Like any new business owners, Heather and Kevin Dosch had nowhere to go but up when they launched their homebuilding company – in their case, way up, and at rocket speed. Sales grew by 1,512 percent from 2010 through 2012.
The Doschs, owners of John F. Buchan Homes LLC in Bellevue, know they can’t keep growing at such a dizzying pace, but they plan to keep trying. “I love challenges, and we’re taking it as a challenge to keep the growth going,” Heather Dosch said.
After generating virtually no revenue during its first year in 2009, the company recorded nearly $625,000 in sales in 2010, $5.46 million in 2011 and $10.07 million in 2012. The projection for 2013 is $18 million. The company employs 22 people, up from three in 2010.
If the company’s name rings a bell, it’s because John Buchan, Dosch’s father, was a premier local homebuilder for 50 years. Although his company’s official name was John F. Buchan Construction Inc., he and his wife, Gloria, did business as John F. Buchan Homes.
When the Doschs started John F. Buchan Homes LCC, they arranged to adopt the same business name — John F. Buchan Homes — as the original company. “There’s no question there’s a great brand there,” Dosch said. “To be able to (capitalize on that) is very helpful.”
By adopting the name, the Doschs are keeping it alive because the original company, founded in 1961, is no longer in business after the retirement of John and Gloria Buchan.
Over the years, Dosch worked for the original John F. Buchan Homes in various roles, including CEO from 2008 through this year, when the books will officially close. “I basically stepped in to wind (the company) down,” she said. The recession hit the original Buchan Homes hard and contributed to her parents’ decision to retire, Dosch said. With a large inventory of unsold properties that were plummeting in value, she worked doggedly with the company’s lender to negotiate short sales and was able to avoid foreclosure on all but four properties, she said.
Dosch and her husband co-pilot the new John F. Buchan Homes. “He runs everything out in the field, and I do everything that relates to sales and finance,” Dosch said.
She said managing the new company’s growth has been a lot easier than winding down the old company, especially since they were able to hire some of the old staff. “I think the biggest challenge has been the [amount of] time we have personally spent working,” she said.
Although the name and focus on high-quality construction mirror that of the original company, version 2.0 is not a clone, Dosch said. “The business model is fairly different,” she said. “We’re not these big land developers. We’re much more about…remodels and custom homes.”
At its peak, the original company built 100-plus homes a year in plats it developed as spec projects. “The company was a bit of a machine before,” Dosch said. “We didn’t want to do that. There’s a lot more personal aspect to the company now.”
It pays to be flexible, though, and after acquiring three small plats totaling 23 home sites in 2011, the Doschs expanded their business model to include spec projects — which fueled the company’s exponential growth. “We didn’t plan on doing any plat work when we first started, but we were able to take advantage of some great opportunities that were present in the market,” Dosch said.
Each of the plats acquired in 2011 is sold out, and the final eight homes are approaching completion. Since then, Buchan has acquired three more small plats ranging from three to seven lots each that are in various stages of construction and development.
“We’ve decided to keep doing a little bit of plat work,” Dosch said. “It helps our visibility in the marketplace to have some spec listings.”
Buchan also is dipping its toe into the multifamily market, acquiring property on Queen Anne Hill and in Kirkland. It plans to build three condos at the first location and four at the second sometime next year.
The price point for most everything Buchan builds — spec, custom, condos — is $800,000 and up.
The company’s long-range goal is to build 35 to 40 units of new housing a year – half or more of them custom homes – with a sprinkling of remodels. Buchan will complete 10 custom homes and eight remodels in addition to 13 plat homes in 2013.
With custom construction and remodels, the customer already owns the land, reducing the risk compared with plat projects. “We’re not opposed to risk, (but) not having to finance all that land spreads it out and lessens it,” Dosch said.