When Victor DiGeronimo Sr. and his brothers were running things at Independence Excavating Inc., they sealed most of their deals with a handshake. It’s a different world now and Victor Jr. has taken a more formal approach in the way he operates the business. But the spirit with which he guides the company has not changed.
“Dealmaking to me is all about your partners and doing the right thing and adding value,” DiGeronimo says. “I guarantee you could dig up 98 percent of my partners and they would love to do another deal. My family, my dad and my uncles — they instilled in us that your reputation is everything. The money doesn’t matter. If you do the right thing, you’ll make money and keep everybody happy. That’s our goal.”
Independence Excavating was founded in 1956 with a backhoe, a bulldozer, a truck and a few employees. It has grown to become a nationally recognized leader in site development and demolition. The business is part of DiGeronimo Cos., which has nine companies under its umbrella and has become an active player in the Cleveland real estate market with current projects in Brecksville, Orange Village and Berea. Cornerstone Business Park in Twinsburg was also managed by DiGeronimo and is a 1-million-square-foot development that is home to distribution facilities for FedEx and Amazon.
“If you talk to most of my relatives, dealmaking is where I fit in best,” says DiGeronimo, who serves as CEO. “I have awesome family members and non-family members who are really good executors. I’m not necessarily the best guy to execute everything, but I somehow have the knack of getting to the green flag. By having that ability with all of our diverse companies, we make it easy whether it’s owners, investors or whoever it might be who wants to get on board with us. They only have to make one phone call.”
This week, we talk to DiGeronimo about how he got his start in the family business and first began to develop the entrepreneurial and dealmaking skills that helped him build a strong and dynamic family business.
Construction is in the blood
I got my start in the construction industry at the young age of 12.My father and uncles had a small sewer excavation-type business. My grandfather, Sam, was a mason, so they used to dig his basements. He didn’t build enough homes, so they had to go do other construction work and that’s how the company started. When I was 12, I spent my summer working on a road crew doing drilling work. When they pour the curb, you drill holes every couple of feet for the sidewalks to tie to the curb. That’s all I have ever really known is construction.
My grandfather was super innovative.My dad followed suit and my uncles were innovative as well. We were always looking for a better way to do stuff. My grandfather had a company before my father and uncles were around called Better Methods Construction. He always was looking to the next thing and he built all kinds of different attachments for his own business through the years. It just kind of carried on. My dad is 78 now, but he still sends me magazine articles and he’ll say, ‘We should look at this and we should do this.’ They bred it in us. They’re always looking to do the next thing and be the first to do it if we can.
Opportunity to us, that’s our lifeblood. We’re constantly looking for new opportunities, new areas, new ways to add value whether it’s a building job or a utility job or a site job. I have a mixed group of family members that I work with. Some of us are more conservative and some of us are a little less. I’m one that is a little less. We have a pretty good balance in our family. But everybody wants the end result and that’s to have a good project and a happy owner and happy investors. As long as we all keep that in mind, we have a lot of ability to analyze opportunity.
Cornerstone Business Park
One of the most memorable deals I can remember is the Cornerstone Business Park deal in Twinsburg, the old Chrysler facility.There were 1,250 employees there working for Chrysler when they closed. That was 2010 when that happened. It was 33 percent of Twinsburg’s income. We had been asked several times to look at demolishing the building. I thought it was a beautiful building, so we had a tenant that we were going to put in there and a guy came to us and he had this big project he was going to do. So we bought it based on that with another guy out of Indiana. It was a very difficult time in the industry. The banks weren’t giving money and we couldn’t do anything, but we got that deal all signed up.
Then we lost the tenant.After a few months of looking and sweating, I decided to demolish the building. My dad is still not very happy that we did it. It was a beautiful building, but we’re demo guys too and steel was up, so we saw the value in it and we took the building down. Now we’ve put FedEx in there, Amazon and Performance Food Group. We have other tenants and we have two buildings going in there this year. So that’s one project that started out maybe the worst and ended the best.
There are no deals that we haven’t had some history on. In our construction business, whether it’s utilities or dirt moving or whatever, we bid the new work off of our history. If we can do 1,000 loads a day, then we figure we’ll do 1,010 the next time and do it better. It’s similar to how we do a deal. We try to isolate the risks. If you want to do a deal, you figure out how to make it work on paper more times than not. Sometimes things happen. Twinsburg made no sense. I could have gotten out of buying it. But I made a commitment and I decided we’re going to figure it out. And that’s what we did.
There were a lot of people who wanted to buy the Chrysler plant.But nobody wanted to take the environmental risk. We knew what it was. We did our due diligence and we were comfortable with it. A lot of really smart real estate people and really smart industrial property owners wouldn’t touch it because they didn’t know what was underground. They didn’t have the knowledge in house to be able to say, ‘OK, it’s going to cost me this much.’ That’s where we have a huge advantage.
The Last Word
The first thing we start with before we do anything else is look at who the opportunity is with. We really need to be comfortable with the partner or the owner. We like to get educated, but we like to do it on our own terms. We vet that out the most. Is this a guy you want to have a deal with? If you do, what are the risks? Then we have people who can assess those risks. If it’s environmental, we have those people. We have building construction people. We have the utility people. We have all the experts in the various disciplines of all that we do. We get all of their input. One of the reasons we’ve gotten a lot of the deals we do is because we can manage our risk and we have skin in it.
How to reach: DiGeronimo Cos., www.digeronimocompanies.com