Economic uncertainty toward the end of 2024 and heading into 2025, in addition to an office market that hasn’t fully recovered from the COVID-19 pandemic, were among the reasons cited for Orange County’s tenant improvement contractors collectively reporting a 5.6% loss in work in 2024 compared to the year before.
The 29 tenant improvement contractors on this year’s list reported more than $1.3 billion of work done last year – a 5.6% decline from the $1.4 billion of work reported in 2023.
Those companies also worked on less space, completing 15.6 million square feet of projects in 2024 – down 5.5% from the 16.5 million square feet completed in 2023.
Employee count for the companies edged up 5.5% to 2,708 Orange County-based workers, indicating tenant improvement contractors are still bullish on upcoming work despite tariffs and recent economic turbulence.
Doug Bassett, president of Brea-based Caliber Construction Inc., said the final few months of 2024 and the start of 2025 proved to be tough on tenant improvement projects.
“The fourth quarter (of 2024) and the first quarter of this year, it seems like things grounded to a halt,” Bassett told the Business Journal.
He added the election and uncertainty surrounding President Donald Trump’s tariff policies, in addition to a struggling office market, was likely to blame for the slow period.
But the second and third quarters started with a flood of projects, making him optimistic about the near future.
“Since March, just as we’re sliding into the second quarter things have just exploded,” he said. “We are operating at a maximum level. We’re hiring people. Things are good and the future looks bright.”
Bassett said Caliber Construction pivoted to industrial real estate projects as the office market slowed down due to pandemic.
“It seems to me that 2024, from a real estate perspective, with high interest rates and all the negative economic news, deals didn’t seem to pencil,” Bassett said. “The office market was in the tank, coming out of COVID.”
Caliber Construction moved up one spot on this year’s list, from 18 to 17. The contractor reported $22.8 million in work for 2024, up 12% from 2023.
The contractor’s projects included the expansion of Multiquip Inc.’s headquarter expansion in Cypress and an office update for Speedo’s 65,000-square-foot space, also in Cypress.
Fountain Valley-based RBA Builders climbed from 14th on the Business Journal’s 2023 list to the No. 8 spot this year. The contractor that specializes in aerospace, biotechnology, entertainment, healthcare, higher education and industrial sectors, reported more than $56.3 million in work in 2024, a 30% jump from the $43.2 million it earned from tenant improvements in 2023.
“Our customer base includes several people in the Fortune 500 of blue-chip companies. They are a little bit insulated from the economic fluctuation now. We are not worried about the tariffs hitting too hard. However, we need to stay agile and come up with strategies to be able to adapt to this,” RBA Builders President Bryan Pavalko told the Business Journal.
New Top Dog
Irvine-based RAM Construction Inc. (see page 1) ranked first on this year’s list, with $163 million of work done, countywide, in 2024. That’s up 14% from the $143 million it reported for 2023.
Bay Area-based Swinerton Builders, which has an office in Santa Ana, dropped from first in 2023 to fourth place in 2024, with $103 million in tenant improvement work done countywide for 2024. That figure trails RAM Construction, Los Angeles-based Howard Building Corp. (second place, $148 million) and Brea-based KPRS Construction Services Inc. (third place, $140.7 million).
Ten of the 29 companies on this year’s list reported declines in 2024, compared to 2023. Costa Mesa-based Slater Builders Inc. was down 55.4%, reporting nearly $16.9 million in countywide work for 2024, compared to $37.8 million in 2023.
VR Mason Inc. dropped from No. 24 last year to No. 29 this year. The Huntington Beach-based tenant improvement contractor completed $5.3 million of work, countywide, in 2024, down nearly 30% from the $7.5 million it reported for 2023.
Other tenant improvement contractors reporting a dip in Orange County work for 2024, compared to 2023, were Torrance-based Esplanade Builders Inc. (down 15.5%), Garden Grove-based Coastline Development Inc. (down 15.5%), Santa Ana-based Gray West Construction (down nearly 14%), Newport Beach-based DBaC Inc. (down 8.3%) and Irvine-based Casco Contractors (down 7.7%).
Research Director Desmond Celo contributed to this report.