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Building Guam

Will Hawaii profit from the boom?

(page 2 of 3)

Logistics

From a contractor’s perspective, the most obvious feature of Guam is its remoteness. At 5,900 miles from California, and nearly 3,800 miles from Hawaii, Guam lies at the end of a long and tenuous supply chain. “Most of this work is ‘Buy American,’” says Peters. This means construction material can’t be quickly shipped from nearby Asian suppliers, making it critical to understand materials logistics. It takes a ship three weeks to get from the West Coast to Guam. “So, you’ve got to be self-sufficient,” Peters says. “When something breaks, you better have a spare part, or you better be able to get a replacement quickly – probably by airfreight.”

Even before buildup for the Marines,
Hawaii contractors like Watts Constructors have
been working on military projects in Guam
Photos Courtesy of Watts Constructors

Even within Guam itself, logistics will be challenging. Port facilities will need tens of millions of dollars in improvements to handle shipping volumes, which are expected to quadruple. Roads and bridges will have to be hardened and widened to accommodate the trucks needed to haul material. There’s not enough electricity or fresh water to supply the anticipated needs. And there’s nowhere near enough warehouse space from which to stage the enormous construction projects. Once it gets started, the great Guam buildup might turn into a quagmire.

Small Businesses

Despite the challenges, Guam still represents a tremendous opportunity for large Hawaii companies. For smaller Hawaii subcontractors, the labor issue presents a major hurdle. “They’ve never had to go out and hire foreign workers,” Denny Watts points out. “And yet, by definition, these are the guys who would have to provide 75 percent to 80 percent of the manpower on any given job.”

“I know there are several sub-contractors interested in coming to Guam,” Peters says, but he doubts they’re prepared to work with an inexperienced workforce. “When you need 30 electricians, you can’t just go down to the union hall.” Maybe more important, he points out that not knowing the productivity of your workforce makes it impossible to budget accurately. “Productivity drives your construction costs,” he says. “And understanding productivity determines what you bid.” In short, it’s almost impossible for small companies to plan adequately for Guam.

And planning is essential. Lance Wilhelm, senior vice president of Kiewit, points out that his own company, a major U.S. contractor, is still grappling with the implications of going to Guam. “Businesses need to formulate a Guam strategy, whether you’re big or small,” he says. But small companies in particular have to look at what it means to do business so far away. “How are you going to manage your people? Do you even have the people who are willing to go down there? How will you handle the logistics? Do you understand the tax issues, union issues, legal issues … ” Small companies need to consider all this before they talk with the larger contractors. “You need to formulate a strategy,” Wilhelm says, “so, if you should be asked to go down there, it isn’t the first time you’ve thought about those things.”

Wilhelm also points out that, for many small companies, management is already stretched thin. “Can you commute to Guam and still keep a going concern here in Hawaii?” he asks. “We’ve had to think about that, too. We’re not going to jeopardize what we have here in Hawaii; so, part of our Guam strategy is that we have to be able to do both.”

Notwithstanding the complications, small Hawaii companies will almost certainly be drawn to Guam. Many of them already have experience there. Steven Baldridge, president of Baldridge and Associates Structural Engineering, points out, “We’ve actually done work in Guam for about 10 years; we’ve just done it from Honolulu.” Most of BASE’s work in Guam has been for the military, which can often be done from a distance. But, like many observers, Baldridge expects the buildup to also generate work “outside the fence.” That may be where small Hawaii companies, particularly technical companies and vendors that are less burdened by labor issues, will find their place in Guam. “There’s other infrastructure work that we can get involved in,” he says. “It might be housing, upgrading the local schools or building bridges. But the first step is to have a more solid and continuous presence.” For BASE, the Guam office is about becoming part of the territory’s business community.

Steven Baldridge, president of Baldridge
and Associates Structural Engineering
Photo: Rae Huo

That process is made easier by having Hawaii service providers already working there. It’s possible, for example, for a Hawaii company to open an office in Guam and still use the same bank, accounting firm and law firm as the home office. Many of these companies are important members of Guam’s business community. First Hawaiian Bank, for example, is the largest bank in Guam. Carlsmith Ball has had law offices there for more than three decades. Because of this experience, they offer more than just banking and legal services; they provide inside knowledge of the community and vital introductions.

