🔒New acquisition gives Loureiro Engineering vertical construction capabilities, growth opportunities

During his 30 years with Loureiro Engineering Associates, Brian Cutler says the Plainville-based company has grown for one main reason: leadership listens to their clientele.

So, when roughly 80% of Loureiro’s top clients identified a need for general contracting and construction management services, the company acquired Coventry-based Pelletier Builders last December.

Cutler, who officially became Loureiro’s CEO this past January, says Pelletier’s 54 years of general contracting experience — including the ability to build multistory vertical buildings — is an important supplement to the company’s existing civil construction business and a further enhancement of Loureiro’s integrated engineering and construction service.

An integrated approach, also known as design-build, streamlines the design and construction process under one company and it’s becoming an increasingly popular model for firms and clients as industry studies have shown it creates greater efficiencies, lowers project costs and expedites project completion speeds.

Over the past decade, according to the Design-Build Institute of America (DBIA), design-build construction has increased dramatically and accounts for 40% of the non-residential construction market.

Over the past year, design-build projects were vitally important in providing alternative medical facilities and other COVID-related construction projects, says Lisa Washington, CEO of Washington, D.C.-based DBIA.

“It’s the most cost- and time-effective way to deliver projects,” she said and “[it] will help as we rebuild our economy in the post-COVID era.”

From concept to completion

Loureiro Engineering, which was founded in 1975, operated largely as a traditional civil engineering company during its first quarter-century, but has been providing integrated services since 1999, when it established Loureiro Contractors Inc. (LCI) to offer a broader range of mostly civil services, including infrastructure development, environmental remediation, roadways, bridges and underground utilities.

For Cutler, the company’s evolution is about being able to take a project from concept to completion under one roof.

In addition to engineering and construction, Loureiro offers environmental assessment, landscape architecture, health and safety, facility services, energy waste management and laboratory services through its subsidiary Tunxis Labs LLC, which focuses on environmental research.

Dave Fiereck, who was promoted to president of Loureiro Engineering Associates in January, said the diverse range of services offered by the firm allows for cross-functional teams to work on projects so they are well-vetted.

In total, Loureiro employs roughly 200 people — with about 20 new employees coming onboard with the Pelletier deal.

Recruiting talent has been a key focus. Since 2018 Loureiro has offered remote working flexibility, including a handful of employee moves that have fueled satellite offices in Massachusetts, New Hampshire and Rhode Island, where Cutler says there was opportunity for economic activity.

Loureiro’s employees have a particular incentive to drive that activity, too, because the company is employee owned under an employee stock ownership plan (ESOP), which provides a share of company profits.

Those numbers have been on an upward trajectory as the firm has added to its client portfolio, including more than 100 new clients last year alone.

Over the past three years, Cutler says, revenue has increased by 31%. More than half of that comes from Loureiro’s top five or so clients with 90% owing to their top 50 clients, including some that have been working with Loureiro for more than 45 years.

For any of the firm’s roughly 400 clients, there’s no project too small.

While Loureiro offers integrated services, it provides open architecture so clients can choose the services they need, a la carte.

“We have projects that are $2,500 and some that are $10 million,” Cutler said, noting that the company’s sweet spot for civil construction projects is between $5 million to $50 million and for projects for the newly-acquired Pelletier Builders in general between $1 million to $10 million.

Cutler said he remains bullish about the company’s future.

As CEO, he’s targeting 10% client growth year over year and was encouraged that none of the firm’s planned projects were canceled due to COVID, although some were postponed.

He said he sees the trends in the industry shifting toward design-build and is confident that Loureiro’s latest acquisition will help capitalize on those opportunities.

Future acquisitions are also a possibility, he said.