Business

Samantha Hungerford • July 25, 2011

Peter Hapstak and Olvia Demetriou sit caddy corner to each other at a long table in the main reception room of their Georgetown office. Their dark clothes set off naturally graying hair in that sleek way that people immersed in the world of art and design often possess, and their easy composure is slightly at odds with their surroundings, which are going through an obvious state of transition.

The pair are the leaders of their namesake architecture and design firm, Hapstak Demetriou +,
a group that is at once a fresh, energetic up-start and a team of seasoned professionals. Hapstak, a former principal and founder of CORE architecture + design, is relatively new to this office at 3742 Q St. NW, but to Demetriou the space is familiar – it was formerly the headquarters of Adamstein & Demetriou, the architecture firm she started with her former husband, Theo. Now the office building that saw the passing of one firm is seeing the birth of a brand new venture within its walls.

Although the stenciled sign on the door has yet to be changed, plenty of businesses and residents across the city – as well as across the nation – have taken notice of their presence and lined up to have their space transformed by Hapstak Demetriou +. The firm truly hit the ground running. Almost immediately, they drummed up several dozen projects which are now all in various stages of progress and completion, backlogging the small but growing crew into next year.

Between their packed roster of projects and the familiarity with which they talk about their firm, their projects, clients and each other, it would be easy to believe that the duo has been working together for years.

Yet less than six months ago, the two had considered themselves business rivals. In fact, they hadn’t even exchanged more than five words to each other in passing at cocktail parties over the last 20 years. Serendipity, however, seemed to have other plans for the two architects.

“In a way we both had partnerships but I think we each felt very alone and we were kind of at forks in the road. And a very good consultant that we both work with said that I really need to speak to Peter and Peter really needs to speak to me,” says Demetriou. “So we got together for coffee and then suddenly realized wow, it was really a convergence of both of us needing someone like the other. And it’s been a real process of discovery.”

Although they both describe their partings from past ventures as amicable, their excitement and enthusiasm about their work and the future of Hapstak Demetriou + is palpable.

“My journey was starting in December of last year and we really did not sit down until February or the beginning of March,” says Hapstak, describing the point at which he started to rethink his career future.

“It was exactly the same timing for me,” Demetriou says, talking over him.

“So neither of us really knew until that March period,” Hapstak continues.

“Mid-February was the coffee,” Demetriou cuts in.

“And then within two weeks it was done,” Hapstak says. “I can’t believe to tell you how right this shoe fits; I mean this is amazing to me. And I really love what we’re doing. I’m just pinching myself, I can’t…I think we’re both going to ultimately going to have the firm we really both wanted to have, which was this creative, think-tank, boutique firm that is flexible and agile, that can move very much.”

Hapstak Demetriou + is what the pair describes as a full-service design firm, guiding their clients through architectural and interior design projects from inception to opening. They take on a varied array of projects, but estimate that their undertakings are divided up between residences, miscellaneous projects, hotels and restaurants at 15, 20, 25 and 40 percent, respectively.

One project that is in the final months of completion is a 300-seat restaurant on Duke Street in Old Town, a collaboration with Kendle Bryan called Ginny’s (a sit-down full service restaurant) and Esquire Dog (a small café-style beignet shop by day and hot dog stand by night), which will be reminiscent of an old-fashioned drive-in. Hapstak describes the renovation of the old building as a portrayal of the resteraunteur, a former lawyer turned CIA trained chef, putting his life and personality into architectural form.

“I think we’re both chameleons with our work. Our design really does adapt to the client and the client’s identity instead of seeing, you know, our print on any project,” Demetriou says. “But we each do have a different style and in a way I think they’ll complement each other, those styles. I tend to be more structured and ordered, maybe formalist, minimalist.”

“I’m all about chaos,” Hapstak says.

“And Peter’s passionate and creative, and a lot of adaptive re-use and so that adds an interesting dimension to his work,” Demetriou continues. “So, you know, he’ll loosen me up and…”

“And she’ll tighten me up a little bit, which is good,” Hapstak cuts in.

Although Demetriou says that one person generally takes the lead as a client’s main contact for each project, their efforts so far have been largely collaborative.

“The beauty of a small firm is that one of us is always involved,” Demetriou says. “We don’t just assign things to our younger staff.”

