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

A new 521,000 sf, 350-bed behavioral health hospital in Lakewood, Wash., a Tacoma suburb, will serve forensic patients who enter care through the criminal court system, freeing other areas of campus to serve civil patients. The facility at Western State Hospital, to be designed by HOK, will promote a holistic approach to rehabilitation as part of the state’s vision for transforming behavioral health.

Vertical Transportation | Aug 17, 2023

Latest version of elevator safety code has more than 100 changes

A new version of ASME A17.1/CSA B44, a safety code for elevators, escalators, and related equipment developed by the American Society of Mechanical Engineers, will be released next month.

Adaptive Reuse | Aug 16, 2023

One of New York’s largest office-to-residential conversions kicks off soon

One of New York City’s largest office-to-residential conversions will soon be underway in lower Manhattan. 55 Broad Street, which served as the headquarters for Goldman Sachs from 1967 until 1983, will be reborn as a residence with 571 market rate apartments. The 30-story building will offer a wealth of amenities including a private club, wellness and fitness activities.

Sustainability | Aug 15, 2023

Carbon management platform offers free carbon emissions assessment for NYC buildings

nZero, developer of a real-time carbon accounting and management platform, is offering free carbon emissions assessments for buildings in New York City. The offer is intended to help building owners prepare for the city’s upcoming Local Law 97 reporting requirements and compliance. This law will soon assess monetary fines for buildings with emissions that are in non-compliance.

Office Buildings | Aug 15, 2023

Amount of office space in U.S. is declining for the first time, says JLL

In what is likely a historic first, the amount of office space in the U.S. is forecast to decline in 2023, according to Jones Lang LaSalle. This would be the first net decline according to data going back to 2000, JLL says, and it’s likely the first decline ever.

Fire-Rated Products | Aug 14, 2023

Free download: Fire-rated glazing 101 technical guide from the National Glass Association

The National Glass Association (NGA) is pleased to announce the publication of a new technical resource, Fire-Rated Glazing 101. This five-page document addresses how to incorporate fire-rated glazing systems in a manner that not only provides protection to building occupants from fire, but also considers other design goals, such as daylight, privacy and security.

Office Buildings | Aug 14, 2023

The programmatic evolution of the lobby

Ian Reves, Managing Director for IA's Atlanta studio, shares how design can shape a lobby into an office mainstay.

Contractors | Aug 14, 2023

Fast-tracking construction projects offers both risk and reward

Understanding both the rewards and risk of fast-tracking a project can help owners, architects, engineers, and contractors maximize the benefits of this strategy and can bring great reward on all fronts when managed properly.

MFPRO+ New Projects | Aug 10, 2023

Atlanta’s Old Fourth Ward gets a 21-story, 162-unit multifamily residential building

East of downtown Atlanta, a new residential building called Signal House will provide the city with 162 units ranging from one to three bedrooms. Located on the Atlanta BeltLine, a former railway corridor, the 21-story building is part of the latest phase of Ponce City Market, a onetime Sears building and now a mixed-use complex.

Office Buildings | Aug 10, 2023

Bjarke Ingels Group and Skanska to deliver 1550 on the Green, one of the most sustainable buildings in Texas

In downtown Houston, Skanska USA’s 1550 on the Green, a 28-story, 375,000-sf office tower, aims to be one of Texas’ most sustainable buildings. The $225 million project has deployed various sustainable building materials, such as less carbon-intensive cement, to target 60% reduced embodied carbon.

Currently Reading

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

TOP ENGINEERING FIRMS

TOP ENGINEERING/ARCHITECTURE FIRMS

Tags

Healthcare Facilities | Aug 18, 2023

Vertical Transportation | Aug 17, 2023

Adaptive Reuse | Aug 16, 2023

Sustainability | Aug 15, 2023

Office Buildings | Aug 15, 2023

Fire-Rated Products | Aug 14, 2023

Office Buildings | Aug 14, 2023

Contractors | Aug 14, 2023

MFPRO+ New Projects | Aug 10, 2023

Office Buildings | Aug 10, 2023

Most Popular Content

Magazine Subscription

Get our Newsletters

Follow BD+C: