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Martha’s Vineyard’s integrated design/build company

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The Company We Keep

Dear Reader,
This blog is now an archive. John Abrams (Founder of South Mountain, author of this blog, and a book of the same name) retired on December 31, 2022. All posts published up until this date are preserved below.

For updates on John's next chapter, visit abramsangell.com.

For updates on South Mountain's second act, subscribe to our newsletter using the form below.

Triple Bottom Line

A Design/Build Breakthrough

June 27, 2022 by John Abrams 1 Comment

For many years South Mountain has engaged in master planning and conceptual design efforts for island non-profits – Martha’s Vineyard Community Services, MV Museum, Island Grown Initiative, The MV Public Charter School, Featherstone Center for the Arts, The Nature Conservancy, and others.

But when these organizations moved from planning to design and construction, our design/build commitment (we don’t build what we don’t design and we don’t design what we don’t build) left us out in the cold. Non-profit Boards of Directors, with a fiduciary responsibility to their donors and organizations, generally feel that the conventional project delivery method – i.e., architecture firm designs, builders submit competitive construction bids, and a contract is awarded – is the only viable path. Our design/build method (architecture and construction by the same company) contradicts their allegiance to the perceived financial efficiency of the traditional approach. Even though some board members are attracted to the potential efficacy of single entity responsibility, it’s understandable that they would be concerned about eliminating the financial control of a competitive bid process. This has been a tough obstacle to overcome.

The Breakthrough came in 2017 when we were helping Camp Jabberwocky plan renovations. Camp Jabberwocky is the oldest sleep away camp in America for people with disabilities. It’s a magical place where dreams come true and nothing is impossible. It’s been that way for 65 years.

The main building on their campus needed major change. After some initial programming work, we spoke to their board about the possibility of hiring SMCo for architecture and construction services. The same old problem surfaced. Not long before, we had been hired to develop a schematic design for the new Martha’s Vineyard Museum and had been disappointed when they elected not to accept design/build for the next phases.

This time, we had an idea.

We developed an important clause to add to our design agreement. Essentially, it said that:
• At the completion of design we would prepare a detailed cost estimate for construction.
• Then Camp Jabberwocky could elect to hire an independent professional estimator to provide a comparative estimate.
• If the independent estimator’s construction estimate was close to, or higher, than ours, the construction contract would automatically be awarded to us.
• If it was more than 5% lower, there would be a reconciliation process to assess the reasons for the differences and reach agreement on a final price.
• If the parties were unable to agree, Jabberwocky could use our plans to get bids from other construction companies.

This suggestion breached the dam; we signed a construction contract, and the project was built. Since then, two other boards – Martha’s Vineyard Community Services (MVCS) and Island Grown Initiative (IGI) – have agreed to this approach for major projects. The result: three of the most rewarding endeavors in our history.

It’s notable that by the time we completed the Jabberwocky design, enough trust had been built that their board decided to forego the comparative estimate opportunity and directly engage SMCo for construction.

MVCS is the island’s umbrella social service agency; it provides an array of services to thousands of islanders each year. Just after the Jabberwocky project was completed, we created a master plan to replace the dilapidated and insufficient MVCS buildings – to make a new campus – and completed the design for their Early Childhood Center, the first phase of the campus re-build. Their board took a more conservative approach and hired an outside estimation firm, whose pricing turned out to be higher than ours. They signed our construction contract, and we completed the project on time and on budget in 2021. The organization and the families the building serves could not be happier. We begin design of phase two this fall.

Meanwhile, we will soon complete design for a new Education and Innovation Center, three units of staff housing, and extensive infrastructure improvements at IGI’s Island Grown Farm. When we complete our construction estimate in the fall, we do not know how the board will proceed. Either way (the Jabberwocky way or the MVCS way) works for us.

One way or another, we are thrilled by the prospect of building this project, about which longtime land planner and sustainability advocate Rob Kendall recently wrote in the Vineyard papers, as public permitting hearings proceeded at The Martha’s Vineyard Commission (MVC), “This is a gift from the Island community to itself. The plan has the long-term educational potential to move the island closer to a more sustainable food and energy future.”

We are looking forward to IGI construction, to MVCS Phase Two, and to more of this mission-driven institutional work in the future. Using SMCo’s integrated design/build approach, we are bringing high performance and high-quality development to a sector we respect and organizations we cherish. This trilogy of exemplary projects embodies our values and allows us to contribute to and synergize with our community in a very public way. Our staff loves the opportunity to explore different building types and scales, new ways to practice our craft, and the purpose and meaning embedded in this work. We are humbled by the great work these organizations do and proud of our modest contributions to their success.

