Tutor Perini Awarded $1.66 Billion City Center Guideway and Stations Project in Honolulu

Rhea-AI Summary

Tutor Perini (NYSE: TPC) has been awarded a $1.66 billion contract by the Honolulu Authority for Rapid Transportation (HART) for the City Center Guideway and Stations Project in Honolulu, Hawaii. The project involves designing and constructing six rail stations and approximately three miles of elevated rail guideway. Design work will begin immediately after contract execution in mid-September, with construction starting in the second half of 2025 and substantial completion expected in 2030. Parsons (NYSE: PSN) will serve as Tutor Perini's design subcontractor. The contract value will be added to the Company's backlog in the third quarter of 2024.

Positive

• Awarded a significant $1.66 billion contract for a major infrastructure project
• Project adds substantial value to the company's backlog in Q3 2024
• Long-term project with construction expected to last until 2030, providing steady revenue

Negative

• Construction start delayed until second half of 2025, potentially impacting near-term revenue
• Large-scale, complex project carries execution risks and potential for cost overruns

Financial Analyst

This $1.66 billion contract is a significant win for Tutor Perini, likely to boost its backlog and future revenue streams substantially. The project's long-term nature, spanning until 2030, provides stable cash flow visibility. However, investors should note that the contract execution is slated for mid-September and construction won't commence until 2025. This timeline suggests a gradual impact on financials rather than an immediate boost.

The partnership with Parsons for design work is strategically sound, leveraging complementary expertise. Given Tutor Perini's track record in light rail projects, this contract reinforces their market position in the infrastructure sector. Investors should monitor project progress and potential cost overruns, which are common risks in large-scale infrastructure projects.

Infrastructure Expert

The City Center Guideway and Stations Project represents a significant urban transit development for Honolulu. The three-mile elevated rail guideway and six stations will likely alleviate traffic congestion and improve public transportation efficiency. The project's complexity, including elevated structures in a dense urban environment, aligns well with Tutor Perini's expertise.

The extended timeline (2025-2030) reflects the project's scale and intricacy. Investors should be aware that such large infrastructure projects often face challenges like permitting delays, community opposition, or unexpected site conditions. However, Tutor Perini's experience in similar projects might mitigate some of these risks, potentially leading to smoother execution and maintaining profit margins.

Market Research Analyst

This contract win positions Tutor Perini favorably in the growing urban transit infrastructure market. With increasing focus on sustainable urban development and public transportation, similar projects are likely to emerge in other cities, presenting future opportunities for the company. The $1.66 billion value significantly boosts Tutor Perini's backlog, enhancing revenue visibility for investors.

However, it's important to consider the broader economic context. Infrastructure spending can be sensitive to economic cycles and government budgets. Any economic downturn or shift in political priorities could impact future project pipelines. Investors should also monitor Tutor Perini's ability to manage multiple large-scale projects simultaneously, as operational efficiency will be key to maintaining profitability across its expanding portfolio.

LOS ANGELES--(BUSINESS WIRE)--

Tutor Perini Corporation (NYSE: TPC) (the “Company”), a leading civil, building and specialty construction company, announced today that it has been awarded a contract valued at approximately $1.66 billion by the Honolulu Authority for Rapid Transportation (HART) for the City Center Guideway and Stations Project in Honolulu, Hawaii. The contract is expected to be executed in mid-September. The project scope of work includes the design and construction of six rail stations and approximately three miles of elevated rail guideway beginning just east of the existing Middle Street Transit Center Station and ending at the Civic Center Station, which will be located just east of downtown Honolulu. Project design will begin immediately after contract execution, while construction is estimated to start in the second half of 2025 with substantial completion expected in 2030. Parsons Corporation (NYSE: PSN) will serve as Tutor Perini’s design subcontractor.

“We are proud and honored to be a part of this transformational project in Honolulu,” said Ronald Tutor, Chairman and Chief Executive Officer. “Tutor Perini has a long and successful history of building large, complex light rail projects in various cities in the United States, and we look forward to partnering with HART to see this project successfully delivered.”

The contract value will be added to the Company’s backlog in the third quarter of 2024.

About Tutor Perini Corporation

Tutor Perini Corporation is a leading civil, building and specialty construction company offering diversified general contracting and design-build services to private customers and public agencies throughout the world. We have provided construction services since 1894 and have established a strong reputation within our markets by executing large, complex projects on time and within budget, while adhering to strict quality control measures. We offer general contracting, pre-construction planning and comprehensive project management services, including planning and scheduling of manpower, equipment, materials and subcontractors required for a project. We also offer self-performed construction services including site work, concrete forming and placement, steel erection, electrical, mechanical, plumbing and heating, ventilation and air conditioning (HVAC).

View source version on businesswire.com: https://www.businesswire.com/news/home/20240815664122/en/

Tutor Perini Corporation

Jorge Casado, 818-362-8391

Vice President, Investor Relations and Corporate Communications

www.tutorperini.com

Source: Tutor Perini Corporation

FAQ

What is the value of the contract awarded to Tutor Perini (TPC) for the Honolulu rail project?

Tutor Perini (TPC) has been awarded a contract valued at approximately $1.66 billion for the City Center Guideway and Stations Project in Honolulu, Hawaii.

When is construction expected to start on Tutor Perini's (TPC) Honolulu rail project?

Construction on Tutor Perini's (TPC) Honolulu rail project is estimated to start in the second half of 2025.

What is the expected completion date for Tutor Perini's (TPC) Honolulu rail project?

Substantial completion of Tutor Perini's (TPC) Honolulu rail project is expected in 2030.

How many rail stations will Tutor Perini (TPC) construct in the Honolulu project?

Tutor Perini (TPC) will design and construct six rail stations as part of the Honolulu City Center Guideway and Stations Project.