. It’s a totally different language.”
Silverman senior project manager Bruce Pinkney arranged tours of other churches with similar facilities, held programming sessions, did the preliminary budget work, guided the architect selection process and the design process, helped complete the construction documents – the game plan for the bricks and mortar to come. All of that took about a year.
“The most important actions of the construction program manager take place before construction starts,” says Heery, chairman and CEO of Brookwood Program Management in Atlanta. “And some of the most critical actions need to take place before the design process starts.”
For the frugal nonprofit, say a church, that usually means putting together a realistic project budget before the architects and engineers and contractors are selected. Getting started early and not rushing through the project, thinking through every conceivable option saves pain and money in the long run.
“Taking your time at the beginning, so that your client doesn’t go off on a wild and expensive goose chase is so critical,” says Paul Marston, president and CEO of Atlanta-based Richmond Sterling Construction Con-sulting, who has managed projects for numerous churches and religious-based organizations. “Some expectations are beyond a church’s budget and one of the first things I often have to say is, ‘Sorry, a million dollars is not going to get this for you.’
“You need somebody on the team, a good project manager, immediately to help with the planning, keep the project on track and, as sometimes is in the case, save the client from himself.”
So the CPM helps with the tough choices at the critical crossroads of a project – before, during and after the ground has been broken. For example, is it more cost effective for the client to replace a slate roof with cheaper asphalt shingles, or spend more money to save the roof, and how does the life cycle of a slate roof vs. asphalt shingles play into the long-term price tag?
That was a real-life scenario for Marston, who was managing a renovation project at Columbia Theological Seminary in Decatur. They decided to save the slate roof.
Once the project actually begins and ground has been stirred, there are the inevitable new revelations that crop up – the piece that won’t fit, requiring a change order. After the early stage program management, which focuses on design, the project moves into the construction phase, “and that’s the real fun,” Harris says.
For the Beulah Family Life Center, Silverman helped select a general contractor, orchestrated the progress, kept the devil out of the details by stressing over the little things. “One thing I stress over is the structural integrity of choir pews,” Silverman says.
And somehow they kept the project moving forward in spite of several plot twists, most notably a matter of some bad dirt. “The property we purchased was once used as a landfill,” Harris explains. “And even though we did plenty of testing and boring to make sure we were building on a solid portion of ground, we did run into some bad soil that would not support the weight of the building.”
They were looking at a three-month delay and expensive options to fix the situation. But Silverman, the general contractor and the church brainstormed a better solution. Beulah has 40 acres at the site, and they were able to find enough good soil on the property to replace the weaker ground.
“It was a creative way to resolve the situation as soon as possible,” Harris says. “And that option ended up saving us about $400,000. It would not have happened without a good program manager on our team, bringing everyone to the table and – this was really important – making sure we all sat on the same side of the table.”
Writing The Book
The construction program manager profession evolved out of the construction eruption that followed World War II.
“During the war civilian construction projects stopped. After the war, there was a flurry of what I call ‘catch-up projects,’” says Brookwood Program Manage-ment’s Heery. “New classrooms, hospital expansions, business expansions.
“Then in the late ’50s there were plans for major public projects – transit systems, tunnels, bridges, big, new administration buildings. These projects really took off in the ’60s and during that time the country began to experience the highest interest rates and the highest rates of inflation anybody had ever seen.
“With the combination of inflation and the high cost of money, and the complexity of these huge projects, it was almost standard procedure for a $20 million project to turn into a $40 million project, because of price changes, cost overruns. There was a growing discontent or questioning of the whole process of buying construction.”
Before World War II, most construction was carried out by the contractor’s labor force, with few subcontractors involved. After the war, projects got bigger, more complicated, so design and construction professionals became more specialized. Out of all this grew the need for one professional who could work with all parties to complete the project, someone who could manage quality, cost, schedule and risks.
