Mergers and acquisitions transform engineering sector [2013 Giants 300 Report]

Merger and acquisition deals by MEP, commissioning, structural, and specialty engineering firms were up 14% nationwide in 2012 compared with 2011, according to consulting firm Morrissey Goodale (morrisseygoodale.com). Since the beginning of 2013, the consultant has reported more than 60 M&A transactions involving North American engineering firms, including interstate, intrastate, and international deals.

As economic recovery generates new business, engineering and engineering/architecture firms continue to seek M&A targets that offer an expanded employee base, a geographic springboard, or simply a broader mix of skills. A typical example: the November acquisition of Energy Ace, a Georgia-based commissioning and sustainability specialist, to beef up the green expertise of global engineering, architecture, design-build, surveying, and geospatial solutions firm Merrick & Company.

During the recession, multiple architecture and architecture/engineering firms also sought to broaden their client appeal by going on an engineering talent hunt. A third of AIA member firms now identify as “multidisciplinary,” including engineering services, compared with about 25% a decade ago, according to Morrissey Goodale.

SSOE Group is among the companies capitalizing on the volatile business climate. “We closed on three M&A transactions in 2012, so our emphasis in 2013 is on integration and realizing the synergies from the combined companies,” says CEO Tony Damon, AIA, LEED AP. “Our merger with Evergreen EDC in December should be transformative, allowing us to diversify our business and leverage our combined resources for new clients, in new markets and geographic locations.”

TOP ENGINEERING FIRMS

2012 Total Revenue ($)

1 Fluor $221,231,200

2 Arup $149,738,587

3 Affiliated Engineers $105,503,000

4 WSP USA $105,362,352

5 KPFF Consulting Engineers $91,000,000

6 Syska Hennessy Group $82,097,502

7 Henderson Engineers $63,485,775

8 Smith Seckman Reid $52,919,312

9 KJWW Engineering Consultants $51,092,154

10 Vanderweil Engineers $50,552,200

SEE FULL LIST

TOP ENGINEERING/ARCHITECTURE FIRMS

2012 Total Revenue ($)

1 Jacobs Engineering Group $2,715,210,000

2 AECOM Technology Corp. $1,610,390,000

3 Parsons Brinckerhoff $337,900,000

4 URS Corp. $314,266,757

5 Buro Happold Consulting Engineers $194,220,000

6 Burns & McDonnell $160,645,000

7 Thornton Tomasetti $124,575,393

8 Science Applications International Corp. $120,249,686

9 Merrick & Co. $103,998,000

10 SSOE Group $103,708,918

SEE FULL LIST

Damon credits a rebound in business from manufacturing and automotive clients, especially in the Southeast, for some of SSOE’s bullish attitude. Other hot prospects identified by Damon include the semiconductor industry in the West, and international markets, especially China, India, Mexico, and Brazil.

Steven Strauss, President of Glumac, reports good business from domestic micorelectronics companies and from Chinese clients, some of whom are developing entire new cities. Strauss has also seen an uptick in medical office buildings, mission critical, hospitality, and mixed-use commercial. “Projects that have been on the back burner are now re-emerging, and developer clients are more able to get financing through banks and institutional investors.”

For Bergmann Associates, the retail sector has been a bright spot. “The growth has been primarily with corporate retailers—big boxes, grocery stores, banks, restaurants—in New England and the Mid-Atlantic region,” says CEO Thomas C. Mitchell, PE. Property development companies in the East and Midwest have also been hiring the firm, and Bergmann has won new clients in science and technology, replacing some who have stopped building. The company recently added personnel in Michigan, Ohio, and the Carolinas.

In the West, Spectrum Engineers is getting a steady flow of work from retail, mission critical, and private commercial development, as well as some government clients. However, K-12 is “slow,” according to President and Principal Electrical Engineer Dave Wesemann, PE, LEED AP, ATD.

Considerable hustle is still required, even as the market improves. “Business continues to be challenging overall in the Southeast,” says Mark A. Gelfo, PE, LEED AP BD+C, LEED AP O+M, CxA, EMP, Director of Business Development and Sustainability at TLC Engineering for Architecture. “Competition remains high, and clients want more and more for less and less. During the past few years we have made significant initiatives in energy services, federal—though that market’s definitely on a downward track—mission critical, and hospitality, while maintaining our historically major markets such as healthcare, commercial office, and higher education.”

Like many engineering pros, Gelfo expects energy services—from commissioning, auditing, and retro-Cx to high-performance MEP design—to generate significant revenues for the foreseeable future. Spectrum’s Wesemann says advances in green technology, including LED lighting and variable-refrigerant flow HVAC, are persuading some clients to seek a more integrated delivery model to take advantage of all the potential savings.

According to Kenneth G. Diehl, Jr., PE, Senior Vice President at Smith Seckman Reid, building owners increasingly understand the high long-term ROI of green upgrades—a trend that can only be good news for engineers. “The biggest mover in this area is currently existing buildings that are using retrocommissioning to significantly lower utility costs,” he says. “The market is continuing to move toward a model that supports high-performance building operations.”

Read BD+C's full Giants 300 Report

The Brick Industry Association (BIA) has opened entry submissions for its 2013 Brick In Architecture Awards—with a new Renovation/Restoration category and new category divisions this year. BIA’s annual awards honor architectural excellence and sustainable design nationwide that incorporates clay brick products as the predominant exterior building or paving material.

| Feb 27, 2013

Marvin Windows and Doors now accepting entries for fifth annual Marvin Architect’s Challenge

Architects have an opportunity for their best work to compete on a global stage in the fifth annual Marvin Architect’s Challenge. Previous winners of Marvin Windows and Doors’ prestigious award program have come from Spain, Ireland and across the United States — with their work among the world’s finest.

Residents of energy-efficient complex will reap the benefits of hydropon farm.

| Feb 27, 2013

Bronx residents get LEED Platinum public housing complex, rooftop farm

The New York City Housing Authority has opened Arbor House, a 124-unit LEED Platinum complex in the Morrisania neighborhood of the Bronx.

| Feb 25, 2013

HOK sustainability expert Mary Ann Lazarus tapped by AIA for strategy consulting position

Mary Ann Lazarus, FAIA, LEED® AP BD+C, has accepted a two-year consulting position with the American Institute of Architects in Washington, DC. Her new position, which begins March 1, will focus on increasing the AIA's impact on sustainability across the profession. The St. Louis-based architect will continue consulting at HOK.

The new "Googleplex" will feature green roofs and common spaces.

| Feb 25, 2013

First look: Google's new HQ is engineered for creative collisions

The new California "Googleplex" will be engineered to make sure no Google employee will be more than a 2.5 minute walk away from any other.

Currently Reading

Mergers and acquisitions transform engineering sector [2013 Giants 300 Report]

TOP ENGINEERING FIRMS

TOP ENGINEERING/ARCHITECTURE FIRMS

Tags

| Mar 4, 2013

| Mar 3, 2013

| Feb 28, 2013

| Feb 28, 2013

| Feb 28, 2013

| Feb 28, 2013

| Feb 27, 2013

| Feb 27, 2013

| Feb 25, 2013

| Feb 25, 2013

Most Popular Content

Magazine Subscription

Get our Newsletters

Follow BD+C: