The Turner Corporation

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The Turner Corporation

375 Hudson St.
New York, New York 10014
U.S.A.
(212)-229-6000
Fax: (212-229-6185)

Public Company
Incorporated: 1984 as The Turner Corporation (Holding Co.)
Employees: 2,700
Sales: $3.14 billion (Total); $2.64 billion (Construction)
Stock Exchange: American Stock Exchange
SICs: 1522 Residential Construction, Nec; 1541 General Contractors Industrial Buildings; 1542 Nonresidential Construction, Nec; 7389 Business Services, Nec; 8741 Management Services; 8742 Management Counseling Services

Founded in 1902 by Henry C. Turner, a devout Quaker from the eastern shore of Maryland, the Turner Corporation has grown into the leading builder in the United States. It is the largest builder of commercial, industrial, manufacturing, institutional, biotech/pharmaceutical, healthcare, retail, recreational, and government buildings, as well as multi-unit housing and interiors. This award-winning company built many of the most famous buildings in major cities around the nation, among them the John F. Kennedy Memorial Library in Dorchester near Boston, the United Nations Secretariat and Plaza in New York, the Xerox Center in Chicago, and Two Union Square in Seattle. As of mid-1993, the company had won four AGC/Motorola Build America Awards, and from 1985 to 1992 was named number one in Modern Healthcare Magazine’s annual design and construction survey. The Turner Corporation has built 20 of the 100 tallest buildings in the world. Its clients are among the world’s leading corporations, such as General Motors, Ford, Chrysler, United Airlines, American Airlines, General Electric, and IBM.

The company operates through more than 35 offices in the United States and abroad. It has divisions and subsidiaries located in 97 cities, 22 states, Puerto Rico, Kuwait, the United Arab Emirates, Taiwan, and Belgium. This network of offices enables Turner to function as a local facility as soon as a contract for construction is awarded. In fact, Turner is referred to as “the largest small contractor in America” because of its system of serving as a local contractor in each community. Turner’s president, Harold J. Parmalee said in 1992, “Our roots go very, very deep. We’ve been in New York City for 90 years, in Philadelphia for 85 years, and in Boston for 76 years. This allows our people to become active citizens of these communities and to work closely with local owners, architects, subcontractors and municipal agencies.” Staff members in these offices have an intimate knowledge of local regulatory and review processes, local labor conditions, and strengths and weaknesses of subcontractors, thereby facilitating the construction process.

Another benefit of having ties in a community is that quality is enhanced. According to Chair and Chief Executive Officer Alfred T. McNeill, “People who are building their own community take greater pride in it. Our commitment to quality can be seen in the 75-story First Interstate building in Los Angeles that didn’t crack in the earthquake and the Turner-built housing in Florida that remained standing after Hurricane Andrew.”

Turner’s success has frequently been attributed to its ability to adapt to changing market conditions and construction demands. As the demand for commercial building has declined with world’s economic cycles, Turner has been quick to diversify into new markets in the social and public sectors. Thus, Turner has constructed buildings of all types as the market and demand has changed. In addition to the construction of new buildings for niche markets, the company has been involved in expansions and renovations of existing facilities, and in providing services related to construction activities. When poor economic conditions have forced other companies to reduce staff, Turner expanded its services, using its full network of staff and resources to function as a sort of one-stop construction business, providing a full range of services from designing to building to helping with financial matters.

Turner began modestly. After Henry C. Turner graduated as an engineer from Swarthmore College, he worked with the little-known Ransome system of steel-reinforced concrete. Believing that this new method would revolutionize construction, Turner and a partner, D. H. Dixon, purchased the rights to the system for $25,000 and founded Turner Construction Company. In the early 1900s, the company completed the stairways for New York’s first subway stations. Industrial contracts soon followed as Turner’s reputation for speed and skill grew, and the Ransome system received recognition. Turner’s faith in using concrete led the company to adopt the slogan, “Turner for Concrete.”

