Kenn Penn (left) and Peter Pelullo of Benchmark Construction Group in the Giant Heirloom on Market Street in Center City.
Derrick Dean
No. 1 — Benchmark Construction Group
2-year growth rate: 787%
Industry: construction
Headquarters: Philadelphia
Top executives: Kenn Penn, president; Peter Pelullo, vice president
Total employees: 6
2019 revenue: $110,728
2020 revenue: $1.1 million
2021 revenue: $8.59 million
It’s been just over five years since Benchmark Construction Group formally launched, but already the Philadelphia firm is imprinting its mark on the city. Last year, Benchmark took on a big project in the fit-out of Giant Heirloom at the Fashion District and in the remaining months of 2022 is gearing up for half a dozen new projects. That pipeline is contributing to the firm’s soaring growth, which from 2020 to 2021 saw revenue increase by a factor of eight to $8.59 million. The surge makes it the fastest-growing company on this year’s Soaring 76 list.
The firm projects that it will more than triple that revenue figure to $27 million by the end of next year.
While Benchmark has quickly found success, the company’s formation came somewhat by happenstance. Partners Kenn Penn and Peter Pelullo met more than a decade ago when Penn hired Pelullo’s previous company to work on projects at some of the buildings he managed. Penn began his career as a real estate construction loan officer, including working at First Pennsylvania and CoreStates banks, and then went on to also become a property manager. A carpenter by trade, Pelullo’s diverse crew and quality of work caught Penn’s attention.
“I liked the work, I liked the professionalism, I liked their knowledge, and more importantly, what was intriguing to me was that his company at the time also hired a lot of subcontractors,” said Penn, noting that “many of them were Black or brown.”
More than that, the two also hit it off personally.
“He liked the work, which helps, but from a personality standpoint, things really gelled as well,” recalled Pelullo.
It didn’t take long before they started conversations about going into business together, joining their backgrounds to grow a construction firm that could impact change in Philadelphia.
They formally launched Benchmark Construction Group in 2017 with the goal of “doing commercial construction, as well as making sure we can hire people of color in the business,” Penn said.
For Pelullo, diversity in hiring was par for the course. Having worked for years in the city’s Grays Ferry neighborhood, where his grandfather ran a business, he solely made hires based on reliability and hard work.
Penn saw Pelullo’s hiring approach as an opportunity to make a meaningful impact as both an employer and as a developer.
“When we sat down, the goal was to be able to make a change in Philadelphia’s landscape in terms of having a diverse workforce,” Penn said.
The construction industry lacks diversity for certain races, according to 2020 data from the U.S. Bureau of Labor Statistics. The vast majority of the industry is made up of white individuals at 61%, and those identifying as Hispanic make up 30% of workers. Those who identify as Black (5.1%) and Asian (1.8%) are vastly underrepresented.
Benchmark’s goal, in part, is to hire and train minorities in construction and to work with other firms that have similar values of increasing diversity and equity within their companies.
More than just so-called blue-collar jobs, the company is focused on diversifying the entire pipeline within construction. “That’s what we’re working on now, is trying to set up a strong infrastructure of management,” said Pelullo, noting his previous business partners Sal Jalilvand and Elliot O’Neil are also working with them to that end.
In addition to better diversifying the construction talent pipeline, they’re also focused on building impact in the city, working on tax credit projects and inclusive housing, among other developments.
That’s becoming an increased focus. Since launching, Benchmark has grown from kitchen and bathroom jobs to single-family home renovations to tenant fit-outs. Now they’re also focused on new construction and development, including a number of multifamily and mixed-used projects with anchor commercial tenants.
Last year proved a big one for the company, partly thanks to its relationship with Philadelphia developer Alterra Property Group. After working on a number of projects for Alterra, Benchmark was tapped to do the fit-out of the Giant Heirloom at 801 Market St. in Center City. The highly anticipated 32,500-square-foot grocery store opened in December.
The mixed-use building, at the time owned by Alterra but which this June traded for $21.63 million, saw the transformation of what was once a Strawbridge & Clothier department store. The Giant Heirloom, in addition to groceries, has a self-serve beer section, a Starbucks, and a sushi bar.
It took the firm about six months to complete the fit-out, transforming the “naked space,” Pelullo said. “It was an aggressive schedule. They wanted to be open before the holidays and we were able to get that done for them.”
Both agree the project was a major driver in their growth over the past year.
In addition to retail, Benchmark has an eye on inclusive and affordable housing, particularly those with tax credits, and has a number of such projects in the works.
“The Low-Income Housing Tax Credit is something that we understand, that’s something we would like to be able to participate in more,” Penn said.
The Philadelphia Housing Development Corp. awarded Benchmark a 99-year lease on the land at 13th and Bainbridge streets in the Hawthorne neighborhood, where the firm plans to develop a 45-unit complex known as the Parker. About 30% of those units will be inclusionary housing going to those earning roughly 50% to 60% of the area median income (AMI). The approximately 30,000-square-foot development is projected to take 14 months to complete and Benchmark expects to break ground in October.
Benchmark is also working to develop a 36-unit, four-story project in the Sharswood neighborhood. Once completed, the roughly 33,400-square-foot development is intended to serve those who were previously in foster care. Located at the intersection of Ridge Avenue and Bolton Street, Benchmark expects to break ground in November and complete the project within a year. JKRP is the architect.
Benchmark will also purchase and renovate 22 vacant properties from the Philadelphia Housing Authority in the Brewerytown neighborhood, which it will then market at fixed sale prices for those earning no more than 80% of AMI. It plans to partner with the local community development corporation to ensure opportunities are available to long-term community residents.
Another project is in the Spring Garden/Francisville section of the city, where Benchmark is the general contractor for an adaptive reuse of an historical building. It will include 21 market-rate units with commercial space on the first floor.
Between their work on projects like Giant Heirloom and in housing, Penn believes others in the industry “are beginning to recognize us and who we are.” As such, they’re being approached about more opportunities and larger projects.
“The difference between a small job and a large job is usually just another floor or two – or 10,” joked Penn. “But the mechanics of construction is basically the same, the understanding, the theory is all the same.”
To support the upcoming projects, Penn and Pelullo have been intentionally growing headcount. Benchmark now has eight employees with plans to add a few more positions. The company recently added Henry Sullivan, formerly of Alterra, to help grow its impact, including in affordable housing.
The firm is also relocating its office to Center City this October, taking space at 1600 Spruce St.
While Benchmark is making big moves in the city, it doesn’t have plans to spread much beyond some of its collar counties. “Philadelphia is our home,” Penn said. “It’s important for us to make sure we manage these properties effectively and efficiently.”
Read about all of this year’s other Soaring 76 honorees below:
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