A closer look at executive housing, office spaces and a day in the life of two CEOS.
Trends in Executive Housing
The captains of industry in the Twin Cities have precise standards for where they live
The excellent, cringe-inducing Larry David sitcom, Curb Your Enthusiasm, had a memorable tagline: “Just because you’ve made it, doesn’t mean you’ve got it made.”
That pretty much sums up the upper end of the real estate market. Executives and other high rollers can afford a lot of house, especially in relatively inexpensive markets such as the Twin Cities metro. But that doesn’t mean your average exec can snap her fingers and find the home of her dreams — particularly when she’s relocating from out-of-state.
To learn what makes home-searching executives tick, we spoke with Steve Havig, owner of Minneapolis-based Lakes Area Realty, and Chad Larsen, principal of the Berg Larsen Group. Both know their way around the upper echelons of the Twin Cities real estate market.
Location, location, location
On the location front, the executive’s employer is usually the top concern. 3M execs, for instance, are more likely to settle in affluent East Metro communities like Lake Elmo, White Bear Lake, or St. Paul’s Crocus Hill neighborhood. Cargill execs prefer upscale housing in close-by communities such as Wayzata, Deephaven and Orono.
“Beyond location, the question is: Just what does the family want and need?” says Havig. He ticks off a laundry list of considerations for relocating executives and their families, none of which are particularly surprising: “Amenities such as parks, lakes and good views; access to work, schools, activities, the arts and restaurants; and comfortable surroundings.”
For executives with school-age children, the most desirable areas are close to highly ranked public and private schools — places such as Wayzata, Plymouth, Edina and southwest Minneapolis.
Of course, amenities and housing types vary tremendously within these areas. Larsen remembers a younger family — a Minnesota-born executive, his foreign-born wife and their small children — who knew they wanted to live in Edina or southwest Minneapolis. From prior experience, both were keen on walkable neighborhoods with engaging street life. They initially looked in Edina, near 50th & France, but were shocked by the cost of the area’s new-construction family homes.
“You do pay a premium for new construction, especially in that area,” says Larsen.
So they headed a mile or two northeast, to Lake Harriet, and chose an older, renovated rambler — in effect, trading at-the-doorstep shopping and dining for green space and affordability.
Like goes with like
Desirability builds on itself, too. Most sizable metro-area suburbs have great-looking neighborhoods with leafy streets, large lots, ample green space and limited noise. Though more urban, wide swathes of Minneapolis and St. Paul are safe, quiet and green, also, only a relative handful of communities will do for discerning executives, says Havig.
The reason: home values. “Upper-bracket buyers want to be next to other high-value homes,” says Havig. Even in largely affluent suburbs such as Edina, for instance, high rollers tend to cluster in a handful of enclaves: Country Club, Indian Hills, Rolling Green. Some smaller Lake Minnetonka communities, such as Woodland and Deephaven, cater almost exclusively to the 1%, but they’re exceptions that prove the rule. In the core cities, deep wealth concentration is limited to a few spots around the Minneapolis Chain of Lakes and the Mississippi River bluffs.
To each their own
According to Havig and Larsen, metro-area execs don’t really segregate by industry. It’s not like Wayzata is home only to finance execs, Plymouth only to medtech execs, Stillwater only to manufacturing execs.
That said, signs point to a nascent generational shift. Younger buyers, especially in the tech industry, appear to have a soft spot for amenity-rich core city neighborhoods. Though neither Havig nor Larsen specialize in tech relocations, they affirm that “younger buyers are downtown, in both Minneapolis and St. Paul, along the [Mississippi] river,” and in the North Loop, where condos and lofts are prevalent.
Since the executive class naturally skews older, the full effects of the shift from suburban manses to downtown and riverside condos probably won’t be felt for a decade or two — to the extent that it happens at all. But for those interested in (or invested in) the metro real estate market, this is certainly a trend worth watching.
The better half
What about the better half?
The needs and wishes of trailing spouses are important too, even without kids in the picture. Relocations can happen fast, leaving working spouses and partners to decide whether to continue working in their origin cities and look for Minnesota-based positions remotely, or quit their jobs and move with their spouses on the expectation that they’ll land on their feet.
“You always want a happy spouse,” says Havig.
Spouses’ professions and preferences can influence executives’ choice of housing location, and even type. A spouse who works in finance, for instance, might nudge the family toward close-in Minneapolis neighborhoods with easy access downtown. A public-sector spouse might prefer homes in or near St. Paul. When time is of the essence, the family might settle on temporary housing — an apartment or condo — near the executive’s employer, then look for a permanent home convenient to both partners’ workplaces.