During the years that the nation was involved in World War I, the company received several defense contracts. Volume increased from $6.5 million in 1916 to $35 million in 1918. In 1919, the company received its first international contract. From 1919 to 1922, Turner expanded into new areas and built its first high-rise office building, its first hotel, and its first full-scale stadium.

During the Great Depression of the late 1920s and early 1930s, construction activity declined. Turner’s volume fell drastically but the company remained in business while thousands of other contractors were forced to close their doors. Turner was able to continue operations because it shifted its focus from industrial and commercial building to other types of facilities, such as retail stores, churches, and other academic and public buildings.

During World War II, the company once again received defense contracts from the government and was involved in such building projects as a submarine base in Connecticut, Pacific Naval air bases, the Brooklyn Navy Yard Storehouse, and 93 oil tankers for the Alabama Drydock & Shipbuilding Company. During wartime, Turner also managed base facilities for the topsecret village at Oak Ridge, Tennessee, where, without the company’s knowledge, the components of the first atomic bombs were being prepared. By 1941, when Henry C. Turner retired, defense work represented 81 percent of the company’s business.

After the war, the country started rebuilding programs and Turner received contracts for building academic, commercial, and industrial buildings. Turner built a structure for the Coca-Cola Bottling Co. in New York and was the contractor for the Firestone Library at Princeton University. By 1951, with all this activity, company sales had reached $100 million.

In the 1960s, Turner built high-rise buildings, futuristic airline terminals, and pavilions for the World’s Fair, as well as some of the nation’s most well-known buildings, such as Lincoln Center, Madison Square Garden, and the U.S. Steel headquarters in Pittsburgh. By the late 1960s there were Turner buildings as far away as Hong Kong. In 1969, the company went public and by 1972 was selling shares on the American Stock Exchange.

By the 1970s, Turner had expanded its foreign offices into such countries as Iran, Pakistan, and Dubai. In the late 1970s and early 1980s, the company continued to build highly visible facilities associated with prestigious names, such as the John F. Kennedy Library in Dorchester in 1979 and the Moscone Convention Center in San Francisco in 1981.

The search for new and different types of markets was especially important during the recessionary years of the late 1980s and early 1990s when the real estate market slumped. Turner continued to expand into niche markets that reflected the scope and range of its experience. For example, in 1989 the company contracted to build a convention center in Columbus, Ohio. In 1990, the company completed the 54-story Mellon Bank Center in Philadelphia, the third tallest building in the city. In 1991, Turner completed construction of the 63-story Society Tower in Cleveland.

In 1992 alone, Turner built 125 projects, including office, retail, airport, industrial, advanced technology, healthcare, justice, residential, educational, science, and recreational facilities. Through diversification into new markets, sales in the commercial sector dwindled, representing only 17 percent of the company’s total sales in 1992. Moreover, this volume was mostly for renovation and interiors rather than new construction.

In 1992, a new jointly owned company was developed by Turner and Steiner for acquiring the ongoing business of Turner International, called Turner Steiner International SA (TSI). The domestic company was to retain its responsibility for activities in Japan, North America, Central America, and the Caribbean. Also in 1992, Turner’s policy of moving into the social sector was rewarded when the company became the leading general contractor or construction manager of healthcare facilities, with sales hitting $1 billion. New projects continued to roll in, and Turner was awarded contracts to build University of Chicago Hospitals for their new Center for Advanced Medicine and two new buildings at the New England Medical Center. The company also negotiated construction management contracts at two San Jose area hospitals.

Educational projects were also showing steady growth and were 33 percent higher in 1992 than in 1991. The company was involved in new and renovated educational facilities with local school systems and large public and private colleges and universities. Also, Turner was chosen to manage the seismic upgrade addition and renovations of the Doe and Moffit libraries in San Francisco the same year.

