While disrupted supply chains, soaring material and labor costs and rising interest rates have hurled construction into choppy economic waters the last several years, the MidAtlantic’s specialty construction firms are starting to get their sea legs again.

The top 10 firms on the ENR MidAtlantic Top Specialty Contractors list posted a combined $2.10 billion in regional revenue for 2022, a 16.02% increase from the $1.81 billion reported by the top 10 firms on last year’s ranking.

“The last four years have been a roller coaster of extremes, but we are very optimistic regarding the upcoming years,” says Craig Melograno, president at PDM Constructors Inc., a multidisciplinary specialty firm that ranked seventh on this year’s MidAtlantic list with $125.09 million in regional revenue.

PDM’s revenue increased 15.82% from last year’s $108 million, which placed the firm in the No. 8 spot.

“It still might be a little choppy in the first half of 2024,” Melograno adds, “but we see positive momentum beyond that.”

Participation Shift

Based on 2022 revenue data, this year’s survey saw a combined $2.57 billion in revenue from the top 18 firms, a 26.6% increase from last year, when the top 18 firms that submitted responses had a combined $2.03 billion in revenue. Last year’s total represented a 25.2% decline from the $2.71 billion recorded by the top 18 firms on the previous year’s ranking.

But one noteworthy element in last year’s ranking was that the No. 1 ranked firm from the previous year’s survey—MasTec Inc.—did not participate. MasTec posted $688 million in regional revenue two years ago.

Once again, the firms on this year’s survey performed well despite MasTec’s absence. Overall, the 25 ranked firms collected $2.75 billion in 2022 revenue in Delaware, Maryland, Pennsylvania, Virginia, West Virginia and the District of Columbia. Two years ago, MasTec topped the 24 firms that reported a total of $2.8 billion in revenue.

The top three ranked firms on this year’s ranking also topped last year’s list, but in a different order. Rosendin Electric Inc. jumped three spots to finish first this year with $420.68 million in regional revenue, a 44.53% increase from last year. Meanwhile, last year’s No. 1 ranked firm, Comfort Systems USA, finished second with $403.39 million in regional revenue, a 11.44% jump from the previous year.

Hatzel & Buehler Inc.—ENR MidAtlantic’s 2017 Specialty Contractor of the Year and the nation’s oldest electrical contractor—slipped one spot to No. 3 with $325.20 million in revenue. That represents a 10% lift from last year’s $295.66 million.

Pennsylvania Pride

Despite being based in Wilmington, Del., Hatzel & Buehler performed $260.70 million worth of work in Pennsylvania, which was more than any other firm logged in the Keystone state for the second straight year.

The firm’s nearly 17% increase from the $223.10 million it collected in Pennsylvania last year is indicative of the state’s specialty construction market at large. The top 10 firms working in Pennsylvania collectively had $820.35 million in revenue, up 62.5% from last year’s $504.71 million.

Melograno says health care has been the strongest sector for North Wales, Pa.-based PDM Constructors, “but it’s been a little surprising how resilient the other sectors have been. Even if a business has stopped expanding, they have pivoted to redefining and repositioning themselves, and that change generates construction activity.”

Providing preconstruction services, modular manufacturing, drywall, carpentry and millwork, PDM Constructors, the 2020 ENR MidAtlantic Specialty Contractor of the Year, also repositioned itself last year to focus more on manufacturing and “productization,” Melograno says.

For example, one of the firms “products” is its modular bathroom pods. The firm says the prefabricated solution provides $14,000 worth of work per hour compared with the $125 value per hour for constructing a bathroom on site using tradition methods.

“As we transform from a construction company that performs manufacturing to a manufacturing company that performs construction,” he says, “we have looked introspectively at every process and every person to see how they may or may not fit in to that new paradigm. That analysis includes our customers, our contract types and the projects we pursue. The contractors that continue to build like its 1975 are already being left behind—they just don’t know it yet.”

Strong Steel

No. 21-ranked Sure Steel Inc. also cuts its own path by self-performing the construction of its scope and work directly for the contractor or owner—a common practice in other trades, but a “differentiator” for structural steel firms, says Daniel Miller, the firm’s chief executive.

Miller says most MidAtlantic steel firms “are contracted to the manufacturer/supplier first and the steel contractor works for the supplier.”

He says his firm has an advantage because contractors hire them and “work directly with our construction team and our crews, and then we hire the supplier to provide our materials to align with our construction approach from a holistic schedule and pricing perspective.”

The firm also provides metal building systems, insulated metal panels and mass timber construction. It had one of the largest percentage increases in revenue on this year’s ranking. The South Weber, Utah-based firm’s $31.20 million in regional revenue was up 514.2% from the $5.08 million it reported last year.

Miller attributes its boost in the region to its controlled growth plan. “We expanded to the region back in 2018 with a focus on our existing customers,” he says, “while also showcasing our experience and reputation to add new customers. Our reputation and backlog in the region have grown steadily since.”