As Skyline Construction grows a national footprint, it takes steps to scale intelligently with a purpose

Jessica Carps serves as Skyline’s COO and its first female member of the Board of Directors. Her background in management consulting and manufacturing has allowed her to bring a unique and innovative perspective on the construction and real estate industry. She is responsible for creating repeatable processes and systems to facilitate growth, drive profitability and create redundancy, which has allowed Skyline to expand nationally. 

Since Jessica joined the firm in 2015, Skyline’s revenue has increased from $175M to $550M. Today, she oversees Skyline Enterprises, the holding company for the Skyline family of companies, and she leads the Sky Service Team, a group that has successfully executed the start-up of two new subsidiaries in 2019. 

Another key aspect of her role as COO is overseeing the Skyline family of the companies’ employee stock ownership program. She prides herself on being a steward of the well-being of the employees that work for Skyline and views the program as a core component to the culture and success of Skyline. 

What motivated you to expand outside of the Bay Area?

Our expansion was very much customer-driven. We have very strong relationships with our clients, particularly our tech clients, who have been asking us for years if we can help them with their own office expansions into other markets. However, effective expansion requires more than customer relationships. It requires you to have the right team in the market, a team with familiarity with the buildings, owners, facility managers and strong relationships with subcontractors. In 2019, we found that partner in Andy MacGregor, now the President of ACCEND, and opened up ACCEND Construction in Chicago. In 2020, we formalized a long-standing customer service partnership with Unimark and Servicemark in Seattle through a formal acquisition. The great thing about our expansion plan is that it is a win-win for Skyline and for our customers. It allows us to diversify out of one market, avoiding the cyclical nature of the construction industry. It also provides opportunities for upward mobility for existing employees and increases the potential ESOP stock value, which as a 100 percent employee-owned company is beneficial for our employees and shareholders. 

the basis of our expansion plan is to find companies with strong brand recognition and talent in their local markets

What drove you to the Chicago and Seattle markets for expansion? 

Seattle and Chicago both have experienced significant growth in the tech industry, an area where we have deep expertise and strong relationships. Many of our clients are looking to diversify their business out of the Bay Area and into more affordable areas to capture talent and reduce overhead expenditure. We wanted to be able to service our valued clients in other areas, making the move to become their national interior construction partner. Ultimately, we were drawn to Chicago and Seattle not only because we have strong partnerships and found great leadership talent there, but because of the synergy and similarity to the Bay Area commercial real estate markets, their deep talent reservoirs, and opportunities for scalable growth. 

Tell us about your company structure and why you operate under so many different company names? 

We have two strategies for entering new geographic markets or service lines: “greenfield” offices, as demonstrated in Chicago with ACCEND and Skyline Capital Builders in the Bay Area, and acquisitions, as demonstrated by Unimark and Servicemark in Seattle. From an acquisition perspective, the basis of our expansion plan is to find companies with strong brand recognition and talent in their local markets. Nobody knows the intricacies of building in each major metropolitan city better than the people who have been doing it for years. Our goal is to find small to medium-sized successful companies who are looking for financial and business resources to take their organization to the next level. We are not looking to change their name or who they are – just support and enhance their business operations. From a greenfield perspective, we are looking to build similar brands, and we are somewhat limited legally by the naming conventions that are available in the markets. Both expansion models, greenfield and acquisition, benefit from the resources of our SkyService team, a group of subject matter experts in many areas of the business including Human Resources, Finance, Legal, Branding, Sales, Safety, IT & Security. This corporate team alleviates much of the burden of running the business so the leadership team within each firm can focus on quality project execution and providing the optimal client experience.

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Skyline Enterprises is 100 percent employee-owned. Why the ESOP model and what has the impact been for your employees?

