Transcript: Episode 216: Job Site Sabotage

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[00:00:00] Susan Barry: This is Top Floor episode 216. You can find the show notes at topfloorpodcast.com/episode/216.

[00:00:13] Narrator: Welcome to Top Floor with Susan Barry. This weekly podcast ride up to the top floor features tangible tips and excellent stories from the experts and characters who elevate hospitality. And now your host and elevator operator, Susan Barry.

[00:00:32] Susan Barry: Welcome to the show. Jake Zwaagstra is a development leader with experience across general contractor project management in Las Vegas, owners' team hospitality projects like Hard Rock and the Cosmopolitan, first-of-a-kind industrial development in New Mexico, and a $600 million tribal expansion with the Choctaw Nation. In 2019, he founded TriCelta Development, a boutique firm that guides owners through complex hospitality projects. Today, we are going to talk about how to get big hotels built, but before we jump in, we need to answer the call button. 

Call button rings…

The emergency call button is our hotline for hospitality professionals who have burning questions. If you would like to submit a question, you can call or text me at (850) 404-9630. Today's question was submitted by Judy, and Judy asks, “What is something you would never value engineer when building a hotel?” So, in other words, what's something you would never try to save money on? What do you got, Jake?

[00:01:50] Jake Zwaagstra: First of all, thank you for having me. So to answer Judy's question, anything that affects the operator's ability to operate long-term is something I would never really think of value engineering. As a developer, our job is to put something in place that allows the owner and operator to be successful long-term. So we always wanna take that view in that course of a VE perspective, make sure that we aren't impacting their long-term lives when we walk out the door. 

[00:02:25] Susan Barry: Can you give an example of what you mean? 

[00:02:28] Jake Zwaagstra: Sure. So let's say, an operator comes in or we have a project, maybe it's entertainment based, right? Maybe it's a concert venue 'cause it's hospitality driven. And they say, “Hey, we need to find some dollars in the project because it's over budget”. I would never impact say, the video or the AV systems, those are driven towards the operator and how the room's supposed to work. I would never affect their ability to maybe serve drinks or have service to be able to run those bars or be able to cue the bars appropriately. But I might look at like, “Hey, maybe we can look at the flooring,” because it allows for them to still service and turn shows, but not impact their ability to service the project.

[00:03:23] Susan Barry: Understood. That is a great example. That really helps paint the picture. Well, you started on the general contractor side of construction and then moved over to the owner's team. What did that switch teach you that you maybe couldn't see from the construction trailer? 

[00:03:42] Jake Zwaagstra: Absolutely. Yeah, I started my career in the GC side 'cause I wanted to learn one lens of development. And about five years into the career I realized, hey, there's a lot of other lenses that I need to be able to take into account. And so, swapping to the owner's rep side, allowed me to see a different lens, see an operational lens, see a financial lens, see basically anything that was done before the shovel was put in the ground. We wanna be able to see the entire lifecycle of development. And so that was one of the reasons why I needed to kind of step away from the GC side and fill another lens. That's why I swapped over to the owner rep side. 

[00:04:23] Susan Barry: So speaking of taking a step away during the great financial crisis, you temporarily left hospitality like a lot of people did to help build what sounds like a horrifying or Homer Simpson style project which was a nuclear enrichment facility. What did that experience add to your playbook that you still used for hotels? And please do not say nuclear energy. 

[00:04:50] Jake Zwaagstra: No. So it was a unique pivot at the time when there wasn't a whole lot of hospitality going on. And so one of the reasons that I was entertained for that role is because of my large project experience. And coming into that, obviously I was drinking from a fire hose and looking at something that's a completely different vertical, but I still didn't lose the ability to maybe challenge the status quo in design. So you designed those projects with redundancy upon redundancy because of the safety factors. But it doesn't mean that things need to be overly designed to where it would hinder budgets. And so redundancy with explanation is the way I say it. So, we made sure there was redundancy in that approach, we made sure that we still provided explanation to get value out of the project. The other piece that I think I pulled from the nuclear side and the hospitality side was over communication. There was a thing called, it was called the plan of the day. And so every morning, we got our resources together and we'd sit there. It was a standing meeting. It's no more than 15 minutes. We stated, “Hey, what were you accomplishing today? What was your plan of the day?” To keep all parties on the same page moving forward, and ultimately relay accountability because you knew the next day you had the same plan of the day. So you need to be able to push things forward. And so what that taught in the hospitality world, or how I transition that is you eat that elephant one bite at a time. And so that plan of the day helped establish that to where if you're accomplishing something small every single day, it adds up to a larger engagement of for the entire broader, bigger development.