And it’s all because we stopped seeing our approach as an obstacle, gave up
trying to convince boards to take us on faith, listened carefully to their concerns, and devised a way to alleviate them. There are lessons here: saying no to no is valuable, finding the heart of an impasse can inspire innovation, and making minor method adjustments can produce major harvests.

In this case, a simple solution caused a quantum leap.

Filed Under: Collaboration, Martha's Vineyard, Small Business, Triple Bottom Line, Uncategorized

On Building Second Homes

February 1, 2022 by John Abrams 4 Comments

This piece was written for and published in Fine Homebuilding. Thanks to Kevin Ireton (former FH editor) for the idea and his stellar editing. As always, he held my feet to the fire.

“How can you justify devoting so much time and energy to building vacation homes for rich people?”

It’s a good question,and one that I’ve heard often during my nearly 50 years on Martha’s Vineyard. In resort communities, many don’t have a first home. They’re scrambling to find stable housing while more than half the houses sit empty much of the year. That’s a problem. And in light of our climate crisis, the significant materials and energy dedicated to building and operating those houses compounds the problem.

When I came here in the 1970s, designing and building homes was so thrilling that I was content to build anything that developed new skills and knowledge. Working with head and hands gave me great pleasure; the idea that people would pay me to do it felt like a bonus. After a few years, however, the joy of the work and the satisfaction of the results were no longer enough. By then second homes had become a staple of our company, South Mountain, and my colleagues and I began to ask ourselves how we could justify this work.

The answer came in 1980. It began with a phone call from a woman named Madeline, who asked if I would look at a piece of land with her. She was a 60-year-old librarian whose husband had recently died. They had no children, and they had always lived in rented apartments. Her dream was to own property. She had $7,000 in cash. A realtor showed her a lot priced at exactly that, but her friends advised against buying it due to its topography and location.

The steeply sloping parcel was adjacent to the main road from Vineyard Haven to Edgartown. Traffic on the road was noisy and constant. The property faced due south toward a beautiful little valley. Except for the proximity to the road, it was lovely. I suggested an earth-bermed, partially underground house and told her we could design the noise of traffic right out of the picture. She was excited. She bought it.

At about the same time, I was approached by a single mother who owned property in West Tisbury and wondered whether we could build a house she could afford. Her budget was too small, but we had heard that the Farmer’s Home Administration was providing 1% loans to those with low and moderate income. We hoped to bundle a nice passive-solar house for Cathy and the earth-bermed house for Madeline, though the Farmer’s Home fixed-expenditure cap did not take into account either the Vineyard’s high construction costs or the long-term energy savings our houses would realize. We applied anyway.

We created plans for simple, compact houses and submitted them to Farmer’s Home with a request that they raise the mortgage limit (from $40,000 to $48,000) on each house due to the energy savings, which we analyzed and documented. After some bureaucratic wrangling, the increase was approved. Unfortunately, it still wasn’t enough to build the houses, unless we cut our overhead and profit to nothing and reduced our labor rates to below cost. Additional subsidies were needed.

Enter David and Pat Squire, who had purchased land in Edgartown and designed a second home with a Boston architect. They asked if we would be interested in bidding on the construction, and I told them that South Mountain built only those projects that we designed and that we didn’t bid on construction projects. They persisted, and a radical thought occurred to me: What if we gave the Squires a bid that had an explicit “premium” built in to subsidize the two Farmer’s Home houses? I shared the idea with the Squires, and they invited us to submit such a bid.

Our bid, one of three, was roughly $40,000 more than the next highest. They chose us nonetheless, and we built their house. We also built the two small houses for Madeline and Cathy by making up the shortfall with our extra earnings from the Squire project. Dreams came true, and mortgage payments were under $200. The Squires’ philosophical alignment with our purpose led them to become strong supporters of affordable-housing efforts on the Vineyard. Years later, when the Island Affordable Housing Fund was established to raise money for affordable housing, David became an important board member.

That was the first and only time that South Mountain inflated the cost of a project to support affordable housing efforts, but the experience inspired an idea that shaped the future of our company. If we could become a reasonably profitable enterprise, we could devote a portion of our earnings to affordable housing work for our community, and we could engage our wealthy clients in the issue.