The Employee Stock Ownership (ESOP) model is an income equality solution and has been influential in numerous ways. Most importantly, our clients see and feel the result of the ownership culture. Our employee-owners take great pride in providing the best client experience through open communication, cost-saving measures and full project transparency. The ESOP model also rewards the hard work of all staff, not just a small few, by providing a secure retirement, which has proved to be a wonderful recruiting tool to attract talent in the industry. We feel very strongly that employees are the heart of our company, and we are motivated to operate under a fair business model. 

What is your company doing to brace for a potential slow down?

It is part of our corporate strategy to maintain a strong balance sheet so that we are not only prepared to weather any downturn but to leverage such events into growth opportunities. We believe that we are in such a position now. We continue to look for companies who are ready to take their business to the next level, or owners who are looking for a strong exit strategy as they move toward retirement. Our recent geographic diversification allows us to be less reliant on just one area or region, which has further strengthened our financial position. For example, since the COVID 19 event, companies have started to approach us who are looking to be acquired. More will come and we will act on the right one, with the right leadership team in the right location.

Given where Skyline stands today, what are the priorities for your business in 2020 and beyond?

2020 has already proven to be an eventful year. We are closely monitoring the impact of COVID 19 on the economy and the industry to ensure that our businesses are prepared both financially and operationally to not only withstand [themselves] but to be at the forefront of solutions. On top of that, a few priorities remain top of mind for us: implementing technology solutions to streamline the business, integrating our newly acquired firms into the family of companies and continuing to provide the absolute best quality projects to all of our valued clients. 

There are a limited number of women in C-suite positions in this industry. Do you see yourself as pioneering, to some extent, as these companies embrace more diversity and inclusiveness?

You know, it’s funny, I think that other people think about situations where I am the only woman in the room much more than I do. I give 110 percent to everything I do, and I come to work every day with the intention of always doing the right thing for the organization and the employees I work for. I feel very lucky to have been a part of organizations, particularly Skyline, that value hard work and effective leadership above all else. I think it is important to make sure others are afforded the same opportunity. I’m proud to have been able to promote numerous talented women onto Skyline’s leadership team, and I truly enjoy mentoring emerging female leaders to speak up, take risks, have confidence and push hard for what they believe in. Also, as a working mom, I am quite aware of the intricacies of managing both work and household responsibilities. I have supported significant changes to the benefit offerings at Skyline over the last few years to ensure that our work environment supports both working mothers AND fathers. That starts with enhanced maternity and paternity leave and continues through affordable and strong health benefits, extra support in the form of child and elder care, gym reimbursement for mental health and wellness, and unlimited PTO to create the work/life balance necessary in order to manage both of these areas. I am committed to Skyline’s “people above all” mentality and I look forward to seeing more women take on leadership roles in the industry in the years to come. 

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What are some of the challenges in the industry that you expect to see unfold in the next few years?

Clearly, the coronavirus is changing the landscape that we operate in as we speak. Prior to recent events, two of the main challenges we anticipated encountering were rising construction costs and a shortage of labor. While we cannot control all the aspects that contribute to rising costs, we have taken the initiative to work with and inspire students coming out of college to pursue careers in the commercial real estate industry. However, COVID 19 is changing the situation in the industry and the economy every day. It’s highly possible that supply chain disruptions and shortages could drive material costs even higher but change the course of the labor market entirely.

How do you anticipate the coronavirus will impact construction over the course of the year?

While the full impact of the coronavirus is unknown at this time, we anticipate disruptions in the supply chain as manufacturers around the world are slowed. To address this and continue to serve our clients, we have developed an internal task force to work very closely with our subcontractors to identify and assess risk. We are monitoring the situation very closely and on a project by project basis to understand if and how construction schedules and costs will be impacted and will institute best practices to address these challenges. 

We are also prepared to face these issues from previous initiatives we have taken to increase reliance on American made products and services. A few years ago we created an organization called the Build America Challenge with the goal of procuring products and materials for construction projects made in the United States. Through this process, we developed a rich database of American produced construction products, which we are currently refreshing so that we can best provide an additional resource and value add to our customers.

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