It’s been a busy couple of months for the architecture and design firm NELSON. It was wrapping up its merger with Wakefield Beasley & Associates and WB Interiors, a deal that was announced last November. It recapitalized its business with two financial partners, H.I.G. Capital and Prudential. And today, NELSON announced that it had entered into a merger agreement with FRCH Design Worldwide, an architecture and design firm with three offices and 200-plus employees, which specializes in retail, hospitality, and mixed-use.
NELSON’s Chairman and CEO, John “Ozzie” Nelson Jr., and FRCH’s CEO, Jim Tippmann, will serve as Co-CEOs of the combined company, which now consists of 25 offices and more than 1,100 employees. FRCH Design Worldwide will be known as FRCH a NELSON company.
Tippmann tells BD+C that he and Nelson started talking “15-16 months ago” about the possibility of merging their two businesses. Such a deal made sense, explains Tippmann, because “we’re both operating in a dynamic, changing business environment.”
FRCH, with estimated revenue of $40 million, had concluded that it either had to acquire a company itself, or find a partner like NELSON that had the geographic reach FRCH needed in order to compete for business from larger clients, especially those propagating brands in multiple markets.
Just as the Wakefield Beasley deal got NELSON deeper into the mixed-use realm, merging with FRCH would bring into NELSON’s stable “a sizable hospitality business,” says Nelson. His company would also benefit from FRCH’s “big retail engine” in a sector where NELSON on its own has had difficulty gaining traction.
Jim Tippmann (left) and John “Ozzie” Nelson Jr., Co-CEOs of NELSON, will manage their company after the merger by region and practice sector. Image: NELSON
As Co-CEOs, Nelson and Tippmann have crafted a regionally defined operating model. Tippmann says he will be “the first point of contact” for NELSON’s business in the Northeast and Southeast, and Nelson will take the lead for its offices in the Midwest and West. Practice responsibilities will align with each of the merging company’s specialties: for example, Tippmann will oversee retail and “consumer interface” projects, whereas office, financial, and industrial projects will fall under Nelson’s domain.
The combined company’s holding company will continue to be based in Minnesota. But Cincinnati—FRCH’s headquarters city—is now NELSON’s biggest office. Atlanta is the company’s biggest market, and will be managed by two offices there. Over the coming months, the leadership of both organizations will further integrate their expanded service offering.
Nelson tells BD+C that he still sees his company as a “global boutique” with an office structure that Tippmann thinks is now “a contemporary model, where leaders can be anywhere in the U.S.” FRCH and NELSON both use video conferencing to connect their offices, which came in handy yesterday when the CEOs were announcing the merger to their employees via electronic town hall-like meetings. (Nelson notes that he spent 2½ hours with 250 people in his company’s Atlanta offices answering their questions. “You want to be as transparent as you can in those meetings,” he says.)
“I couldn’t have been more pleased with how this came together,” says Tippmann.
Nelson says his company has gotten to a size where “we will have an opportunity to grow organically and attract talent.”
However, having been involved in 40 mergers during his 30-year career with the company, Nelson says he’s still on the lookout for acquisition candidates in Southern California and Texas, and for firms that would strengthen NELSON’s competitive position in such sectors as industrial architecture and healthcare.
What he will avoid, though, is finalizing a merger just to get it done. “Culture trumps everything, and you don’t want to do a deal that leaves you with an operating nightmare.”
Related Stories
Building Team | Jul 15, 2022
ABC: Construction materials prices increased in June, up 20% from a year ago
Construction input prices increased 1.9% in June compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data released today.
Arenas | Jul 15, 2022
U. of Oregon renovation aims for ‘finest track and field facility in the world’
The renovation of the University of Oregon’s Hayward Field had the goal of creating the “finest track and field facility in the world.”
Building Team | Jul 14, 2022
ABC’s construction backlog inches lower in June; Contractor confidence falters
Associated Builders and Contractors reports today that its Construction Backlog Indicator fell 0.1 months in June and stands at 8.9 months, according to an ABC member survey conducted June 21 to July 5.
Sustainable Development | Jul 14, 2022
Designing for climate change and inclusion, with CBT Architects' Kishore Varanasi and Devanshi Purohit
Climate change is having a dramatic impact on urban design, in terms of planning, materials, occupant use, location, and the long-term effect of buildings on the environment. Joining BD+C's John Caulfield to discuss this topic are two experts from the Boston-based CBT Architects: Kishore Varanasi, a Principal and director of urban design; and Devanshi Purohit, an Associate Principal.
Multifamily Housing | Jul 14, 2022
Multifamily rents rise again in June, Yardi Matrix reports
Average U.S. multifamily rents rose another $19 in June to edge over $1,700 for the first time ever, according to the latest Yardi® Matrix Multifamily Report.
Building Team | Jul 14, 2022
Austin PBS gets a new state-of-the-art facility with three studios
Since the 1970s, Austin PBS, birthplace of the Austin City Limits TV series, has been based inside the communications building on the University of Texas campus—a space it has long outgrown.
Building Team | Jul 13, 2022
The YIMBY movement emerges as valuable advocate for affordable housing
Over the past few decades, developers grew accustomed to nothing but staunch opposition to dense affordable housing project proposals.
Energy | Jul 13, 2022
Electrification of buildings, new and old, furthers environmental responsibility and equity
It’s almost a cliché in our industry, but nonetheless: The greenest building is the one that is already built.
Building Team | Jul 13, 2022
Austin’s newest entertainment and hospitality complex has been made from repurposed shipping containers
A new entertainment and hospitality complex in Austin, The Pitch, has been made out of repurposed shipping containers.
Codes and Standards | Jul 12, 2022
USGBC sets out principles for LEED’s future
The U.S. Green Building Council recently published a report containing principles outlining how LEED will evolve.