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Willis A. Smith Construction Inc. has grown from a small company in 1988 with about $3 million in revenue to one of the larger general contractors in Sarasota and Manatee counties.
By Sean Roth
Real Estate Editor
Like most other U.S. companies, the events of 9/11 stung Sarasota-based Willis A. Smith Construction Inc. The terrorist attacks and resulting uncertainty cost the general contractor six projects, including a six-year $20 million office development.
To ensure continued growth and survival, the company refocused its efforts on public projects to hedge against the uncertainty in private development. Thirty months later, Willis Smith is now among the top 10 largest general contractors in the two-county market and is one of the five largest local builders of educational facilities.
"We are heavily weighted in the public sector," says David Sessions, president of Willis Smith.
The educational projects continue unabated, giving the builder solid growth. This year, revenue is projected to grow by 82% from $33 million to $60 million.
The 32-year-old general contractor, construction manger and design/builder, is in a joint venture with 3D/International for replacement facilities to service Bayshore Elementary and Prine Elementary in Manatee County. It just started on the 111,000-square-foot Venice Elementary, and it is handling campus improvements for FSU/John and Mable Ringling Museum of Art. Last month, the company was awarded a contract to renovate Marie Selby Botanical Gardens for the Selby House.
Willis Smith builds an average of 60 commercial projects a year, of which more than half is educational projects.
"Our goal is to have clients that will keep coming back," says Warren Simonds, director of client relations. "We try to build long-term relationships. There are some contractors that are almost exclusively in private projects. We feel more comfortable having a balanced portfolio."
Clients such as the school boards of Charlotte, Manatee and Sarasota counties aconstantly renovate or build new facilities to keep up with a growing student population. Repeat business can turn into significant annual revenue. Public projects are also buffered somewhat from economic fluctuations. But there is a tradeoff: they tend to have smaller profit margins.
Still, the work is there.
"We are in a very high-growth market," Sessions says. "Everybody is expanding. When we started this we had one or two people working with the school boards. Now, we have multiple teams. They tell us, 'We want to work with this team on this project.' You could say Willis Smith grew up along with the school boards. We worked with them so they developed a comfort level with us."
Not only has new school development increased, development costs have also grown. Sessions estimates that constructing a school cost about $5 million a decade ago. Today, that same school cost about $12 million.
The company works primarily with the Charlotte, Manatee and Sarasota county school districts, but it also has a contract to provide some smaller services for the DeSoto County School Board.
Willis Smith, founded in 1972 by its namesake, affectionately known as Smitty, was simply a general contracting firm. "He did a lot of work on the islands ... Gasparilla, Sanibel and Useppa throughout the '70s, along with working here and in Charlotte," Sessions says.
Exit Strategy
In 1979, Smith, who planned to retire, decided to sell the firm to employee Leighton Hunter. The duo agreed that Hunter would purchase the company over a period of six years. The final handover occurred in the mid-'80s.
A few years after Hunter took over Willis Smith, he met a young project manager named David Sessions.
Sessions, a University of Florida School of Building Construction graduate, had worked for E.E. Simmons, a contracting firm, for about five years. But he was restless.
After a chance introduction, Sessions, 29, and Hunter met for lunch. Talk turned to how Sessions and Willis Smith Construction's futures were intertwined. Hunter eventually offered to let Sessions acquire the company over 10 years.
"I knew how to be an OK project manager," Sessions says, "but I had no idea how to run a business. This was the way the transition of the firm could by done successfully."
Each year, starting in January of 1989, Sessions took on another responsibility. By 1999, through a combination of personal savings and sweat equity, Sessions was the sole owner of Willis Smith.
During the transition, the partners also gradually grew the company. "(In 1988,) we were a small general contracting firm specializing in pre-engineered building systems," Session says. "We needed to diversify. There was the perception that (pre-engineered building) was all we did. We were barely doing $3 million a year."
In the early '90s, the company expanded into school construction.
Two years ago, Sessions offered an equity position to F. John LaCivita, a Sarasota native and fellow University of Florida grad. Although the position is a minority stake; the agreement implicitly follows the Smith-Hunter-Sessions example, with a leadership transition expected in the future.
Prior to joining Willis Smith, LaCivita had spent about seven years working for Forristall Enterprises Inc., a Palmetto demolition subcontractor, most recently as its vice president.
"I just wasn't doing what I was educated to do (at Forristall)," LaCivita says. "So I contacted Dave. This involves a lot of equity both sweat and personal. It also means a lot of late nights and a lot less family time. It's a lot to take in, but it's very exciting. I have to be educated in all the minute details of insurances, bonds ... various types of contracts from their lawyers. It's involves a lot of reading and technicalities. But Dave is an excellent teacher."
Says Sessions: "John is absolutely critical to this organization. When he approached me a couple years ago, I saw his work ethic and his spirit, and it was an absolute no-brainer."
Goal oriented
Asked how changes in 2001 led to an abundance of educational projects, Sessions points to lengthy lead times. Most of the slow down in private commercial projects, which occurred in 2001, actually hit the company's books in 2002.
