Dan Vos Construction Co. Inc. President and CEO Dan Vos Dan Vos Construction Co. Inc. President and CEO Dan Vos COURTESY PHOTO

Dan Vos Construction banks on strong backlog, even as pace of projects eases

BY Sunday, December 22, 2019 03:45pm

 

As the frenetic pace of projects begins to become more manageable next year, Dan Vos Construction Co. Inc. President and CEO Dan Vos hopes his company will be able to say yes to clients more often. The full-service construction firm has a strong pipeline heading into 2020, even if it is expected to slow down somewhat compared to the last couple of years.

What’s your overall sense of the construction market for 2020? 

I think for us next year is going to be similar to this past year and maybe a little slower, but not much. We’ve got a pretty good backlog going into the new year, similar to last year at this time. We’re short on people like everybody else, and there’s plenty to do. It doesn’t seem to be slowing down a ton. I think we’ll have our typical little slowdown in late February or March for a little bit, but then spring comes around and everybody ramps up again. 

Nothing out of the ordinary then?

No, not really. I don’t expect a whole lot of difference. A lot of our clients are repeat clients that we work for year after year after year. They’re cranking. 

How does the vision of your project pipeline compare to a year or two ago? 

I’d say it’s normal. It’s hard to go past a year out. We don’t usually book stuff beyond that. So I feel comfortable for the next year anyway, and after that it gets a little more fuzzy. 

Have you seen any major themes emerging for projects? 

For us, it’s been a mix. In the last year or two, it’s been pretty heavily in the religious sector: churches, private schools and things like that. After the recession, that market was dry. You’re dealing with a lot of personal money. When people are having a hard time, it’s tough to give to a school or something like that. I think there was kind of a big backlog for that type of thing: new churches, new schools, or renovations. We’ve got quite a few going right now and have for the last couple of years. It’s not a major market for us, but it’s just something we do a lot of. 

We’re in the food processing and pharmaceutical world also. Those tend to be strong markets pretty consistently. Even in a downturn, those two areas are pretty strong so that helps even out the down times for us.

Are there any lingering effects on raw materials stemming from ongoing trade tariffs? 

We hear a little bit of chatter from our clients about it but it kind of is what it is. They need it, so you do it. 

Do you see any major change in the cost of construction in the next year or so? 

I think it’s just a factor of the market. I don’t know that once costs go up, they come down much at all — ever. It’s just kind of a factor of the way things are.

Will 2020 be the year for more speculative projects? 

We don’t do any of that anyway, so I don’t have a feel for that at all. … We specifically build for a client, so if a client needs something, we do it for them. It’s not on a spec type of deal. We just have never been in that. I know a lot of our competitors do it and that’s great, but it’s just not what we’re doing. 

Will the presidential election have any effect clients’ willingness to do projects? 

I don’t know when that’ll start to happen and I don’t know if it will, but I’m guessing it probably will. I think it always does. 

Is that a headache for next year?

No, I don’t think about that much. 

How does the continued investment around the West Michigan area help attract new projects for contractors to work on? 

There’s been a lot more activity … and I think it’s bound to attract people. I look at my son, who is going to be in college next year. If you look at these kids coming out of college, it’s a cool place to be. It’s bound to attract young folks and businesses. 

It sounds like you’re expecting more of the same for 2020. Does that pose any challenges for your company? 

I’m not too worried about it. We’ve got more work right now than we can do. We’ve said no to more projects this past year than we ever have just because we can’t handle them because of the staff. I think that’s going to continue into next year and hopefully we’ll have the right mix and we won’t have to say no next year. But that still means we’re busy, we’re just not as crazy busy. You can finally get caught up on some things and you can refresh some equipment. 

What’s keeping you up at night as you look ahead to next year? 

I always get a little nervous this time of year for upcoming work, but at this point in the year, I feel good with our backlog. I feel good with our people that we have on board. We’ve got an excellent team right now. All cylinders are operating pretty good, so I don’t stay up at night a whole lot for anything.

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