[00:05:51] Susan Barry: That's a good thing. What would happen if you came to plan of the day tomorrow without having completed what you said you were gonna do today? Was it like you got in big trouble or did you just know you had to explain what happened? 

[00:06:54] Jake Zwaagstra: You knew you had to explain what happened and very few people wanted to come without an answer. So that was the biggest piece of that accountability piece was built in because you say you're gonna do something, you really kind of had of a plan to make it happen. 

[00:06:58] Susan Barry: Got it. What is something besides plan of the day from a past project that you are particularly proud of and maybe why is that? 

[00:07:17] Jake Zwaagstra: So, back at that same project in the nuclear days. I was tapped on the shoulder by my company to actually give back to our community. So they had a need to create a new boys and girls club. And so I volunteered my time, pro bono, to develop a brand new Boys and Girls Club. There was an amazing foundation in the community where we worked and they said they would pay for the entire project, which was a $10 million project to put a brand new, state-of-the-art Boys and Girls Club facility. And so why that was so important or why that kind of stood out as a key moment in my life is, it showed the impact far beyond what walking away or seeing a tangible aspect. The impacts far outlasted our involvement in the project. It shaped the community to really kind of provide for those who can't, which I think we're all called to do, and it lifted up a real need and kind of expanded the horizons of those individuals and kids that were served.

[00:08:29] Susan Barry: You prefer development manager over project manager. What is included that people miss when they just hear PM or project manager? 

[00:08:41] Jake Zwaagstra: So you probably see if you've engaged people in your normal day, project manager is a term that's used indiscriminately. 

[00:08:50] Susan Barry: Yes. If I see somebody say I'm hiring a project manager, I'm like, well, I'm good at managing projects, so sure I'll come, I could probably do that. Probably not on your projects. 

[00:09:02] Jake Zwaagstra: Exactly. And so that type of confusion I was like, we need to be able to tell our story a little bit better. So we use the term development manager because development is so much more encompassing. It's critical to grave. And so we kind of prefer that nomenclature to help stand aside and show, Hey, we're part of real estate development, we're not IT, we're not marketing, we're not project management where it comes and hits other aspects. Now we may work with those individuals, but development is so much more encompassing than just an individual project or construction piece of a project. 

[00:09:39] Susan Barry: Get into more detail about that, like how do you and your team spend your time during a hotel development? What are the tasks that you're shouting out at your plan of the day every day? 

[00:09:52] Jake Zwaagstra: It changes day to day. So I kind of see it as multiple avenues of kind of handing off during the project. So in the early development stages. We're kind of in lockstep with the owner, right? That's understanding and translating their needs, understanding their vision, making sure the program aligns with what they're looking for, making sure the program aligns with their financials and budgets, helping create some of those budgets to be able to translate what they're telling us into real, tangible assets.

[00:10:21] Susan Barry: So this may make me sound really stupid, but just be cool about it. Does that mean you're sitting in a meeting room like, “Okay, Joe, I know you wanna build this hotel, describe it to me.” Or is it more technical, like flipping through plans and making sure that an owner sustainability goal is carried through into the architecture? Do you know what I mean? Like what are you physically doing in the day? 

[00:10:52] Jake Zwaagstra: So that could be both things that you said. So the first piece could be coming alongside them to say, “Hey, let me learn what you actually wanna see, what the end vision, the end goal looks like”. But then we could transition into that in what I would call maybe like a design phase where we're living alongside the design teams or doing those page turn aspects of projects where we're making sure that their vision's not diminished in that process, and then what they're telling us is captured. And then, making sure and confirming the programs still aligned with the budgets during that phase. And so, first we're stepping with the owner, then we're bringing kind of the teams in to step alongside the owner. And then that transitions into a construction phase. And then the construction phase, we’re really bringing the entire team together and partnering and making sure that we can go execute the right way and that they have all of the information to be able to make that happen. And so, as an owner's rep, a lot of our job is going down and staying far enough of the development team where we can knock down those hurdles to not lose momentum because at that point in the stage, we're spending real dollars and delays in time mean actual impacts to the budget. Our job is to make sure we stay far enough ahead of those teams to keep the execution aligned with that everyone's vision and make sure that they have what they need to go execute on the work.

[00:12:19] Susan Barry: Would something like Case Good install be a hurdle? I will tie this together, I swear, but, right now we're in this climate of economic uncertainty, supply chain issues, all that kind of stuff. And it keeps getting surfaced as a topic for construction. And everyone who answers the question is like, oh yeah, we just stay ahead of it. Like, we're cool. No big deal. But is that the kind of thing that you mean when you're talking about those getting ahead of those hurdles or is that one of a bazillion different things? 

