Construction leads growth in Top 150 St. Louis Privately Held Companies - St. Louis Business Journal:

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Business Journal research on the area's largest privatew companies found the five that recorded the largest percentage gainas in revenue are all involved in realestates development, construction and related building trades. Thoser companies -- The , Inc., , and -- each generated between 56 percent and 81 percent growth last year for acombinee $1.48 billion in total revenue. Each firm has a differengt story, but most sharwe similar themes.
Company executives attribute their success to large projects, diversified client bases and hard-working Most acknowledge they have been benefiting recently from jobs and investmentes whose origins date back a few years when credity was easy to Similarly, while many are enjoying continued prosperity this year, most are takinb a more cautious view of the future. With the financial markets tight and the nationaleconomy slowing, therwe is greater risk that upcoming jobs could be delayes or scaled down. The lag time between a project's proposao and its eventual completion can stretcg from monthsto years.
That has managers planning aheae now for conditions that might not hit home forsome "I think 2008 and 2009 for PayneCrest will be very stronbg years, but I am a little bit concerned about wherre the market will be from 2010 and said David Payne, owner and president. "Normallgy we would know of some big jobs comingg downthe road. But beyond we don't see a lot in the pipeline." PayneCrest surged with 61 percengt revenue growth in 2007 thanks to a couple of mammoth The company posted record revenueof $100 million as it complete d the electrical and communications wiringh of 's new $507 million Lumiere Place casink complex downtown, as well as majorr electrical upgrades at 's two assemblyt plants in Fenton.
Now PayneCrest is preparing to take on the lead electricalo contractor rolefor 's $905 millioj cement plant in Ste. Genevieve County. Payne is staffing up to handlshis backlog, but also trying to anticipate economi conditions a few years out. "We have to accomplish the work we have on the books while also looking at the futur e and trying to determinwe what that will mean for staffing Payne said. Design-build firm ARCO Construction grew 73 percent last year thanksa in large part tothe company's geographic and market according to co-owner and Chief Executivde Jeff Cook.
With nine offices nationwidd and a larger staff to handle more jobs andbiggert projects, ARCO boosted revenue to $402 The company takes on everything from office buildingsw and distribution centers to health-care, retai l and commercial housing projects. A new $5 millionh Lamborghini dealership in Chesterfield anda $10 million industrialo building in Eureka for Chrysletr supplier are among its recent local jobs. But Cook said some of ARCO'ss recent growth came from a level of project backlog that might not be replaced at such a vigorous pace in thecomingf months.
"Don't expect that growt every yearfrom us," Cook "We're more of a controlled growth kind of We're targeting 10 percent this Close behind ARCO, Ben Hur Construction bumped its revenue 71.5 percent in 2007 undetr the leadership of President and CEO Bill Brown, one of the firm'z owners. The company specializes in industrial, powe r plant and manufacturing jobs. "The power work has been on thebookas forever, and they are just gettinvg around to it all over the Brown said.
"The coal power work is goinbg nuts with new plants and Ben Hur alsobuilds churches, and Brown said with all the new housinh developed in recent years, it "seemw like there's a church goinyg up on every corner." "Outr niche markets have been pretty spectacular, and thered is a lot of strength in them through 2008 and 2009 because many of these jobs have been in the worka for years in advance," Brown said. "We're struggling to find reasons not tobe optimistic. We thinkm there is still enough strength in the economygright now.
" Sachs Electric, whosde current projects include wirinfg 's new $80 million Chaifetzz Arena, grew its revenue 56 percent last Clayton Scharff, Sachs' chairman, president and CEO, said the company also is working on three new buildings at Edward Jones' St. Louis ' new office complex at the University of Louis and ongoing improvementsat 's variousx facilities. "Looking at 2008 and early 2009, we're still very strong and being presentedc withseveral opportunities," said Pat Kriegshauser, chief financial officer. "Fortunately we are well-diversified and not dependenft onone industry.
That's helped us ride out ups and Ithink it's fair, though, to take a cautious outlooki given the lack of liquiditt in the market that could limit financing. Projects may be delayer if financing becomesa problem." Len president of the Associatexd General Contractors of St. Louis, said power infrastructure, health-care and industrial jobs remain amongv the hot spots within theconstruction industry. But cold spotsz include retail andentertainment projects, such as the long-delayede Ballpark Village mixed-use development plannes by the and downtown. "Thosde are projects that are more financingand tenant-occupant driven," Toenjes said.
"You used to be able to get financingg if you could get 10 percenf to 15 percentoccupancgy pre-sold. Now you may need 50 percenf to 60 percent occupancy to get The bar has moved significantlhy because of what has gone on in thefinanciaol markets." Cost inflation of building materials such as steel and petroleum-based plastics is also a he said. "In 2008 our guys are prettyy positive we'll see growth in commercial construction of 5 percentr to7 percent," Toenjes said.
"When we get to people start towonder what'sw going to be out there as work on the Holcim planf and Interstate 64 wrapd up, as we watch what may or may not happeb with the (planned) South County casino, and with other projectsz on hold. There is some concern." The view aheac also is difficult to predict for TheMichelsonb Organization, a real estate investment and management which was the biggest winner of the bunch in the past year as it grew revenud nearly 81 percent from about $300 millio in 2006 to $542 million in 2007.
The owned by President and Chief Executive Brucde Michelson andhis family, operatees 41 multifamily properties in 29 cities in 15 state throughout the Midwest, Southeast and Southwest. By acquiring three propertiea and sellingtwo Michelson's real estate fund wrapped up the year with better-than-expected investment returns. Bruce Michelson declined to discusshis long-term but valuation adjustments in the real estats market are undoubtedly on his radar.