"John is doing a great job. He works so well with Ken Volk, and it’s amazing to see them together," said Ike Heller.
This chapter begins with John’s recollections of the long and complicated interviews that earned John the title of Executive Vice President of I. Heller Construction Company.
EDISON, NEW JERSEY, FEBRUARY 7, 2013: I started working for Heller Construction in 1996. At that time there were two individuals who ran the construction company; Ken Volk, who is Heller Construction’s executive president, and Gary Alpert, my predecessor.
Gary had been with Heller Construction for quite a long time, but he was retiring that year and Ike needed to seek a replacement for him. So he put an ad in The Star-Ledger and he set forth the qualifications and requirements for an executive vice-president.
THE SCREENING INTERVIEW
Joan Nulton sent a memorandum to each of the prospective employees. We had to fill out the memorandum and then come to the office for a screening interview.
At the screening interview, Joan sat down with us, looked at the memorandum, went through our history, and gave us an IQ test.
Ike’s theory is that if you are intelligent, you could be trained to do the job, even if you don’t have the exact qualifications or don’t know the exact parts of the business. Not that this was a prerequisite, but my understanding was that about one hundred people had applied for this position and a good score on the test would get you on to the short list.
I was asked to return for an interview with Ike Heller and Jeff Milanaik and then I returned for a third interview with Ike Heller, Joan Nulton, Jeff Milanaik and Ken Volk.
THEY CHOSE THE OTHER PERSON
I hadn’t heard anything from them after that interview, but I called a couple of times, basically to see if they had made a decision. About a month after the third interview, I received a letter from Joan stating that they appreciated my coming in for the interview and the whole process, but they had decided to set forth in a different direction. I was also invited to "feel free to stop by for a cup of coffee any time."
As it happened, I was one of two finalists, and they chose the other person.
It seems that just before I received Joan’s letter, I had sent a letter to them, because I hadn’t heard anything. In this letter, I kind of went through their whole memorandum, explaining how I thought I fit every piece of the puzzle. They received that letter after they had made the decision to hire the other applicant.
Later on, Ike told me that if they had received my letter earlier, they may have changed their minds. They had already set course with the other individual, but when they got the letter he had an inkling that he hadn’t made the right choice -- but he made his choice already and he had to go in that direction.
I worked in construction for a short time after that, but I was kind of fascinated with the financial industry, so I thought maybe I should switch from construction to another area. I’d been in the construction industry for fifteen or so years and I had reached a crossroads in my life.
At that time, Dean Witter was offering a broker training program and I decided to make some calls. I went on an interview with them and enrolled in their training program.
‘WE MADE A MISTAKE HIRING THE OTHER GUY’
Ike called me on a Sunday morning after I had just completed the training program at Dean Witter.
He said, "I gotta tell you, we made a mistake hiring the other guy. We should have hired you. The guy just wasn’t right for us. Would you want to work for me?"
I said, "No, you made your decision and I decided to set course in a different direction. I’m not involved in construction anymore. I have an opportunity in the financial industry and I’d like to pursue it."
But I thought about it again for a while and I said, "Okay, let me come in and talk to you."
I met with Ike and he told me again that he had made a mistake and wouldn’t have made that decision if he had received my letter beforehand.
He walked me through the office and the buildings. He told me about his partnership program here and how he likes to give people "pieces of the rock."
I always had a true love of construction, creating things and building things. I had the construction background and an engineering background. I had worked in the field, so these were the things that he was looking for in the person who would fill this position.
I didn’t say yes or no at that meeting, but I went home and brainstormed for a while. I called him back a week or so later and accepted the position.
After I was hired, I gave my notice at Dean Witter, and started here.
HE WANTED ME TO KIND OF ‘SHADOW’ KENNY
I started work at Heller Construction on a Monday morning and met with Ike in his office.
The theory was that he wanted me to kind of "shadow" Kenny.
"Sit in his office for weeks," Ike told me. "Listen what he says, you’ll hear how he talks about the business, you’ll understand what he’s talking about and you’ll just follow him. Don’t talk, don’t do anything, just watch what he does, see what he talks about, and little by little you’ll learn the business. You may know how you did things in the construction business and who you worked for, but we have certain ways of doing things here and I want you to understand this."
So this is what I did at first. At that time, I kind of saw the focus but I didn’t see the intense focus that Ike Heller puts into his work.
When Kenny, Ike, and Jeff Milanaik joined us, the first thing that Ike wanted to do was sit us all down and introduce me to everybody. We went into one of his conference rooms. And, as you know, he’s very sensitive to noise.
