A new local construction management company has emerged to carry on a family legacy in the construction industry that hearkens back over a century.

Last month, Beverly Hills private equity magnate Trevor Saliba spun off Saliba Group Inc. from his NMS Capital Group and its management consulting arm.

Saliba Group is still housed at NMS Capital’s Beverly Hills office while nearby Beverly Hills office space is being prepped for early next year. And Trevor Saliba said in a recent interview that he is also searching for a president to lead the newly launched company.

Saliba added that NMS Capital is providing up to $10 million in upfront cash to help launch
Saliba Group until the company can nail down some contracts. He said negotiations are ongoing on five to six construction management contracts for projects collectively worth about $500 million.

Storied history in construction

The Saliba name has long been synonymous with construction, going back four generations and more than 100 years to the turn of the last century, shortly after the family immigrated to the U.S. from Lebanon.

Naseeb Michael Saliba – Trevor Saliba’s late grandfather – started in the business working for a firm run by two of his maternal uncles. Then, in 1941, he founded N.M. Saliba Co. in Los Angeles. That firm quickly rose to local prominence amidst the post-World War II building boom.

In 1972, Naseeb Saliba went on to join forces with another local construction legend, Ronald Tutor, to co-found Tutor Saliba Corp., which was best known for building the Metro Red Line (now B Line) subway through Koreatown and Hollywood.  In 2008, Tutor Saliba merged with Ashland, Massachusetts-based Perini Corp. to form present-day Tutor Perini Corp.

The Saliba name in the construction business then went dormant for the next 17 years.

Coming full circle

Then, enter Trevor Saliba, who grew up in the construction industry and even served as an apprentice in a Los Angeles-area carpenters union. Trevor Saliba didn’t start coming into his own, however, until he took over the running of the Saliba family investment portfolio. In 2010, he used that portfolio as a launching pad for NMS Capital Group. A few years later, Saliba formed a management consulting business within NMS Capital.

Gradually, Saliba explained in the interview, NMS Consulting edged into construction management of projects that NMS Capital was financing.

This fall, Saliba finally took the plunge and spun off that construction management business into a standalone company, naming it Saliba Group.

“It was time,” he said. “We realized we were leaving money on the table by not formalizing the construction management business for the projects we were helping to finance.”

There was also another intangible factor. “I still have construction in my blood,” he said.

Challenging times

Saliba said that NMS Capital Group has been injecting up to $10 million in the fledgling Saliba Group to help the latter company get off the ground.

In the early years, Saliba said the firm plans to work on a fee-only basis, focusing on development projects in the hospitality and multifamily sectors, along with some mixed-use projects. Construction management firms coordinate all the elements of project construction on behalf of the project owners and developers. This includes finding the design and architectural firms, selecting the general construction contractor – all with an eye toward keeping the project on-time and within budget.

He said eventually Saliba Group will take on construction management projects on an at-risk basis, where the firm would be on the hook for cost overruns. Many larger construction projects are managed on an at-risk basis.

As a standalone company, Saliba Group is taking a different tack on construction management than most of that segment, according to Jon Keller, associate editor of surveys and rankings at Engineering News Record, a trade publication based in New York. Keller said that about two-thirds of companies involved in construction management work across the nation are also in the construction business.

A local example is Tutor Perini, where one arm of the company, known as Perini Management Services, focuses on project management.

Keller added that labor costs are the biggest issue bedeviling construction management firms

“There’s an aging workforce with insufficient new blood to replace those that are leaving,” he said.

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