Contractors See a Mixed Outlook in Local Markets
While medical facilities have been a steady source of work in Houston for years, Harvey notes that health care work has also paused, in part due to uncertainty about the future of the Affordable Care Act. "Everyone is holding their breath," he adds.
Still, some contractors saw big medical projects kick off in 2011. McCarthy Building and Balfour Beatty broke ground on the $531-million Carl R. Darnall Army Medical Center Replacement project at Fort Hood. Hunt Construction Group also started work on the $450-million William P. Clements Jr. University Hospital at the University of Texas Southwestern Medical Center in Dallas."
Gridlock over a new federal transportation bill caused headaches for both state agencies and contractors, but Texas found a way to keep the region's largest firms busy. James Construction Group, Baton Rouge, saw improved revenue in 2011, in part thanks to its work on the state's $1.9-billion I-35 expansion project.
The company has four projects along the corridor currently under construction, totaling $421.5 million. The company's combined revenue in Texas and Louisiana has increased steadily from $370 million in 2008 to $463 million in 2011.
Public-private partnerships are also driving significant work. Webber, The Woodlands, started work on a $208-million project on the Manor Expressway, US 290 Toll Road in Austin last year. Williams Brothers Construction, Houston, broke ground on a $152-million project on US 290/IH610 in Houston.
As post-Katrina reconstruction projects wind down, construction opportunities are getting tight in Louisiana, according to Robert Boh, president of Boh Bros. Construction in New Orleans. "For the last year, it has been extremely competitive to get new work," he points out. "As projects finish, it gets more difficult to find something new."
Still, Boh Bros held its own in 2011 with $381 million in revenue, virtually flat compared with the $380 million reported in 2010. But times are getting tougher, and Boh forecasts that 2012 could be down slightly.
Among his concerns, Boh notes that large national firms that came in several years ago to pick up work after Hurricane Katrina now have a solid foothold in the state. "You can tell by the number of bidders from companies that had not been here in the past," he says. "If things get better somewhere else in the country, they may move on, but for now they're staying here and they're still bidding."
Although the state could see a boom in activity tied to petrochemical projects, Boh doesn't see many local firms getting much of a boost.