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Sunday, May 26, 2024

A century-old Winston-Salem contractor picks up its pace

Winston-Salem-based Frank L. Blum Construction has survived a world war, a global pandemic, 17 recessions, and four leadership changes. Making it to 100 years in business this year is something to celebrate. 

CEO and President Mike Lancaster enjoyed the stroll down Memory Lane, digging through old photos and blueprints that are now mostly yellow. But most of his time is spent looking forward. There’s always the next job to win and complete, a new foundation to be poured so that the company’s future remains as solid as its past.

“Being that old, 100 years, it’s just a mark of a real commitment to quality,” says Lancaster, a Blum employee since interning with the company as an N.C. State University freshman 24 years ago. “You get that perspective when you’re a 100-year-old company. We all know in this business that you never build the perfect building.”

Lancaster, 42, obviously never knew Frank Blum, whose death following a heart attack in 1954 nearly ended the company’s story. “But everything I’ve learned is that he was like that,” he says. “He valued good people, just like we do, and he strived for quality. That’s the way every generation (of Blum leadership) has looked at it. I want my kids to walk into the Kaleideum [children’s museum that Blum is building in Winston-Salem] with their kids, or even their grandkids, and see that it’s stood the test of time. I think we’d all like to see that happen with this company, too.”

The company bought some security more than a decade ago with a carefully planned transition that brought Lancaster — then, just in his 20s — and the next generation of company executives to the fore. By giving that group an equity stake, a strategy turning into a Blum tradition, the company staved off selling to an outsider, and, at the same time, launched a new era in the company’s history. Since Lancaster was named president in 2014 and CEO in 2018, Blum has gone from the leading construction management firm in Winston-Salem, to one of the 10 largest in North Carolina, with revenue topping $405 million last year. Its 255 employees are spread across offices in Charlotte, Raleigh, Asheville, Greensboro and the company’s new headquarters building near Winston-Salem’s Lawrence Joel Coliseum, which Blum built in 1989.

That’s a far cry from the company Lancaster joined in the early 2000s. Back then, Blum had fewer than 60 employees and it was “a real accomplishment to get someone to go to Greensboro to look at something,” he recalls. “We were a Winston-Salem company.”

Blum is the contractor for Winston-Salem’s new Kaleideum museum opening next year.

The Lexington native pooh-poohs the growth to a degree, noting that 20 years of inflation would have turned $40 million into a “pretty big number all by itself.” Growth at the pace of inflation would be around $170 million, so Lancaster and company have managed to double that production in two decades. Not bad for a period that included the Great Recession and COVID-19.

“That growth is not something that happens without Mike, without the next generation,” says Drew Hancock, Blum’s president from 1983 to 2014. “All the planning that went into the transition has paid off, I think. We could see that there was a lot of talent in the fourth generation, Mike and those guys. Because we began planning so long ago, we were able to put those dogs into the woods and let them hunt.”

Lancaster, the former intern, emerged as the leader of the pack. He’s just the fourth president in the company’s history. Hancock succeeded his father, Jim, who was thrown into the breach following Frank Blum’s untimely death.

Hancock says the day he announced Lancaster would be the next leader “there were hats thrown in the air” at Blum. The young engineer was a popular choice, says Hancock, because he was a natural team-builder and because of his unusual ability “to listen and understand others at a deep level.

“When you do that it creates this great bond of trust,” says Hancock, who is on the advisory board of Wake Forest University’s Center for Private Business. “In our business, in a lot of businesses, that’s gold.”

ON TO RICHMOND?

With most of North Carolina covered, Lancaster says Blum’s next horizon lies across state lines. The company has completed a handful of projects in Virginia, including Primland Resort, where they created luxury treehouses and golf chalets, and a 300,000-square-foot office renovation for Truist Financial in Richmond.

Blum will have an out-of-state office within the next decade, probably sooner. “We’re going to keep growing,” says Lancaster. “It wouldn’t be our style to say we’re done. But I think we’ll keep moving the way we move as we grew across the state. If you think about it in terms of concentric circles, that’s kind of the way we’ve operated. You draw a big one, an hour and hour and half to the west, and to the east, from the Triad. And then you continue to add to the circles. That’s what feels right to us, to grow but also to maintain our brand.”

Blum’s circles could be geographic, or they could be defined by sectors. The company has a strong presence in higher education, healthcare and senior living. Projects in those areas helped it expand across North Carolina. Senior living work in Greensboro and Winston-Salem opened doors in Durham and Raleigh. Building the McCreary Tower at Wake Forest University’s football stadium caught the eye of a visiting architect who was working on a project at the Dean Smith Center at UNC Chapel Hill. Blum worked on that project, which led to more business on that campus and at N.C. State.

“We think it’s better to go and plant a flag on the back of a strong project,” says Lancaster. “These companies that sort of look on a map and say, ‘Oh man it really looks like this place is really going to be doing some stuff, let’s pack our suitcase and go — and let me just say, there are plenty of companies bringing suitcases to North Carolina right now — that’s a tough road, to prove yourself in a new place … But if there’s a hospital in Greenville, South Carolina, that’s curious about Blum, all they have to do is look to their neighbors to the North. (Blum has completed healthcare projects in Morganton and Hendersonville and is about to start a renovation project at HCA Healthcare’s Mission Health in Asheville). That just seems like a lot simpler way to do it.”

CULTURE OF THE RUB

The company has, so far, managed to export its culture to new parts of North Carolina by moving homegrown talent out of the corporate office and into regional leadership posts. The company has also stayed in touch with its roots by re-establishing some “self-performance” divisions within the company.

Blum has about 40 employees tasked with actually laying brick or putting up drywall. Blum is something of an outlier, in that regard, among large construction management firms. But Lancaster says it can help “drive schedule by giving us some resources we control at critical times. If you can get a project enclosed, that’s a major step. Our self-perform groups can help us get that done.”

The company probably had more employees in the 1950s than it does now, Lancaster notes. “We had terrazzo machines and concrete machines in the warehouse. We had people in all the trades,” he says. “We did it all. But the industry went from generalist to more specialists. Now, the pendulum is swinging back a little bit. It helps us do certain things, and I think it helps us stay rooted. We’ve still got people who can do it with their hands. I kind of like that.”

Lancaster isn’t one of them. He hasn’t been involved in the “blocking and tackling” of a project in years. Most of his time is spent managing people and worrying about attracting tomorrow’s employees. It’s a challenge to recruit young engineers willing to tackle construction’s long hours and the culture of the “rub,” industry slang for points of friction and contention that dot every big project.

“Finding talent is one of the toughest … well, it’s the toughest problem we face,” says Lancaster. “Construction is not for everyone. It is hard work.”

But for those bitten by the bug — guys like Mike Lancaster — there is nothing like it.

“I’m still fascinated by building something, seeing the pieces and parts that go into each project, how they’re vastly different but then figuring a way to make it work out,” he says. “Not everybody sees that, but there are plenty who still do. That’s who we want. It’s a people business, and it always will be, I think.”

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