I found out later on that the walls were soundproofed and there were double doors leading into the rooms, because he can’t be bothered with a lot of extraneous noise.
We all sat down and we spread out all the estimates on projects. My responsibilities would include estimating projects, bringing projects for approval before the planning boards and then actually following through the projects and bidding on subcontracts.
Among the first things that Ike wanted to go over with me were the current estimates for a one million square foot industrial building on Saw Mill Pond Road, a project that they were in the process of building.
YOU COME INTO A ROOM WITH A PLAN AND LEAVE WITH A DIRECTION
Ike had copies of the estimates and he showed me how these projects were kept track of. Basically this was my understanding of the focus that Ike works with. You come into a room with a plan about whatever you’re going to talk about, and you leave that room with a direction. This happens with any type of problems there are, whether the problems are small or large.
He has always had a knack for recognizing problems and solving them. No matter how big the problem was, he taught us to peel off pieces of it, as if you were peeling a banana, and solve each piece separately.
He’s had that ability to, either gather the internal team that can solve the problem, or to recognize that we need outside expertise and to assemble this team with internal and external expertise to solve the problem.
‘YOU CANNOT ACCEPT MEDIOCRITY’
One of the requirements you need here is a thick skin. You cannot accept mediocrity. You have to always try to be one step better than others. If we’re building a building, it has to be one step better than somebody else’s building.
We’re building a product that the tenants really need in today’s industrial world. Is it an efficient building? If the tenant moves out, can we get a tenant who will be able to use that building?
It’s constantly reevaluating the things that we do on a daily basis and also looking at modern technology. Are there any things that we should be changing based on different construction methods, different ways of doing things compared to the last time we built a building? It’s a continuing reevaluation of how we perform in what we’re doing and it calls for extreme focus and extreme persistence.
Ike always wanted to create this company and create people who had certain responsibilities for certain parts of running the company.
He had that ability to recognize the work that people are able to do, and that’s what he tried to create. Initially he had a hard time letting people do their own thing. When he was in Florida, he would call you ten times a day. But little by little he’s done what he set out to do. He lets people run their business and at the end of the day he’s starting to enjoy himself more, starting to spend more time in Florida and not calling in as much, and that’s really what he wanted to do. Between him and Helaine that’s what they have started to do now.
Ike certainly has created the people and he’s identified the ones he feels will succeed. There are a lot of people who came to work here and had been here for a short period of time and left. They didn’t have a thick skin or they didn’t have what it took to make it here.
HE STARTED HELLER INDUSTRIAL PARKS
The people that Ike identified were put in charge of key spots in the corporation. When I started here in 1996 we owned 9 million square feet. Today we own 16 million square feet. That’s a fairly short period of time, but in that period, his portfolio has expanded substantially.
When Ike first started Heller Construction, he constructed buildings for others like Owens Corning, who then leased the buildings back to him. He did that type of work with a lot of corporations.
Then he started to become a general contractor. He would build a building and the company would own that building after it was completed.
Then, somewhere the 1980s, when he started to build more and more and became more successful, he said, "I want to keep on building for others and for myself, but I want to lease the buildings out myself and I want to manage them myself."
That’s when the pendulum started to flip. He added more and more buildings to his portfolio and he stopped building for others.
This was when he recognized that "I’m no longer a construction company, I’m more of a management company."
He started Heller Industrial Parks because he wanted to make sure that he was always his own general contractor; he didn’t want to be at the whim of another general contractor, he wanted to have control of it.
His own construction company is always important to him because when he tells the tenant, "I’m going to get you in in ten weeks and do whatever I have to do," he has total control of the situation.
He started the management company because he realized, "Now that I have all these buildings, I’ve got to manage them." Those two entities have always been working side by side.
Even today, Heller Industrial Parks is kind of the base of Heller Construction because we own more than 16 million square feet, which is a substantial portfolio.
Heller Industrial Parks is this umbrella, but the construction company continues to be here and a strong part of the whole umbrella company because it continues to do what it’s always done. Whether it’s a brand new building, a routine job, or a simple painting job, it’s really the support mechanism for the industrial park entity because it allows us to build things for tenants in a cost-effective and time-effective manner. That’s how we really operate here.
HARRISON
I. Heller Construction Company was the entity that started in 1969, after Ike sold Remco toys and decided, "Well, what am I going to do with myself now at my age?"
What did Ike know about the construction business at that point?
