How I survived the housing slowdown

Editor’s note: This is the first in a series of survivor stories as told by the survivors themselves. These brave builders and designers will share their stories of struggle and ultimately survival, as a method of therapy for them and to let their peers know they’re not alone in their challenges.

 

I started my firm back in 1980, when mortgage rates were in the double digits and architects weren’t hiring. I was young, enthusiastic and ready to conquer the world. My story is probably similar to principals of other small, residential architectural firms.

I started a firm focused on energy-efficient solar design. As interest in solar work faded, our work became more conventional and had steadily grown in size and reputation. I enjoyed my work, our office staff and clients. I felt I would gradually reduce my role in the firm as I reached retirement age, although I always insisted I would work until I was 80 as long as I still enjoyed it.

In 2007, Styczynski Walker & Associates, our architectural firm, was starting to feel a slowdown. We felt the firm was well poised to survive a slowdown with a diversified mix of clients and projects, including custom single-family homes, additions, renovations, commercial projects and a design/build program which was just starting to gain traction. Having survived multiple recessions starting from the early ’80s, we were prepared for a slowdown but never expected the drop off the cliff we were about to experience.

At the time, we had 10 to 12 employees, a nice 3,600-sq.-ft. office in Chicago’s western suburbs, and a track record of steady growth over almost 30 years. Personally, I had learned to delegate responsibility, allowed several staff architects to control their own projects, developed numerous quality control systems and worked at broadening our client base. The most ambitious project was to build a home for my family that was also part of a luxury home tour and would be utilized to promote our design/build capabilities.

 

Recession aftereffects

As many in the industry know, the collapse of the housing and financial markets devastated the residential market. As it all unfolded, I felt I was in an uncontrollable free fall. By the time things bottomed out, we were at about 20 percent of the income levels we had before the crash. Privately funded projects disappeared, accounts receivable became uncollectable, we couldn’t afford to pay the office rent, and I had to lay off much of my staff for the first time. I have always thought of my office staff as family and I can vividly recall many sleepless nights, staring out in the darkness trying to figure out what to do.

I made many mistakes — using all of my retirement money to help fund the firm and keep the office operational. The emotional attachment to the firm clouded my business judgment. The best advice I was given after the fact was whatever happened in the past was history and I needed to look forward toward the future.

By June of 2009, I had reduced our staff to four individuals in addition to myself. Everyone agreed to work reduced hours and agreed it was better than being unemployed. We set up an office in my home, utilizing a garage area where I used to keep a couple race cars. My hobby and passion for racing cars was put on hold. My wife returned to work to help make ends meet, and her long-arm quilting room was converted to our conference room. Our home now felt more like a bed and breakfast than a private residence, but again, my staff was like family and we needed to cut costs and adapt to survive.

Focus on positivity

The market had definitely changed. It felt as if our architectural services had become a commodity. Fees were severely undercut; we took on a multitude of smaller projects to survive and were fortunate to have a few new homes, additions and commercial projects. During the lulls, we used the time to develop new marketing materials and looked at new ways to gain enough market share to meet our financial goals. Although to be honest, budgets and the business plan had to be adjusted on a monthly basis. At times I felt I should just shut down the firm and drive a bus for a living.

So where are we now? Quite honestly, we are still experiencing a roller coaster ride of projects and emotions. Although it doesn’t always show, I am an extremely optimistic person with plenty of drive. There are still projects out there and we spend more time than ever to obtain a signed contract. At times I feel we are only one significant project away from turning the corner, only to have the rug pulled from under our feet.

Our plan for the future is to stay in our current location for at least another year, maybe two. Moving forward, it is important to keep our expenses as lean as possible, stay flexible, respond to changes in the market and be diversified. I also feel that open communication with my staff has helped them understand the challenges we all face.

Where will we be five or 10 years from now? My guess is we will be back in a real office, with a staff of no more than eight, probably doing more design/build work, but with a clear memory of this humbling experience. I do know that whatever form the firm does take, it will be based on our care and dedication to our clients and employees, a commitment to quality services, and the flexibility to change and reinvent ourselves as the world around us changes.

 

A. William Styczynski is president of Styczynski Walker & Associates, an architectural firm specializing in custom residential design and small- to medium-size commercial projects. A licensed architect with a bachelor of architecture degree from the University of Illinois-Chicago, Styczynski has more than 32 years’ experience in the architectural field. He is NCARB certified and a Certified Green Building Professional. The firm has won numerous design awards including five prestigious Crystal Key Awards from the Home Builders Association of Greater Chicago. Contact Styczynski by sending an email to editor@rdbmagazine.com.

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