Other projects in 1992 further demonstrated the company’s commitment to diversity. Turner built new research and development facilities for companies that wanted to compete internationally. Turner entered into a contract with the biotech/pharmaceutical company Genzyme Corp. for building a quality control/quality assurance laboratory and pharmaceutical manufacturing facilities. The company was also engaged to build a new petroleum additives research facility for Ethyl Corporation. Other work progressed on pharmaceutical projects for Rhone-Poulenc Rorer, Ethicon, Ortho, and Allergan.

Some construction and management contracts for publicfunded projects were also awarded in 1992. Contracts were awarded for modernizing and expanding Albany Airport, building the Cleveland Public Library, providing management services for renovations to the New Jersey State House Annex in Trenton, and building a new open-air sports complex in Cleveland.

In keeping with its pursuit of diverse roles in the construction field, Turner contracted its management services at this time as well. Some early management service contracts were made with Hewlett-Packard, the Columbus Convention Center, the University of Washington, and, in partnership with other managers, the new Walt Disney Concert Hall and 2,500-car garage.

Turner also took on the responsibility for both design and construction of a project, as clients sought to save time, money, and staff hours. The design/build projects that were developed from this strategy in 1992 included the Federal Justice Building, Atlanta City Detention Center, and a six-story parking garage at Vanderbilt University in Nashville.

As the recession of the early 1990s persisted with its resulting tight credit market that hampered new building, Turner adopted another strategy. The company took the design/build process one step further and developed the design/build/finance service. Turner assembled teams of facility users, developers, designers, and lenders in agreements that met all the needs of the people involved in the projects. The finance and development was assumed by a third party, a special purpose corporation. Turner arranged these design/build/finance contracts in 1992 with the University of Cincinnati and the Middletown Courthouse in Connecticut.

In the early 1990s, Turner continued to secure contracts with local governments, agencies, and authorities to manage long-term construction programs, such as the Los Angeles County-USC Medical Center replacement facility and the 10-year expansion project at Lambert-St. Louis International Airport.

Expansion into international markets continued as the company focused on projects in Europe, the Middle East, and the Far East as its subsidiaries and affiliates secured contracts from new and existing clients. With TSI, Turner took on several rebuilding projects in Kuwait after the Persian Gulf War, providing in particular reconstruction services for the Kuwait Sheraton Hotel. Other projects with TSI were the Abjar Hotel in Dubai, the Almulla Hospital, New Doha International Airport in Qatar, preconstruction and construction services for office towers in Sri Lanka, and a project in Brussels for Citibank Europe.

As the company looked to the future, it planned to develop more services as a way of satisfying changing client needs. Turner president Parmalee said, “Clients will seek more program management from concept to completion and more overall responsibility.”

The company would continue to look for new markets as some sectors showed strength and others showed weakness. Some opportunities were expected to come from expansion in such geographical areas as the Southeast, Southwest, and upper Midwest. Other opportunities were expected to come from new fields such as seismic adaptation and high-strength concrete technology. The specific types of facilities where growth was expected were as varied as in the past, but special emphasis appeared to be in the social service areas. Construction of educational facilities and healthcare facilities in particular was expected to be strong. With its sizeable share of the healthcare market, Turner developed a division called Turner Medical Building Services Inc., located in Phoenix. Growth was also projected for publicly funded projects awarded by federal, state, and local governments for justice facilities. The company even has a division called Correctional Facilities Division located in Portland, Oregon.

Other types of building also were expected to be promising. More construction of research and development facilities was forecasted for biotech and pharmaceutical companies in the Northeast, Mid-Atlantic, and West coast. Turner also anticipates work on public/government buildings such as post offices, airports and libraries, sports and recreational facilities such as stadiums and amusement facilities, as well a future projects such as hotels, religious buildings, and residential condominiums.

Principal Subsidiaries

BFW Construction Co.; The Lathrop Co. Inc.; Service Products Buildings Inc.; Turner Caribe, Inc. (Puerto Rico); Turner International Industries Inc.; Universal Construction Co. Inc.