Founded in 1972, HACI Mechanical has evolved from its early years as a primarily residential air conditioning contractor to a diverse commercial construction company with high-profile projects in Arizona. The contractor has in-house BIM and CAD operations and a 30,000 square foot automated manufacturing facility that can produce an average of 1.5 million pounds of fabricated duct per year.
HACI became employee-owned in August, marking a significant transition in ownership and culture for its 350 employees. The company also experienced its most productive year in 2024, with reported revenue of $102 million, up 29% from 2023’s $72.62 million.
The company ranks No. 14 on this year’s list of specialty contractors in the seven mountain states and the Southwest region that includes Arizona, Colorado, Idaho, Montana, New Mexico, Utah and Wyoming.
ENR Regional Editor Jennifer Seward sat down with Rob Rarrick, president of HACI, to learn more about the company’s new employee stock ownership plan (ESOP) and how the contractor is leaning into other employee-oriented initiatives. The questions and answers below have been edited and condensed.
A look at HACI’s Arizona projects
Taiwan Semiconductor Head Office, Phoenix:
Tenant improvements to an 830,000 square foot office building.
West Pool Expansion at Talking Stick Resort, Scottsdale:
Renovation of the casino floor plus pool and new houses.
601 North Central, Phoenix:
New high-rise multi-family building with 747 units and on-site services.
South Pier at Tempe City Lake, Tempe:
Mixed-use development with 2,500 residential units.
Updates at various Mesa Public Schools
What’s behind your recent growth?
In Phoenix, the multifamily high-rise market has had some major projects in the last three or four years, and while we don’t generally do a lot of that work, some of our long-standing clients have brought us into these big projects and they’ve been successful for us. But it’s really due to many things. Our build and retrofit service and our scheduled service and preventive maintenance divisions have grown substantially. There have also been good opportunities with government money coming from COVID to support Arizona school districts, and we were a big part of that work.
We’ve had some pretty big industrial projects, like JA Solar, and we’re involved in the largest hospitality project to date in Arizona, the VAI Resort in Glendale. We have also completed several student housing projects, including Herberger at ASU [with Okland Construction] and a major expansion project for the Talking Stick Casino and Resort.
We have been so busy in recent years that we haven’t had a chance to enter the data center market, but now we are ready and would like to start offering these services as well.
How are you navigating challenges like labor shortages and tariffs?
Labor is in a much better place today than it has been in the past five years. There has been a general slowdown [of construction]and it’s enough to loosen the labor market a bit. Rates are a mixed bag. We have received hundreds of letters from equipment manufacturers and material suppliers indicating price increases. Although around 25% of these have been realized, the rest have not. Most of us were able to work [collaboratively] with our general contracting partners, and it hasn’t been too painful.
How does HACI stand out from the rest of the pack?
Tim King, our CEO, bought the company in 1993 and added water pipe and plumbing services, as well as design-build and design assistance, and grew the company doing much larger and more complex work. The biggest news for us is that for the past few months he and I have been working through an ESOP sale and we are officially an employee-owned company. We have many employees who have been here for many years, some for more than 30 years, and it seemed important to give a stake in the company to those people who have put their hearts into the company. Tim has a great reputation in the industry and we are honored to carry on that legacy. We looked at private equity buyouts, but Tim and I didn’t want to go that route. We believe that being an ESOP sets us apart from many [construction] companies that have been swallowed up by private capital. We are looking forward to rebranding as an employee-owned company.
“We believe being an ESOP sets us apart from many [construction]companies that have been swallowed up by private capital”.
—Rob Rarrick, President, HACI Mechanical
This is a huge success. What else is HACI working on internally? Over the past five years, we have made a concerted effort to revamp our safety program and are undertaking a major review of our mental health services for our employees. We recently had a long-time employee take their own life, and that really made me stop and embrace what we can do to help our employees. Construction has one of the highest suicide rates, and this is long overdue. We have created a mental health committee and are auditing the services we offer to see what is working and what is needed more. When we’re in a crisis with an employee, we’ve always seemed to be flying by the seat of our pants, but recently we’ve learned about resources through 988. [a suicide and crisis line]and the Phoenix Fire Department has crisis teams. We provide resources to our managers and identify steps that can be taken when necessary. We are at the beginning of the process. We have monthly roundtables with 10-12 employees at a time on mental health. I’ve been surprised that some of the people I thought would push back the hardest have been the most receptive. At the end of the day, it is [just] a job; we all have families and loved ones, and that’s why we’re here in the first place.
