With multiple geographies and construction market sectors offering companies healthy opportunities, contractors in the five-state region had no trouble staying busy in 2023, according to the results of the annual survey of major contractors of ENR Texas and Louisiana. The 79 companies that participated collectively reported revenue of approximately $45.8 billion in 2023, a huge jump from the previous year.
The top 25 companies on the list reported total revenue of $34.14 billion for 2023, up 27% from 2022 revenue for the same group. The growth marked a change of pace from last year, when the top 25 contractors collectively reported flat revenue for 2022, following a 4% decline in 2021.
Graph by ENR
Looking at the top of the rankings, Zachry remains in the #1 position thanks to $4.97 billion in regional revenue in 2023, an increase of more than $1.5 billion from the previous year. Austin Industries, in second place, also saw its annual revenue increase by roughly $1.5 billion, totaling $4.18 billion last year.
The revenues of the 78 companies follow a slightly different pattern. Average revenue per company increased to $587 million in 2023 from $464 million in 2022, a 26% jump. However, average revenue per company also saw a healthy 12% increase in 2022, after a steeper 8% drop in 2021 during the pandemic.
Construction revenue from the oil sector saw significant growth of 42%, from $5.69 billion in 2022 to $8.1 billion in 2023. The manufacturing sector saw even greater growth, from $2.57 billion from $4.35 billion in 2022 to $4.35 billion in 2023.
In contrast, the overall construction market saw only modest growth of 5%, from $21.07 billion in 2022 to $22.09 billion in 2023. However, there were significant changes within the market. Revenue from healthcare and hospitality projects saw little movement, down 1% and a further 3%, respectively, while revenue from multi-unit residential projects grew 24%.
Construction of the Loews Arlington Hotel and Convention Center in Arlington, Texas, involved 129 business partners, according to contractor JE Dunn.
Photo courtesy of JE Dunn
Important work, challenges ahead
Contractor business opportunities continue to be in healthy supply throughout ENR’s Texas and Louisiana region. However, lingering issues of escalating material prices, tight homeowner budgets and labor shortages continue to challenge all businesses.
“The market remains stable,” says Greg McClure, senior vice president of Manhattan Construction Co. in Dallas “The projects continue to progress to hire. However, there is significantly more effort involved in aligning project costs and owner budgets. [And] with continued positive market growth, the industry continues to be hurt by an overstretched labor market, which is causing downstream impacts on project costs and schedules.”
In Oklahoma City, Manhattan Construction is delivering the Chickasaw Nation Development Team’s Okana Resort master development project, which includes a 391,000-square-foot hotel and conference center.
Photo courtesy of Manhattan Construction Co.
Greg Lorei, president of the South Central region with JE Dunn’s Dallas office, sees a similar situation.
“The Texas construction market remains robust, but very competitive,” he says. “Due to higher interest rates for construction financing, we’ve seen a slowdown in viable projects” led by private developers.
“The projects continue to progress to hire. However, there is a significantly higher effort to align project costs and owner budgets.”
—Greg McClure, Senior Vice President, Manhattan Construction Co.
“As a result, many construction companies pivoted to different markets/types of construction,” he adds. “This creates more competition for projects that are not privately run or developed.”
However, Lorei adds, “Texas’ business-friendly climate has attracted national customers to establish major campuses for mission-critical and advanced industries and industrial and manufacturing projects.” Lorei also cites the estimated $10 billion-plus in airport expansions and improvements across Texas as a target for potential future work.
Manhattan Construction is a contractor that has already made recent gains in this market.
“The aviation sector is another area where we’ve seen substantial growth, driven by state and federal infrastructure initiatives,” says McClure. “Manhattan has successfully acquired several of these projects, most notably … the transformation of United Airlines’ Terminal B [of the] North and South Concourse to Improve Passenger Experience at Houston IAH Airport.
Graph by ENR
About the rankings
ENR Texas & Louisiana invites readers to examine the following rankings to learn which construction markets offered contractors opportunities in the states of Arkansas, Louisiana, Mississippi, Oklahoma and Texas. In addition to the main regional list, there are detailed revenue rankings by state, market sector, construction type and delivery method on the following pages.
