School and commercial multifamily housing projects are helping to buoy construction firms in Northern Colorado, now in its third year of decline.

Colorado State University’s Research Innovation Center contains a manufacturing center, lab and office space, BSL3 imaging and a vivarium.
Rendering credit: The FWA Group
Colorado State University�s Research Innovation Center contains a manufacturing center, lab and office space, BSL3 imaging and a vivarium.

Those contractors, design firms and developers that are surviving are diversified and conservative, and they have learned a new way of doing business to stay in the black, including going out of state.  

“This whole economy has turned our business upside down,” says Terry Drahota, president and CEO of Drahota Construction in Fort Collins. “We’ve gone from an 80-person company to a 40-person company. Normally we have been doing around $70 million in construction a year, and in 2009 we put in place $30 million.”

Keeping Drahota’s crews busy this year are HUD-financed apartment and mixed-use projects in the Denver area, as well as Northern Colorado municipal projects.  

“There really is no financing available for multifamily projects unless it is HUD, so the fact that we have experience with that and are qualified as a HUD contractor is an advantage for us,” Drahota says.

He estimates his firm will do about $50 million in business this year, which includes a $6.5-million, 19,000-sq-ft addition/27,000-sq-ft remodel of the Chilson Recreation Center for the city of Loveland. 

Public projects are important for Alliance Construction Solutions in Loveland, as well. The firm is doing a $3-million, 14,000-sq-ft expansion/7,500-sq-ft remodel of Spruce Hall at Morgan Community College in Fort Morgan. But it’s having more success outside of Northern Colorado, says Damon Balcerak, Alliance project manager for business development. 

“We are in the ‘business development’ stages of some medical office buildings, but they are in Denver and Cheyenne,” Balcerak says. “Also, a good portion of our portfolio right now is affordable or transitional housing in the commercial sector in other parts of the state.”

McCauley Constructors of Windsor is not only keeping its 13 employees busy, it just opened a Grand Junction office.

“A lot of companies our size have disappeared,” says Nancy James, McCauley’s business development coordinator. “We are actually hiring for the Scottsbluff (Neb.) library project we just got.”

James adds that her firm has to scramble to win bids, and “the margins are nothing. If you miss one little thing with the margins being so tight, you’re going to lose your shirt. And there are two to three times as many people bidding on any one job than there used to be.”

McCauley’s current projects include an $850,000, 4,000-sq-ft addition to the Cooperative Institute for Research in Atmosphere building at Colorado State University in Fort Collins; a $1.4-million renovation of the Sterling Public Library; and a $480,000 historical renovation of the Hugo Roundhouse.

McWhinney, developer of Centerra in Loveland, the largest master-planned community in Northern Colorado, cut about 15-20% of its staff last year. The developer is cautiously moving ahead with design and construction of its Rangeview series of office buildings, says Jeff Jensen, vice president of commercial design and construction.

“The market is more dependent on having a complete build-to-suit for a client in hand, or the building needs to be pre-leased at a fairly high rate to get financing,” Jensen says.