Energized: Contractor Reynolds rises on growing energy-services work

//June 11, 2019

Energized: Contractor Reynolds rises on growing energy-services work

//June 11, 2019

Rick Evans, left, president of Reynolds Enterprises Inc. subsidiary Reynolds Energy Services, joins Jeff Merritt, COO of Reynolds Enterprises; David Angle, CEO; and Anthony Worrall, CFO. The Harrisburg-based company had a record year in 2018 after joining a private-equity portfolio. (Photo: Markell DeLoatch)

Reynolds Enterprises Inc. may be known for managing construction projects at Harrisburg Hospital or the tower being built for Harrisburg University. But executives with the Harrisburg-based commercial contractor said a growing share of the company’s revenue is coming from existing buildings.

In fact, CEO David Angle said about 60 percent of the company’s work is now tied to its energy services business, which has been growing since Reynolds joined a portfolio of companies owned by California-based investment firm Oaktree Capital Management last year.

Reynolds leads the eastern division for the Minnesota-based portfolio, known as SitelogIQ, which operates four companies providing facilities consulting and construction services nationwide. The portfolio is structured as a private equity fund with Oaktree’s backing.

For Reynolds, the partnership has offered greater access to capital for investing in staff and operations.

“It has given us more resources,” Angle said. He and his three partners — COO Jeffrey Merritt, CFO Anthony Worrall and Rick Evans, president of Reynolds Energy Services — each have a minority ownership interest in the portfolio.

Reynolds, which has offices near Pittsburgh, Philadelphia and Baltimore, has grown to about 155 employees, including 10 added since the partnership was announced last May.

Angle credits the partnership with SitelogIQ for more work, boosting the company’s revenue last year to $100.2 million, the best its 25-year history. Revenue at Reynolds was $80.5 million in 2017.

Most of the company’s energy service work, Angle said, is performed over the summer for public school districts across Pennsylvania. The districts are mostly focused on upgrading mechanical systems, lighting and plumbing to save money on energy and other building costs.

In addition to energy efficiency projects for the schools, Reynolds also provides oversight of renovations and additions.

But energy is expected to be the engine of growth.

Angle is projecting about 10 percent to 15 percent annual revenue growth from energy work. He said Reynolds – known as SitelogIQ East as part of the investor-owned portfolio – is looking to join its sister companies and expand into higher education work.

He said Reynolds has been supporting projects for other divisions, including retail and hospitality work in Chicago and California. With Oaktree’s backing, Angle said he could see expanding the Reynolds-led eastern division into New Jersey, Ohio and Maryland.

Reynolds also may start bidding on federal government work.

Reynolds also remains active with Harrisburg University. Ahead of construction on the $135 million tower at South Third and Chestnut streets, Reynolds is building a $2 million student union inside the Whitaker Center for Science and the Arts.

Reynolds also has handled construction of the university’s esports training facility in the science center.

Angle said he doesn’t expect construction opportunities around Harrisburg to slow down, noting in particular the growth of health systems in the region. They are building new hospitals and adding medical offices.

“There are always health care opportunities,” he said.