“Outsider” Firm Paving a New Path in Construction
New Path Construction and Consulting
Adam Garcia launched New Path Construction and Consulting in May 2016 with a simple vision in mind: he wanted to stress business acumen and fundamentals during construction deals while embracing an outsider’s mindset. The formula worked, and the firm is marking its fifth anniversary with big plans to expand its market reach and services.
“Our first five years have really been about proof of concept. We were a bunch of crazy Wall Street guys that said they’re going to start a construction company without any construction experience,” he says. “Everybody thought we were crazy when we did that, but now, nearing year five, we do significant top-line project volume and perhaps more importantly, we have had zero liens or litigation issues.”
From its base in Hanover Park, Illinois and branch in Arizona, the company offers general contracting, construction management and real estate advisory services.
“We will hold the client’s hand from the day that you decide you want to build a building through the day you open. We’ll help put the capital together for you. We’ll help raise capital if required. We’ll invest capital if needed, and then from there, we’ll work on the design by getting architects lined up and finally build your building,” Garcia explains. “After we build and open, we’ll introduce you to a network of people who can help you run the business if needed.”
New Path self-performs some carpentry, heating, ventilation, and air conditioning (HVAC) and demolition work while subcontracting most everything else for its clients.
“We’ve worked with companies like Starbucks, Dairy Queen and Dunkin. We’ve done a lot of retail, gas stations, and car washes as well. We’ve done surgery and medical centers, office buildings, restaurants and bars, country clubs. You name it, we’ve pretty much done it, outside of bridge and road construction,” Garcia says.
While mainly focused on Texas, Arizona, and the Midwest, the company has demonstrated a willingness to travel when necessary. “We do national projects. The biggest clients ask us to travel for them. So, we may not have an office in Tennessee for example, but we’ll work on projects in that region,” says Garcia.
New Path is currently engaged in some deals in Florida and just started its first wave of projects in Arizona. “Arizona is an interesting dynamic. You have to have a specific license number to do anything in Arizona,” he says, noting that the company’s license number for Arizona is AZ ROC #327484. “We believe in the growth factors and general demand in the Southwest and look forward to serving our current and new clients in that market.”
As Garcia is of Colombian descent, the company has recently become certified as a Minority Business Enterprise (MBE), which has opened other doors. “The notion of going into South America is on the radar for us,” he notes.
Such achievements are quite remarkable given the CEO’s lack of experience in the construction sector. After graduating from the College of Commerce (now the Driehaus College of Business) at Chicago’s DePaul University in 2011, Garcia took a job with the Bank of America. There, he helped with mergers and acquisitions.
“I was working on Wall Street,” he recalls. “My background is in investment banking, corporate development and private equity. Basically, I spent the early parts of my career, traveling the world, buying companies, selling companies, providing capital, flipping companies, shutting businesses down and really learning what it takes to run a successful business, and more importantly, what has driven businesses into failure.”
During these formative years, he paid close attention when deals were discussed. “I sort of developed a business playbook. I had a mentor tell me, ‘Hey, keep notes in all these meetings you are in. Keep notes about how they run their business, their approach, their leadership style, things that worked, things that didn’t work, successes and failures.’ So, I kept notes on all that,” he says.
“Essentially, it came to a point five years ago where I thought I had a really good start on a playbook for launching and running a business. So, at the time, I was on Wall Street trying to figure out what I wanted to do. I decided that I would take this playbook, and I was looking for an industry where I could basically come in, be a great business person that understands the financial and capital challenges facing the businesses, and make a difference. We figured that the commercial construction space was the way to do that,” he continues. “Our primary value proposition was going to be that we are the best in class when it comes to understanding the full end-to-end business process surrounding development and construction.”
Garcia then founded New Path with the help of his wife and says that not having a construction background was beneficial. “One of the things that have driven our success is we have the ability to come in as complete outsiders, with no contacts, no connections. We came in, and we were able to sit back and look at the business and kind of say: ‘Look at the industry. What’s wrong with the industry right now?’ without the bias of being a fifth-generation family business,” he explains.
“After discovering that many of the business tools and protocols used by construction companies were antiquated, New Path developed proprietary models, data-gathering systems, and reporting tools,” he adds.
Last year, COVID struck, presenting both seen and unseen challenges. The Governor of Illinois designated construction as an essential business, so job sites remained open. The company immediately reached out to clients to outline the measures it was taking to cope with the virus and keep people safe.
During the pandemic, hospitals and healthcare facilities took priority for cleaning and maintenance services. Companies outside the health field also wanted top-notch cleaning services, which is where New Path came in.
The team had access to personal protective equipment (PPE) and a strong labor pool. Cleaning guidelines from the Centers for Disease Control and Prevention (CDC) were consulted, and a venture called New Path Sanitizing was born. This branch is responsible for cleaning company job sites but works with outside customers as well.
New Path currently has twenty employees, up from fifteen this time last year. Garcia keeps certain prerequisites in mind for potential new hires. “Drive is our biggest thing,” he says. “We’re looking for people that are very driven. Many of our people have a chip on their shoulder with the way they were treated by a general contractor or a construction company they worked with in the past.”
Down the road, the company wants to enhance its real estate advisory services. “We can do everything from introducing people to capital sources to delivering proprietary, off-market deals to our existing clients. A lot of times, we have a tenant who comes to us and says, ‘Hey can you find me a developer?’ We also have developers that say, ‘Hey, can you find me a tenant that fits this category that wants some development help and expertise?’ I think the matchmaking and real estate advisory services are going to be a really big deal for us going forward,” he says.
That said, New Path faces plenty of obstacles as it passes the five-year mark in business. Aside from COVID, Garcia describes supply and sourcing shortfalls resulting from major variability in commodity prices to be a major challenge. The company has met this challenge by being on top of its game by actively sourcing and “working to buy our own materials, instead of going through two or three parties,” he adds.
A nationwide demographic crunch represents another difficulty, as young people shun jobs in the skilled trades. “Everybody thinks you have to go to school to be successful. We preach that school is not for everybody. High-end project managers are making over $200,000 a year, and many don’t have to have any formal education. You have carpenters making $60 – $70 – $80 an hour. If you work with your hands, there’s a good outlook because labor is so short right now,” he says.
Having established a successful business in Chicago, which is “one of the most political, fragmented construction industries in the world,” according to Garcia, the company is ready to expand.
Despite COVID and everything else, Garcia offers an optimistic forecast for the next five years.
“I see us with an even more sizeable and solid client base and being able to create deals for our shareholders, our clients, our stakeholders, entirely in-house,” he states. “From a geographic perspective, we’ll be much more nationwide than we are today. At the end of five years, I think you’ll be seeing us traveling to South and Central America and offering our services to some of the existing and new businesses ventures down there.”