This sense of collaboration is one of the driving visions behind Hapstak Demetriou +. The pair envisions the firm as an open-minded and creative force producing fresh and innovative ideas, and is working to balance their artistic ambitions with the realities of the market.

“Being a design-strong firm in a world where you’re dealing with corporate clients and businesses that have bottom line issues, money making issues, deadlines you know – you’ve always got one foot in the art world, like he [Hapstak] said, the think tank, and another foot in the business world,” Demetriou says. “And I do think that we want to stay on the more creative side of doing really good work, exciting work and working with interesting people and having a chance for reinvention with each project.”

As often happens in businesses of any size, the attitudes of the bosses trickle down through the rest of the employees, setting the work climate of the office. In this case, Hapstak and Demetriou’s enthusiasm is mirrored in the relatively young staff of architects and designers that they currently employ.

The youthful energy provided by the ambitious staff of 10 will hopefully propel the firm to new heights – Hapstak says that their young staff is not only helping them produce innovative ideas, but also helping them to fully take advantage of all the new technologies that can help grow the business.

But with two seasoned professionals at the helm, Hapstak Demetriou + will be less likely to fall into some of the blunders that other ambitious start-ups get caught in. The two pointed out common examples that green-behind-the-ears architects are likely to make, such as not giving strong enough guidance to clients and promising more than can be delivered. Between the two of them, Demetriou and Hapstak have designed more than 200 hospitality, cultural, private and public spaces in the nation’s capital, and have the contacts, resources and savoir-faire to prove it.

“I think the other thing that comes from us too is there’s a level of professional experience that you just can’t get with a younger firm,” Hapstak says. “I mean, our repertoire and our knowledge and all this institutional memory that we have, it kind of gets us to this point.”

Yet the two are far from jaded, and still take deep personal satisfaction in seeing their projects appreciated and used.

“Any time we walk into a project and see it full of people we know we’ve been successful,”

For this reason, both Demetriou and Hapstak take a special pleasure in public projects such as restaurants. They both enjoy the feedback they receive from visitors and the satisfying feeling of seeing customers and the owners of the venues enjoying and making use of their work.

Demetriou describes her passion for designing restaurants: “Restaurants are – they’re theatre. They’re our main square, our town piazza, it’s where we all go, you know – what are you going to do? Let’s go out to eat. This is what people do to socialize and to gather and connect. And I think even both separately, before the alliance and now, it’s very much part of how we work. You try to create a space that delights people, excites people, reinforces that message, sometimes subliminally, sometimes not so subliminally,” she says. “There’s always a message, like Founding Farmers has a message, Zaytinya has a message. Each restaurant has built into it through the materials, through the forms, through iconographic references that kind of make people think about that food, that concept, the chef.”

But although the two take pride in their work in D.C., Demetriou and Hapstak plan on extending their firm out to the national architectural scene.

“I think what’s big for us now is a national draw, we see ourselves moving out of this market,” Hapstak says. “As much as this will always be our home and this will always be a priority for us because this is where we learned and so our greatest level of give back is here. But we are now on other people’s radar screens, which is really great for us, which allows us to continue to grow the firm, continue to expand what we’re doing.”

Although they say the plans are too premature to discuss any details, they do say that they’ve investigated possibilities in Vegas, that they have plans in the works in Miami, South Beach and Coconut Grove, and that they’ve been pursued by clients in New Orleans in addition to a couple projects they’re working on in the northeast. One project which is well enough along to mention is a collaboration with chef Robert Wiedmaier for a new restaurant in Atlantic City.

It seems that the advent of Hapstak Demetriou + is the turning of a leaf in both architects’ lives.

“Olvia and I are very similar,” Hapstak says. “I was out of a marriage and out of a business, but I have to tell you something, there’s nothing I’ve learned more than that the relationships [I’ve built] have been there for me. And that makes me value them even more and makes me want to perform for them at an even higher level.” [gallery ids="100228,106495,106493" nav="thumbs"]

David Post • July 13, 2011

Fifty years ago, it was called MAD: Mutually Assured Destruction.

By the 1980s, the U.S. and the Soviet Union together had amassed 25,000 nuclear warheads aimed at each other. Carl Sagan, the people’s scientist, compared it to two people standing in a room the size of a football field filled up to their chins with gasoline, each holding 10,000 matches and each threatening to light one.
Today, the Debt Ceiling debate is MAD.

