- The Washington Times - Wednesday, May 21, 2003

A Beltsville construction company is capitalizing on the Washington area’s booming building industry.

Gilford Corp.’s revenue has climbed from $3.6 million in 1996 to $62 million last year, on the strength of steady contracting with the federal government and by diversifying in the private sector, owner Henry Gilford said.

“The number of contracts out there from the D.C. and federal government has made the company recession-proof,” Mr. Gilford, 58, said during a tour of the site for the under-renovation Carlos Rosario International School on Harvard Street in Northwest.

Seventy percent of Gilford Corp.’s work is with federal and local governments — primarily the State, Homeland Security and Transportation departments — and 30 percent is with the commercial and residential markets.

While construction fell last year in San Francisco, Boston, Atlanta and Los Angeles, new construction in Washington grew 15 percent from the previous year, a McGraw-Hill Construction study found.

But Gilford’s success isn’t common, said Debora Schoonmaker, president of the D.C. chapter of Associated Builders and Contractors, a trade association based in the Rosslyn section of Arlington.

“I can think of a handful of businesses that have had that same sort of growth, but it’s not a regular thing,” she said.

Mr. Gilford, who is also the firm’s chief executive officer, this month was named Small Business Person of the Year by the Washington district of the Small Business Administration.

About 50 of Gilford Corp.’s 170 workers are finishing renovations on the three-story, 82,000-square-foot Carlos Rosario International School.

Mr. Gilford, glancing at the nearly completed third floor, said the project was on schedule for its Aug. 1 deadline. The charter school will begin teaching about 1,000 immigrant students English and cultural lessons in September.

Gilford will receive $9 million from the school, but the company’s average contract is $46 million.

“Our goal now is to win larger contracts — in the $100 million range — from the government,” Mr. Gilford said.

He said he doesn’t plan to expand beyond demolition, general contracting and network services and international divisions, or move the focus from the government.

“I like working in both markets, but the government is more consistent in payments and stable than the commercial markets,” he said.

But government contracts come at a price. Payments generally are delayed 60 to 90 days after a project has started, and Mr. Gilford faces a continual challenge of surety bonding, which secures insurance for those projects.

“We are constantly outgrowing our surety bonding size limit,” he said. The company had bonding, or insurance, for up to $500,000 in 1995.

“But we busted that, so I managed to get $3 million in 2002. Now, we’re looking at netting $8 million, but it’s perpetually a problem,” Mr. Gilford said.

Another problem with government contracting is that profit growth is lower, said Dennis Day, spokesman for the Associated General Contractors, an Alexandria-based trade organization.

Mr. Day said increased government spending on contracts doesn’t equal increased profits for contractors.

Despite the problems, Mr. Gilford said, the company is close to achieving his initial goal of $100 million in annual revenues by 2005. He forecast 2003 revenues to reach $80 million to $85 million, but did not disclose his profits.

Mr. Gilford began his first civil engineering firm, District Engineering Services, in 1977. He sold his interest in the company in 1984 to start another civil engineering firm, Gilford & Chase Inc.

With a focus on construction, Mr. Gilford sold the assets of Gilford & Chase, modified the charter, changed the name and opened Gilford Corp. in 1995.

Gilford Corp. initially had 92 percent of its sales in government contracts awarded to small businesses, and competed against companies like Hillian Brothers & Sons Inc., KCI Inc. and William Euille & Associates Inc.

The company now bids against major contractors like Davis Construction Corp., Monarc Construction Inc. and Holder Construction Co.

Mr. Gilford said he visits all current projects, about 20 to 25 in the District and Maryland, once a month to check on progress. He also checks over the phone on projects in Algiers, Bosnia, Russia, Kenya, Tanzania and Suriname.

But he doesn’t get involved with the details of any site.

“I’ve made that mistake in the past. I became so trapped with doing the daily operations of the company that I never looked at the larger idea of how to grow my business,” he said.

He leaves the school site satisfied with the progress.

“These visits are a great break, but I essentially collect the money and market the company now,” he said. “It’s a better way of living.”

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