DENNIS ODA / DODA@STARBULLETIN.COM
Gene Asahina, front, and his brother Dean, center, were among local contractors who packed a state Capitol auditorium yesterday to hear about business opportunities as the military privatizes much of its housing. The Asahinas own Universal Construction Inc.
Contractors look
for piece of $2 bil
military projectLocal firms learn how
to make sure they qualify
The U.S. government is expected to spend more that $2 billion over the next 14 years to build or renovate almost 17,000 military homes on Oahu.
Though small contractors and businesses have been skeptical about how much work will be awarded locally, they are understandably keen to secure a piece of the business.
Such is the case with Dean and Gene Asahina, principals of Universal Construction, a 40-year-old general contracting firm which does mostly small commercial building projects and has experience with state and city contracts. The company also did some work for the Navy in the late 1980s.
Along with an auditorium full of other contractors, the two attended a briefing yesterday that aimed to help small businesses qualify for jobs on the huge military housing project.
"We'd like a shot at it," said company President Dean Asahina.
The briefing was sponsored by the Chamber of Commerce of Hawaii and the Building Industry Association of Hawaii. Representatives from three of the five large consortiums of firms in the running for primary contracts were also on hand to answer individual contractor questions.
But with the size of the military project, the Asahinas wonder how the prime contractor who is selected will manage what will eventually be a large group of small subcontractors.
"Even the biggest contractors here don't build that many homes -- it's staggering," Dean Asahina said.
The chamber's small business advocate, Bev Harbin, said the project's 50-year contracts will open the door for more than construction work. In addition to construction, the housing has to be maintained and managed over the long term. That means things like landscaping, clean-up and repairs, she said.
Harbin said the larger business consortiums in the running as primary contractors approached the chamber for help in reaching out to potential local subcontractors. But many would-be subcontractors are not yet up to speed on what will be required.
At yesterday's forum, they got a glimpse of what it will take to qualify as a subcontractor for the project that will privatize Oahu military housing.
Gregg Yamanaka, outgoing chair of the chamber's Small Business Council and president of TeraBiz, has been working with primary contractors currently bidding for major contracts on what they are likely to require from local businesses.
Yamanaka is concerned many of the companies interested in subcontracting are not prepared. He noted that on a recent request for proposals put out by a prime contractor for another federal job in Hawaii, 10 of the 12 local subcontractors did not qualify or failed to fill out the forms correctly.
"Many of us are not prepared for working with primes," he said.
Yamanaka is now working on developing programs to help local businesses qualify. He showed examples of the kind of documentation and paperwork successful subcontractors will be expected to maintain.
Because prime contractors will be under tremendous pressure due to the long-term nature of the contracts, there will be stringent requirements for those selected, Yamanaka said.
Apart from their ability to perform the task, local contractors must meet an array of requirements including adequate insurance, human resource practices, certified payroll requirements, medical and safety procedures, education and training practices, and expense control. Subcontractors must also be able to demonstrate they will be in for the long haul, Yamanaka said.
"This is about sustained performance over a number of years," he said.
The U.S. Small Business Administration's Jerry Hirata offered advice on how to obtain the funding necessary to prepare for qualification. SBA will not provide loans directly but will partner with banks to guarantee loan financing, Hirata said.
The key is to be prepared and be aware of what the lender is looking for before applying for a loan, Hirata said. A good credit history and credit score are key, he said. A proposal and business plan should also be prepared, Hirata said.
