When homebuilders Nick Dolphens and Dave Vogtman went into business for themselves five years ago, they knew they couldn’t afford a team of in-house computer whiz kids to build an online construction management platform.
It took a trip to the 2012 International Builders Show in Orlando, Florida, to find what they were looking for — an online platform that would allow them to make changes in building specifications, get customer approvals, manage billing and other tasks. What the Nebraska crew didn’t know was that the answer they’d find in Florida came from Buildertrend — a company that has its headquarters just a few miles from its Omaha firm.
Buildertrend at that time was a lean team of about a dozen people refining a relatively new product. The company now is bursting at the seams with nearly 200 employees. It recently closed on an $8.6 million real estate deal that will have it moving once more into new digs by next summer.
The company’s platform is web-based and allows builders and buyers to enter and sign off on change orders, upload documents and photos and manage scheduling. Newer features let builders and their associates process payments, send internal messages and manage time sheets.
“We can send change orders at any time of day and clients can see exactly what we will do and what the price will be. If they don’t want it, they can decline it, and if they approve it, we can implement the change right away. It makes our job very seamless,” said Nick Boyer, a sales listing agent at the Home Company, the now-client that found the Omaha firm at the Florida trade show.
Buildertrend now will move into about 110,000 square feet of space in the former home of Vatterott College at 118th and I Streets by mid-2017.
“We moved in here two years ago with a plan to be here for four years, and we’re cutting that short,” Buildertrend co-founder Dan Houghton said of the current office near 120th Street and Miracle Hills Drive.
“We’ve been asking ourselves, ‘Do we need 50,000 square feet? Do we need 100,000? Do we need to set up a separate office in Denver in addition to Omaha?’ It’s exciting, but it’s stressful,” Houghton said.
Houghton and co-founders (and brothers) Jeff and Steve Dugger are no strangers to stress. The U.S. housing market was verging on a full-blown implosion by the time the trio of Omaha entrepreneurs brought to market the web-based application aimed at residential homebuilders in mid-2006.
An armchair quarterback could say there was no worse time for such an endeavor: Mortgage behemoth Freddie Mac said it would stop buying subprime mortgage loans in February of that year. In April 2006, subprime lending juggernaut New Century Financial was in financial ruin and filed for bankruptcy protection.
At about the same time, the U.S. homeownership rate began a decade-long dive from its historic peak. An ensuing global financial crisis hollowed out the once-booming industry — and the millions of houses built during the bubble along with it — but Buildertrend’s namesake software product surged.
Since Buildertrend was launched, more than 620,000 projects worth $56 billion have been completed in the platform.
As it turns out, coming through the other side of the housing crisis increased its appeal.
“Before the recession, we were only focused on homebuilders. The market got so crazy (during the bubble) that carpenters and framers were becoming homebuilders,” said Steve Dugger. “A lot of these guys went back to their original trade and still wanted our software, so it made our market bigger.”
About 10 years later, the homeownership rate is still seeking a bottom, but Buildertrend has yet to hit a ceiling.
The company will have plenty of room to find one after it moves into its fourth office in the last 10 years.
That means there’s also some stretching out in order.
The software company has nearly doubled its employment over the last 12 months to 180 employees. In its present home, a roughly 25,000-square-foot building that used to be headquarters for local energy firm Tenaska, there are no walls left to push out.
David Arnold, the company’s corporate development manager, said May or June is a “realistic” estimate of when a planned renovation of the former Vatterott space will be wrapped up. Company officials declined to share revenues or a renovation budget.
Initial plans call for a build-out of 80 percent of the floor plan at the new building, followed by a move-in.
“We think we need about 80 percent of the building to handle the people we’ll be bringing over and our new hires,” Arnold said. “We’ve been hiring about 10 people a month, so that takes us to at least 280 employees by the end of (2017).”
Given the building’s amenities, the company should be set for at least a few years.
Steve Sheppard, a broker with CBRE/Mega Commercial Real Estate, worked with the building’s seller on the “significant” deal and said the volume of parking at the new site is relatively staggering. Most office buildings in Omaha provide between four and five parking stalls per 1,000 square feet of space. At the former Vatterott building, that ratio is closer to seven, he said.
“You really can’t find anything else close to that in Omaha, and it’s hard to find buildings with parking ratios greater than six,” Sheppard said. “They can have upwards of 600 to 700 employees in that building.”