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Frank Ciminelli to form a new company, separate from LPCiminelli

Frank L. Ciminelli, son of embattled construction executive Louis P. Ciminelli, has formed a new construction management firm to chart his own path in the building industry, effectively separating himself from the legal woes surrounding his father's company, LPCiminelli.

The younger Ciminelli will be the sole owner and president of the new company, dubbed Arc Building Partners – with no reference to the family name that adorned two predecessor firms.

But in an illustration of the complexity of family businesses, Ciminelli said he will remain president of LPCiminelli for now, and will fulfill all current obligations under that entity. He is still a minority owner of LPCiminelli, alongside his father and other family members, with the fate of that status still to be determined. The two companies will be co-located for now.

There are no plans to phase out LPCiminelli, he added. However, Ciminelli said he will probably not remain in an executive role with LPCiminelli for the long term. "This is just that natural progression of things," he said. "It's a completely new venture, owned completely by me."

The launch of the new firm represents an opportunity for the younger Ciminelli to start fresh, with a "clean slate." He repeatedly said during an interview that he views Arc as a way of distinguishing himself and pursuing the kind of work he wants. He noted that it's similar to what his father did with his grandfather, when the former Frank Ciminelli Construction Co. evolved into LPCiminelli.

"It became my turn to go out and kind of carry on that entrepreneurial legacy within the construction industry and to do that on my own. The opportunities manifested themselves to make now the right time to do it," Frank Ciminelli said. "This gives me the chance to establish my own brand and perpetuate that."

But it also allows him to break away at a time when his father and two other LPCiminelli executives still face federal indictments for alleged bid-rigging related to the state's Buffalo Billion contracts. Besides Louis Ciminelli, the charges filed by former U.S. Attorney Preet Bharara also targeted Kevin Schuler and Michael Laipple. All three pleaded not guilty.

Louis Ciminelli, who had been chairman and CEO of the company that bears his name, stepped down from all leadership roles in the company in February to focus on fighting the corruption charges, as well as battling cancer. The trial was delayed to allow time for his treatment, which Frank Ciminelli said has now been completed.

"He's healing up and in recovery," Frank Ciminelli said.

The trial is expected to begin no sooner than May 15, 2018.

But the son said he isn't making the change now to distance himself from his father.

"I would have done this nine months ago if that were the case," he said. "He's my biggest supporter in doing this. These are not mutually exclusive enterprises that are doing this with any animosity or acrimony. This is all being done in that very organic evolution, generation to generation."

Besides, he chuckled, "I can't separate myself, and quite frankly, my last name is Ciminelli, so I'd only get so far."

The new business, to be formally unveiled on Friday, will be a successor to LPCiminelli, evolving out from a significant portion of that company's business. It will focus on delivering fast-track commercial projects for private-sector clients, leaving the large "public-private partnership" ventures to LPCiminelli, which will continue operating in the future with a much narrower emphasis on "transformational" work.

Arc will specialize in "at risk" construction management, design-build contracts and program management, as well as handling construction itself. It plans to specifically target private developers, the gaming and entertainment industry, the hospitality sector, and arts and cultural initiatives. However, it will not be a developer and will not compete with Ciminelli Real Estate Corp., the developer owned by Louis' brother, Paul.

Arc also will seek to attract clients that want fast results with early involvement of a construction manager as a partner and consultant at the outset of a project, Frank Ciminelli said.

Citing inherent inefficiencies in the construction industry, the industrial engineer said he wants to shake up the business and challenge the status quo.

"It's easier to wipe the slate clean rather than re-engineer the old," he said. "If that's the way we've always done it, we should at least challenge that and find a way to do it better. That's a big passion of mine."

LPCiminelli has 125 full-time employees, who are "just as excited at this new opportunity as anybody else is," Frank Ciminelli said. So are clients and vendors. "We've gotten unflappable support for this," he added.

He said officials will start transitioning contracts and workers from the old company to Arc as soon as existing projects wrap up and new projects begin.

That means the redevelopment of the former Central Park Plaza site just off Main Street into the new Highland Park neighborhood will remain an LPCiminelli project. But the construction contracts for a planned mixed-use building at 201 Ellicott St., a second Conventus building at 33 High St. and the proposed Reverie residential project at Elmwood Avenue – both for Ciminelli Real Estate – will shift over to Arc.

Future commercial or private-sector work will fall under Arc, which may still bid from time to time on some public-sector work even though that's not its focus.

Meanwhile, LPCiminelli is still positioned to do over $500 million of work this year, despite a general slowdown in the market. That represents its fourth-best year ever, Frank Ciminelli said, and "the prospects would have looked very, very good going forward." That includes both private and public-sector jobs, as the company has not been barred from bidding on government work.

Even so, 80 percent of its work is commercial, and its current contracts will extend through the end of 2018, when that work shifts to Arc.

After that, LPCiminelli will focus on public-private partnerships and infrastructure projects - such as for courthouses, municipal buildings or university facilities - in which a government agency wants a private-sector model.

"That's where his focus is going to remain," he said of his father. "This is the natural order of things."

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