Charter Construction, an award winning Pacific Northwest company specializing in commercial, custom residential, remediation and emergency restoration construction, announced that it will convert its ownership structure to an Employee Stock Ownership Plan (ESOP).
Through transitioning to an ESOP model, Charter Construction is making a long-term investment in its future viability. This change will also build an even stronger company foundation, as ESOPs are a proven tool for effective business succession.
“Over the last 30 years, we have worked hard to make Charter Construction a leader in the Pacific Northwest,” said Peter Saladino, president of Charter Construction. “With the construction industry growing at such rapid pace in Seattle and Portland especially, this was the right time to transition to an ESOP model to ensure we continue to attract and retain the best talent, and are positioned to grow alongside this region for years to come.”
Each year the company will make a contribution to the ESOP Trust, which will buy company stock to distribute to eligible employees. Over time the employees acquire increasing shares and rights to the stock, which eventually becomes fully vested.
The Seattle-area construction and commercial development industries are booming, with recent reports noting that there are more major construction projects in downtown, South Lake Union and surrounding neighborhoods than at any point since 2005.
The same can be said for Portland, where Charter Construction has had a thriving office for more than 10 years. When you look at the more than 7,000 apartments currently under construction, and the more than 15,000 apartments proposed for the Portland-area, this trend doesn’t seem to be slowing down anytime soon.
As skilled construction workers and managers consider employment options in these increasingly competitive markets, Charter Construction’s employee ownership plan will provide a valuable benefit to help attract and retain the best talent across both regions.
It is widely acknowledged that when employees are company shareholders, they feel an increased sense of pride and connection to the company’s mission. Charter Construction employees will now directly benefit from thinking entrepreneurially and doing the best possible job the first time, to increase company stock performance through improved efficiency and potential cost reductions.
This point was reiterated by business owners in a 2014 Employee Ownership Foundation research study. The survey found that 93 percent of respondents believed that creating employee ownership through an ESOP was a sound business decision for their companies. More than 76 percent of these people believed that the ESOP improved overall productivity, while 70 percent said it also increased revenue, and 64 percent also reported increased profitability.
Charter Construction is joining an increasing trend of companies moving to an ESOP model to harness the benefits to the business and its employees, making ESOPs especially popular in the construction and manufacturing industries.
The National Center for Employee Ownership (NCEO) noted that there were 7,000 U.S. companies operating as an ESOP in 2015, accounting for more than 13 million employees. A recent study from the University of California San Diego found that within those figures, the construction and manufacturing industries combine to make up one third of the NCEO’s total.
“Our employees have always taken immense pride in their work. Now that everyone even more directly benefits from our success, our performance will continue to improve,” said Sue Williams, human resources manager at Charter Construction. “Everyone I’ve spoken with is thrilled about the news, and I look forward to seeing that excitement shine through in all of our work.”
About Charter Construction:
Founded in 1983, Charter Construction is an employee-owned construction company with offices in Seattle and Portland. The company specializes in commercial construction, custom residential construction, remediation and emergency response and restoration. Charter Construction provides above-and-beyond service to clients and through collaborating with partners to deliver some of the most ambitious construction, renovation, and restoration projects in the Pacific Northwest.