MEET MILLARD CHOATE
Job: President of Choate Construction Co.
Age: 60
Education: Vanderbilt University, bachelor's degree in economics
Family: Married for 35 years with two daughters
Lives: Atlanta
Favorite movie: "A Few Good Men"
When Millard Choate was just 5-years-old, he got paid for moving bricks from one pile to another — a quarter for every 6-pound brick.
Choate, now 60, says he learned a lesson from that first job — hard work pays off. That helped him build an Atlanta company into a national construction firm with revenue expected to hit $650 million this year. He started Choate Construction Co. in his basement in 1989, shortly before the 1990-91 recession.
During the most recent recession, which he believes is barely over, Choate Construction was hit hard, with revenue dropping from $738 million in 2007 to $359 million in 2009. Recovery has been gradual, and he expects 2014 to continue the rebound.
Q: Who owns the company now?
A: I have the majority percentage, over 50 percent, but we have various people who have been afforded stock over a period of time. Over time, it'll be owned by a group of employees, senior superintendents, project managers and project executives.
Q: How many employees do you have?
A: We have 323 salaried employees and 50 hourly.
Q: Any plans to go public?
A: No. We have had many offers to buy our company. But I just resolved years ago that people with us all these years will own the company.
Q: What kinds of projects do you take on?
A: We don't build individual houses. We do both very large projects and very small.
We do corporate headquarters, student housing, auto dealerships, wastewater treatment plants, hospitals, multi-family, and even high performance motorsports shops. We built the new tower and residence hall at the Shepherd Center.
Q: What has contributed to your firm’s success?
A: We have no long-term debt, as I don't believe in debt. And that gives our clients confidence. People stay with us.
Q: How did you get out of the basement? Many people spend their lives in home offices.
A: I had to go after everything. We were in a recession. It made me focus on each and every job.
It was a tough growing period to convince people that we had the experience and skills. The first project was an interior construction project. You call on your existing contacts in your network.
I was in the basement office for about six months. Then we moved into a basement office at Hammond Ridge. From there, Powers Ferry. Now we are located in a building we constructed, Northridge Plaza in Sandy Springs.
You have to pursue projects, work hard, deliver on time. I’ve always been very hands on. I believe in very personal relationships with clients. Now 70 percent of our work is repeat work. We are still building for some of the clients we built in the first year.
Q: Over the years, building design and construction has changed a lot, hasn’t it?
A: Yes. We call it virtual design and construction, or BIM, for building information modeling. That's where we are internally building models in the computer, virtual buildings. We do the mechanical and electrical, plumbing, heating and air conditioning ducts. It's an extremely valuable tool, both in cost control and finding dollars during the estimating stage.
We work out conflicts in the computer, not in the field. It’s cost effective, saves time, and owners are shielded from change orders. We are modeling nearly everything we do. It saves tons of money.
Q: Do you build only in the southeast?
A: Most of what we do is in the South, but we have clients all over the country.
Q: What about the competition?
A: We have lots of competition, more in Atlanta than any other place. We are one of the top 10 contractors in the southeast.
Q: When did you have your first inkling that the economy was headed for trouble several years ago?
A: A client flew me to a project. I flew over north Atlanta and I saw nothing but thousands of homes being stick built. I thought, "Where is all this demand coming from?" I could see the overbuilding, and not just in residential. There were a lot of what we call see-through buildings — office buildings and condominiums that were half full at best.
When the economy is overstimulated, and there is unbridled optimism, that could point to trouble.
Q: What signs of trouble do you look for?
A: I watch factors like consumer debt, spending, savings. A number of factors like that can be watched that give indications of an economy that has peaked or is running out of gas.
Q: Do you know a lot of people who went out of business in the recession?
A: I know some very fine people who are no longer in business. When the music stopped, they had so much invested, it took them down. Friends, people I've known from school, church. I have some friends who are still out of work.
Q: How do things look to you now?
A: I believe slow growth is much healthier than a fast-growth economy. I'm not worried about what's going on now in residential real estate. Right now, instead of 10 months housing inventory, we have three. The prime rate is low. That lure has regenerated single-family housing. That's a good thing for everyone. I think it will be a slow recovery.
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