Core-Tech International’s Summer Towers luxury condos is a continuing project.
Photo courtesy of Core-Tech International

By Wayne Chargualaf and Meghan Hickey

Construction is one of the major industries on Guam as well as one of its biggest economic indicators. Tied as it is to tourism and the military — Guam’s primary economic drivers — spikes in construction typically accompany strong economic growth, such as during the hotel construction boom in the 1980s. Conversely, construction typically lags when the economy begins to slow down.

Although not without challenges, the long delayed military buildup is finally under way and several projects have been released with more to come. This means a new spike in construction — and economic activity — is on the horizon and Guam’s construction firms are eager to make the most of the situation.

“We currently have the largest secured work pipeline in our history on Guam,” says Benjamin Bailey, manager at Smithbridge Guam Inc. “[We are] currently focusing on refining business systems, process and structures to ensure we are best prepared for increased activity and future growth on Guam.”

But the buildup doesn’t just promise construction projects “within the fence” such as hangars and training areas. The increase in personnel and facilities requires an increase in infrastructure, which connects military installations to the entire island. As a result, Guam’s infrastructure and roads will be built up to accommodate the increased demands imposed upon them. This in itself could have positive economic effects for the island as a whole.

“We have some very exciting projects vital to the continued economic growth of Guam,” says Leonard K. Kaae Sr., senior vice president and general manager of Black Construction Corp. “We are privileged to have the opportunity to construct these notable projects and contribute to the continued growth in Guam and the regions we work in.”

Guam has also experienced some economic relief with the authorization of some H-2B workers for buildup-related projects. Visas for H-2B workers — which Guam heavily relies on for construction — had been denied for the island since 2015. The United States Citizenship and Immigration Services claimed the visas were being denied due to rampant abuse on Guam, which the Guam Department of Labor vehemently denied. Although Guam officials continue to work with USCIS to resolve the situation, projects related to the military buildup were granted an exemption by the past few iterations of the National Defense Authorization Act, allowing them to hire H-2B workers. This frees up other workers — typically local workers — for civilian projects such as hotels and stores.

This relief, however, is limited, as construction firms point to the lack of construction workers as their biggest concern for the next three fiscal years. Even if all the local construction workers on island were fully employed by civilian projects, there would still be a significant labor shortage.

“By summer of 2020, all contractors are going to be shorthanded,” says William D. Beery, vice president and general manager of Tutujan Hill Group Ltd. “USCIS hopefully will back off on limiting H-2 workers. Guam now has over 5,000 local workers, but we will need much more.”

In spite of this, local construction firms remain committed to the private sector, with housing and commercial projects in the works, such as Core-Tech International building the remaining phases of its Summer Towers luxury condos and Summer Town Estates; Tutujan Hills construction of a housing subdivision and two commercial projects including a 100,000-square-foot shopping center called the North Gate Commercial Center; and Black Construction’s work on a storage warehouse facility for Pacific Unlimited Inc.

Construction snapshot: 2019 to 2021

Black Construction Corp.’s Route 3 project.
Photo courtesy of Black Construction Corp.

Black Construction Corp.

• Number of employees: more than 700, expected to grow to 800-plus by December 2019
• Number of high-profile projects between fiscal 2019 and fiscal 2021: 8
• Biggest concerns for fiscal 2019 to fiscal 2021: “My major concern would be the lack of qualified staff and labor moving into 2020 and beyond.” — Kaae

Contrack Watts Inc.’s waterfront headquarters building in Apra Harbor.
Photo courtesy of Contrack Watts Inc.

Contrack Watts Inc.

• Number of employees: 100
• Number of high-profile projects between fiscal 2019 and fiscal 2021: 2
• Biggest concerns for fiscal 2019 to fiscal 2021: “Contrack Watts Inc.’s major concern is the H-2B labor crisis, and the critical need for skilled foreign labor for our Guam projects.” — Shoja Rezvani, general manager for Guam, Contrack Watts Inc.

Core-Tech International’s Summer Towers living room.
Photo courtesy of Core-Tech International

Core-Tech International

• Number of employees: 1,200
• Number of high-profile projects between fiscal 2019 and fiscal 2021: 8
• Biggest concerns for fiscal 2019 to fiscal 2021: “Guam has a limited manpower resource. We have to plan well to mitigate the potential shortage of qualified workers and professionals needed for the construction activities that are expected.” — Conchita D. Bathan, CEO, Core-Tech International

Smithbridge’s POL hardening project.
Photo courtesy of Smithbridge Guam Inc.

Smithbridge Guam Inc.

• Number of employees: 200
• Number of high-profile projects between fiscal 2019 and fiscal 2021: 6
• Biggest concerns for fiscal 2019 to fiscal 2021: “Ramping up our resourcing efforts to secure more skilled workers such as crane and heavy machinery operators. There is a shortfall of this labor on island and an inability to lure skilled U.S. workers due to the current construction boom on the mainland. We are committed to upskilling our local labor force and are one of the few employers in Guam who provide inhouse apprenticeship programs with a focus on training and retaining skilled labor.” — Bailey

Tutujan Hill Group’s JP Superstore remodernation project.
File photo

Tutujan Hill Group Ltd.

• Number of employees: 15
• Number of high-profile projects between fiscal 2019 and fiscal 2021: 3
• Biggest concerns for fiscal 2019 to fiscal 2021: “Cash flow and bonding, and manpower.” — Beery