RTKL to share in $500 million Japanese contract Will help design Tokyo office complex

September 28, 1993|By Timothy J. Mullaney | Timothy J. Mullaney,Staff Writer

RTKL Associates Inc. of Baltimore said yesterday that it has been awarded part of the second-biggest Japanese government contract ever awarded to a non-Japanese architecture firm, as it joined a venture that will design a suburban Tokyo office complex that could be worth $500 million or more.

"[It is] a huge project," said RTKL Chairman Harold L. Adams. "It will double our billings in Japan."

The deal calls for RTKL and two Japanese firms to do conceptual design work for a 2.7 million-squarefoot complex in Saitama, about 50 miles west of Tokyo. If the joint venture's work on preliminary site design is acceptable, it is expected to be awarded a second contract for more detailed design next year, Mr. Adams said.

The complex is more than three times the size of the new headquarters for the U.S. Health Care Financing Administration, whose 875,000-square-foot new home is under construction in Woodlawn. The HCFA complex will be bigger than any single office building in metropolitan Baltimore.

RTKL said the 35-story and 25-story towers will accommodate workers from nine Japanese government ministries and 14 agencies, all as part of a government initiative to decentralize the nation's bureaucracy.

Mr. Adams said the Japanese government had encouraged teams bidding for the design contract to include U.S. architects, saying a 1988 U.S.-Japan agreement called for U.S. contractors to gain more access to the heavily protected Japanese construction market.

That basic agreement was supplemented in 1991, when Japan agreed to double the number of government-funded projects open to U.S. bidders after the U.S. threatened sanctions barring Japanese construction firms from U.S. government projects.

"This is a sort of special treatment of U.S. companies in the public works procurement system," said Junya Akagawa, first secretary at the Japanese Embassy in Washington. He said that while Japan disputes the claims that its construction market is otherwise closed to U.S. firms, the 1988 deal was struck in the interest of U.S.-Japanese relations.

All of the finalists in the competition for Saitama job were teams that included both Japanese and U.S. architects, Mr. Adams said.

RTKL has been moving to diversify abroad throughout the last decade. Mr. Adams said the firm now gets about 30 percent of its billings from abroad, with about 5 percent to 6 percent coming from Japan.

Kurt Haglund, assistant to the chairman of RTKL, said the firm's total billings last year were about $45 million, well below a pre-recession peak of $72 million annually. He said this year's billings will be "much higher than 45 but not 72."

Mr. Adams said RTKL's Tokyo office would probably not immediately add staff.

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