Odebrecht Reconsiders Reliance On Public Sector Projects
Coral Gables-based construction giant Odebrecht USA is considering private development in addition to government projects.
Uncertainty securing government contracts has led one of the hemisphere's largest contractors to develop a backup plan.
After 24 years in the U.S. focusing solely on construction, Brazilian juggernaut Odebrecht plans to venture into private development, a top executive said.
Odebrecht USA, the North American arm of the multinational company, has won billions in public projects across Florida.
It's been a fixture on Miami-Dade County public works, contracting on some of the area's largest projects over the past two decades with work on the Metromover transit system, American Airlines Arena, Adrienne Arsht Center for the Performing Arts, Ritz-Carlton Key Biscayne Resort & Spa, the airport's $2.85 billion north terminal development program and the $360 million project to connect Miami International Airport to the Miami Intermodal Center.
But the company is considering its own developments and reconsidering its heavy reliance on public sector projects, director of real estate investment Eric Swanson told members of the Commercial Real Estate Development Association at NAIOP's 2014 outlook conference in Dania Beach.
"The nature of public projects is that you put in a bid and then spend the next three years of your life chasing it," Swanson said. "We'll gradually morph into some development. 2014 should be a really good year as we begin to look at some private development projects that we can control."
The past two years have seen Coral Gables-based Odebrecht USA hotly pursuing the development contract for Airport City, a $512 million project with retail, restaurants, hotel, conference space, a transit system, business park and other services on nearly 34 acres at Miami International Airport.
But the company suffered a setback when Florida lawmakers passed legislation preventing local and state governments from awarding contracts worth more than $1 million to companies with Cuban connections.
The law hurt Odebrecht because a subsidiary of its parent, Construtora Norberto Odebrecht SA, has at least two Cuban projects. The company won two challenges to the state law in federal coourt.