Like almost all of the construction industry, specialty contractors on the West Coast endured a challenging 2020. Many were relieved this past year to see stalled work move ahead while new projects stayed the course. Generally, firms saw improved revenue in 2021, but challenges remain as many also reported mixed results.

The top 10 specialty contractors that responded to ENR California’s Top Specialty Contractors surveys for both 2020 and 2021 saw combined revenue of $4.4 billion last year—a 3.2% rise from 2020. For ENR’s Northwest region, the top five firms from both surveys tallied $855 million in total revenue, up from $805.6 million—a 6.1% increase.

In both regions, however, some contractors fared better than others. ACCO Engineered Systems, which tops ENR California’s list, dipped slightly from revenue of $1.45 billion in 2020 to $1.39 billion last year. Meanwhile, Rosendin Electric had its best year ever with $1.1 billion in revenue, up from $876.5 million in 2020.

In the Northwest, top-ranked Apollo Mechanical Contractors and Rosendin both saw revenue jump between 2020 and 2021—6.9% and 19.7%, respectively—while revenue for Greenbury Industrial, ISEC and Sure Steel dropped.

Rosendin reported stellar financials for 2021 after a surprisingly strong 2020. The firm posted worldwide revenues of $2.05 billion in 2020, up from $1.8 billion in 2019.

“Looking back, 2020 was setting up to be an excellent year despite some of the projects during that calendar year being on hold,” says Mike Holmes, vice president of preconstruction at Rosendin. “For us to be able to still eclipse the $2 billion mark in 2020 was remarkable in and of itself.”

“If we have the management and we know the timing, we can do the work.”
—Jeff Garreans, Director of Preconstruction, Pan-Pacific Mechanical

Holmes notes that although some projects stalled, new work continued to flow in 2020. “We had more than $300 million in projects go on hold that year, but we were able to backfill that with about $400 million in solar and renewable projects. We never really saw a dip.”

And that high pace accelerated in 2021. In California alone, the firm saw a 25% revenue increase last year. Holmes attributes much of that success to strength in the data center, solar and commercial markets. Firmwide, he says the company saw data center revenue rise by almost 40% in 2021. Its largest project completion in California last year was a data center project for a confidential client.

Revenue continues to trend up in 2022, with the worldwide total on track to top a record $3 billion. Still, that momentum is tempered by a challenging labor market. “Our growth would be even greater if we had all the resources we need to support the work we see out there,” Holmes adds.

Pan-Pacific Mechanical also weathered the pandemic well with double-digit growth in 2021. Jeff Garreans, director of preconstruction, says that while some project starts were delayed in 2020, few projects went on indefinite hold. When those delayed starts got going in 2021, the firm was also moving ahead with its existing 2021 slate of projects. “In 2020, the work in place that we had didn’t stop except for one private job, which was a high-rise project—and that one started back up this year,” he adds.

After a strong 2021, Garreans says 2022 has held steady. Although the firm hasn’t seen a dip in the number of projects it pursues, the types of work the firm targets has changed. The company is favoring public and institutional work over private developer projects, especially as rising interest rates have put more private projects at risk. “We’re definitely moving away from the private sector, unless it’s for someone that we know is a very financially secure owner,” he says. “We don’t want to commit any resources to a project that’s going to stall or get canceled.”

Despite labor concerns, Garreans says he sees enough capacity to take on projects. “As a union subcontractor, we’re connected to the halls,” he says. “The ones that we’re looking at currently have anywhere from 400 to 800 laborers available right now.... If we have the management and we know the timing, we can do the work.”