...helped provide funding to local critical-care facilities has forced federal agencies such as the U.S. Dept. of Housing and Urban Development and the Federal Housing Administration to fill some gaps in rural areas.

Turner Construction has made a service move in the health-care sector. The Turner Logistics Group was set up several years ago to help owners procure building service equipment more efficiently using the contractor’s purchasing power. Now, "we are getting actively involved in procuring medical equipment for supply and installation in medical facilities," Makes says. "Through bulk purchasing, we hope to provide our clients with better prices," he says.

Bumpy Road

While U.S. manufacturing appears to be declining, Gray says there is some significant activity in the automotive sector, particularly among first and second-tier suppliers. "But all businesses are being pressed to become more efficient." This is leading to clients demanding more engineering and front-end work by contractors, "and budgets are more sacred then ever," Gray adds.

The recent downgrade by financial analysts of Ford and GM bond ratings has some in the automotive market worried. But others are finding some significant work in that sector. "We are working on a supplier park for companies supplying parts of the DaimlerChrysler Jeep plant in Toledo," says Alter of Rudolph/Libbe. "This is the first time DaimlerChrysler has decided to group its suppliers in one place."

But Alter concedes that manufacturing is slow except for the renovation and maintenance market. That’s why Rudolph/Libbe has been diversifying into other markets recently. One recent project award that is not too far from its industrial .roots or too far from home is the Toledo Museum of Art’s new Glass Pavilion. "Toledo is the center for glass production in the U.S., so we’re proud to be working on this project here at home," says Alter.

One area of optimism in the manufacturing sector is the increased interest among foreign clients seeking a bigger foothold in the U.S. market. "We are definitely seeing an uptick in foreign direct investment in the U.S.," Gray says. This has worked to the firm’s favor, as James N. Gray has had a history of working for Japanese firms here.

Gray says the firm’s experience with Japanese clients has helped it with new Korean clients. "The Koreans liked our marketing–strong but not aggressive. But they also liked that we were patient with clients while managing projects aggressively," Gray says. The firm has used this experience to win several projects for parts suppliers for the Hyundai assembly plant in Alabama.

One indication that the manufacturing market is still alive is that Turner Construction has decided to become more active in that market. "We’ve looked at all the statistics and projections, but we believe that there are great opportunities in the industrial market," says Makes. Turner has two subsidiaries, Turner Universal and The Lathrop Co., that are active in the manufacturing and industrial sectors. "We plan to take their experience and combine it with our other offices to expand our presence," he says.

Heavy Lifting

The heavy-civil markets generally are active. "We have offices in lots of places throughout the Southeast, Midwest and Southwest and most are doing well," says Steve Swatek, senior vice president of Garney Holdings. "The market for water and wastewater treatment plants is good throughout the Midwest and Rocky Mountain region, particularly in Phoenix, Colorado and the Kansas City area. Our [water-and-sewer] line work is particularly good in Florida and in the Nashville area, he says. "The one area that seems to have fallen off is Texas."

Many contractors in the infrastructure market are concerned about maintaining levels of federal funding in the water and wastewater markets. Swatek has not seen any major problems. "I haven’t noticed a drop-off in our markets," he says. "There have been the occasional cutbacks, but the [U.S. Environmental Protection Agency] keeps coming up with new mandates that keep the market healthy."

The transportation market continues to be one of the biggest for contractors, despite the lack of a federal transportation reauthorization bill. Some states continue to be strong markets despite the uncertainty caused by reauthorization delays. "Florida’s economy continues to grow and I’ve heard statistics that a thousand people a day are moving here," says Evans of Hubbard Construction. This means huge growth and its accompanying infrastructure needs, he says.

The market is good enough in Florida that the state continues to experience materials supply problems. "In Tampa and Orlando, we still can’t get enough aggregate," Evans says. "We have to have it shipped in from Georgia and other areas in Southeast."

One of the biggest surges among the Top 400 was by Lane Construction. "We’ve had about 70% growth over the past two years," says Alger. Part of this growth was through acquisition. Lane acquired Rea Construction from now- defunct J.A. Jones in 2004 and recently acquired Eby Construction’s Florida operations. "About one-third of our growth came through acquisition," Alger says. "The Eby acquisition is not reflected in our 2004 numbers."

Alger is excited about Lane’s growth. "The Rea acquisition has really gone well. It gives us a major presence in the Carolinas and Florida," he says. Lane had revenue of $130 million in Florida last year, "up from pretty much nothing."

Not all states are running smoothly. "The Carolinas have had some transportation funding problems," says Evans. "Federal reauthorization will help some, but the states have to come up with their share of matching funds, and North Carolina has recently cut its transportation funding, so I don’t see that as a boom market even after Congress acts."

Alger agrees that the Carolinas have had some problems. "North Carolina cut its roadbuilding budget by $400 million, as have other states, but we’ve been seeing some major movement in states like Pennsylvania and Virginia," he says.

"Transportation has always been high on our list of markets," says Michael J. Sweeney, director of marketing, Ames Construction. The firm is finding success in the Rocky Mountain states. It now has five regional offices and one of the largest equipment fleets in the U.S. "We can go just about anywhere for a project," Sweeney says.

Ames has its own engineering resources and has been doing design-build work for years. But the growing willingness of state highway departments to embrace design-build has been a bonus. "We have been working on TH-52 in the Rochester [Minn.] area. It may be the first really big design-build road project in Minnesota," Sweeney says.

Congress is studying a bill to expand public-private partnership financing on federally funded projects. "There are always private groups that will help finance road projects," says Evans. "Disney and Universal Studios were willing to spend to upgrade roads around their attractions."

One major PPP job was the $900-million-plus award in April of a project to build a 14-mile stretch of toll lanes on the Washington, D.C., Beltway. The project, led by Fluor, includes Lane Construction. "This is our first major participation in a PPP road project," say Alger.

But not everyone is happy with PPP and other contractor-arranged financing programs. "There are a lot of small, family-owned contractors that are opposed to such programs because they won’t have the ability or experience to organize financing to participate in these programs," says Evans of Hubbard.

As the market grows, the opportunities also are growing. But many contractors are cautious about overreaching, having seen what happened in the past construction boom when firms grew too fast and paid the price. "We’ve got some big projects out there," says Jim Gray. "But we don’t go up there swinging for the fences. We’re just trying to hit good, solid singles."