Well, he knew how to build a big building because that's what he had done when he built the 700,000 square foot Remco building in Harrison. So he decided to try to put together deals where he would get people at the railroad together with tenants and customers who needed to have buildings constructed and try to create that relationship.
"When Ike first got started in Harrison, he built the 43,000 square foot Myles Kelly building for Owens Corning. This building had rail access and that's when he began to create the relationship between large customer-type clients, Conrail and the rail suppliers, and then he leased the building back to them.
"I. Heller Construction Company was the company he created to do that work. That was his first building. He continued with that same process in trying to identify sites and customers, then putting together the rail and continuing to build these buildings.
He constructed four buildings in Harrison and we still own them. They are different tenants, but the buildings are still in our portfolio today.
The project they are working on now is located on a piece of property that Heller Construction did not own.
There's a part of Harrison from the Passaic River to just north of where the PATH train comes in that for many years was a series of different factories and manufacturing facilities owned by Westinghouse and General Electric, where a number of people were employed.
But as time went on, those companies moved out of Harrison and relocated to different parts of the country.
After a period of time Mayor Frank E. Rodgers of Harrison started to recognize that these buildings were becoming vacant. Heller had been in Harrison for many years so he developed great relationships with the mayors and Frank E. Rodgers had been the mayor for a long time.
When these buildings and in fact, that whole area started to become vacant, Mayor Rodgers talked to Ike and just in general conversation asked Ike, '"What do I do with this area now? It's not producing tax revenue."
"A PLACE CALLED METROPARK"
Ike told him, "Let me take you for a ride to a place called Metropark.'"
Ike took Mayor Rodgers to Metropark, because the scenario there had been similar to what was happening on Harrison. He showed Rodgers how an area that was vacant and was not performing could be transformed.
One of the key advantages is that Metropark has rail access and it's a flourishing area. In this particular case, obviously, Metropark was transformed into an office environment, but it was focused around rail.
Ike told Rodgers, "This is something that can be done if you plan it."
In effect, Ike was the impetus for Harrison to take this whole non-performing area, identify it as an area that needed redevelopment, and do what we're doing with it today.
Ike was always focused on industrial real estate. So when Harrison created this whole area for redevelopment, they talked to different developers who would potentially want to develop these areas.
However, the township was planning a mixed use development, including retail, office and residential space. At that time Ike said, "I don’t want to get involved with any of that stuff because it’s not professional real estate and it’s not what I would do."
DIFFERENT TYPES OF REAL ESTATE ASSETS
However, after a period of time, he became open to the concept and he decided to pursue the opportunities in Harrison. Since he’d been in Harrison for so long, he felt that the skill sets we have here, including construction engineering and problem-solving, don’t necessarily limit themselves to industrial real estate. They can be utilized toward different types of real estate assets and he decided to maybe pursue these assets in Harrison.
Ten buildings needed to be demolished on this 10 ½ acre site. We finished the demolition phase and now we’re working on excavating soils within the site that were environmentally contaminated, and back-filling them. Then we will be ready for the new construction.
At this point, the new construction in Harrison will consist of a combination of multi-family residential units and some retail space right along the main road, which is Frank E. Rodgers Boulevard.
The current plan is for six buildings with a total of 747 residential units and 22,000 square feet of retail space. Apartments would be rented and stores would be leased.
We’ve been working on the planning and environmental issues involved in developing the Harrison property for eight years or so. The actual construction started in March of 2012 and will take another six years to complete.
The best part is that we are located just northeast of where the PATH line actually travels. The residential real estate trend within New Jersey now is gearing itself more toward urban development or redevelopment as opposed to suburban-type sprawl, which used to be how residential realty was handled years ago. I think we’re going to see this more and more, where the general trend of residential living is more toward being near mass transportation and actually not travelling far to get to your spots of entertainment, restaurants and things like that.
I think that different branches of the government are trying to promote that type of living, because these urban areas that are somewhat depressed can be created, with the right planning, to vibrant centers of residential living.
The other point is that the PATH stations around this area haven’t been updated in a long time, and there’s a $260 million plan to renovate and expand the PATH station area adjacent to our site.
‘SAME SPOT HE STARTED FROM’
Ike started in Harrison and he’d been in Harrison for so many years that he obviously developed a good reputation with the different administrations here, so it’s quite interesting that this is in the same spot he started from.
Heller Industrial Parks now owns 16 million square feet of which Edison, the largest of all the industrial parks he has in different areas, is about 8 ½ million square feet.