At that point, the work of building second homes became meaningful. From then on, I often told new clients that they could count on me to ask them, in the future, to help with the Vineyard’s affordable housing problem (which they exacerbate, of course). I have done that now for 40 years, and the response has been heartwarming millions of dollars donated for attainable year-round housing.

Building second homes also allowed us to experiment and take risks. One of these occurred in 1987 when, in response to a request from two long-time employees for a greater stake, I sold South Mountain to my employees (and myself). We became a worker-owned cooperative and began to introduce new values to our business activities. For example, we committed to the creation of lifelong living-wage jobs and family-first policies, such as flexible work arrangements and stellar benefits. We began to codify our commitment to our community by donating to essential nonprofits and engaging in pro-bono work. We became a triple bottom line company long before we’d ever heard the term, measuring our success not just by our profits but also by effects on people and the planet.

Our journey since then has been influenced by many others, but particularly by Patagonia, the outdoor clothing and gear company that has become the gold standard for corporate social and environmental responsibility. Just like our second homes, many of Patagonia’s products are nonessential. Not everyone needs a pair of $300 ski pants or a lifetime wetsuit. So the company balances that reality with its social and environmental contributions, its political advocacy, and its important innovations, such as pioneering the use of organic and recycled cotton, and buying back old garments to refurbish and resell for far less than new ones.

Inspiration from Patagonia and others, combined with our own cantankerous sense of justice, has helped South Mountain become at once a profitable business, an active agent of community change, and a supporter of the local economy that supports us.

Today our second-home work is unusual in several ways. First, we restrict the size of the houses we are willing to build. Only on rare occasions, on very large parcels, have we designed and built houses over 3500 sq. ft.

We also use our second-home work for de-facto research to advance the building industry, especially with regards to energy performance, comfort, health, and durability. By experimenting with the homes of our well-to-do clients, we’ve learned a lot about high-performance building. As a result, we set minimum performance standards for our buildings that are well above code. Now we mostly produce net-zero-possible buildings. We use reclaimed materials extensively and are beginning to reduce embodied carbon (a work in progress with net-zero carbon as the ultimate goal).

By elevating performance standards, we make models that others can emulate and that we can incorporate in our affordable housing work. For us, truly affordable housing differs from luxury housing in only three ways: it’s smaller, it’s less detailed, and it’s differently financed. The performance and quality are uncompromised.

Perhaps the biggest step we have taken with our second-home work is doing less of it. Over time, we diversified South Mountain’s work into five parts; here’s a rough breakdown over the past year in terms of dollars per category:
• Limited-use second homes: 10%
• Year-round, fully occupied homes: 20%
• Attainable workforce housing: 10%
• Institutional work for nonprofits: 35%
• Solar for homes and businesses not built by us: 25%

This is only one year, and it happens to be a year with an uncharacteristically small amount of second-home work, but it indicates a direction: less harm, more good. Causing no harm is impossible — we are part of the problem too — but we share our experiences and hope others will join our push to turn some of the negative impacts of building into positive benefits for communities and the environment.

An added benefit of our business practices is that the second-home clients we attract tend to share our values. We love working with them. They go from being clients to becoming partners in our efforts to make the Vineyard a better place. Many have become friends for life. The rewards of this work and these relationships have become deeply ingrained in our core purpose.

Filed Under: Collaboration, Housing, Long Term Thinking, Martha's Vineyard, Small Business, Triple Bottom Line, Uncategorized

All in a Company Meeting

December 23, 2015 by John Abrams Leave a Comment

We began our recent year-end company meeting by reviewing finances, work completed, work ahead, affordable housing projects in the pipeline, solar sales and installations, and a variety of compelling and not-so-compelling metrics and indicators.

It has been a very good year, as were the two that came before.  A robust trifecta.  One of our younger employees, Ian Gumpel, asked why we’re doing so well.  Great question.  I mumbled a few dis-jointed explanations that didn’t quite add up.  Later I thought more and the next day I wrote a brief addendum to everyone that said in part, about Ian’s question,  “As a friend of ours, Devon Hartman, once said, ‘The key to making a company work is getting all the wood behind one arrow.’  We are making great strides toward doing just that.  Sometimes it doesn’t seem so; the alignment can be obscured by the drama and upheaval of constant change.  But it becomes clear through the lens of our triple bottom line  performance.”

Read More about All in a Company Meeting

Filed Under: Collaboration, Design, Energy, South Mountain Company, Triple Bottom Line Tagged With: Bernie Sanders, Devon Hartman, Triple Bottom Line, Zingerman's, ZingTrain

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