“Someone to be on the owner’s side but [someone who] understood the design and construction side, and [could] do away with the adversarial relationship between the owner and the builder,” says Heery, whose book Time, Cost and Architecture, published in 1974, was billed as the first definitive work on construction management.
Heery, the architect for Atlanta-Fulton County Stadium (as CEO of Heery International, a firm he sold in 1986), helped jump-start the professional construction management movement in the late ’60s, when he and a handful of others began conducting seminars around the country.
“Almost all of our effort focused on managing the construction process itself – construction management,” Heery says. “I was the one who kept saying, ‘Wait a minute guys, construction isn’t the whole issue. If you’re going to really control the direction of a project you’ve got to start before the construction – predesign, developing a budget, scheduling, taking care of all the program requirements through occupancy. You’ve got to look at the whole program.’”
Today, construction management (CM) is a growing and sometimes lucrative career choice, with about 250,000 working in the profession nationally, averaging almost $117,000 in annual salary (more than $60,000 after five years). According to the Bureau of Labor Statistics, the opportunities will only get better over the next six or seven years, with the number of job openings expected to exceed the number of qualified applicants as college programs swells to meet the demand.
These new CPMs, most with a degree in civil engineering or construction management and background in building science, business and management, will go to work for engineering firms or real estate developers or contractors. Generally, these people work within the “CM At-Risk” service delivery method in which, essentially, the construction manager also serves as the general contractor.
Or they might join a firm that specializes in acting as the eyes and ears for the owner – this is called CM Agency; the manager provides advice and assistance to the owner, but does not hold contracts or take construction risk. That’s the world that Heery, Marston and Silverman inhabit.
Ever since that first CM gig at Paideia, Silverman has worked almost exclusively for nonprofits and community-based organizations, a diverse client and project list that includes Atlanta Botanical Garden, Atlanta Union Mission, Chattahoochee Nature Center, DeKalb County’s courthouse renovation and senior multipurpose facility, the Olmsted Linear Parks, the Villages of East Lake, churches, temples, schools, community improvement districts and a host of public-private projects.
SCPM routinely wins awards through the Construc-tion Management Association of America (CCMA) for its work, but none stands out for Silverman like Imagine It!, which won a national award in 2003.
The museum, which anchors the Museum Tower at Centennial Hill condo building, opened four years ago this month. Its completion marked the beginning of a Downtown Atlanta tourist mecca north of Centennial Olympic Park – the Georgia Aquarium has since opened across the street, and the new World of Coca-Cola is coming this summer.
“That was a fascinating project,” Silverman says, “because of its complexity, its integration into the developing downtown community, the difficulty of coordinating our construction project within another construction project, installing all of those exhibits, the special lighting.”
They also developed a maintenance program and hired the staff. Most important in getting the job done on time, though, was the role Silverman and senior project manager Dave Borchers played as peacemakers, because the relationship between the museum and the Museum Tower developer became strained early on.
Matching funds from foundations and corporate sponsors required the match be achieved by certain dates, and that the museum be completed and opened by March 1, 2003. When a dispute between the developer and his contractor arose, resulting in the contractor walking off the job and the site being fenced shut, no work took place for three months. The museum worried that it wouldn’t make the deadline, resulting in the loss of committed funding. That’s when Silverman was hired and took over all coordination with the developer on the museum’s behalf.
“This project was beyond the scope of your typical museum person,” says Hill, now executive director for the Colorado Alliance for Arts Education. “If we didn’t have a program manager keeping everyone calm throughout, and making sure that actual construction was happening, we would not have opened on time.”
But it did open on time. A project that could easily have been a Three Stooges pie fight instead became a well-choreographed production with a professional construction program manager pulling all the right strings.
“We needed someone who could understand and manage those moments when electricians and architects and exhibit designers and installation people were working at the same time in the same space,” Hill says. “Someone to make sure these people were not walking over each other, or stealing each other’s tools, and that the right things were happening in the right sequence.
“Someone to create order out of chaos.”