 

 

Hawaii Business magazine invites you to comment on our articles and the issues they raise. Comments are moderated for offensive language, commercial messages and off-topic posts and may be deleted. Some comments may be chosen for inclusion in the magazine on the Feedback page.

Old to new | New to old
Oct 28, 2009 05:22 pm
 Posted by  findfitz

How do I find out about job opportunities for the Guam expansion. I am a certified inspector and would like to inquire about employment possibilities. Thank you

This has been flagged
Jan 7, 2010 06:39 pm
 Posted by  viv

When will the Guam project get into high gear?

This has been flagged
Mar 8, 2010 04:23 pm
 Posted by  ciddester

I am an HVAC technician with extensive experience in construction A/C. Are there any companies looking to employed for it? I been looking for months without any luck. Could you point me in the right direction?

This has been flagged
Mar 8, 2010 04:24 pm
 Posted by  ciddester

I am an HVAC technician with extensive experience in construction A/C. Are there any companies looking to employed for it? I been looking for months without any luck. Could you point me in the right direction?

This has been flagged
Nov 8, 2010 12:11 am
 Posted by  levi

Good day . I'm from the Philippines , willing to assign any job in your country. Have bachelors degree with background in engineering specialized in electrical. Holder of certificate in building wiring installation. Presently I trained as welder in shielded metal arc welding Smaw NC II, Plate and Pipe welding. As of now im working as construction worker specialized as steel fixer, electrician, and welder. Hope that you will consider me as one of the applicant. Thank you very much. God bless.

Jan 1, 2011 07:45 am
 Posted by  butch

good day i'm from the philippines i presently work in kuwait american base as HVAC Technician Sr.from 2005 to present my fenish contrac feb.2011 also have experience electrician, all type of welding work, car A/C,i certified EPA 609,608,HVAC/R R-410A,HVAC/R PM Tech.i willing to work in your country hope that you will consider me as one of the aplicant. thanks, rolly facun

Mar 23, 2011 12:34 pm
 Posted by  johnweld007

Dear Mr. Watts,

I owned welding training and testing institution in Manila, Philippines I am interested work with to support your projects
in your country if you need filipino welders we have large data base for welder in my country i am willing to personally visit you
in your place if necessary.

Sincerely,

John

John McGregor Marineweld Training Center
website; www.johnmcgregormarineweld.yolasite.com
Tel: +632-589-85-17

Mar 23, 2011 12:36 pm
 Posted by  johnweld007

About Us
John McGregor Marineweld Training Center, Inc.

Was Established on August 28, 2005 Pandacan, Manila Philippines
to provide Maritime Welding Skill Certification both Filipino and Foreign
seafarers serving on board sea going vessel worldwide this institutions
founded by Filipino Marine Welder and joint partnership with American national serving the Ret. Military as Navy Welder.

JMGMTC a company affiliated AWS American Welding Society USA
who controlled and maintained quality standard of welding worldwide
since 1919.

Tesda NC 11 standard applies their standards from aws base the accordance of AMERICAN WELDING SOCIETY AWS D1.1


International Links:

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Telephone (+632) 589- 85-17

Direct Line: (+632) 569-42-46

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Add: 1697-Pres.Quirino Ave., Pandacan Manila, Philippines (1000)

website: www.johnmcgregormarineweld.yolasite.com

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This has been flagged
Feb 4, 2012 03:32 pm
 Posted by  bonie

mam/sir.. im an building electrician in the philippines and other countries.and i worked also in us base in afghanistan.if you can give me a chance i would like to worked again in us base,,,thank yuo and god bless

Jul 5, 2013 04:00 pm
 Posted by  DENNIS

To Whom It May Concern;

I am writing for the possibility of filling for any vacant position that I may apply for, in your company at this time or in the near future base on my qualities and experience preferably in the field construction and related job. I am an experienced Electrician and Engineer by professional who is skilled in electrical construction, electrical controls,apparatus,and electrical system designs of buildings and out-door/ in-door construction.Worked in GUAM construction b4.

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