Thomas C. Leppert, the former management consultant and financial executive who as chairman and chief executive of contractor Turner Corp. led the company into its greatest period of prosperity, will depart at year’s end. The company has shifted strategy under his leadership and now receives 40% of its pretax earnings from businesses started in the last five years such as procurement and insurance.
“That’s significant,” Leppert told ENR. “But it’s also taken a total team effort” involving all the company’s operations.
Leppert, who is 52 and has had the top job since 1999, says he informed the directors of Hochtief, Turner’s German parent, of his desire to leave earlier this year. “To put it simply, at this stage of my life I want to do other things, including in the areas of individual investments and contributing to my faith and the community,” he said in a written statement.
He will be succeeded by Peter J. Davoren, who has been president of Turner Corp. and chief executive officer of its New York City-based unit, Turner Construction Co., since 2003. A 28-year construction industry veteran, Davoren has spent his entire career at Turner. He received his bachelor's degree in the school of architecture from Pratt Institute in Brooklyn, N.Y.
“Peter Davoren is a brilliant builder, deeply rooted in the Turner organization and has been a great leader of Turner Construction,” says Dr. Herbert Lutkestratkotter, the Hochtief executive board member responsible for its American business.
Turner Corp. says it put in place $7.4 billion worth of construction in 2005. The company ranked second, behind Centex, on ENR’s Top 400 Contractors, with 2005 revenue of $6.32 billion.
“Returns since the beginning of this decade have exceeded the combined total returns of the company from its inception in 1902 through 1999,” Leppert wrote in a chairman’s message in June.
At the time Leppert took the top job, Turner Corp. moved the corporate headquarters from New York City to Dallas. The headquarters will remain there. “Hochtief’s intent is to keep the status quo,” Leppert says.
The move was one of many ways Leppert and Hochtief, which completed its buyout of the company at about the same time, recast Turner Corp.’s style from the New York City-rooted contractor to a national services organization. Leppert launched numerous corporate initiatives to help it build on Turner’s top position in major building construction markets. For example, the company launched Turner Logistics, a procurement service, and Turner Casualty & Surety. More recently, Turner began offering facilities management services. The company also added other pre- and post-construction services.
Turner Corp. has continued to win major projects, including breaking ground August 17 for a new stadium for the New York Yankees in New York City. Although the company’s New York City office experienced staff defections last year, Davoren said at the time that Turner still had plenty of New York “bench strength.”
Leppert says he “feels good” that Turner’s staff during his tenure has “done very well” via a bonus pool and other compensation programs.
Before joining Turner, Leppert had no direct experience in building contracting. He served as a bank and finance company executive and estate trustee from 1996 to 1999. He began his career with McKinsey & Co., the big management consultant, where he became a principal who specialized in financial services.
One of his main contributions has been the strategic repositioning and the addition of new services.
“A big reason to extend the brand within the building side of the business as well as expand the scope of services, is both to increase the returns but also to provide competitive advantage,” says Leppert. Much of Turner Corp.’s competition comes from smaller local contractors. “In the contracting business there’s not a lot of differentiation in services performed, and offering logistics and insurance gives us competitive advantages that aid general contracting.”
“Logistics and insurance can lead you to a contract,” he says. “We are able to sit at a table and offer [customers] people who are extremely good at building, but other [contractors] do, too.” Procurement and insurance and other services add value, he says.