CCM
Katy Abraham and Keith Kothmann.
While celebrating the 45th anniversary of the company he founded, it’s clear that Keith Kothmann is prouder of the second generation of leadership of Construction Cost Management than the first.
“I wouldn't be able to describe what an incredible job she's done,” Kothmann says of his daughter Katy Kothmann Abraham, who took over as owner and CEO in 2012.
“When it was just me, I had to do all the marketing, so, I didn't do much. I had to do payroll, I had to do everything and that barely left time to do the estimating, but I had to make time. She jumped into those roles and immediately became an expert.”
He notes also with pride that Abraham has expanded the company’s client base by 10 times, he estimates.
“And our sales just went off the rails as far as annual production.”
Construction Cost Management was founded by Kothmann in 1979. Since then, the firm has provided estimating and construction consulting to architectural and engineering firms. Over the past four and a half decades, the firm has completed more than 8,000 project estimates, and 93% of those projects have come in at or under budget, the company says.
What the firm does is critically important. And its projects sometimes could take decades to complete.
“Unless you're here in the middle of it, you don't understand exactly what we do,” Abraham says. “Most people have never even heard of it, but [projects] can't go on without us.
“We see national parks, we see the Pentagon, then we see Army barracks, and then we see a runway, and then we see a pipeline, a nuclear base.”
The company’s notable projects include the Elwha River reclamation in Washington state, which removed two dams, restoring the river’s free flow from its headwaters in the Olympic Mountains to the Strait of Juan de Fuca.
Another the firm is working on right now is the National Park Service’s biggest project, replacing the Transcanyon Waterline, a 12½-mile line that provides potable water for all facilities on the South Rim and inner canyon facilities within the park.
The job illustrates the complexity of CCM’s task. This one involves the cost of planning for logistical challenges of a remote and environmentally protected location, as well as helicopter drops and building small tent cities.
“You're almost a city planner at this point,” says Abraham of the job.
Keith Kothmann, soon to be 77, who studied engineering at UT Austin, was practically born with a tool in his hand. Between the tools passed down from his contractor father to those he purchased himself, he has quite a collection.
“I bought every tool known to man,” he jokes.
All of his father’s friends were also contractors. “They would all come over and then we'd all build stuff, and I got to help. That's where I started.”
He began working on his father’s jobs when he was 15 or 16, he recalls.
That evolved into becoming an estimator.
“How much ceramic tile is in this building? How much drywall is in this building? And I would quantify that,” Kothmann says. “That's how I started in this business.”
He worked for Cost Systems Engineers for several years until a French firm, interested in its proprietary software, scooped it up in an acquisition.
“I had the choice of working for the French people,” says Kothmann, “or starting my own business. So, I just went out and did it.”
The firm has been in office space in the Stockyards, at 2413 N. Main St. since 1979.
As he grew older, into his late 60s, Kothmann says he naturally began to think about retirement and what that would look like. Financially, he had everything worked out.
“But what was I going to do with this business? [He thought] ‘I’m probably just going to have to work until I die,’ which isn’t a bad deal because the option was to go home, stay at the house, watch Netflix, and then get murdered by my wife.”
Kothmann’s got jokes. I think.
“Both of my parents showed me exceptional, crazy person work ethic,” Abraham says.
“I mean my mom was advancing in her career at RadioShack and she went to work every Saturday and my dad was building his business here and he went to work every Saturday. So between dance and birthday parties and things like that I spent my time here or at Tower One RadioShack. They would put me to work. I sharpened pencils, I made scratch pads, I organized file folders, I put things in alphabetical order, I cleaned, I just went to work.”
She even, Kothmann interjects, counted doors and light fixtures and plugs for estimates.
Says Abraham: “He sat me down and said ‘this is the symbol for doors, now count them all.”
Kothmann says in the back of his mind he had wondered what his daughter could do with the business.
“I was afraid she would say no,” Kothmann says of asking his daughter to buy the business.
And she did at first, sort of. What she said was, paraphrasing, “Let me think about it.”
Abraham has a business degree from North Texas. She had worked in oilfield services, as well as logistics. At the time of her phone call with her father, she was working in her “dream job.”
“I was a breed specialist for a canine companion food company, Royal Canin,” Abraham says. “I was with veterinarians and people who love animals all day long.
“I loved it. And, so, when he asked me, I was, like, ‘I work with dogs all day.’”
In fact, when she ultimately accepted her father’s offer, she stayed in both jobs for two years.
Of taking over CCM, she says: “When I got to know more about it, I talked with my husband Joe about what that looks like for us and then I kind of wondered what I could do with it.”
Abraham, a Fort Worth Inc. Entrepreneur of Excellence finalist, immersed herself in the job, using a network within the industry to help teach her what she didn’t know. She also received executive certification through a program administered by Goldman Sachs.
Since her ascent, Construction Cost Management has experienced over 500% in revenue growth, she says, in part because of certifications that have opened a multitude of opportunities to work on federal contracts.
CCM’s sales suffered in COVID, of course, but from 2021 to 2022 year-over-year sales increased by 12%, and in 2023, the company projected a 26% increase from 2022.
The company’s workforce has also expanded, from three in 2012 to upwards of 15, depending on the work demand. Manpower — a shortage of estimators — has been one area of challenge that Abraham has faced head-on.
“What had started happening was that everybody in the industry was my dad's age and there was no one coming up,” Abraham says. “It's a highly sought-after position. It's engineering and knowing how to be a GC, and knowing how to engineer and even a little architecture, but nuanced into an art that a lot of engineering brains don't lean to.”
It's also not much taught in the universities, both say.
So, Abraham began an internship program. The would-be estimators can learn from the master himself, Keith Kothmann.
“She came up with a fantastic idea. The internship worked out great and we got some super fine people in here and they learned so fast,” Kothmann says. “They just gobbled it up because it was something new every day.”
So, Katy Abraham has aced Rule No. 1 in stewardship: Making the place better than she found it.
“I can give you several examples over the years where women bought or inherited … and became owners of estimating companies,” Kothmann says. “Old estimating companies have been around a long time. My competitors. And they didn't last two years because they couldn't manage the industry.”
That’s clearly not the case here.
Correction: This original version of this story incorrectly noted that the firm was founded in 1976. It was founded in 1979.