Business Insider

ESI’s David Bowar: Times are better, but ...

David Bowar, senior project manager for construction firm Engineered Structures Inc., came to Boise in 2008 for the reason untold thousands have made the same move before and since: quality of life.

Bowar was working in the Seattle area for Skanska, a global construction company, after spending the first 14 years of his career all over the United States and in Japan and Brazil with M.A. Mortenson Co., another mega-construction firm.

“And then my wife and I had a son, and we thought, ‘Where’s the best place in the world to raise a family?’” he says. “And we moved to Boise.”

Bowar, 52, a Washington State University graduate, had visited Boise on business many times throughout his career.

For decades, Meridian-based ESI has been a force in commercial construction across the West, with major projects in Texas, Arizona, California, Utah, Washington, and Montana. It has about 250 employees and annual revenue of close to $250 million. Since Bowar arrived, the company has become more active in the Treasure Valley. Bowar oversaw the construction of Boise’s Whole Foods grocery store and Gardner Co.’s Eighth & Main building.

Q: The market seems to be picking up. Is that bringing any challenges?

A: I’m not saying we’re out of the recession, but it’s certainly showing signs of a busier market than we’ve experienced the last three to five years. What happens then is the subs get busy. They can pick and choose which projects they go after a little more and choose ones that suit them better. They put a little more margin or profit into their bids, so there’s escalation occurring in subcontractor pricing.

Q: How do you vet subcontractor bids to make sure that, when all of them come together in your bid to a developer, you are offering the best value?

A: What helps is a good cross-representation of bids. If we got one bid, that’s not a comfortable situation to be in. If you got two bids, that’s a little better. We’d like a good four or five bids so that we can scope those out and make sure that we’re talking apples to apples and know that four or five subs are looking at it the same way.

The other thing we have is historical data. We know how much things cost based on our experience on 15 years of projects. The challenge with that, again, is what something cost three years ago is different than what it costs now.

Q: Let’s say you get four, five, six bids on a project. Do you take the high bid? Low bid? Somewhere in between? Or is it more complicated than that?

A: It’s always more complicated than that. People think that you bid it, you get five bids, and the low bid gets the job. That’s not necessarily true. It’s about scope and pricing, value and qualifications. The low bidder may not be the best guy for the job. He may be low because he missed some scope.

Q: You talked about subcontractors getting more choosy because there’s so much more work out there. Is ESI getting more choosy these days, too?

A:I think every contractor has the ability to make better decisions for what suits them as a company and what geographic regions they want to work in. The exception to that would be, you work with a client and that client says, ‘I want you to go to Laramie, Wyo., and build this project for us.’ And no matter what we’ve got, we would do that for a repeat client.

Any company, certainly the size of ESI, we’ve got the ability to grow and respond to those needs. We can hire people. And we do. And we have been here recently just to respond to the growing market and the needs of our clients. In the same breath, we’re still interested in pursuing relationships with new clients.

Q: What project that you’ve worked on in Boise makes you most proud?

A: Eighth & Main.

Q: Why?

A: One of the things that makes that an important project for me professionally is what it meant for the Downtown businesses and the Downtown community to fill that Boise Hole with such an important landmark project. It kept the wheels turning on this whole Downtown rejuvenation things.

Q: Given a choice, which would you take: the market of three years ago or today’s?

A: We miss being able to call a sub and, boy, they’re right there, Johnny-on-the-spot. Now, it’s like, “Yeah, I’ll check it out. Maybe I’ll get back to you.” They’re not as responsive.

Numbers are higher. For developers who were able to do work in the lean years, they got some pretty good value. And now, they’re like, “What do you mean it costs me that much?” They’re not used to some of these escalated numbers we’re having to present.

We’re not complaining. We always say everyone’s busy and things are good, but it’s better than the alternative. The alternative being we’re scratching for work and our margins are low and we can’t keep everyone busy.

Q: Looking forward, will we have a manageable, steady rate of growth, or are we headed for that same old cycle of boom and bust?

A: You like to think people learn from their mistakes. Did the housing market learn from [the Great Recession]? Did the commercial market learn from that? I think so. People are a little more deliberate in their growth plans and what projects they take on. They don’t want to get in over their heads.

It’s creating opportunities for established companies to grow at their own pace, whatever pace they find appropriate. It’s also creating some opportunities to bring in new businesses and new contractors into the valley because of the volume of work. There’s room for a larger subcontractor community here.