Chad Pepper builds career out of helping fraternities and sororities

A. I started out as a builder in Columbus. I got a building science degree from Auburn University. Started doing some houses in Columbus. That market went bad, so I turned to commercial, and that market went bad. I’ve done tenant finishes, restaurants, churches, just a wide variety of projects in the Columbus and surrounding area. That was before I got in this niche of Greek Key Services. I’ve really been focused on the fraternity and sorority market. It’s really kept me busy for the last seven years.

A. As the economy goes down, you would think people are spending less money on everything. But the fraternity and sorority market is a way for people’s children to network. As you can imagine, as the economy’s gotten worse and jobs are less and less, people are putting their kids in these fraternities and sororities so they have a larger network when they get out of school in order to get a job. I’ll give you an example. I know a guy that came out of a fraternity and was in the building business and lost his job with a big developing company. He picked up the phone and called a fraternity brother and within a week he had another job and was in another large city working again. And it’s a network for a lifetime.

So these fraternities and sororities have grown by leaps and bounds on every university over the last decade. As the economy got worse, these fraternities have grown and grown and grown.

A. No. That’s what’s tough about the fraternity and sorority market that I’m in. It’s taken me the seven years to really figure it all out because every campus is different. Every fraternity is different, every sorority is different, every large organization is different. I’ll give you an example. I work with one sorority, it’s Alpha Delta Pi. They have an international headquarters in Atlanta. They have 150 chapters all over the country. So 60, 70, 80 percent of them might have houses. Some of them might just be on campus and they’ll have a house, but they’ll meet somewhere on campus in a classroom somewhere after hours. But a lot of them have houses. So there’s 6,000 fraternity and sorority houses all over the country. They’re constantly building new ones, and they’re constantly tearing them down and rebuilding them. Some of these houses are 100 years old. They’ve been paid for a long time ago and they’ve got no cost in it, so they can demolish the house.

A. They’re not big enough. And what they’re trying to do is compete. Over the last 20 years, half of the fraternities and sororities have built new houses or expanded, and everyone’s got to keep up. You might have had 35 people living in a house; now it’s getting to where you might have 65, 75 or 85 people. You’ve got to double the size of your house.

It’s also about competition and having a nice place to meet. Some of these places on a typical football game day, they might have 2,000 people come through the house, alumni that are just visiting. They’ll have lunch for them and that kind of stuff. These houses have full kitchens, like two, three, four chefs in there doing breakfast, lunch and dinner. One of the houses we just finished had about $250,000 worth of kitchen with it (at Ole Miss). I’ve built restaurants that didn’t have kitchens as good as these.

A. Typically, these fraternities and sororities are somewhere between 15,000 and 30,000 square feet, like a small apartment complex or a small hotel, and that’s what it’s like. You’ve got rooms on the second and third floors and the first floor is usually the social area, kitchen, dining, meeting rooms and dens.

A. Yes. Sometimes they’ll put out a project for bid and I’ll bid on it. But a lot of it is just making those relationships in the industry. I’ve done seven projects with the same customer. So you’ve just got to get looped in with one. Especially when I’ve saved them money. When you’re able to say, hey, my fee is this amount, but I’m saving you this amount, the fee becomes kind of a net zero plus for the customer.

A. Yeah, you just say I’ve had a history of saving this kind of money. I had a project over at the University of Texas and before they hired me they had a contractor. I don’t act as a contractor. I act as an owner’s rep. So I helped them hire the contractor, the architects, the engineers, the vendors, the subcontractors. I help them order the furniture, the kitchen supplies, the dishes, the forks, the knives. I help them from the very beginning of design all the way through to turning over the key to them at the very end. Full service.

A. That’s where my specialty comes in, my whole history of working for restaurants when I was a kid. Knowing the operation of a kitchen comes in handy now when I’m working on kitchens. I knew about dishwashers because I was a dishwasher. I knew about busing because I was a busboy for awhile. I knew about cooking because I cooked for awhile. I owned a lawn business, a handyman business. I was a carpenter. I knew I was getting in the construction business, so I wanted to do these things. I wanted to hang sheet rock, I wanted to work with carpentry, I wanted to do trim work, plumbing, electrical, roofing. I did everything just so when I was talking to somebody about that trade, I would know what they’re talking about. I wanted to be a good builder and I knew if I wanted to do that, I had to touch a lot of these things.

A. I act as an owner’s rep. I review all of the contracts between the owner and all of these (design and building) people. I just help oversee all of it. I become the flow of information between the owner and all of these other people. Typically, the owner has very little involvement. I’ll go to them once a week or once every couple of weeks and relieve them of the daily burdens of a construction project. For instance, I’ve got projects this summer where I might be out of town the entire summer. I’ll physically be on site to answer questions.

A. Three years ago, I had a heart attack. I had a real busy summer. I had a project that was going awry. I had a contractor that wasn’t performing, and we have to hit deadlines. Some of these projects, if they don’t get the girls in the house, the girls have to go live somewhere else. And with some of these campuses, they’ve got to commit to a lease for a year. So that sorority or fraternity could lose one year worth of rents. They could lose one year worth of all the chefs and the cooking and what they would make on the food. So it could be a million dollars that they lose.