When expectations are high and personalities strong, conflict inevitably follows. Some years ago, Larsen worked with a relocated 3M executive who’d be spending long hours on the conglomerate’s Maplewood campus. Tragically, his wife would settle for nothing less than a Lake Minnetonka estate.
“It was basically a deal-breaker,” says Larsen, of her strong preference for a lakefront spread. In the end, she won, and the 3M exec steeled himself for a daily cross-metro commute.
“The main thing we have to remember is that executives are people with families,” adds Larsen. “They are being uprooted and relocated, leaving friends and sometimes relatives.”
Trends in Executive Offices
Flatter, fewer walls
Modern executive offices are constantly evolving. For the latest, we turned to two local office-design experts: Aaron Eggert, president of Minneapolis-based iSpace Furniture, and Andrew Leddick, director of furniture sales, design and operations at Burnsville-based Innovative Office Solutions.
Democracy at long last?
Call them democratic, pluralistic, egalitarian, flat — whatever your preferred buzzword, today’s offices appear less hierarchical than ever before. The boss is still the boss, of course, but she’s more likely to have a desk in the bullpen or a modular, centrally located suite than a traditional corner office.
Leddick prefers “pluralization.”
“There has definitely been a ‘pluralization’ of the workplace, breaking down walls and reducing the layers of workplace perks for management. More junior workers really want their leaders to be in the trenches with them. Leaders enjoy being part of the excitement, and almost everybody I talk to wants to be part of their organization’s culture, not just a person who does a task.”
Fewer walls mean fewer barriers to communication. That’s good for rank-and-file workers, who value access to (and accountability from) the big boss. It’s even better for execs, who see more (and feed off their team’s energy) when they’re lower to the ground.
Form follows function
The high-paneled office wall is dead. In many offices, so is the cubicle.
What’s replacing them? In a word, variety: work lounges, workstations, work bars, work benches, small group gathering spaces (huddle spaces), quiet rooms, conference rooms and more, all infused with what Leddick describes as “a homey patina” — warm colors, “scrappy mixtures of textiles,” hot food and coffee, table games.
According to Leddick, the “common thread” linking these trends is talent — specifically, “attracting and inspiring new talent” in an increasingly competitive human resources market. The last thing employers want, notes Eggert, is to appear “old and stodgy.”
“Many knowledge workers can now work wherever they want, so office space has to offer something they can’t get at home,” says Leddick. Last fall, Leddick toured a revamped Minneapolis office built around a “fully stocked kitchen” — to the extent that the elevators opened straight into the canteen, forcing execs, interns and visitors alike to walk past the fridge on their way into the space.
“That’s very different than a wet bar hidden in the president’s office,” he says.
Room for tradition
Of course, not all employers embrace the cutting edge. Larger companies — Fortune 1000 firms, mostly — probably won’t do away with their executive floors or wings anytime soon. And partners at accountancies and law firms still value the prestige and privacy of the corner office, says Eggert.
But pretty much everyone else has the democracy bug. Companies that can’t afford the expense or disruption of a move or office redesign are simply repurposing formerly closed-off enclaves as conference rooms and huddle spaces. Eggert practices what he preaches: iSpace Furniture has just one office, for the CEO; Eggert sits out in the bullpen with the rest of the team.
Ever more eclectic
Demographic realities all but guarantee that office design will get more exciting in the coming years, not less. Soon, the oldest members of Generation Z will enter the workforce, taking their place alongside Generation Y, Gen X and younger Boomers.
“Never in the history of work have four generations been in the workforce simultaneously,” says Eggert. “Designers need to accommodate everyone’s needs,” from executives nearing retirement to fresh-faced grads. Work spaces are likely to become more eclectic and technology-driven, possibly with new forms and configurations not yet in common use.
And, in keeping with the younger set’s artisanal streak, Leddick expects more furniture, design pieces and entire office spaces made with repurposed or salvaged materials.
“There could be a collection of products that [combine] with existing furniture components to integrate AV, divide spaces differently, or maybe even route HVAC or electrical,” he speculates. “Whatever they are, new design elements will have to empower workers to connect with their colleagues — to participate in a workplace — in a way that’s not possible at home.”
A Day in the Life
What do manufacturing CEOs actually do all day?
Contrary to popular belief, they don’t stand akimbo in skybox-like offices with panoramic production floor views, cackling softly as their underlings toil. In fact, they’re more likely to be on the floor themselves.
To learn more, we spoke with the CEOs of two Best in Class 2016 Manufacturing Awards winners: Jaime Harris of Hydra-Flex and Vicki Holt of Proto Labs. We came away with a better understanding of their daily activities — and newfound respect for Minnesota manufacturing.
Jaime Harris, Hydra-Flex
Jaime Harris founded Hydra-Flex in 2002. For five years after that, “It was basically me, my cofounder and a beer fridge.”
