Deborah Kuo never saw the 27-acre site on the Chesapeake Bay in Baltimore as just another plot of land for a project. She saw it as a stage from which Exelon Corporation could set a new standard.
Not that the new, 430,000-square-foot corporate headquarters for Exelon was ever going to be any old project. Nearly six years in the making, the overhaul of a former chemical plant site went to such sustainable measures that the project is chasing LEED Gold certification for the building and Platinum certification for the tenant fit-out. Still, that’s only one facet of the opportunity that Kuo, the company’s vice president of real estate and facilities, and the Exelon team set their sights on. In setting up a new headquarters in a new city, she took great pains to meet and get to know many consultants, contractors, distributors, subcontractors, and other stakeholders in and around Baltimore. She also made great efforts toward getting them involved in the project.
“We’re very committed to cultivating and developing the MWBE business community,” she says. “So when we have a big project with all this visibility, it’s only right to use this as an opportunity to make a big statement.”
In most projects, she explains, the owner hires an architect, who then hires a variety of consultants to design the entire project. Instead, Kuo opted to employ an extensive competitive-bid process for each of the design disciplines. The architect reports to her, as do all the other disciplines, such as the mechanical, electrical, lighting, plumbing, and acoustical consultants, just to name a few. Taking this approach allowed her to pick the best in a competitive field, and maintain direct line of sight and follow-through on creating a diverse multidisciplinary team.
“I’ve got about 25 different disciplines reporting to me directly, instead of going through that traditional architectural funnel,” she says.
Rather than going with one general contractor, Kuo pushed Turner Construction to establish a three-way partnership with two local minority-owned contractors—a first for Baltimore. Even when selecting furniture for the new space, Kuo says the company divided office furniture into nearly 20 categories with a dozen dealers sourcing everything from desks and chairs to power strips.
“Yes, it can be a headache, and it’s a lot more coordination and oversight on my part, but from the start, this wasn’t going to be run as a typical project,” she says. “From the very beginning, I went out and met with everyone I could. ‘Tell me who you are, what you do, who else I should talk to.’ As a newcomer to the city, I wanted to make sure we were champions for the community, doing what we could to make sure many companies—and not a limited few—could participate.”
The fruits of that labor also bore the project’s workforce development investment in job-readiness and skills training for underprivileged Baltimore city residents. By joining the Center for Urban Families with the Job Opportunities Task Force, the two local nonprofits prepared several hundred city residents for jobs, and a few dozen graduates gained work in the construction field. All these efforts have enabled the community’s embrace (“We’ve received fantastic, positive feedback”) of a project that had to face its fair share of resistance through the years.
Not only was the 27-acre brownfield site riddled with environmental concerns because of its previous life as a chemical plant, but even the site-selection process drew some consternation from local groups concerned about Exelon’s choice to build in an up-and-coming part of the downtown area instead of the traditional central business district. Those hiccups led to a prolonged effort to secure public financing for the development, which meant that although the project was announced in 2011 after Exelon initiated its merger with Constellation Energy, construction didn’t actually commence until 2014. Even the promises to redevelop the site into a sustainable piece of property were met with local skepticism.
“I’ve worked for developers, so I understand the business,” Kuo says. “[Developers] are selling a vision for development, with a goal of making as much profit off these developments as they can. Sometimes, they’ll do that at the expense of other promises they made.”
Nevertheless, the promises for the new Exelon headquarters have come to fruition. In addition to LEED Gold certification for the building shell, the company is pursuing LEED Platinum certification for a commercial building interior, which would make it the first project in Baltimore to earn this designation if successful. Kuo says the site itself will feature green public space—a rare amenity on a downtown site—as well as recycled building materials, and a recycled stormwater system. Not bad for an area with a long history as an industrial site that sat neglected for years.
