Steady Gains in 2014 May Not Satisfy Southeast Firms
At first glance, a lineup of some of the biggest Southeast projects expected to begin construction during 2014 seems to indicate a boom market. There's a $1-billion National Football League stadium project in Atlanta. A $1-billion passenger rail line linking Orlando to Miami. In Orlando, a $2.1-billion, 21-mile-long transformation of Interstate 4. And in Atlanta, an $840-million revamping of Interstate 75.
But a closer look reveals a twist. In the past, almost all of these projects would have been funded mostly, if not entirely, with public funds. Today, though, each of these pending megaprojects is bankrolled at least partly with private dollars.
Coincidentally or not, these projects reveal a simple fact: The economy isn't yet boosting public or private capital budgets to a level necessary for a widespread construction boom. At the same time, these high-priced construction plans indicate something else: hope for better days.
"For us, 2014 will be a boom," says Scott Moss, president of Fort Lauderdale, Fla.-based construction manager Moss & Associates. "But for the rest of the Southeast, it will be 2015" before activity picks up across the board, he adds.
Moss says his firm will benefit from South Florida's surge of multifamily, hospitality and university projects during 2014. Moss & Associates is currently building the $83-million 400 Sunny Isles condominium project in Sunny Isles Beach, Fla., as well as a 382-unit Flagler Village residential project in Fort Lauderdale for The Related Group.
Further north, the Atlanta construction market should get a boost beginning next spring, when the NFL Falcons intend to break ground on their new movable-roof stadium. But Bill Anderson, president of Associated Builders & Contractors (ABC) of Georgia, doesn't think 2014 will be as strong as contractors would like.
Calling it a "slow recovery," Anderson says: "We expect this steady but minor increase to continue throughout 2014. The industry's overall direction is definitely improving but certainly not at the pace many are accustomed to after a downturn, especially one as long as the Great Recession."
Mark Wylie, president and CEO of the Central Florida chapter of ABC in Orlando, agrees that commercial construction markets will continue to see slight improvement in 2014.
"While there are some major construction projects [coming] in the next couple of years, the current economy will continue at the same pace for most commercial contractors in ," he says. Wylie cites proposed work at Orlando International Airport, ongoing construction for Orange County Public Schools and a $400-million revamping of Daytona International Speedway as bright spots.
Overall, the residential construction market will continue to be one of the Southeast's strongest, notes Randy Hall, president and CEO of contractor Batson-Cook Co., Atlanta.