Tutor Perini Lands $1.4 Billion Airport Contract

A Tutor Perini Corp. partnership to build a New Jersey airport has landed a $1.4-billion commitment from the Port Authority of New York and New Jersey, and analysts of the Sylmar-based construction company are calling the contract “a material positive.” Tutor Perini will partner with Washington, D.C.-based Parsons Transportation Group Inc. on the 1-million-square-foot Newark Airport Terminal One Design-Build Project, meant to pull Newark Liberty International Airport into the 21st century. In addition to a 33-gate common-use domestic terminal, the airport overhaul will include a roadway network connecting the new terminal to existing ones, as well as to a parking garage with toll plaza facilities. Tutor Perini will serve as managing partner on the project. Construction will break ground in April with eyes on a 2022 completion date. It represents the largest transportation infrastructure design-build contract in New Jersey’s history, and KeyBanc Capital analysts approve the undertaking. “The large size of the project helps put backlog on a positive-growth trajectory early in the year and the project timeline suggests it should contribute to the bottom line in 2018 (though we anticipate a gradual ramp from design to construction),” KeyBanc Capital representatives Sean Eastman, Tahira Afzal and Patrick Sullivan said in an analysis of Tutor Perini’s latest giant-scale venture. Tutor Perini generates more than $4 billion in annual revenue. Recent high-profile projects the Sylmar company has embarked on include Gov. Jerry Brown’s $1.3-billion California High Speed Rail project; Los Angeles County Metropolitan Transportation Authority’s $1.4 billion Purple Line extension; and the Hudson Yards project in New York City, worth $2.3 billion in contracts. As for the Liberty Airport, the KeyBanc Capital analysts noted that the Tutor Perini/Parsons joint venture was the sole bidder on the project. “For perspective, this contract win (assuming it is finalized and booked in the first quarter of 2018) represents roughly 70 percent of our quarterly bookings estimate,” the KeyBanc analysts said. The book-to-bill ratio relates to new backlog contracts divided by revenues in a given period. Generally, a book-to-bill ratio above 1.0 is indicative of a growing backlog.