In addition to setting both local officials and community members’ minds at ease, Kuo has the added objective of making sure employees are heard. Although many years have passed since the merger with Constellation, she says it’s still important that employees in the post-merger environment adapt to and embrace Exelon’s culture. Kuo says cultivating this culture was a good reason to make sure their feedback was part of the design process for the new headquarters.
“We spent a lot of time doing research, surveys, and focus groups with our employees, showing them different things to help us understand what they liked and wanted more or less of,” she says. “Ultimately, we’re delivering space they’ve got to live in. It could very much be a design-driven thing where we say, ‘We want the most fabulous design and we hope it works for you.’ Or, we could say, ‘Let’s see if we can marry great design with what our employees think is functional and important.’ Everyone has a voice, and asking and listening helps to build our culture. . . . Doing that brings employees together.”
Considering the project is a headquarters for one of the largest power utilities in the United States, it might have been easier if the company had simply used its power and influence to push it through instead of making the effort to involve all the parties that Kuo wanted aboard. She says that would’ve been a missed opportunity.
“Yes, there’s the faster, more efficient way of doing something, but for something like this, we need to consider that we’re part of something bigger,” she says. “This is impacting the city, the whole community—and we hope it creates goodwill. This is a public utility. All of our customers know who we are. You’re our customer, right? So even though you might not be directly impacted by this project, isn’t it good to hear good things about the company you’re doing business with?”
INSIDE THE JOB
with Guest Editor Tom Ruscitti
TR: What were some key workplace strategies employed in Exelon’s new Baltimore headquarters? Can you describe the desired impact, if any, on space efficiency, productivity enhancement, and personnel recruitment and retainage?
DK: For Baltimore, we used the project as an opportunity to rethink and update how we approach our space. Things like open floor plans and interior offices were a given, but taking the step of giving our employees a day-to-day choice in how or where they work was critical. This means adjustable-height desks so that you can sit or stand at any time of the day and technology that allows us to be “freed” from the desk.
As a result, employees have many choices for working in a traditional conference room, a more intimate huddle room, a private focus room, or in one of the many open gathering areas throughout each floor. We have a rooftop terrace with tables and seating where employees can enjoy the green roof, watch a solar photovoltaic array in action, and catch great views of the bay. We have less dedicated personal space, yet more flexible space, to accommodate fluctuations in head count. There are also more choices to move around, get together with a team, or get away for a private moment.
TR: How is the shifting energy paradigm impacting Exelon’s current and future real estate needs?
DK: Our business includes generation (gas, hydroelectric, nuclear, solar, and wind power plants), transmission and distribution (utilities), and competitive wholesale trading and retail energy sales. I like to think that Exelon pushes itself to be in front of changing industry dynamics and, ultimately, what we do relies very importantly on our people. Our workforce is evolving—maybe more than other industries—so our real estate is structured to be agile and flexible to give us a high degree of optionality when it comes to managing existing and future real estate needs.
TR: What are the key business drivers in establishing Exelon’s real estate holdings?
DK: Flexibility, flexibility, flexibility. Of course, access to a viable labor market is important, along with economics that make good near- and long-term financial sense. We also consider where our customers are located.
TR: With operations and business activities in 48 states and Canada, what are some of the manifest and latent risks with maintaining uptime of essential facilities?
DK: We’re in the power generation and utility business, and those businesses demand that we’re always “on.” This is what we do, and we work hard to do it well—with minimal downtime and minimized risk.
Tom, you and I worked together at Deloitte & Touche LLP many years ago. There was a partner who, when asked what the most lasting piece of advice he’d heard in business, replied, “Pigs get fat, and hogs get slaughtered.” Do you recall that?
TR: Yes. A project manager’s alliterative mantra retort to that adage is “plan, prepare, prevail.” In other words, “Make no little plans, and don’t buy a pig in a poke.”
DK: I don’t recall the actual context of why that statement was made, but in business, it’s a great maxim to live by and one that I share with my team and partners—especially in negotiations when parties start getting piggish and treading on hog territory. For some reason, this has stuck with me.