"It takes these projects a year or two from the time you sign the contract to the time the shovels hit the ground," Sessions says. "We have to tell clients that in the beginning, it will take longer to design or permit a project than it will take to build. Right now, we are focusing on 2006 and 2007."
As an example, Sessions points to Southside Elementary School, scheduled to start next summer. Willis Smith was awarded the contract two months ago and the entire project will take about 39 months. Of that time, 12 months is set aside for planning and design.
This year, the company is projected to grow by 82% from about $33 million to $60 million. LaCivita attributes the growth to the company's performance, reputation and attention to clients' needs.
For instance, Willis Smith agreed to build a bank branch building in Lakewood Ranch for SouthTrust Bank in 90 days - a goal not accomplished in the bank's history. Instead, Willis Smith completed the bank in 72 days. Since then SouthTrust has been a repeat client.
Another example LaCivita points to is the 99,000-square-foot, three-story RE/MAX Properties office building. After the permitting and application process dragged on, Willis Smith was charged with constructing the huge office building in just six months.
"We delivered it in five months and three weeks," Simonds says.
Gradual growth
Looking forward, the partners plan to keep the company predominantly in Sarasota, Manatee and Charlotte counties.
"We have gone into different parts of the state for different clients," Sessions says, "but that is something we only did because we had an existing relationship. We would love to simply stay in the same geographic area. We have started to do a little work up in Pinellas and Hillsborough counties, but that will depend on timing and will be client driven. Working (locally) will also help us retain employees that have families and kids here and don't want to be on the road all the time. We have a heck of a lot going on right now. This is the most rapid pace of growth I have seen after 30 years of living on the coast. There is plenty of work right here."
Both partners emphasize Willis Smith's growth will be gradual.
"We do not hire and fire by the job," Sessions says. "There are times where we have passed on opportunities, because we don't have the right person to serve that project's needs. We need to balance our growth. We typically recruit project managers out of the University of Florida School of Building Construction. We will hire some young guys that are absolutely brilliant. (It is a challenge) finding the right person that fits with our corporate culture."
Willis Smith, which employs 48 full time, continues to do pre-engineered steel projects, through a relationship with Kansas City, Mo.-based Butler Manufacturing Co. The recent steel shortage has caused problems for the company.
"We are doing OK, but there has been an impact on some projects," Sessions says. "We are fortunate that the subcontractors have kept us up on the increases they were facing. We have a long-term relationship with Butler so allocation doesn't seem to be the problem ... now pricing that is another issue."
"So far we have been lucky," LaCivita says. "We have been able to manage it. Because of our subcontractors we have been able to project what will be happening a few months out based on past increases. That way we don't shock our clients. So far, we have been right on target. Most of our projects have been on budget. We have weekly sub meetings to work out any problems they have. Most contractors meet monthly; that means if you don't discuss a problem at the meeting it may not get addressed for another three weeks. "
Gross Revenue
2001$16 million
2002$26 million
2003 $33 million
2004 projected $60 million
ONGOING AND COMPLETED PROJECTS
EDUCATIONAL
× Mote Marine Laboratory Goldstein Mammal Research Center
× Mote Marine Laboratory Mammal Research Center expansion
× Ringling Center For Innovation & Collaboration
× Ringling School Of Art - Roskamp Center
× Ringling School Of Art Campus Housing Village
× Ringling School Of Art Whitaker Bayou Studios
× School Board of Manatee County Samoset Elementary Accelerated School
× School Board of Sarasota County Gulf Gate Elementary School
× School Board of Sarasota County Sarasota High School - Building 13
HEALTH CARE
× Hospice House of Ellenton
× Hospice House of Port Charlotte
× Hospice House of Sarasota
× Sarasota Bay Club Health Center
INDUSTRIAL
× Dana Corp.'s Gresen Hydraulics Division (manufacturing)
× Gorman Co. New Warehouse Building
× Griffin Electrical Sales Warehouse
× Joelson Concrete Pipe Co.
× Mader Electric & Motor
× Matzke Warehouse
× New England Machinery Manufacturing Facility
× Sarasota County Solid Waste Disposal Complex
× Sun Hydraulics
× World Precision Instruments Addition
OFFICE
× Cavanaugh Office Building
× Center For The Arts & Humanity
× Leblanc Studios Office Building
× Mote Marine Laboratory Administration Building
× Mound Street Office Building
× Peace River Electric Cooperative
× Sarasota Chamber Of Commerce
× Sarasota County Solid Waste Disposal Complex
× SouthTrust Bank - Lakewood Ranch
× New College Keating Center
× Mote Marine Keating Marine Research
RELIGIOUS
× Faith Presbyterian Church
× First Church Of God
× Grace Baptist Church
× Lutheran Church Of The Living Waters
× Parrish United Methodist Church
× Seventh Day Adventist Church
× St. Mary Magdalene Episcopal Church
RESORT
× Bradenton Yacht Club
× Lakewood Ranch Tennis Center
RESTAURANT
× J. Ryan's On The Grill - Lakewood Ranch
× J. Ryan's On The Grill - Tampa
× Pink Elephant Restaurant
× Seafood Shack
RETAIL
× Darby Buick South
× Palmer Crossing
× Yoder Farm & Hardware
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