[00:12:54] Jake Zwaagstra: That's a perfect example of items where we stay out, try to stay out in front of the owner and the design teams to make sure that we're going down that path robustly to say, “Okay, hey, maybe where's the best place to go buy furniture right now? Where has the least impacts when it comes to tariffs? Where does that align in relation to ports in receiving to make sure that is really, truly looked at to say, Hey, can we get this stuff? Or is it gonna sit in a dock for the next six months because there's a backlog?”

[00:13:26] Susan Barry: Gotcha. So like, even if you get it from a place with low tariffs, you could end up spending all the money that you save waiting. Oh, I didn't even think about that. 

[00:13:36] Jake Zwaagstra: Yeah, or looking robustly at those docks to say, “Hey, are there any union strikes that are coming down the pipe? Are there any bargaining agreements that would impact offloading that you could see coming down the line?” That's why we try to stay out in front to say, “Okay, here are the things that we see coming down the pipe and here's the strategies that we need to put in place to hopefully mitigate that coming down on any point in the project”.

[00:13:52] Susan Barry: Gotcha. We like to make sure that our listeners come away from every episode of Top Floor with a couple of very practical and tangible tips to try either in their businesses or their personal lives. So what is your checklist to make sure that on day two, the operator isn't stuck with some avoidable friction in their operation. 

[00:14:30] Jake Zwaagstra: We usually try to find ways to visually show what something will look like or build. So a perfect example would be a front desk. We might actually build a front desk mockup section to where we're looking at, Hey, bring in some of your operators. We need to look at, hey, are they six foot, five to five foot, tall? Is there an ergonomic piece that we need to plan for? How are they going to use each of the front desk sections? What kind of materials do we need to use to make sure that repeated use does not show on the actual, front desk. How are they planning on using guest interaction? Do you need to have a specific ledge for signing and what's comfortable from a guest perspective to be able to sign? Right? It's finding those interactions that having those types of pieces that help tell and show that, hey, that interaction from a guest perspective and then interaction from a operator's perspective are gonna be seamless throughout the project. 

[00:15:38] Susan Barry: It's funny when you said the thing about 6’5” vs. 5’, nothing. I am generously 5’2”, and there are so many things in hotel guest rooms that are really difficult for me to reach. But I'm also thinking about working when I worked at a movie theater, I worked in the concession stand and where the sodas had to be filled. I could no more reach that than fly to the moon, so they had to build me steps so that I could get up and fill the Cokes before people went into the movies. It's really an interesting and good point. What about decisions that you make early on that save money later? Like, do you have two or three that are typical?

[00:16:24] Jake Zwaagstra: So, from a broad perspective, I think that number one, function has to be first over aesthetics because if it looks pretty, but it does not work, does not matter if it looks pretty. So you need to find the function over the aesthetics and that drives to that operational lens to make sure that we're seeing how is this thing gonna be operated long term? The next, lead time then aesthetics. So if it works, but you can't get the thing in time. It doesn't matter. So you need to make sure, number one, function first. Number two, lead time to make sure that whatever they're asking for, we can build or we can get. And then lastly, performance over preference. And the reason I say that is, when we have conversations with operators, we would rather understand how do you want something to perform over “Hey, what kind of brand do you want to make sure that it tells a story?” Because ultimately, performance tells us where we need to go to find the answers over a preference which limits the ability to give flexibility to the operator to do their job. 

[00:17:41] Susan Barry: Got it. That's interesting, and I bet that leads into why a model room is important.

[00:17:47] Jake Zwaagstra: I think the model room is the most underserved basis in a hospitality project because ultimately early in the project, it touches almost every aspect of a hotel or hospitality. It touches your IT teams, right? How do you need to make sure you have technology that goes across the property? Touches your AV teams. How are you gonna have touch points to make sure that you have both audio and visual cues throughout the property to tell the story or direct people? It tells the facility teams how are we gonna service these rooms or how's our mop or vacuum gonna work underneath the bed?

[00:18:25] Susan Barry: Yes, that is always one that I remember seeing the operations leaders looking at when we did model room reviews. Will the vacuum fit and if it won't fit, we need to put a base under this bed to make sure that nothing gets down there. Stuff like that. Is that what you mean, right? 

[00:18:45] Jake Zwaagstra: Hundred percent. And the model room also provides a really good option to the marketing teams, right? They have a tangible asset they can use to go market the product, get nice pictures. 