First, what is the Debt Ceiling? Until 1939, Congress approved the issuance of a Treasury bond every time the U.S. needed to borrow money to pay its bills. In 1939, Congress authorized the Treasury Department to borrow the money needed to fund the government, but set a limit on how much it could borrow. That limit is the Debt Ceiling. For the past several decades, the Treasury has been borrowing money four out of every five business days and the Debt Ceiling is approaching $14 trillion. Our lenders, in approximately equal amounts, are the Federal Reserve, U.S. investors and foreign investors (mostly the central banks of China, Japan and the United Kingdom).

Over the years, Congress has raised the Debt Ceiling with no fanfare. For example, the Debt Ceiling was raised during each year of George W. Bush’s Presidency, doubling from $5 to $10 trillion. Every time the Debt Ceiling was changed, a handful of Senators and Congressmen gave speeches on controlling the budget. Some voted against it, but they knew that others would vote to raise it.

This time, Congress is playing poker with the world economy as its chips. If the Debt Ceiling is not raised within a few weeks, the U.S. will not have enough money in the bank to pay its bills. That’s never happened, but we know it won’t be good and will probably have unforeseen consequences.

Greece defaulted, has riots in the streets, and is at the mercy of other countries. Lehman Brothers defaulted in 2008 when the government refused a bailout, and over the following months unemployment doubled and the stock market lost almost half its value. Lehman Brothers was a New York investment bank. Large, but not the largest. And nothing compared to the U.S. government.

For 2011, U.S. revenues are $2.2 trillion and expenses are $3.8 trillion. We borrow 40 percent of what we spend. How would Congress reduce spending by 40 percent next month? To listen to the talking heads, it sounds easy.

Some, including Presidential candidates, U.S. Senators and Congressmen, are saying that default would be avoided if we pay the interest and “prioritize” other spending with available funds, or cutting all other government spending by half.

Some suggest across the board spending cuts. If serious, beginning next month, Social Security benefits would drop 40 percent along with reimbursements to health care providers, all government salaries, including our military, and interest payments to our lenders. That’s drastic, but social security, health care, defense, and interest on the debt account for more than 80 percent of the budget.
Others say “Just go back to 2003 spending levels” when spending was $2.2 trillion. That may sound logical, but that’s the same 40 percent cut.

Imagine an angry and crazy couple. One picks up their child and holds it over a bridge railing and says, “If you don’t do what I demand, I’m going to drop the baby and it’s your fault.” The other says, “No, it’s your fault.”

No crazy couple should negotiate that way. And neither should the Congress.

If Congress wants to cut spending, it holds the purse strings. The President can’t spend a dime unless Congress both authorizes and appropriates the money. If it were serious, Congress could pass legislation reducing spending by 40 percent and only give the President that much to spend with specific instructions. Parents do that all the time to their kids.

Economists and corporate CEOs are begging Congress to not play this game. Rating agencies are saying that the U.S. credit rating would drop below junk bond status. It would be unmitigated disaster.

But this isn’t real poker. It’s pretend. Everyone knows that the United States is not going to default. Congress operates like kids doing their homework on a school bus a few minutes before an exam.
This debate is about demagogy. It is about political posturing, blaming the other party, and gaining political advantage up until the last minute. It is not about what is best for the United States or the world economy.
At least with nuclear warheads, everyone agreed it was MAD.

Georgetowner • July 12, 2011

Ins

Fleurir Hand Grown Chocolates at 3235 P St. NW is a recent in on the Georgetown dessert scene. Run by a husband and wife team, this chocolate boutique specializes in hand-made confections made from high-quality, natural ingredients. The brightly colored little chocolate squares are simplistic in design and range in flavors from the classic caramel or raspberry to the more novelty Lavender Shiraz or Pink Peppercorn.

Kraze Burger, a burger chain with roots in South Korea, has plans to open a Georgetown location, according to the Georgetown Patch. The joint offers healthy alternatives to traditional fast food fare including tofu, turkey and garden burgers. The chain, which has over 100 locations in Korea and neighboring countries, will enter the U.S. restaurant scene in Bethesda Sept. 1 before moving on to Tenleytown, Union Station and, of course, Georgetown.

