Cautious Optimism on Industry Growth in Texas, Louisiana
With a strong economy and the continued strength of the oil-and-gas sector, Texas and Louisiana contractors are seeing strong gains in regional revenues.
Combined revenue of the Top 10 firms in the ENR Texas & Louisiana annual Top Contractors survey hit $12.5 billion in 2013, marking a post-recession high. That is up from $9.8 billion in 2012, $8.3 billion in 2011 and $9.4 billion in 2009.
All 128 responding firms reported a combined regional revenue of $32 billion in 2013, up from $25.9 billion in 2012 (and 130 respondents).
Beyond Oil and Gas
In last year's ranking, energy/petroleum projects played heavily into work for the region's top firms.
Last year's Contractor of the Year, Turner Industries Group, Baton Rouge, saw revenues climb by nearly $150 million to reach $2.2 billion for 2013, topping this year's ranking. In at second was Kiewit Corp., Fort Worth, which saw similar growth, up about $200 million to reach $1.6 billion in 2013. Filling out the third spot was Ferrovial US Construction Corp., Austin, this year's Contractor of the Year, which pulled in $1.5 billion in regional revenue, up by $270 million.
Turner Industries and Kiewit both reported solid petrochemical project portfolios, at 93% and 63%, respectively, while Ferrovial does 100% transportation.
General building contractors David E. Harvey Builders, Houston, Gilbane Building Co., Houston, and Balfour Beatty US, Dallas, ranked in other top spots, respectively. Seven out of this year's top ten firms also reported revenues above the $1-billion mark, versus just the top four last year.
"2014 we expect to be a little stronger. It started really in the second half [of this year], and we see it picking up," says Roland Toups, CEO of Turner Industries. "But in terms of the bottom line, you probably won't see a lot of that registered until maybe 2015, 2016. We are feeling a lot more content with the workload that we have, with the jobs we just put on the books in the last couple of weeks. We're optimistic that this has kind of started a rebirth of the whole industry and we're going again."
Slow and Steady
"Across Texas and Louisiana, all indicators show a robust marketplace with slow, steady growth. Balfour Beatty continues to see an increase in multifamily and student housing, hospitality, corporate office, health care and K-12 verticals, specifically in the Houston and Austin markets," says Doug Jones, regional CEO, central, at Balfour Beatty. "Population growth in both states will continue to drive the need for more social infrastructure, such as hospitals and schools," he adds.
Jones notes that the firm, which broke ground last year on the $139-million DFW Airport TRIP SA09 Terminal A Phase 2 project, hit revenue peaks in 2013 on some major projects sold in previous years, and is projecting revenue growth in 2014 and 2015.