Construction Materials Startup Raises $18 Million For New South Florida Plant
Renco USA, which has introduced an innovative new building material for the development industry, raised $18 million in convertible notes, a deal that values the company at $318 million.
It will use the funds to construct a manufacturing plant in Jupiter, where dozens of jobs could be created.
Renco USA was co-founded by Tom Murphy Jr., the CEO of Miami-based Coastal Construction, and its expansion is being led by his son, Patrick E. Murphy, a former Congressman. Coastal Construction is one of the largest general contractors in South Florida.
Investors in Renco USA now include Gil Dezer of Dezer Development, the builder of Porsche Design Tower in Sunny Isles Beach, and Eddy Chabli of Avant Garde Partners.
Patrick Murphy said 12 years ago people from Turkey contacted Coastal Construction about their new building material that has been used with great success in their market. Renco is a composite material, a mix of recycled glass, recycled plastic, calcite limestone dust and resin. The composite is formed into blocks and an adhesive glue melds the blocks together into a monolithic structure that’s incredible strong and long-lasting, Murphy said.
It's taken them nine years and over 400 tests, and now Renco has been approved by the International Building Code, Murphy said. It’s currently approved for five-story buildings, and Renco USA is close to securing approval for eight-story buildings, he said.
Murphy said the composite material is rated to withstand a Category 5 hurricane, and a level A or B seismic event, with testing underway for stronger earthquakes.
The testing also showed the material has a lifespan of about 250 years, compared to about 40 years for most types of concrete, Murphy said.
The Renco building composite is also less expensive to use, requires less labor to assemble and it’s better for the environment, since it’s made mostly of recycled materials, he added.
“There hasn’t been a new building system in the developed world for 100-plus years,” Murphy said. “One of the greatest attributes of Renco is you don’t need skilled labor. You pour the concrete slab and you just stack the blocks.”
The first project in the U.S. with Renco is a three-story, 96-unit apartment complex under construction in Palm Springs.
Murphy said the Renco USA factory in Jupiter will total 60,000 square feet and should open by the end of this year. Initially, it will have 10 or 20 people, but the factory could employ 100 people when it’s fully operational later in 2024, he said.
Renco USA will not sell its building materials exclusively to Coastal Construction, as it’s aiming for a broad market, Murphy said.
“As a partner in the first demonstration project to utilize Renco’s materials, we have seen firsthand just how revolutionary these products are,” Dezer stated. “Given the advantages of these materials over traditional structural products, we believe Renco may change the way real estate developments are constructed in the future.”