Hochtief's sales have continued to grow in Germany. But even Europe's economic powerhouse is vulnerable to the crisis in the euro zone, with construction expected to plateau this year, Stieler says.



Eastern Europe's construction market is now "much more depressed because of the financial crisis," says Dupety, citing the Czech Republic as particularly challenging. However, with highways and infrastructure work, "Poland is still doing well," while Romania and the Ukraine are "not too bad," he adds.

For Skanska, Poland is in "very good shape" and increasingly attracting international competition, says Karlström. "The Chinese tried to enter the market and backed out," he adds, referring to the Poland highway authority's cancellation of a contract with the Chinese Overseas Engineering Co. "[Chinese contractors] cannot behave in the same way as they do at home or in emerging economies," he says. "If they want to enter the European or American markets, they have to buy a [local] player."

Signs of Life in Russia

In Russia, VINCI already is working on the environmentally controversial Moscow-St. Petersburg motorway project and targeting more civil contracts there, says Dupety. Bouygues also is "monitoring the development of this market with interest," adds Bouygues' Gabriel.

For some international contractors, Russia is beginning to pay off. "Between 1998 and 1999, Russia was in economic breakdown ... many international contractors left the Russian market, but we have decided to stay," says Mehmet Okay, a board member of Turkey's ANT Yapi.

Having completed the 990-ft-tall City of Capitals Moscow Tower in 2010, Okay says ANT Yapi now is working on Plot 16, the IBC Tower in the Moscow City Zone (see ENR 12/18/08 p. 108). Plot 16 consists of mixed-use twin towers designed by Skidmore Owings & Merrill in the U.S. One of the towers is planned to reach 1,082 ft.

The concern about Europe's fiscal health has caused large contractors to search out new markets. "The makeup of bidder lists has changed as companies have started to pursue markets and projects they would not have considered in the past," says K. Burak Ozselcuk, business development manager for Turkey's TAV Construction. He says international contractors are now more financially exposed from increased risk, squeezed margins and reduced backlogs.

Public spending cuts and private-sector uncertainty make the U.K. market "very challenging," adds Ian Tyler, CEO of London-based Balfour Beatty plc. The U.K. government's offer last month of loans and guarantees for infrastructure projects helps, he says. But "while they are doing that, they are delaying decisions" on energy and airports investment, he adds. Balfour Beatty's recent shedding of hundreds of U.K. staff members was not a response to the market but a long-term repositioning after 10 years of growth, says Tyler.