[00:18:55] Susan Barry: When I was opening hotels, we often use the model room as a sort of like, exclusive sneak preview because people get excited about a new hotel being built. And so that's just like a little thing behind the curtain that you can show to start building the excitement. 

Well, we have reached the fortune telling portion of our show, so now is the time for you to predict the future and we'll come back later and see if you got it right. So, Jake, what is a prediction you have about the future of hospitality development and owner's representation?

[00:19:34] Jake Zwaagstra: Perfect. I think the human aspect of hospitality has to be not lost in what we do. Technology is so prevalent nowadays. And times have been challenging in the hospitality world for a few years. So, it's forced developers to think outside the box. Where can we get efficient? Where can we find avenues to service a property, maybe have less headcount? And so I think there's a driver obviously to not diminish product. But ultimately, I think technology will be a piece that needs to be brought in. Projects need to be technologically driven, but authentic, authentic hospitality will rise to the top. And I think that's why you're seeing a higher end hospitality, not lose market share and actually grow because guests ultimately want that engagement of person to person ways to create that guest experience to bring them back. So from an owner's rep role, some of our competition may focus maybe more on the construction project, right? That approach will kind of impact their value to owners because ultimately an owner's rep is way much more than construction management. So finding ways to educate and influence through decision making, I think are pieces that will become the future for hospitality projects specifically. So we have to change the way that we look at and act as integrators. We need to be early on in the progress and process to provide that guidance alongside the technology recommendations, right? To show the return that the owner's looking for, partners with the operational engagement, and not losing hospitality in the long-term strategy of the project.

[00:21:27] Susan Barry: If you could wave a magic wand and change one thing about how large projects are developed, what would it be? 

[00:21:34] Jake Zwaagstra: I’d say large projects while well intentioned sometimes folks can lose the force from the trees. So I think you have to bring the right team in early. And I think outside voices are helpful in large projects, so I think you have to bring other individuals into the project that are outside the project to help tell that story and see if you have blind sides because when you work inside something so long, sometimes you don't see, oh, well that was right in front of me, but I've been doing it so long, I didn't realize that. So I think on large projects sometimes you have to get that outside engagement, that outside voice, that outside taking the pulse of a project to say, okay, are we hitting the marks? Are we missing something? Do we have a blind spot? And on large projects, it's hard to slow down because there's so much capital and so many pieces, sometimes you have to take a step back and say, “Hey, have we lost the vision? Are we hitting the marks? Does this provide the operator with what they need? Does this provide the financial returns there that, owner's looking for?” Again, not losing sight of the bigger picture, but having that outside voice occasionally to check you. 

[00:22:59] Susan Barry: Has that ever happened to you where you were on a project and you're like, whoa, whoa, whoa, whoa, we’re gonna have to turn this iceberg around.

[00:23:08] Jake Zwaagstra: We've had lots of projects where we've had to come in and save a project where things have gone awry. And I think that if folks had taken a second to go in and look and say, “Okay, how is this aligning with the general project? How is this aligning with what the vision of the project is and how does this align with where we need to get this project open?” It probably could have had a much different engagement where they didn't have to bring us in to help, right the ship for lack of a better term. 

[00:23:44] Susan Barry: Got it. Right the iceberg in my analogy. 

[00:23:47] Jake Zwaagstra: So here's a perfect example, had a high-end project where we were brought in to come and save to a date, an opening date, essentially. It was super high-end product and when we came in there, and one example is we had wall covering that was $1,100 a foot for this wall cover. Incredibly expensive. 

[00:24:12] Susan Barry: What was it made of? Angel tears? 

[00:24:14] Jake Zwaagstra: It had actual pieces of gold and like, mother of pearl in the wall covering. 

[00:24:20] Susan Barry: Holy mackerel. 

[00:24:22] Jake Zwaagstra: And so we came in and said, “Hey guys, we understand there's some challenges in budget, how about we look at avenues where we could give you the same look but maybe not at $1,100 a foot? And it might be a little bit more easy to maintain on this product.” So we found some avenues that allowed, worked with their timeframe that provided something that gave them the same look but was like a quarter of the cost. It was still expensive, but a quarter of the cost in relation to approach. And so when you did that a couple different times across this product, it brought the project back in budget, it brought the operator's idea of operating the project much easier 'cause they didn't have to go stock $1,100 a square foot wallpaper to replace.

[00:25:09] Susan Barry: How would even clean that? I mean… 

[00:25:12] Jake Zwaagstra: Exactly 

[00:25:12] Susan Barry: One sneeze and you're through. 

