FIRST CONSTRUCTION CONTRACT FOR HONOLULU RAIL TRANSIT PROJECT COMES IN $90 MILLION

LESS THAN ESTIMATE

(Honolulu, October 21, 2009)- Mayor Mufi Hannemann announced today the awarding of the first of several construction contracts for the city’s Honolulu Rail Transit project, and that the City will seek proposals November 18^th for the next phase, the Kamehameha Highway Design Build contract, two years earlier than expected so as to capitalize on favorable market conditions.

Kiewit Pacific Company was awarded the design-build contract for construction of the first segment of the elevated guideway route. The initial 6.5-mile segment of the transit route will run from Kapolei to Pearl Highlands near Leeward Community College.  Kiewit’s proposal was determined by the City to be the best value at $482,924,000.  This represents a $90 million savings from the project estimate. The design-build contract had been estimated by the City to be approximately $570 million.

“This award shows that we have been conservative in our estimate and our financial plan is very sound,” said Mayor Hannemann said. “This contract brings us even closer to ground breaking.”

Based on this contract’s actual price, the City could save several hundred million dollars in construction costs for the project.  This estimate reflects the cost savings from this first contract applied to the other contracts still to be awarded.

“This is why we need to get this project going now during a down economy because of the lower costs and the need to crate jobs,” Mayor Hannemann added. “This project will give our local economy a big boost and help get people back to work.”

Kiewit Pacific Company is a wholly owned subsidiary of Kiewit Corporation and has two offices on Oahu.  They have more than 25 years of operation in Hawaii.  Kiewit was named by Forbes Magazine as the “Most Admired Engineering and Construction Company” in 2007.  They have been consistently ranked in the Top 10 contractors by Engineering News Record.  In 2008, Kiewit Corporation had revenues of $8 billion.

The contract includes construction of the elevated guideway, installation of the train tracks and restoration of the road surface along the route. The train stations along the rail route are to be constructed in separate future contracts. Separate contracts are scheduled to be awarded early next year for the train storage and maintenance facility in Waipahu, and one for the manufacturing and shipment of the core systems that includes the train vehicles. 

The City originally was going to solicit proposals for the Kamehameha Highway contract in 2012 but decided to take advantage of today’s favorable market conditions. The contract is to build the 3.88 mile segment of the guideway from Pearl Highlights to just past Aloha Stadium.

Train service for the first leg of the transit route is scheduled to begin in 2012, with full service along the entire 20-mile route from East Kapolei to Ala Moana in 2019.

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