If If you’ve been previously named America’s Best Builder, it’s a good bet your company is doing something right. But you know you’re special if you win the honor twice in eight years. This year, Bethesda, Md.–based Eakin Youngentob (EYA) finds itself in that enviable position. EYA is a moderately sized builder/developer specializing in mixed-used and mixed-income infill developments in and around the Washington, D.C., area. A 16-year-old company, it has developed a reputation for architecturally driven, progressive developments that appeal to urban-lovers. “Our general market is every type of urban lifestyle–driven buyer you can think of,” says president Bob Youngentob. “It’s everything from Gen X and Gen Y to professionals, singles, couples, and empty-nesters.”
The builder’s projects are relatively small, 98 percent attached, and thoughtfully conceived and designed. Exteriors mostly skew traditional, but interiors feature contemporary, open plans. And the design is specific to the neighborhood.
“We don’t design a catalog of a bunch of models and take a suburban land plan and start plopping them down,” says Greg R. Shron, vice president of architecture. “They’re all contextual with the existing neighborhood and existing vernacular,” Shron continues. “We spend a lot of time and energy making sure we respect the existing architecture in the neighborhood.”
As a testament to its success, the builder has achieved above-average returns on over $1 billion in sales for the past 16 years.
SMART GROWTH
Urban infill was the focus from the moment chairman Terry Eakin and Youngentob started the company in 1992. Having previously worked on similar projects at local developer The Holladay Corp., the two men recognized an untapped market for urban projects and saw growth for the future.
“We felt that if we really focused our energy on this one particular segment, there was a tremendous number of people, both young professionals and empty-nesters, who aspire to the lifestyle,” Youngentob says. Other builders ignored this niche and EYA benefited. “Nobody was really trying to recreate neighborhoods or go in on a large scale and take two or three city blocks and rebuild those neighborhoods,” Youngentob explains. Today, EYA’s project locations contribute directly to its success. Its motto, “Life within Walking Distance,” sums up its philosophy. “We wanted to do one thing well, and we’ve kept virtually the same focus for our company since the day we opened our doors,” Eakin says.
But not all of EYA’s infill projects are in typical downtown urban locations. The company built its brand doing market-rate projects in sought-after Washington suburban edge cities such as Alexandria, Va., but its strategy has evolved.
“We’ve also done really well going into areas that have been under-supplied with new housing alternatives or have had some challenges,” says COO Andy Warren. Such areas include the now-burgeoning U Street Corridor in Washington, downtown Silver Spring, Md., and the Hyattsville Arts District in Prince George’s County, Md.
Since the 2000 ABB win, EYA has reinvented itself, adopting new systems and processes along the way. “We’re a different company from an operational standpoint [than we were back then], but we have the same philosophy and core values,” says Eakin. One of these core values is the emphasis of long-term relationships. Believing that they are vital to the company’s success, EYA uses the same architect, lender, equity investors, subs, and attorney on all of its projects. And operations continue to evolve.
The company started identifying key trades and subs to join its Subcontractor Alliance program, under which subs agree to provide timely service and high quality in return for consistent workload, prompt payment, and priority bid review. The program is essentially a recruitment tool for quality subs but also a way to keep the good subs it has rather than lose them to other jobs in the suburbs. It also means the builder gets safe, reliable workers that deliver high-quality work.
Recently, EYA has altered the construction of its houses. Because its strategy of building near existing infrastructure is already sustainable, the company decided it was time to increase the energy efficiency of the homes as well. “The commitment we’ve decided to make over the past six months—starting with this project we have going on down in the Capital Quarter [near the new Washington Nationals Baseball Stadium]—is to embrace Energy Star and LEED for Homes on that and all future projects,” Warren says.Older projects used high-efficiency HVAC systems, low-E windows, and upgraded roof insulation, Shron says, but now the builder is upgrading a variety of energy-related features and will be performing blower door, duct leakage, and thermal bypass inspections.
“We have aggressively increased the scope of our insulation contractor to provide all kinds of air-sealing measures on the exterior building envelope,” Shron says.
SYSTEMS ANALYSTS
Another improvement to EYA’s systems is an in-house training program for project managers, superintendents, and subs to focus on areas of the home that are prone to defects. It’s especially important to offer this training, the company says, because it builds unique projects in tricky locations, and training ensures the work is executed correctly.
The company also is using in-line, mobile inspection software by Latista to improve communication among subs, site superintendents, and the office. Conducted five times throughout the construction of each home, these inspections occur at foundation, pre-mechanical, pre-close-in, building envelope, and final close.
“Latista has standardized the way we want to evaluate the house at particular points,” says Anthony Procaccini, construction manager of the Capitol Quarter project. “Regardless of a worker’s level of experience, we’re able to show them what we need them to look for at various points.”
Latista employs handheld tablets, digital cameras, and computers to relay messages and inspection information, so that issues can be addressed within 48 hours. “To the extent that we can systematize how we build,” says John Fahey, vice president of construction and warranty services, “it takes out the goof factor, so to speak, and really makes [our subs] organized and methodical on building the homes.”
This extremely serious approach to construction has made EYA that much better, the company believes, and helps the builder deliver defect-free homes. And the company makes sure it relays this message to home buyers at the various pre-construction, pre-drywall, and pre-settlement orientation meetings the production team holds. The warranty team also meets with buyers three times, during pre-settlement orientation, at the 90-day walk, and at a one-year walk. “It’s just so important that home buyers know we’re building the home to the highest level of quality we can achieve,” Fahey says.The builder wanted to quantify whether or not its changes were working, so it hired the research and consulting firm Woodland & O’Brien to help gauge the customer satisfaction program and its buyers’ “willingness to refer.” Tied to EYA’s annual employee incentive compensation, the customer satisfaction metric is an extremely important part of the company’s operation and culture. EYA says it normally achieves a 92 percent to 95 percent willingness to refer from buyers but has been running 100 percent in the past 18 months. This proves the changes are working, the company says.
EYA’s latest drive to be better happened around its 10th anniversary when the company launched E², a program that set goals to raise customer satisfaction to 92 percent willingness to refer (from 82 percent); improve employee satisfaction and productivity; identify quality standards and establish processes to meet them; and reduce construction- and service-related costs by $2,000 per home.
The program has been very successful, Warren says. “Since 2005 we have made significant improvements in construction cycle time, we save thousands on interest and carrying costs, and warranty costs are dropping,” he explains. The company also is saving more money per house, he adds.
Going forward, EYA will be doing bigger projects and more mixed use but with a steady focus on attached townhomes. “We want to grow the organization modestly, but we don’t want to chase growth for growth’s sake,” Warren explains. “We know what we do well, and we also like to be hands on. If [the company] got too big, it would be hard for us to stay hands on.”
EYA
Chairman: Terry Eakin
President: Bob Youngentob
CFO: Frank Connors
COO: Andy Warren
Company Focus: Mixed-used, mixed-income urban infill development
Employees: 60
Year Founded: 1992
Web site: www.eya.com
Notable: Started in suburban edge cities, but now develops dense, mixed-used urban infill projects near transit and existing neighborhoods. As a commitment to green building, it recently began construction on what is targeted to become the nation’s largest LEED for Homes residential for-sale neighborhood. One of the first builders in the nation to use Latista inspection software.
Learn more about markets featured in this article: Washington, DC.