[00:25:15] Jake Zwaagstra: So that goes back to having the functionality over aesthetic, right? That's the piece that has to be first. So a lot of times there's that loss of why are we doing this? That gets lost in the mix. And so we have to continually remind ourselves like, okay, someone still has to clean this, someone still has to vacuum here, someone still has to deal with this product every day. And if we give him something that's untenable, that's not doing our job. 

[00:25:46] Susan Barry: Okay folks, before we tell Jake goodbye, we are going to head down to the loading dock where all of the best stories get told. 

Elevator voice announces, “Going down.”

[00:25:59] Susan Barry: Jake, what is a story you would only tell on the loading dock? 

[00:26:04] Jake Zwaagstra: So, I spent 10 years in Las Vegas and my background is obviously a little different in hospitality 'cause I come from the development side. So in the mid 2000s, 2006, 2007 era, I was working Las Vegas on a couple high-rise hotel condo projects at a prominent hotel property. And at the time, and still to this day, Las Vegas was a very heavily unionized town, right? Projects were signatory to union work. And at that time, as you can imagine, union workers were strapped. At the time, 42 cranes in the air. There's a lot of projects that were going on, and so we did not have enough people to perform the same scope of work from one tower to the next because physically was not enough people in this one union. So we got a determination we could utilize another union to do the work. It was outside their normal scope, but within their jurisdiction, what they could do. So we signed up this group so that we could continue the schedule and the cost on the project. Well, it ticked off one union and over the next couple weeks, we noticed product was being damaged. And so we found out that one union was sneaking into the other union's work areas and damaging product because they weren't happy with that result. 

[00:27:39] Susan Barry: That doesn't seem very cool. I mean, you went through the proper channels. It's not like you just did it 'cause they were cheaper, right? 

[00:27:47] Jake Zwaagstra: Yeah, no, it was proper channels. We went through the entire piece. And so then the sabotage began 'cause the one union then went over to the other union's tower and they started sabotaging. We're not talking big things, but we're talking things that would come up in a punch list or other things that would impact the quality of product. And so responding in kind landed a couple weeks and at one point, believe it or not, I knew what was going on. I walked into a project after shifts had ended to go check on work and I actually found individuals hiding in closets waiting to sabotage work. 

[00:28:26] Susan Barry: Oh no. 

[00:28:28] Jake Zwaagstra: And very swiftly, those individuals were terminated and walked off the project. 

[00:28:33] Susan Barry: Yeah, I bet. 

[00:28:34] Jake Zwaagstra: A few weeks later we had a conversation, brought all parties to the table and basically said, Hey guys, if this doesn't knock off both of you're gonna be fired and we're gonna go get non-union work to come do this. And they both knocked it off and we finished the project, but it was an interesting couple weeks where it was just this cloak and dagger going back and forth trying to impact one group's work versus losing the sight of, hey, we need to deliver the project, not this petty back and forth.

[00:29:08] Susan Barry: This is such a great example, Jake, of why, despite the fact that I am old and cynical, I am also the most naive person in the world because to me, that story sounds like something that would only happen in a movie. Like it can't possibly be real, but I believe you that it's real. I mean, I know it's real. It just seems so, are you kidding me? These grownups acted like that, you know? 

[00:29:34] Jake Zwaagstra: Yeah. Well, at the time I was, I was young and it shocked me too as far as like, Hey man, let's speak of the bigger person here. And like I said, don't lose sight of, Hey, why are you there, right? You're there to get a paycheck, you're there to deliver a product. You're there to take quality in your work. Focus on what you can do. Focus on your lane. Don't worry about what's happening in another area, another project even when you can't do anything about it. 

[00:30:03] Susan Barry: Well, it sounds like you're lucky. You made it off the loading dock without any broken arms or legs.

[00:30:10] Jake Zwaagstra: Exactly, exactly. Had to maneuver on that one for sure. 

[00:30:14] Susan Barry: Jake Zwaagstra, thank you so much for being here. I know that our listeners learned a lot about the process of developing a hotel, and I really appreciate you riding with us to the top floor. 

[00:30:25] Jake Zwaagstra: Thank you, Susan. I appreciate the time. This was great. 

[00:30:29] Susan Barry: Thank you for listening. You can find the show notes at topfloorpodcast.com/episode/216. Jonathan Albano is our editor, producer, and all-around genius. He even wrote and performed our theme song with vocals by Cameron Albano. You can subscribe to Top Floor on Apple Podcasts, Spotify, or wherever you like to listen, and your rating or review will go a long way in helping us give you more of what you like.

[00:31:05]Narrator: Thanks for listening to the Top Floor podcast at www.topfloorpodcast.com. Have a hospitality marketing question? Reach us at 850-404-9630 to be featured in a future episode.