NJBIZ Features President Ken Karle and LANNovember 2, 2015
A lot can change over the course of 50 years — just ask executives with LAN Associates.
But here’s something that has stayed the same for the North Jersey-based engineering and architectural firm: In a sector that always has been competitive, the key to success is fairly simple.
“I’d say during the recessions, a few firms fall by the wayside, but there’s always more coming up to replace them,” said Kenneth Karle, president of LAN Associates. “That’s why it’s so important to keep your clients happy, because repeat business is everything, and everybody knows that.”
The firm this year is marking its 50th anniversary. Now based in Midland Park, it has come a long way from its founding by John Lacz, who launched what started as an engineering and planning firm that worked for clients such as housing authorities and local governments, to a team of 80 employees offering a full complement of design, engineering, surveying and planning services.
And LAN Associates has done that while largely building on its roots in the public sector.
One major niche — one that accounts for some 40 percent of its business — is public school projects. Karle said that practice goes back decades, with “a boom run” of work from about 2000 to 2010, and is still strong today even as state funding has dried up in the post-recession era.
“So, although we had projects that took several years to complete past 2008, there really has been no big school initiative since then,” Karle said. “Now, for some reason, the districts are out improving their schools on their own with local funding and taxpayer support, so it just seems to be something that they’re forced to do with the growing student populations again.”
Its track record in education has made LAN Associates well-suited for major projects such as the rebuilt James Monroe Elementary School in Edison, which was destroyed last year in a high-profile fire and is now being replaced by a $28 million, 67,000-square-foot building. That work feeds its pipeline while the firm also serves as the architect or engineer of record for some two dozen school districts in the state, meaning it oversees general maintenance for those facilities.
In either type of assignment, Karle said, referred business is critical.
“Reputation is everything. Word of mouth is everything,” he said. “If you get into a market sector, all of those people have their societies and their meetings and they talk to each other. So if you can do a good job, they’ll recommend you to their business associates. That’s one reason we do so much school work.”
The sector has been a staple for LAN Associates even as it worked to diversify over five decades. The firm began to bolster its architecture practice when Karle, who started as an architect, was hired in 1978 and joined a team of about a half-dozen associates.
It has since developed a specialty in environmental and facilities engineering, Karle said, accounting for about 30 percent of its business as the firm boasts clients such as Unilever, Siemens Healthcare Diagnostics and Pratt Whitney.
“We try to stay somewhat diverse,” Karle said. “It introduces you to different technologies, different products, different expertise that benefits everybody.
“I’ve always enjoyed that. You don’t get bored coming to work.”
Long-term success is also about managing growth, Karle said. A decade ago, the firm had grown to about 115 employees, thanks in part to branch offices in Paducah, Kentucky, and St. Augustine, Florida, that specialized in environmental and facilities engineering.
But he said those employees asked to buy their offices “because basically it was a different client base and a little bit different expertise,” prompting LAN Associates to sell that portion of the business under an amicable agreement. That brought the firm down to about 80 employees ahead of the downturn, during which it shrunk further to about 65 thanks largely to attrition and a decision to not be “in a hiring mode for a few years.”
With the recession behind it, though, LAN is now back up to about 80 employees. And it’s looking to grow, Karle said, even if finding talented engineers and architects is about as competitive as trying to win a public school contract.
“We’re always looking for good people,” he said. “And even when we’re not looking to hire, if we see an exceptionally strong resume, we will definitely want to meet that person, because it’s hard to find those strong resumes. The really good people have good jobs.”
Building for the future has meant tapping into another key demographic trend in recent years: the aging population. That has helped generate projects related to senior living, including age-restricted housing and retirement communities such as The Vista, a proposed 199-unit development by the Christian Health Care Center that straddles Hawthorne and Wyckoff.
Karle noted that they can be substantial projects because “the expectations of these people are much higher.”
“These are pretty high-end living facilities, they’re not apartment houses,” he said. “They’re more like resort complexes: They have the amenities; they generally have three or four dining venues; they have an indoor swimming pool; they have a beauty salon; they have fitness and health care; they have a spa.
“So it’s a whole new paradigm of retirement living compared to where we were 20 or 30 years ago.”
If you’re looking for a good “only in New Jersey” story, Kenneth Karle has one for you.
His firm, LAN Associates, has spent a decade working on behalf of the Christian Health Care Center in Wyckoff and its plan to build a 199-unit retirement community known as The Vista. And while the approval process for developers is notoriously a slow in the Garden State, this project happens to straddle two municipalities — Wyckoff and Hawthorne — and both Bergen and Passaic counties.
“Although the property itself is beautiful, the bureaucracy of approvals was double everything,” said Karle, president of LAN Associates. “There’s even two area codes. There’s even two 911 call response systems we have to put in.” “You can’t make this up.”
That’s not to mention two soil conservation districts, two sewer districts, two county planning boards, and two municipal planning boards. For Christian Health Care Center, a longtime client, and for LAN Associates, it was a worthwhile endeavor partly because of the difficulty of finding good developable sites in the region.
“In northern New Jersey, all of the prime land is gone, so you get the tough sites,” Karle said. “They either have major environmental constraints or flooding issues or other issues.
“In this case, it was kind of pristine property, but it spanned two towns, two counties.”
Passing the test of time
LAN Associates President Kenneth Karle jokes that he has “been with the firm only for 37 years” — a tenure that began when he graduated college and “sent 65 resumes across the country.” That resulted in two interviews, one at LAN Associates and one at another firm, as he quickly realized just how troubled the economy was.
“The market was terrible — the economic cycles have been going on forever,” he said. “Sometimes you think about this 2008 downturn, but it was probably just about the same way back in 1978, too.”
But that has given way to a four-decade career with the Midland Park-based architecture and engineering firm. Today, he is part of a six-member management team that also includes CEO Ronald Panicucci and vice presidents Stephen Secora, Michael McGovern and Steven Ramiza and Kim Vierheilig. Karle, meantime, is still an active engineer and architect, even if he might have more of a passion for one field than the other.
“My mind is engineering, my heart is architecture, so my goal was to become a registered architect much more than a professional engineer, even though I did both,” he said. “So building design, creating the built environment and built space is very rewarding. That’s what I was after.”