VCC's Sam Alley On What's Next In Construction (Exec Q&A)

Sam Alley is one of the founders of VCC, the Little Rock general contracting firm and presently serves as chairman and CEO. Beginning his career as a project manager and working up the ranks, Alley has managed all levels of project development and completion. He has more than 30 years of experience in the development and construction of dozens of private and commercial projects. He is currently responsible for the overall guidance and vision of the company.

Alley earned a Bachelor of Science degree in civil engineering from the University of Arkansas and is a registered professional engineer.

AB: Tell me about your first construction project.

SA: My first construction project was in 1978, job No. 928 — Southwestern Bell Telephone Building (now AT&T) on Pershing Boulevard in North Little Rock. I worked as project engineer with Pickens Bond Construction Co.

What are the looming concerns in the construction industry?

Construction has always been a competitive and risky industry. Now more than ever, it’s important to do business with people whom you trust. This is true for the clients we work with as well as the subcontractors and vendors that we hire to build the projects. A construction project is one big partnership, and you have to be able to trust those partners to fulfill their financial and technical commitments. Subcontractors being financially unstable and clients being unable to pay timely are the two biggest risks we work to avoid in today’s market.

What is the status of VCC’s involvement in downtown redevelopment in Little Rock?

VCC is proud to call Arkansas our home, and we have been headquartered in downtown Little Rock since our inception 25 years ago. There are a lot of exciting projects coming up that we hope to be a part of. We own our office building at Third and Louisiana, which was remodeled from old, obsolete space. Also we recently purchased the vacant Channel 4 building and created a nicely landscaped parking lot for the time being. VCC is extremely interested in the long-term vitality and growth of downtown Little Rock.

What is the state of VCC construction markets in Georgia, California, Texas and other states?

Being registered and licensed in all 50 states, VCC is always proud to follow our clients around the country wherever they have projects that need our expertise. This philosophy has allowed us to remain diversified. It has been particularly advantageous in that when one area of the country slows down, we will be working in multiple other markets that are still thriving. Texas and California, in particular, have been very active through the downturn. We are excited to see places like Georgia, Florida, Arizona and Nevada begin their recovery with new projects coming out of the ground today. VCC currently has projects in all of these markets, and our seven offices allow us to quickly service a project no matter where it is located.

When is it a good idea to renovate an existing building instead of razing it to build a new one?

Renovations are typically good ideas when there is an existing functional aspect that can be reused and reduce cost significantly. It can be a huge cost savings to using existing structure and other key components. It can also be a good idea to renovate when zoning or entitlements are more favorable to renovation than new build. This becomes a cost issue again. In renovations, you can potentially keep some of the asset operating, which allows for income to continue even during construction, which is an advantage to razing it. Many times however, it turns out that you may be better off razing a building and starting from scratch. This can be cheaper in some cases and allows you to avoid some historical problems that may exist from renovations (i.e., systems that were designed or constructed poorly originally). If there is a historical component to the building, then renovation may be the best alternative even if the cost relationship is not advantageous.

How have construction techniques changed over the last 20 years?

In a lot of senses, the basics of construction are still very much the same. Attention to detail and good quality go a long way to building a great project. We certainly have seen many new construction materials in the last 20 years. These help us build projects faster, build them safer and build them more cost effectively. Technology has become an extremely important aspect of the construction processes over the past 20 years as well. Staying ahead of the game in technology has made our company more efficient.

How cool is it to actually build a building?

Creating a community landmark and public space is really one of the coolest things you can do in the business world. It’s what made construction my passion. The beauty of the construction industry, and real estate in general, is that at the end of the day you can touch, see and interact with the product you created. Thousands of people and more will use those facilities for years to come.

Where do you see growth for VCC?

I see VCC growing tremendously in multifamily, health care and hospitality sectors. We have more of these types of projects going on than ever, and we have found that our particular expertise is very valuable in them. We will continue to work all around the country and find clients that we can work for time and time again. Also, we always continue to look at international markets as an opportunity for long-term growth and to service our domestic clients abroad. VCC currently has an office in Brazil, which is one example of a dynamic market we think will be active for many years to come.