Demolition Can Build Your Business

What goes up, must come down. And when it falls, there’s likely something that’s going right back up in its place.

At least that’s what independent electrical contractors are finding in the busy teardown market. Whether it’s a ranch house, single-family home or industrial plant building, there’s no shortage of properties that need to come down. Electricians, of course, are part of the process, albeit sometimes a minor one, says builder Michael Roy Nagel, president of Roselle, Ill.-based Remodel One Inc. and national chairman of the remodelers division for the National Association of Home Builders (NAHB).

For partial interior demolition, electricians simply disconnect any circuitry connected to the areas that will be removed, but total teardowns are more complex. “In that case, the electrician needs to disconnect the electrical service to remove it from the building,” Nagel says. “Then, he or she needs to move it temporarily, and then reinstall it during the rebuild. For these kinds of jobs, you need someone who’s dependable. Customers don’t want to be without power for any length of time. When you have an electrician who knows what he’s doing and is there for you, it’s very valuable.”

Build Your Reputation
Electrician Scott Caron, president and owner of Caron Electric in Lexington, Mass., is building business from the ripple-effect rewards of teardowns. He’s a veteran when it comes to serving the residential teardown/rebuild needs in Lexington, a high-growth suburb that attracts residents who want to be close to Boston but without the urban lifestyle. In the past decade, many 1,000- to 1,500-sq. foot homes have been demolished to make way for larger ritzier residences. To attract customers in the expanding market, an electrician must raise his or her profile and reputation with the builder community, Caron says.

“It’s not like you’ll find these guys in the Yellow Pages and give them a call,” Caron says. He suggests starting by getting yourself on the local builders’ radar by developing business relationships with other contractors who builders need to work with. “You may have been doing some jobs on the same location as a local heating or air conditioning contractor … those contractors work with builders, and when a big teardown/rebuild job comes, they’ll let you know and even give you a recommendation.”

Keep It In Perspective
A residential teardown/rebuild job isn’t exactly a way to get rich, at least not at first. “The builders are very, very focused on price,” Caron says. “They are trying to maximize the amount of money they can make on a per-square-foot basis. You will need to price the job accordingly. At first, you’ll be working with builders on ‘spec’ jobs, meaning they tear down properties and rebuild on speculation that they’ll sell.”

But you can use this experience to transition into the custom-home market, in which homes are designed and built according to pre-existing, contractually bound buyer commitments. The money is in that market, Caron says.

No electrician should focus solely on spec teardown/rebuild jobs for very long, he says. But a builder is always looking for someone who will be there when the job needs to get done, and that kind of proven reliability can lead to additional higher-paying jobs.

Commercial Teardowns
On the commercial side, Robert Ford Electric Company in Bryn Mawr, Pa., takes part in one or two large teardown/rebuild jobs a year. The company recently helped with the teardown of a 250,000-sq. foot train manufacturing plant and headquarters to make way for a corporate office building of roughly the same size.

For you, the demolition portion might not be as demanding, since the electric company disconnects power and acts in a consulting capacity to the demolition company. But that work often leads to the redevelopment work, and that’s where Ford offers value-added services. “We offer unique expertise as a design-build company,” Vice President Stuart Ford says. “We have an engineer on our staff. That gives us an advantage here that other electrical companies in our area do not have. For projects like a one million-sq. foot manufacturing facility or an abandoned power plant with 100-foot-high vaulted ceilings, we can offer the owner a system designed to save him money—not only on the technical requirements, but also with the cost of installation.”