From its base in Staten Island, Walsh Electrical Contracting serves the residential, commercial, industrial and green energy markets in both the public and private sectors. Its main area of operations is in the five boroughs of New York: Queens, Staten Island, the Bronx, Brooklyn and Manhattan.
Walsh is a member of Local Union #3 – the union in New York City for electrical contracting – and it is a certified woman-owned company. We spoke with Ryan Walsh, company president and son of the founder.
New York City is the self-proclaimed greatest city in the world, and it is also one of the biggest and most diverse. “What ends up happening is more people want to come here and see it, and they need to sleep, shop and eat somewhere. You have strong tourism, strong construction in retail, hotels and entertainment type sectors. The more people visit, the more they want to stay, move here or invest here,” says Ryan Walsh, who calls it a perfect storm of activity. “Construction is going crazy no matter where you look. Residential is busy; commercial is busy; infrastructure is busy.”
It is an exciting time to be involved in electrical contracting and construction in New York City. Residential construction is booming; more people live here; companies are expanding, and that leads to a shortage of space. With this comes residential and office jobs and tourism growth. Tax revenue rises and can then be used to improve subways, parks, firehouses and other city infrastructure.
New York City has mega construction projects underway, and the outer boroughs are particularly active. Everybody is busy, so the talent pool starts to dwindle. “Workers get more comfortable, and prices come up a little, but then you will always have the guy who wants to drop the price to keep his guys busy. Bottom line: as robust as this is, it still stays competitive, which is interesting. You would think that with everyone busy, competition would wane, but it hasn’t played out like that yet.”
With the massive potential for work and expansion, there must be issues with finding skilled labor, but, as Ryan explains, there are not many at Walsh due to membership in a union that boasts 30,000 members. At any point, approximately ten percent of the union labor pool is available for work. That equates to about 3,000 skilled workers available when you need them. This is one of the major benefits of unionized labor in construction – the access to skilled, safe workers who take pride in their work.
The issue is not with having a skilled workforce. The challenge is in finding good contractors for which to work, making sure they pay on time and ensuring that the job is estimated and executed properly. Happy clients mean repeat business for the company.
Walsh Electrical Contracting was founded in 1976 by Kevin Walsh. In 2011, Kevin passed away, and the mantle was passed to his wife – and Ryan’s mother – Linda Walsh.
Being woman-owned and certified presented an opportunity for the company since, in New York State, there are percentage goals for women-owned, minority-owned and veteran-owned subcontractor companies to bid on public sector projects. What Linda’s company found was that many contractors were having trouble satisfying woman-owned business participation goals and needed contractors to get involved in these large public sector and infrastructure projects.
“We saw this huge untapped market and expanded into the subway system construction market, satisfying contractors’ women business enterprise requirements, but we never did subway work before. We expanded into too many projects with too large of a dollar value, too quickly.”
Everyone fails from time to time. It is not about the failure, it is about how it is dealt with and what one does next that counts. Walsh Electrical Contracting found itself in a no-win situation from its participation in the huge New York City subway electric contracting project and came close to bankruptcy as a result.
The company’s inexperience meant the bid was in error and, on the first project, the idiosyncrasies of working on the subway were discovered. However, Walsh was already contracted to work on other sites. Three jobs went sour, which was disastrous, but, armed with new knowledge, it re-established itself and has made $20 million of revenue in the space of eighteen months. Its phoenix-like re-emergence was chronicled by INC. magazine, and it is growing still.
Walsh examined the other markets of its client base and networked to find new clients in those markets. “In those new markets, who do we not have as a client? We broke it down and put our boots to the ground.” The strategy led to rapid rise from 2011 to today, and it has featured on the INC. 5000 list of fastest-growing US companies in 2013.
Walsh has an aggressive five-year growth plan which is being aided by a massive boom in New York construction. “We are bullish on the New York City construction market. Overall, we feel optimistic on the outlook.” The dollar is strong and interest rates are low, which creates a positive economic state.
Presently Walsh is busy with a Staten Island project: the Empire Outlet Mall. It is New York City’s first outlet mall on the North Shore Coast to Staten Island. It will include eighty to one hundred stores and restaurants and is a two-year, $20-million project for Walsh Electric. “It is the biggest project in our company’s history and one of the highest-profile projects for Staten Island. Staten Island is traditionally the forgotten borough in New York City because it is more of a rural type bedroom community without the robust city environment that you would find in let’s say Brooklyn or Manhattan. This project will put Staten Island on the map.”
It is a big project for not only Staten Island but also the city. Currently, if a tourist wants to visit an outlet mall, it is either an hour plus bus ride or a forty-minute car ride from the city. This outlet mall will be accessible via public transportation and is right within the New York City metropolitan area. Work began in earnest in June of 2015, and it should be completed by November of 2017.
In addition, Walsh recently entered into solar energy installations and fully expects this side of the business to grow significantly. The solar industry in America is busy. The technology behind solar has improved; the cost to implement solar has gone down; the price of electricity has gone up, and the federal government has extended the tax credit for five years. All of this makes solar projects much more affordable as thirty percent of the cost is underwritten by the federal government.
“The federal government tax credit is there; electricity prices are rising; solar equipment prices are dropping; so why not do solar? A big component of solar is that an electrician has to install the system. It’s ninety percent electrical contractor work. Everything has to be tied into the main service.”
Walsh has the extensive expertise vital for the electrical side of things. The next challenge is a field technician’s understanding of solar construction, which is acquired by experience. The solar market in NYC is complex because of requirements such as zoning, permitting, jurisdictional issues, street closures, filings, etc.
“There are complexities that you wouldn’t normally see outside of the five boroughs, so I tend to like it because of the barriers to entry it creates for firms that have never done it. If you are not a New York City electrician and coming from out of town to do solar, you will face many challenges with all of the rules and regulations. We do it on a regular basis, so we are trained and have relationships with all of the agencies.”
Battery storage capacity is a limiting factor in the adoption of this technology and is something everyone in the solar field is currently researching. After all, solar is only good when the sun is shining, and power generated via solar panels must be stored somewhere for nights and grey days. As battery technology improves, prices come should come down and solar is poised to take off.
Walsh Electrical Contracting has been family owned and operated for two generations. Ryan Walsh believes it has lasted for thirty-seven years because of how it treats customers and employees. “We treat people fair and provide a nice work environment. We treat our customers fair. We do what we say and say what we are going to do. We deliver projects on time and on budget. There are many electrical contracting firms in NYC, however our mission statement identifies what separates us from everyone else, and that is ‘to provide electrical work of the highest quality, competitively priced, while ensuring the satisfaction of our clients, and always maintaining ethics, integrity, fairness, honesty, and a level of service second to none.’”