Gary Ellis was recently appointed president of Utah’s Jacobsen Construction Co. He succeeds Doug Welling in that role as part of the firm’s ongoing succession plan.

Welling, who became president of Jacobsen in 2006 and chief executive officer in 2012, will continue serving as CEO. Ellis, formerly Jacobsen’s executive vice president of business development and sales, assumed the role of president on June 1. He has been with the company for 19 years in various leadership roles, including several years as chief financial officer.
ENR senior editor Mark Shaw interviewed Ellis in early July about the firm’s leadership transition and the challenges of managing a construction company during a pandemic. The following interview was edited for space and clarity.

ENR: Jacobsen has had its leadership succession plan in place for a while but you probably didn’t expect to be making the transition in the middle of a pandemic. Are you now having to second guess any of the strategic decisions in this plan?

Ellis: I don’t think the pandemic left much opening for us to change our planning, actually. As you know, Doug Welling is still remaining as the CEO. And no time like the present, and no fire like the real current fire, to help train and prepare leadership. We felt by working side by side, by working together in transitioning, that COVID would not have much of an impact on us as far as wanting to move forward with our transition plan.

ENR: How has the pandemic changed your firm’s project portfolio, or do you anticipate it doing so?

Ellis: No, not really. Our project mix and project workload is moving forward. Like everybody else, we’ve had a few projects that haven’t begun yet, or that have been suspended, but we’re not seeing a real change in our project mix at this point.

Luckily, we work mostly in Utah, a state that is recognized for its economic growth, a state that is secure financially. And that has led folks to have confidence in moving forward with their projects here. We have our office here and our group in Hawaii, and we’re not thinking about hanging any shingles elsewhere at this point.

ENR: How hard is the pandemic hitting you in terms of project postponements and cancellations?

Ellis: Construction has been deemed an essential business in Utah, and the state hasn’t been hit as hard as other places initially, so we’ve been able to do really well. We had one significant project that we were weeks away from starting construction on that is being put on hold. That was a developer out of New York City, which was going through complete chaos at the time.

But we’re still talking with them, and we believe the project will go forward. It just put a delay in there. We also had delays in some projects that we have procured but not started yet in some of our hospital systems because of their uncertainty about what was going to be happening in the halls of their hospitals. But our housing and our commercial work, all of that, has continued to move forward.

ENR: Are there concerns about impacts on state and local budgets and possible project cancellations there?

Ellis: We may see quite a few smaller projects for municipal governments that don’t have the same tax revenues coming in being put on hold or rebid at another time. But we have a good financial situation in the state of Utah, with its rainy day fund, and the latest projections show that the state is not going to be hit nearly as hard as we thought it was with lower tax revenues.

ENR: What about work in the religious and cultural sector?

Ellis: The religious sector remains strong. Leaders in the Church of Jesus Christ of Latter-day Saints have been very frugal and make sure they have funds available before they start projects. It’s still a very robust market right now.

ENR: Have you had layoffs as a result of the downturn?

Ellis: We have had to do a little bit of resetting. We had planned for record revenues this year and, potentially, record revenues again next year, and we had begun building the [internal] infrastructure to support that. We realize now that we may be settling in at a revenue level for the next couple of years. So it’s more a resetting of some of the plans we had moving forward.

We’ve done a few layoffs, but very few. And we don’t plan to do any additional layoffs. We believe we’re staffed right where we need to be. We have strong backlogs and don’t see signs of that slowing down. We are able to replace our backlogs even as we work them off in the current environment.

ENR: How have your safety protocols changed in this pandemic environment?

Ellis: It’s a major effort and it’s so crucial. My people are my business. That is what I provide, that’s my product. This is being discussed on a daily basis in our corporate meetings. Everything is changing so rapidly. We’re spending significant dollars on PPE, doing everything we can to ensure social distancing, to require the wearing of masks and provide hand-washing stations and meet all the CDC guidelines.
ENR: And that extends to the other people you work with as well?
Ellis: Yes, including making sure that our clients understand what we’re doing for them to make their projects be successful. We also require all of our subs on all projects to submit COVID-impact logs to us on a weekly basis, including possible impacts to vendors, supply lines, and so on to allow us to have a proactive approach to finding solutions.
ENR: You’re currently building a new headquarters. How does that figure into the planning during these pandemic days of more people working remotely and firms possibly needing less office space?

Ellis: We have prepared that building for continued growth for our firm. There’s enough space in that building [nearly 63,000 square feet] that it will carry us for quite some time. The design of our building was not to try to put as many employees into the space as possible, so it allows for more collaboration and personal space for each employee. We had already planned for extended glass [partitions] at work stations for added protection.

We are using the spaces we had planned for additional employees to spread people out so they’re not all sitting in one area together. We're looking at a mid-December completion.