Landscape Pros Dig Boomtowns

With an onslaught of new residential and commercial development, landscape design and service has become a multi-million dollar industry in Northwest Arkansas.

Michael Steenbergen, who owns All Around Landscaping Inc. in Springdale with wife Jo Lynn and another partner Dave Hansen, said the firm is on target to bring in $6 million in 2005 gross revenue, up 20 percent from $5 million in 2004. All Around Landscaping is one of the only landscape contracting firms in the area with an unlimited state contractor’s license.

Steenbergen said his firm has seen annual growth of 50 to 55 percent on average and will employ about 100 full-time this summer. It employs 70 year round.

Steenbergen said it took nearly 14 years for his business to make money because he reinvested in it.

“We were making a profit technically before that,” Steenbergen said, but it took that long to take a substantial dividend.

He said the landscape construction business has an 80 percent failure rate, second only to restaurant startups.

There are 43 registered landscape architects in Benton and Washington counties. Six of the 17 Arkansas landscape contractors registered with Associated Landscape Contractors of America are in Benton and Washington counties.

Good Lawn Hunters

Jeff Q. Hunter began his Springdale firm, Professional Landscaping Co., 28 years ago with three employees and now employs about 30 in peak season. His son Keith Hunter will earn a degree in landscape architecture from the University of Arkansas in May.

“With the influx of people we have moving to Northwest Arkansas, the awareness of landscaping has increased a lot over the last 10 years, not just five,” Hunter said. “We are seeing a demand for more seasonal color in [flower] beds and for a higher quality of maintenance.”

Professional Landscaping has a $1.2 million job bid limit on its state contractors license. Hunter said that the bid limit is established by financial reports and operating capital. He said his annual sales exceed $1 million.

Hunter said project values can range from $20,000 to more than $100,000 in high-end residential installation jobs. He said his firm offers design and installation for both residential and commercial sites. His firm completed the landscape work for the entrance to the Shadow Valley subdivision in Rogers.

Hunter said the split varies from year to year, but installation jobs have been running 50-50 between residential and commercial.

Developers want to establish curb appeal for their subdivisions, Hunter said.

“They want the property to attract the attention of a potential client,” he said.

He estimates that 95 percent of his maintenance clients are commercial.

“We are seeing an increase in demand from restaurants,” Hunter said. He said an annual restaurant contract would run from $400 to $600 per month, which would include mowing, weed eating, a weed and feed program for the lawn and seasonal plant change-outs during the year.

Some of Hunter’s clients include Marketplace Grill and Tyson Foods Inc., both of Springdale, and the Pinnacle Group of Rogers.

He said customer tastes are becoming more developed.

“As the demand for uniqueness increases, our suppliers have become better at supplying a better variety of plant material,” Hunter said.

None of the landscape firms interviewed would disclose their suppliers.

McMahon Brothers

Tim McMahon, owner of McMahon Brothers Custom Homes, said price is not always a first priority.

“We look for landscape contractors that are capable of creative design,” McMahon said.

He said homeowners are realizing the value of investing in landscaping.

“Landscaping can greatly enhance the real end perceived value of a home or commercial property,” McMahon said. “It makes the home inviting.”

The Associated Landscape Contractors of America report that the proper selection and placement of plant material can lower heating and cooling costs by as much as 20 percent. ALCA said studies indicate that landscaping can increase resale value by more than 14 percent and speed the sale of a property up by six weeks.

McMahon said his firm usually builds landscaping into the price of the home, but he’s seen customers spend from $1,500 to $50,000 on landscaping alone. McMahon said All Around Landscaping has done several jobs for his homes in Johnson’s Clear Creek subdivision

“People do want more landscape and they want it designed for easy maintenance,” McMahon said. “Clients are looking for private-type oasis environments in their backyards with things like fountains and boulder installations, swimming pools etc.”

Commercial Projects

About 80 percent of All Around Landscaping’s business comes from commercial projects. The rest is devoted to individual residential projects.

“We help the general contractor get his job done on time,” Steenbergen said. “They can’t open the building until the landscaping is done.”

Dave Hansen, co-owner of All Around Landscaping, said most of their jobs come from bid work. “What we try to do is make a connection with the customer on the front end and get it to the point where they look at us as a partner.”

Hansen said follow-through is a big selling point. “It’s one thing to put something in, and it’s another to maintain it,” Hansen said.

All Around Landscaping completed the landscaping for Northwest Medical Center of Benton County and all the medical out-buildings, as well as all of the wetlands mitigation. That was a $750,000 job, Steenbergen said.

“With all of the work that is available here in Northwest Arkansas, you have companies that over-commit and are not able to meet your needs,” said Darin Harper, project manager with Northwest Excavation, a division of Nabholz Construction. “With us, if you tell us that you are going to be able to do something, we would prefer that you are going to realistically be able to meet our expectations.”

Harper said that service takes a priority over price.

Harper said they use All Around Landscaping and Midwest Erosion of Neosho, Mo., often for sod and retaining wall work.

A lot of work, Harper said, is weather dependent. For example, if Northwest Excavation installs topsoil and it rains before sod installation, it costs the company in equipment, materials and manpower to replace runoff soil.

A typical sod job for a subdivision could cost about $8,700 per acre or 20 cents per SF. Many times the sod work has to be completed around a detention pond for a subdivision to get final plat approval, Harper said, and that could mean up to two acres of sod.

“We are responsible for giving our customer the best value for his dollar,” Harper said. “We have certain companies that we use based on their service ability and then the price.”

Jean Geren, former owner of Terravista Landscape & Maintenance in Bentonville, said he’s seen a landscaping job run up to $100,000 for a home probably valued at $350,000. That particular project rang in $25,000 for the water feature, another $35,000 for the dirt work, sodding and irrigation and another $25,000 for planting. The 17-year industry veteran said he’s also seen homes valued in the millions where the owner will invest really little in landscaping.

Geren, who owned Terravista until recently, said he thinks the landscape contracting business is cyclical.

“What happened was six or seven years ago we were doing a lot of commercial buildings,” Geren said. “Then two years ago that kind of cooled off.” Geren said his business switched to high-end residential and then back to a 50-50 split between residential and commercial.

He said he’s seen customers spend upwards of $250,000 on landscaping before.