November 2014, Vol. 69, No. 11
Features
Laying The Groundwork For Growth
You don’t have to listen hard to hear the housing boom occurring in Portland, OR. Growth and development echo through the Columbia River Valley, bounding off hundreds of new rooftops — symbols of rebirth and renewal for Phoenix Excavating, Vancouver, WA.
Just five years before, Phoenix Excavating’s owners Teri Reisch and Aaron Riley were forced to accommodate a hedge fund’s ultimatum to liquidate the assets of their former employer and close its doors at the height of the recession. Undeterred by wary developers, nervous bankers and a shrinking construction market, Reisch and Riley knew they had a strong combined skill set to manage their own operation.
They quickly pooled their 401(k)s to form a partnership, starting with a staff of seven and an even smaller fleet. Adopting a strategy based on leaner solutions and a more balanced long-term financial approach has helped the company stay true to its course. It’s laid the groundwork for projects from housing developments and apartments, to office buildings, dental offices and government and industrial projects.
The company is now firmly entrenched in a market that grew more than 11 percent last year, highlighted by rising home values and slim inventory. Multi-family residential rental rates are at historic levels, triggering demand for apartment construction as well. “Bank financing is still pretty difficult with the additional regulations in place, but many projects have started up because it now pencils even with the cost to have an outside investor finance projects,” Reisch says.
Phoenix Excavating rose from the ashes to embody its namesake with a focus on excavation, grading, utility installation and general contracting. The company’s two offices in Vancouver and Richland, WA, have expanded to 30 employees and sales doubled from 2012 to 2013. With steadily improving markets and work volume, the underground utility contractor partnered with Portland-based Feenaughty Machinery to rebuild the company with a fleet investment that includs five Doosan excavators — a DX140LC-3, two DX225LC-3s and two DX255LC-3 models — and a rented Doosan DL200-3 wheel loader.
By fall of 2013, the company juggled three different subdivisions in outlying Portland suburbs. One of those projects is perched high in the hills overlooking the city of Camas and the Columbia River in a 32-lot executive subdivision for Lennar Homes, one of the nation’s largest home builders.
The project’s scope encompassed site grading, subgrade prep and finish grading, the installation of more than 1,300 linear feet of water service with fire hydrants, 1,900 linear feet of storm drainage with catch basins, a 19,650 square-foot storm water facility with filter vault and a 1,770 linear-foot effluent sanitary sewer system with more than 1,000 linear feet of laterals.
Working as a general contractor, crews supervised the site clearing, installations of power, phone, gas and cable, as well as asphalt, curbs and sidewalks and constructed 7,800 square feet of retaining walls.
When it rains, it pours
Staging and launching a project of this magnitude in July on a site with a 150-foot elevation change tested Riley and the crews. The project required that all utilities be placed and the roads rocked before the rainy season set in around the middle of October. “The biggest challenges on the job were the time of year and the scope of work,” says Riley. “Production was key and downtime was not acceptable.”
A DX225LC-3 and DX255LC-3 teamed up with scrapers to remove 37,000 cubic yards of dirt and carve out lots ranging from 8,000 to 20,000 square feet. In addition to the aggressive schedule, crews were tasked with stubborn pockets of sandstone on the 15-acre site that sat on a bed of clay topped with camas basalt – a high-psi rock native to the Columbia River region.
Then the rains came – early. Riley was able to contain the water with multiple erosion control measures. After a 5-inch soaker on Labor Day weekend, he stepped up efforts with the installation of an 18-inch HDPE pipe that dissected the site for 300 feet to help bypass runoff from higher elevations and an existing storm waterway.
With increasingly complex storm water quality standards in Oregon and Washington, the project required a neighborhood filtration system. Excavator operators dug to depths of 15 feet to install an 8-foot by 16-foot storm filter vault containing 36 filter cartridges. A 60-ton crane placed the concrete base and the center sections and the excavators set the top of the system.
Equipped with a 24-inch bucket, a DX255LC-3 was responsible for digging out trenches for the catch basins, curbed inlets and utility pipes. Riley operated the 155-horsepower excavator outfitted with a 66-inch bucket to cut out a wall up to 14-feet high from the bank that runs along the east property line. Designed with a maximum digging height of 31 feet, the DX225LC-3 supplied the vertical and horizontal reach to contour six retaining walls.
The DX225LC-3’s two variable displacement axial piston pumps produce faster cycle times, and its hydraulic flow regeneration provided Riley with additional power to efficiently manage the clay, basalt and sandstone mix. “You have to have good hydraulics to dig in this ground. Sandstone can be harder than rock and all you can effectively do is whittle it away,” says Riley who also added rock teeth to the buckets to break up the formations encountered at depths of 23 feet in the sewer main trench.
Cutting costs, adding efficiencies
A young company with astute financial oversight, Reisch and Riley continually focus on increasing uptime and reducing the cost of ownership on their 15-machine fleet.
Fuel consumption is one of the biggest input costs for the operation, and one that can be impacted with more economical equipment designs. The Doosan excavators’ efficient horsepower curve delivers increased torque using less fuel. “At $4 a gallon for diesel, a 1-gallon per hour savings in fuel across our fleet equates to about $800 a day or $210,000 a year.”
The owners both say the ability to create revenues with an asset that requires a smaller initial investment and at a lower cost per hour will help keep Phoenix Excavating in business longer during good times and lean times. “Our thought process is you can have more machines and create more revenue at a lower cost this way, as long as the machines are capable of performing the workload,” Reisch says.
But Reisch and Riley are careful in planning, managing and operating a sustainable company that won’t lose traction in the next soft economy. “We have two banks, clients in several industry types — and we’re not tied into one brand for all of our equipment, but Doosan is where we have our excavators. It’s all about balance,” she says.
FOR MORE INFORMATION:
Phoenix Excavating, (360) 750-8737, www.phxexc.com
Doosan Equipment, (877) 613-7970, www.DoosanEquipment.com
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