Those were the days. Today, Hydra-Flex employs 40-odd machinists, managers and clerical professionals. “As the business has evolved, I’ve evolved with it,” says Harris.
Though no two days are ever alike, Harris’s day-to-day schedule does include some well-worn patterns:
Standing meetings: Harris runs several “standing meetings” throughout the week, including the mandatory, all-hands staff meeting on Wednesday mornings. “These meetings are opportunities to communicate shared goals, to allow employees to speak up, and to detect friction before it becomes a problem,” says Harris. There’s also a monthly meeting where the leadership shares financial and operational details in a “very transparent” fashion.
Walking the floor: Much of Harris’s day simply involves walking the floor and interacting with every floor employee for 10 or 15 minutes.
Polling and coaching employees: Harris is focusing on building a strong, consistent company culture. He devotes time each day to soliciting honest feedback from employees — “what they’re excited about, what they need to succeed” — and coaching employees to uphold the company’s goals and values.
Devising and communicating new processes: As Hydra-Flex grows, Harris is less focused on implementation and execution than on tactics, strategy and communication. Most days, he works on improving processes that benefit operations, product lines and market verticals, and “articulating what our products do for the applications we serve.”
Other important duties are periodic, but not part of Harris’ day-to-day routine.
Visiting major accounts and sales territories: Harris tries to meet each year with his major customers — whether that means hosting, visiting or meeting in the middle at trade shows.
Hiring: The top goal this year is improving recruiting and retention: “getting the right people on board the first time; we won’t have the luxury to make mistakes in the future.”
Planning and visioning: The beer fridge is no more. “We’re at the stage as a company where I’m not the answer to everything,” says Harris. “I continue to fill a visionary role for longer-term questions, but beyond that, I need to get the hell out of the way and let our amazing team do its work."
Vicki Holt, Proto Labs
Vicki Holt didn’t start Proto Labs from scratch, but she’s been competently steering the ship — with nearly 2,000 hands in at least six distinct locations — for three years straight.
Proto Labs, a contract manufacturer that fabricates high-tech prototypes and short production runs for a wide variety of clients, is much larger and more operationally diverse than Hydra-Flex. It’s also publicly traded, meaning Holt has to devote some energy to investor relations. While, like Harris, she avoids the “typical day” trap, she makes time every day for:
Self-care: On a normal day, she’s up by 4:30 a.m. The early morning is reserved for exercise, either at home or at the first gym class of the day. “I’ve converted my night-owl husband into a morning person,” she says.
Engaging with direct reports: Much of Holt’s time involves checking in with her direct reports — other members of the C-suite and senior VPs. This helps her keep up with the big picture, which can change rapidly in the digital manufacturing business.
Checking in with project teams: Something is always happening at Proto Labs. Though Holt can’t be quite as hands-on as Harris, she consults with project teams at major milestones and on an as-needed basis.
Walking the floor: Like Harris, Holt spends much of her day walking around Proto Lab’s facilities — mostly at the company’s Maple Plain headquarters, and to a lesser extent at its nearby Plymouth plant.
Like Harris, Holt has lots of other duties that demand her time on a more occasional, but nonetheless recurring, basis. At various intervals throughout the year, she’s expected to:
Travel throughout Proto Labs’ domain: Holt spends most of her time in Maple Plain, but she’s not a homebody. She gets down to Plymouth two to three times per week and hits the Rosemount plant at least once a month. Farther-flung locales get attention, too: She visits facilities in North Carolina and England once per quarter, and gets to Proto Labs’ Tokyo plant twice per year. These movements are designed to keep Holt in touch with her “awesome leadership team without interfering with [its members’] time, which is immensely valuable.”
Meet with customers, candidates, investors, and directors: Holt hosts Proto Labs clients in Maple Plain almost every week — a relatively new, widely liked practice. She also personally interviews finalists for key roles: last fall, for instance, she spent hours speaking with chief revenue officer candidates. As the leader of a publicly traded company, she also has to meet and maintain contact with the board of directors, finance experts and institutional investors.
Plan for the future: Holt estimates that 20% of her time is devoted to “strategic and logistical” matters, including long-term visioning and planning. Like clockwork, she sits down with her assistant in January and figures out where she’s going to be, and when, during the next 12 months.
Leadership: Jaime Harris, Founder and CEO
Revenue: $12 million +
Description: Manufactures high-performance chemical injectors and dispensing systems.
Headquarters: Maple Plain
Leadership: Vicki Holt, CEO
Revenue: $200 million (2014)
Description: Manufactures customized injection-molded, CNC-machined and 3D-printed parts for prototypes and short-run production. Web: protolabs.com