Contractor Aims to Start Big in N.Y. Region

Retirement wasn't working for Robert Fee, the former president and CEO of Turner Construction who left those roles in 2003. His interests in wine and art rapidly bulged into 4,500 bottles and fully covered walls.

His fortunes changed, however, with a $50 million investment from a Midwest banker - a major stake that allowed Fee to launch Hunter Roberts Construction Group last month. With no debt, a core staff of construction veterans, and an ambitious growth plan, Fee's new company is aiming to offer general contractor, construction management, and project management services for building projects in the New York and Philadelphia metropolitan areas. It would be the first major entry "from scratch" into the regional contractor market since a pair of former Lehrer McGovern Bovis executives formed the now-defunct York Hunter Group back in 1983.

Regional Focus

Fee said the timing is right for a new general contractor regionally, with the departure or withdrawal in recent years of companies such as J.A. Jones Construction and AMEC Construction Management. "Owners were telling me that they could use another big player in this market," Fee said.

The new venture is aiming big despite not having any projects lined up. It has hired more than a dozen staff members, including the president and CEO of its construction unit, James McKenna, who until February had been head of New York operations for Turner Construction. Fee, meanwhile, will have a daily role with a title as CEO and chair of the Hunter Roberts holding company.

The new venture doesn't plan to win the giant jobs. It is targeting the $10 million to $50 million range of projects in New York, New Jersey, Connecticut, and Philadelphia. McKenna said that would encompass construction for buildings in the corporate office, higher education, healthcare, residential, institutional, K-12 education, and retail sectors, as well as interiors, renovations, and parking garages.

McKenna said the company would tailor its appetite to the regional market, likely seeking retail, school, and mall projects in New Jersey, higher education work in Philadelphia, and residential jobs in Stamford, Conn. It will likely run the gamut of projects across New York City.

The company would handle the work from three offices. It is aiming for the World Financial Center in New York, Bedminster as a permanent home in New Jersey, and the Bell Atlantic Building as its base in Philadelphia.

McKenna said the outfit will be a union shop. As a general contractor, it will subcontract 90 percent of the work, and it plans to pursue joint ventures when appropriate.

Big Plans

Hunter Roberts plans to have 40 employees by the time it starts pursuing projects in April, and 100 by year's end. Within three years, Fee said, he expects Hunter Roberts to start turning profits and within five years, to rank among Engineering News-Record's top 20 contractors nationally. At that point, the company hopes to have 1,000 employees. And it plans to get there "organically," added Fee, who does not intend to acquire other contractors to underpin growth. "When you do a bolt-on, culture fit becomes a major issue," he said.

Fee and McKenna say they can back up those lofty goals, because they have the luxury of the $50 million investment from G. Jeffrey Records, who is chairman and CEO of MidFirst Bank of Oklahoma City, Okla., which with $9.2 billion in assets is the fifth-largest privately held bank in the nation. Fee knew Records from his time as a Turner investor before that company merged into HOCHTIEF of Germany in 1999.

Records has participated in development projects before, and he "understands the cyclical nature of the business," McKenna said. The initial investment could also grow depending on how the company fares, he said.

"Everyone would like to be in our financial position," Fee added.

The money not only leaves the new company free of debt and financial pressures, it also has eased elements like securing project bonding. It also would let the new venture be choosy on project work, Fee contended. "It's awful tight with the low fees in our industry," he said. "You have to be careful who you work for and what the contract terms are. The balance sheet we have gives us the opportunity to be very selective."

The money advantage also is letting the company lure new staffers as project executives, superintendents, engineers, financial officers, and risk management specialists. "Right now we're getting plenty of résumés," McKenna said. An unspecified number have already come from Turner's New York office, he confirmed.

Fee said the venture has gotten a warm reception so far from potential clients, though he stressed no one brought along work from prior stops. "People are saying, 'They've got to have some work lined up out there,'" McKenna added. "But we even left the Rolodexes behind."

Hunter Roberts - a play on Fee's name, which means "hunter" in Gaelic - is also trying to bulk up its industry credentials. It expects to win certification soon to take on projects for the Port Authority of New York and New Jersey, and is aiming for similar eligibility for agencies such as the New York City School Construction Authority, the Dormitory Authority of the State of New York, and the City University of New York. Similarly, the company intends to join the Contractors' Association of Greater New York, for which McKenna had been an officer while at Turner, along with the New York Building Congress, the Building Contractors Association, the Building Trades Employers' Association, and other industry groups in New York and New Jersey. McKenna also remains president of the Cement League of New York.

And with the luxury of starting fresh, the new outfit is acquiring simpler off-the shelf computer systems, free of customized databases that many companies now regret building in recent years because they are hard to update and link to each other. It will instead have basic systems that require one round of data entry, simpler reporting, and full integration.

- Tom Stabile

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