According to the Georgetown BID, Calvin Klein Underwear will open its first store in the U.S. outside of SoHo this summer at 3207 M St. NW. With its high-fashion vibe and iconic advertisements, the new boutique will fit right in on the main M Street shopping strip.

Outs

After 27 years of business, Furin’s of Georgetown will close its doors at 2805 M St. NW July 31, another family-owned business put under by rising costs of operations and a slacking consumer market. The Georgetown Current reports that the building has been bought by Foxhall Partners, who also owns Hook and other Georgetown properties. Beloved for its warm customer service and delicious cupcakes, the bakery, café and catering service will be greatly missed in the community.

Lil Omm yoga studio will also leave its location at 4830 V St. NW in the Palisades July 31 after its lease runs out. The Georgetown Patch reports, however, that this does not mean the end for the family yoga/prenatal/childcare facility – the business plans to take a month off then resume classes at a new studio in September at a location that is yet to be determined.

David Post • June 29, 2011

Why is the slope up a hill steeper than the slope down a hill? Seems like it should be the same, but it never is.
Everyone knows that it’s easier to ride a bicycle downhill than to ride it uphill, or to fall into a hole than to climb out.

The economy works the same way. If a $1,000 investment drops to $800, that’s a 20% decline. But for it to go back up to $1,000, that’s a 25% increase. You see, the climb back up is steeper than the drop down.

Remember the good old days when things seemed to be going great and the Fed would increase interest rates to slow the economy down? Or a big increase in jobs would send the stock market down because it was worried that too many buyers would cause inflation.

The economy seems to be counter-intuitive. Good is bad, and bad is good.
For example, the decline in housing prices has virtually crippled the economy, but it’s a good time to buy.

Banks are in trouble. With zillions of dollars of bad loans on their books and with housing values – their primary collateral – continuing to fall, banks are scared to make loans. Murphy’s Law says, “If anything can go wrong, it will.” Murphy’s Law of Banking stings even more: “If you qualify for a loan, you don’t need it.”

For years, economists complained that Americans “didn’t save enough.” We spent all of our money. That was a bad, but it made the economy grow, so it was a good. Credit card debt soared which was bad, but the stuff we bought made the economy grow, so that was good.

Today, we’re nervous about what tomorrow’s economy is going to do or look like, so we are changing our behavior. Now, Americans are saving more which is good, but by spending less the economy won’t grow, so that’s bad. We are paying down that mountain of credit card debt, which is good, but that money isn’t being used to buy the stuff that new jobs would make, so it’s bad.

The Japanese are very frugal people and famous for saving. That’s good, we were told. We should be more like them. But the Japanese economy has been in a funk for more than 25 years. Its stock market average was 10,000 in 1984 and after a blip, is still 10,000 while the US stock market is ten times higher than in was 25 years ago.

Do we really want to be like the Japanese?
The 2012 presidential campaign has begun, and until the election, the political rhetoric is going to be all about jobs. The political parties will blame each other, but more importantly, both will make promises they can’t keep.

During each decade from 1950 until 2000, the US created on average approximately 150,000 new jobs per month. From 2000 until 2007, US job growth was about half that, or 80,000 new jobs per month (despite huge tax cuts, but we won’t go there). Then, during the Great Recession of 2008 and 2009, the country lost 8.5 million jobs.

Do the math If we can start growing jobs at the rate we did from 1950 until 2000, that’s a 5 year climb to get back to 2007 employment levels. And that’s before a single new job is created. But what if the job growth rate from 2000 through 2007 is the new normal? In that case, climbing out of this ditch and getting back to even ground will take almost 9 years.

What about all this whining about the loss of manufacturing jobs? The US is already the most productive country on the earth. Most countries aren’t even close to American productivity. Each US worker produces 7 times more a Chinese worker and 13 times more than workers in India. As US workers become more productive every year, fewer people produce more. Increased productivity is good, right? But it means fewer jobs, so that’s bad.

It’s deeper than that. We don’t make shoes and shirts anymore. That stuff was easy. Today, we make satellites and electronic components, the hard stuff which requires more educated workers than it did to make shirts.
The presidential campaign will be fought with quick and easy sound bites. The problem is that these issues have no quick or easy answers. What politicians do know is that tearing things down is easier than building them back up.

Up is steeper than down. Go figure. How does anyone make an A in economics when the right answer might be wrong and the wrong answer might be right?