Case Study - Beverly Hills Developer

When a Beverly Hills developer experienced significant struggles maintaining cashflow and creating profitability
We designed and implemented a four-point plan to improve deal structure, eliminate out of scope work, reduce budget overruns, and increase their deal portfolio.

The challenge

The owner was a brilliant designer and architect – his finished homes are stunning and greatly sought after in the Beverly Hills market. Unfortunately, he had no background in business management, strategy or operations. This and a very ‘hands-off’ style created a significant amount of turmoil and anxiety in his organization.

There were no clear definitions of roles and responsibilities which created confusion and overruns. This created significant workflow issues and pervasive delays in decision-making.

His deals were all structured to reward the investors while he took the brunt of all overruns, delays and change orders. His partners would consistently make great returns while the owner would often make little to no profit, even losing money on some deals.

The lack of good supervisors led to unproductive subs who focused on “getting the work done somehow” rather than seeking good solutions.

All of this led to a situation where he could only manage a small number of projects at any given time so his ability to grow and scale was non-existent.  

How we helped

Aspire worked with the owner to design and implement fundamental business practices, hire quality supervisors, implement a complete construction management and accounting system, train his better subs and eliminate the bad subs. We also reworked his deal structure to ensure he got solid returns for his work.

 This four-point plan included:

• Contract analysis and negotiations training and ongoing advisory
• Aspire filling the roles of interim CFO and COO until permanent hires were in place
• Installing new processes and procedures for operations and a new software platform for management and accounting
• And, once he had the fundamentals under control, building up his project portfolio to create move revenue and solid cashflow

Once he had the fundamentals under control, we helped the owner build up his project portfolio to create move revenue and solid, predictable cashflow.

Value delivered

• Completed all existing projects profitably
• Designed and implemented financial systems and processes to significantly improve financial reporting and decision making
• Developed completely new systems and procedures for operations (acquisition, construction, dissolution)
• Developed new management team to fulfill on long term vision and goals
• Eliminated $4M in debt
• Grew owner’s compensation from $200k to $4M year
• Grew investors profit to $10M a year
• Grew projects under management to 12 in a 12 month period. ($200M in portfolio)