Case Studies

OHL USA: Bringing Together Experienced Affiliates

  • Written by: OHL USA: Bringing Together Experienced Affiliates
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OHL USA is a fully owned subsidiary of Obrascon Huarte Lain (OHL), a company based in Madrid, Spain, with a presence throughout the world’s construction industry. The parent company, one of the top 25 largest international contractors as of 2011, has been around for over 100 years, and underwent an enormous expansion that started in the late ’80s through a series of mergers. It continues today with a steady and sustained 15-percent growth of its international business and infrastructure concessions, accompanied with selected acquisitions of construction companies in strategic markets, the U.S. being one of them. Nowadays OHL is a true construction multinational with sales outside its domestic market in excess of 70 percent and more than 90 percent of its EBITDA (earnings before interest, taxes, depreciation, and amortization) generated overseas.

OHL USA acts as an umbrella for the North American operations of several companies in which OHL owns a majority share. From headquarters in New York, N.Y., and Miami, Fla., the operation has contributed to contracts throughout the U.S. and Canada, for projects including and alongside highways, tunnels, hospitals, universities, metro rail, subways, etc. Lauro Bravar, current CEO of OHL USA’s southern region operations, says, “We don’t really have a specialty. We’re capable of undertaking any construction project, any size and any type.”

The Community Asphalt Corporation

The acquisition of Community Asphalt Corporation (CAC) by OHL in 2006 allowed OHL USA to become one of the local players of the transport infrastructure sector immediately, and at the same time the transaction boosted the activities of CAC. Founded in 1980 in Hialeah, Fla., CAC performs general road construction projects and related development throughout South Florida. CAC performs all aspects of its projects from asphalt production to the completion of roads. The company keeps operating costs low by maintaining a full fleet of equipment, all serviced at CAC’s facilities by an in-house team of mechanics. This direct supervision helps inform a fixed replacement schedule for out-of-date equipment.

Most of the company’s work is for state and local authorities, and CAC has undertaken several recent showcase projects. The Florida Department of Transportation contracted CAC to perform a highway improvement project on U.S. Route 1. The segment of this road is part of an important hurricane evacuation route from the Florida Keys. The route’s capacity will be amplified by the new construction, which takes place along a stretch of ecologically delicate land. However, the most innovative aspect of the project was related to its financing, which was arranged by OHL USA. The approach allowed the FDOT to build the highway improvement many years before the budget was available for the investment.

CAC is currently working on the largest project bid by FDOT (excluding infrastructure concessions), a five-year project building a four-level interchange in the busiest highway crossing in Miami. The project is about halfway done and so far CAC was able to avoid any relevant disruption to the existing intense traffic by means of a carefully studied management of traffic and innovative construction techniques.

Another project worth mentioning is the remodeling of the access to the Miami International Airport, known as Central Boulevard, a long-needed improvement that will allow travelers to reach the airport directly through an elevated infrastructure. Also at the airport, OHL USA has just inaugurated the extension of the metro rail that now connects downtown Miami with the airport, a project that included a signature station delivered “on time and on budget” by two of the local subsidiaries of OHL USA: Community Asphalt and the Tower Group.

Other Affiliates of OHL USA in Florida

At the same time when OHL acquired Community Asphalt, it also acquired the Tower Group (Tower), marking the multinational’s entry into the U.S. market for buildings. And a few years later other building companies were added to the portfolio of OHL USA’s investments, namely, Arellano Construction and BCA, specialized in healthcare, university and school construction.

As in the case of CAC, the partnership provided the local affiliates with the financial and corporate resources needed to increase business. These companies offer general contracting services and construction management services; have a diverse portfolio; and offer a full spectrum of services, from preconstruction to closeout.

OHL is a world leader in hospital building, and including the affiliate Arellano projects the company has built 50 hospitals around the world in the last decade alone. While all of these subsidiaries have benefited from joining the OHL group, the companies’ already established reputations for completing complex, technically challenging projects have been key to maintaining a steady flow of projects. “We do a lot of repeat work with subcontractors and suppliers,” says Bravar. “It’s important to us to create and maintain lasting relationships.”

These relationships have led OHL USA and its affiliates to growth allowing for expansion and a greater range of offered services. OHL has established itself in over 30 countries across the globe and has performed projects on five continents. That strong corporate backbone, plus a little of what Bravar calls “luck,” has floated the OHL USA businesses through a tough global economy. “Locally, we were fortunate to land some large projects before the beginning of the crisis,” he explains. Some of these are still ongoing, which has allowed OHL USA to travel through the troubled market in relative comfort.

The group’s mission is to create value and exceed expectations through unparalleled services and exceptional quality, and OHL maintains transparent relationships with clients in order to maintain relationships and perform on-time work within budget. Following in the same footsteps and corporate culture as its parent company, all companies associated with OHL USA strive to reinforce practices and embrace emerging technologies that improve communities socially, economically and ecologically.

Published on: March 15, 2013

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