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Gough & Lesch.

Like many Americans, Larry Gough dreamed of growing up to be President someday.

But for him, the dream came true.

Gough, 30, the son and grandson of bricklayers, is the president of Merrillville-based Gough & Lesch Development Corp., one of northwest Indiana's largest real-estate developers.

John Janik, executive director of the Merrillville Chamber of Commerce, says Gough & Lesch has contributed to the transformation of Merrillville from a sleepy farm town to the commercial hub of northwest indiana. Gough & Lesch and its CEO Neville Gough have made a mark on the community. Their buildings have enhanced the area. (The firm has won the chamber's landscape and architecture award four years running.) They're one of the reasons Merrillville has risen to the forefront of the region," Janik says.

Larry Gough inherited the job from his father, who founded the business in 1974 with partner Donald "Chip" Lesch. But attributing his rise within the company solely to nepotism would be a gross misconception. It took more than genes to climb to the top of this firm. instead of playing in Little League, Gough spent his weekends and summer vacations on paint scaffolds and manning mortar troughs. He won the president's title the old-fashioned way-he earned it.

He assumed control of the multimillion dollar family business two and a half years ago when his father, Neville, 59, stepped down from the role of day-to-day manager of operations to concentrate on development. Neville Gough has retained the title of CEO, but his eldest son now runs the firm, which specializes in residential and commercial development, property management, general contracting and commercial leasing in Lake and Porter counties.

I always wanted to follow in my father's footsteps," Larry Gough acknowledges. "Back in first or second grade I remember driving out with my dad and my Uncle Arnie every Saturday morning to check on job sites. I enjoyed being around the workers and seeing the progress, watching dirt turn into a building, knowing we were creating something where there was nothing before."

What surprised him about his ascension to the top was how quickly his dream came true. After high school, he attended Purdue University and was graduated in 1982 with a degree in civil engineering. After college, he hired on as a project manager with Dallas-based Suburban American Development Corp. to enhance his hands-on managerial experience. He returned to Indianain 1986 to perform the same duties with Gough & Lesch. In a few short years he earned the position of president.

Neville Gough says the founder of a family-owned business always hopes his children will succeed him. When you work for something your whole life, you want to pass it down to the family. But you can't wait until you're an old man to give them a chance,' he says. You have to see what they're made of. And you have to allow them a chance to be their own person.'

My father gives us a lot of rope,' Larry jokes. Luckily, so far I haven't hanged myself. He's been very supportive.'

'All in the family' assumes a whole new meaning at the offices of Gough & Lesch, where it's possible to run into several members of the family. David Gough, 28, is in charge of the company's growing property management division. And Beverly Gough Miller, 31, handles lease renewals and space planning. in fact, the only one of Neville's four offspring not to work in the family store is 34-year-old Diane. She's the smart one in the family,' Larry laughs. She became a nurse.'

With four Goughs in the business, how has Neville Gough reduced the potential for internecine warfare and sibling rivalries?

We come together on major issues and sometimes we butt heads,' Neville Gough admits. But I'll sit in and listen and judge. If they hadn't gotten along so well together, I never would have brought them into the business.'

The 25 employees of Gough & Lesch wear many hats. They need to, Larry Gough explains, to keep track of the company's many diverse properties, which include:

* Thornapple Plaza, a 52,000-square-foot Valparaiso retail and office complex that should be completed this month;

* The Williamsburg, a three-phase, 80,000-square-foot colonial-style, upscale office complex in Merrillville slated for a fall opening;

* Chandana Point, an apartment and single-family residential and recreational development adjacent to the Valparaiso Country Club;

* Schererville Professional Center, a 24,000-square-foot medical and legal office center scheduled for a July completion;

* Sand Creek Country Club, an 80-home residential subdivision with a golf course;

* Park 84, a 20-acre site to be developed into a 200,000-square-foot office and warehousing facility located in the trendy corridor south of U.S. 30 and east of Interstate 65 in Merrillville; and

* Spring House inn, a 50-room, English cottage-style country inn and resort complex already completed and located near the Indiana Dunes National Lakeshore in Chesterton.

`The key is diversification,' Larry Gough says. Gough & Lesch has been expanding its expertise into areas outside the realm of traditional developers. When times are good, as they are now, you have to be building up divisions of the company to support you when times get tough,' he says. For us, that division is property management. It's a fee-income business, not like development. We have seasonal highs and lows, but property management will even them out and see us through downturns in the economy.'

Neville Gough painfully remembers the last time the economy went into a decline. 'In the early '80s, interest rates went up to 20 percent, the mills went slack and the whole area took a nosedive,' he recalls. In some areas unemployment reached 20 percent. Northwest indiana was strangled by a recession that threatened to break out into a full-scale depression.

Both Gough and Lesch were committed to a number of projects and were hard-hit by the economic malaise. We slashed our incomes by 50 percent for a year and a half to two years,' he says. We did some creative financing and barely paid our overhead. But we got through it and survived. it took sacrifice from everyone. And the survivors picked the plums.'