A. That’s right. So I can get stressed at times. I’m pretty low key. I’m one of these guys that’s laid back. But I can get worked up. That summer three years ago, I had a project and it was coming in (to the finish), we were about three weeks out. I had a guy working for me out of Minneapolis that was going to this job. I had another guy in Boston working for me. We were just tag teaming these projects that we had working all over the country.

So when my guy gets there, he says, Chad, they’re not going to finish on time. And I say, no, we’re going to finish. There’s no option. He said, OK, but you’re going to have to come here and you’re going to have to bring your checkbook because we’re going to have to hire some other people. They already had hired a contractor and had a crew of a half-dozen people. We came in and actually hired another half-dozen people to do the same trades, painting, drywall, carpentry.

The sorority had planned a big meeting of 200 people to come to a big party on a Saturday, when we’re supposed to be finished the day before on Friday. Our granite countertops didn’t show up. We were let down by the sub, by that vendor. So I went to Home Depot, found a guy carrying around some Formica that you can do countertops with, and it was about 5 in the evening. I said, hey, I need your help. … We went back to his shop and I helped him build these countertops, put Formica on them, we installed them that night, and at 8 o’clock that morning those 200 girls were having a party. We came back two weeks later and put the granite in. (laughs)

A. I have had times when groups have wanted me to inspect their properties, so I do a type of home inspection. I look into their financials. I look into their taxes. I look into what they’re paying for utilities, and try to help save some money in those areas ... A lot of times they don’t know that the boiler’s about to go. They might have a 20-year-old boiler, but the women of the house want to go out and spend $10,000 on a sofa. So they’ll go spend $10,000 on furniture and not have $10,000 when three air-conditioning units go out. Then they have to finance $30,000 worth of air-conditioning units.

So I help them get a baseline for their house. I look at all of their equipment, take the dates that they were manufactured. I help them get a short-term and long-term budget put together to balance their budgets for the next five to 10 years. I tell them how old their carpet is, what it will take to replace it in two to five years, if the roof’s going to need replacing. Some of these roofs are $100,000. If I go to paint inside one of these sororities, it can be $30,000 (and up).

A. I charge a flat rate for my services, for the whole project. I say I’m not going to charge you extra for travel and I’ll be there as often as I need to be, and it’s built into my price.

A. At least once a month, especially when we’re doing construction. And there have been times when I’ve been there three weeks solid. I’ll just get a hotel room. This summer I’ve got so much work I’m actually thinking about getting a travel trailer. I’ve got four projects. I’ve got LSU, University of Texas, Oklahoma State and Ole Miss. I did the round trip in the last week and it was 2,200 miles. It took me a week and I visited each one of those sites.

But I’ve been to Washington (state), I’ve been up to Connecticut. We’ve done some projects in Florida. I had a bunch of projects for some reason in Ohio — Ohio State and couple of little colleges there. We’ve been in Illinois, Moscow, Idaho. I went to the University of Oregon, UCLA, the University of Iowa. I’ve been to West Virginia.

A. Right. You can say over three dozen campuses spread out across the country. It’s been fun for me. Before I started this seven years ago, I didn’t travel much, just in the Southeast a little bit. But since this has come about, I’ve used it as an opportunity to travel the country. When I was up at Kalamazoo, Mich., I said, hey, there’s Lake Michigan just 45 minutes away. So I went and visited Lake Michigan for a few hours. I was at Northern Illinois, which is 45 minutes outside of Chicago. I thought, the Chicago Cubs are playing tomorrow. So I went to a Cubs game.

I had a conference in Palm Desert, Calif., and was trying to decide if I’m going to drive or fly. It was the summer, so I took all of my kids. I’ve got three boys and we went first to Beaufort, S.C., with my girlfriend, dipped our feet in the Atlantic Ocean, then we drove all the way to San Diego, and dipped our feet in the Pacific, and we did everything in between. We went to Arizona, the meteor crater they’ve got. We went to Carlsbad Caverns. We hit the Grand Canyon. We hit Legoland. It was over 21 days. I was at my conference about four days. So I use it just to enjoy life. It’s been just an incredible experience.

A. It’s really when you go to each new project, and figuring out the different pieces and the parts. The hierarchy of each fraternity or sorority is different. And it’s knowing who the decision makers are, and that’s on each campus, at each fraternity, at each sorority. Really, initially going in, it’s tough. You’ve really got to assess the situation and have a good handle on the operations.

Each campus has a different level of involvement in each project. An example: At Ole Miss, we built a 20,000-square-foot, $6 million house on that campus, and (the university) had no input. I go to LSU and we’re working on just landscaping, and they say, Chad, you can’t be involved. I’m like, my customers hired me to be involved. So I hire a landscaper and get all of that worked out, but they (LSU personnel) have to work on the house themselves. It’s a way for them to generate revenue for their campus, for them to do the work. So if we want to paint a fireplace, their workers at LSU have to paint the fireplace.

So that’s the struggle, and that’s why a lot of these contractors can’t do what I do because it’s so much to learn and know. But if you go into it knowing there’s moving parts, and that you just have to figure those out, that’s kind of my system. I know what the variables are and put things into place.