RCI Construction Group

The states largest civil contractor now eyes private sector growth

August, 2005

It’s like stealth construction. When Top 250 newcomer RCI Construction Group lays down massive sewer and water lines in Hawaii, crews use a method called horizontal directional drilling. Instead of digging up every yard of dirt or concrete to install a new main, the company digs holes some 2,000 feet apart, drills across and pulls the pipe through. Think about that at your next construction-bred traffic jam. Horizontal drilling means less roadside restoration, in addition to digging.

“You are employing oil-field drill technology, but drilling horizontally,” says Martin Miller, outgoing Pacific Region vice president for RCI, whose bread and butter is civil infrastructure contracts. “It is also a good technology to use under the water.” RCI has done just that, running a sewer line from Ford Island to Pearl Harbor Naval Shipyard.

Miller says Sumner, Wash.-based RCI lands contracts by running a lean operation, with cutting-edge technology. Judging from the company’s debut at No. 33 on the Top 250 list – the highest rank of any new company this year – RCI has a successful formula. The company brought in $196 million in sales in 2004. Last April, RCI was bought by Pasadena, Calif.-based Parsons Corp., a global construction management company that reports taking in $2.5 billion in revenues in 2003.

Parsons acquired arguably the largest civil contractor in the state. RCI’s big push here came back in 1999, when the City and County of Honolulu was gearing up for some overdue improvements to its aging infrastructure. RCI had opened an office in Hawaii in 1993, but operations were small, Miller says.

“Then [in ’99] we started to look at the infrastructure market in Hawaii,” Miller says. “The infrastructure program the City and County of Honolulu was instituting was a billion-dollar program. It looked like an opportunity to really enter the market in a strong way.”

By 2000, RCI was the largest contractor for the water supply board on Oahu. First, the company landed a $25 million contract for expansion of the Honouliuli Waste Water Treatment Plant. Miller calls that the “incubator project,” which led RCI to establish an expert team here, as well as its name.

Some of the higher profile work is on the Sand Island Waste Water Treatment Plant, the largest in Hawaii. On just two projects awarded in 2001 to upgrade and expand that plant, RCI pulled in contracts worth $157 million. A more recent notable award for RCI was a $54 million contract in 2004 to build infrastructure for three, 900-home military housing projects.

RCI has been listed on industry-specific lists for several years, lists that help build RCI’s name as a civil contractor, Miller says. However, RCI wants to expand more substantially into the private sector, particularly on Maui, where it branched out 12 months ago. The company wanted its name on a more widely distributed list, such as the Top 250, Miller says.

Miller said the business model for the fusion of RCI into Parsons “is still being developed.” Even the name of the company is under discussion. His receptionist today answers the phone: “Hello, Parsons/RCI.” However, what is clear is that Parsons wants to grow and views RCI as a vehicle to make that happen in Hawaii and the Pacific.

Andy Albrecht, formerly RCI’s president and now group president of Parsons, says: “With the added strength and diversity of Parsons, we will be using our Hawaii office as our base for all outer Pacific projects and our base for growth into Asia.” Whatever name it ends up with, this Top 250 newcomer will not be so stealthy in the future.

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Scott Radway