Larry Gough attributes some of the subsequent growth in the area to the huge influx of Illinois residents lured to northwest Indiana by favorable taxes and housing values. Residential construction spurs commercial development, he says. The two go hand-in-hand. Now that we're attracting Illinois residents, we want their companies to follow. This area has long suffered a reputation as Indiana's stepchild. What we really are is the forgotten Chicago suburb. We're just now waking up to the area's potential.'

The comeback of northwest indiana's scaled-down steel industry also has contributed to the area's revival, he says. The mills are profitable once again and some good resulted from the pain of the recession. The area is more economically diversified than it was 10 years ago,' he points out. An industry slowdown could never cripple the area the way it has in the past.' Gough & Lesch's economic forecasters predict at least 5 to 10 more years of prosperity. But we're always preparing for that day when it stops. As long as we concentrate on protecting ourselves, we won't get hurt again.'

The company always has attempted to limit the risks, which is one secret to its success in the precarious business of property development. We don't speculate space. We explore sites and markets very carefully before we buy. And we're always at least 50 percent leased before we begin construction," Gough explains.

According to Larry Gough, the hardest part of the business is choosing the site and deciding the risk. Choose wrong and you can lose big,' he says. You really have to believe in what you're doing to look at a piece of dirt and envision something viable that can produce income. just because you want to build a 10-story office building doesn't mean people will line up to fill it. You can't afford to build monuments to yourself on every corner.'

The firm looks at 1 00 development properties a year, and of those, it might regard about 10 seriously. it works up about 20 to 30 possible development plans for each site. You have to listen to the market,' says Gough. You can't blaze ahead unconscious of what people tell you. Nothing's cast in stone. We change until the day we break ground.'

The company has made a few mistakes. One was a development in Worth, Ill., a southwest Chicago suburb. We were working outside our immediate area and didn't really know the market or the area's needs,' he says. We learned that you have to be a part of a community to feel its pulse.'

The company's caution has paid off. in 1985, Gough & Lesch was developing approximately $4 million worth of property. By 1 989, that figure had nearly quadrupled to $15 million in developments. And this year we're looking at $34 million in projects,' says Gough. 'I find it hard to believe that we'll double again next year. But that's what I said last year.'

Gough attributes much of the firm's success to the good reputation his father, Neville, has built over the past 40 years.

Roger Chiabai, owner of Southlake Glass and a member and past president of the Merrillville Town Board, says Neville Gough always put back more than he took from the community. He's been a giver, not a taker,' is how Chiabai puts its. His company's developments are something we can all be proud of. Whenever one of their projects comes before the board we feel a sense of confidence in them because of their proven track record and long history of quality work.'

Born in Gary into a bricklaying Irish American family of eight children, Neville and his brother, Arnie, built up the largest masonry contracting business in the area. The two laid brick for more than 20 years, tackling projects as small as private homes and as large as Merrillville's South lake Mall, one of the largest shopping centers in the state. But after working together most of their adult lives, they split in 1974.

Arnie wanted to stay in masonry and I wanted to get out of the business and go into development,' Neville Gough recounts. 'Everyone said I was crazy to leave when we were on top. Even my wife, Mary Ann, thought I was nuts. But she believed in me and supported me and so I went for it.'

The two brothers enjoyed continued success in their respective endeavors and still jointly own property in the area. We're probably closer than we've ever been before,' says Neville.

Neville Gough is a soft-spoken man with a worker's tough hands. He is an outspoken booster of Merrillville, the town he and his brother, Arnie, moved to back in 1956. The Goughs correctly predicted that Merrillville's location at the crossroads of Interstate 65 and U.S. 30 would make it a prime area for expansion. They began acquiring property when the town was comprised of farms and swampland. He was an early backer of the budding chamber of commerce at a time when it sold raffle tickets for a Lincoln Continental to finance the cost of incorporating the town.

Neville Gough doesn't look at his change in assignment as an early retirement. We needed to create a new team to react to the changes in the business and development patterns,' he says. 'I think we've assembled a pretty good one.'

Besides the Gough family, the team includes partner David Lesch, a Harvard M.B.A. and former vice president of the Bank of indiana, who raises capital to acquire project financing and works on planning new developments and building new business. According to Neville Gough, Lesch has been 'an unbelievable asset to the company.'

Gough & Lesch Vice President Daniel Bien manages the construction division of the company. The Purdue engineering graduate oversees field activities, freeing Larry Gough to lead the company.

And Phil Hasiak, an Indiana University graduate, is the firm's vice-president of leasing and development.

Neville Gough says he's proud of the job his family has done. And it pleases him to see them working together. As long as I'm healthy,' he vows, 'I'll continue to bring in new business and try not to step on too many toes.'

Spoken like a true president's dad.
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Title Annotation:Gough & Lesch Development Corp.
Author:Taylor, Mark
Publication:Indiana Business Magazine
Article Type:company profile
Date:Jun 1, 1990
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