Robert Keeley has seen this play before. Twenty years ago, when he founded Diversified Project Management, “the economic climate was very similar. Our early clients weren’t relocating. They were downsizing. They were closing a building, and we were going in and moving the 11 people who weren’t laid off, consolidating them into another building, and liquidating the assets of the building. It was kind of ugly, depressing work.” The ugly days are back, but DPM has gritted them out, thanks to a diversified base of project experience, deep client relationships, and a willingness to adapt.

Robert Keeley

Title: President

Firm: Diversified Project Management

Age: 42

Experience: 26 Years

This year is your 20th anniversary. How do you last that long in a business with the ups and downs like this?

Diversifying our service offering into full-service project management was a big part of it, and industry diversification was huge. Particularly, the dot-com bust, we didn’t do any tel-co space. We didn’t get caught up in that swell. We were busy working on things that are paying off now: developing a health care practice, developing a strong academic group, developing some public sector experience. That has really helped.

Why did you go that way?

The market’s cyclical. One group gets hot and another gets cold. When corporate hit the skids, everyone flocked and wanted to do health care and academic work. It’s a very specialized skill set. Years and years ago, we’d call on a hospital client, and they’d ask, “Have you done any hospital work? Because you’re not going to learn here.” We decided we’re not going to wait until the market crashes to scramble to jump on the bus when it’s already left.

How different are things now than six months ago?

Earlier this year, it was sort of a freefall. Companies couldn’t make a decision because they didn’t know what they

were going to look like. I don’t think it’s over, but I think we’re getting used to it. Nobody’s expecting the V rebound of the last recession.

What kinds of companies are still active?

The commercial market is lease-expiration driven. If you’ve got a 2010 or 2011 expiration, you’re in the market. We’re seeing brokers take tenants out with 2013 expirations, trying to get a jump on things. We’re seeing tenants get in the market to create a big dust cloud. They’re creating leverage to go back and negotiate to stay. Landlords on the other side are offering more significant tenant improvement allowances to woo them into going.

On the corporate side, it’s an economic play. One of the things we do is a stay-go analysis. It’s a math exercise. All these other soft costs come up. We give them that data before they get too far down the road, and then they can use that when negotiating, because they know what their all-in project costs are going to be. A tenant might say, ‘It’s too much money to move, we’re just going to stay put and do a little renovation.’ What they’re really talking about is, carpet, paint, renovating the space, knocking down some walls, and ‘Geez, now that we look at it we don’t like that lighting,’ and suddenly it’s a major multi-phase construction project, and it’s cheaper to move.

But they don’t think that through. A lot of what we’re doing is these little, low-cost, high-value exercises up front, where we help them figure out where the ceiling and the floor are. What it’s going to cost, and how painful it’s going to be. If a tenant is going to renew in place and not do anything to the space, that’s definitely the low-cost option. If there’s any work involved, going through that exercise is huge.

Are you seeing situations where landlords are unable to do a deal because they don’t have the cash for space improvements?

We’ve heard of it. We haven’t seen anything first-hand. But there’s a big concern. Everybody’s struggling right now. I don’t talk to anybody who says, ‘This is great, we’re killing it!’

So what does next year look like?

I think it’s going to be tough into 2012. I think it’s going to be a slow start. I’m hopeful we’ll see some recovery by the middle of next year. I don’t recall any point in the early ’90s where you felt, ‘Oh yeah, things are great!’ You looked back and said, ‘You know what? Last year was a good year.’ It didn’t feel like that at the time, because your fists were clenched on the wheel, just gritting it out, and you realize, ‘I wish I’d stood up and enjoyed it.’ I think it’s going to be similar.

Top 5 way to make it through 20 years:

1. Hire great people.

2. Listen, then act.

3. Look for ways to add value.

4. Diversify your services and client base.

5. Build long-term relationships.