Design Firms See Better Revenues in 2013, But Also New Causes for Concern
Regional designers report that many market sectors have improved, and most firms saw their revenue grow in 2013. But they also have post-recession concerns about staffing and owner finances. Design leaders cite regional strength in the energy, multifamily, commercial and hospitality sectors. They say public-sector work remains generally sluggish.
"The surge in oil and gas production throughout the region is creating a number of opportunities for engineering services supporting pipelines, storage, refining and processing," says Mark Lichtwardt, vice president and general manager in the Denver office of engineering consultant Burns & McDonnell.
Gary A. Thomas, president of Martin/Martin Inc., an engineering firm in Lakewood, Colo., says that land development, office buildings and projects in sports and recreation and higher education "have been very strong, with increasing opportunities in the months to come." But like many of his colleagues, he says the biggest concerns the industry faces include the pressure for low fees and the shifting of risk to designers.
Others—such as Bill Green, president of The RMH Group, Lakewood, Colo., and Peter Monroe, principal at Denver's Monroe & Newell Engineers Inc. and 2014 ACEC Colorado president—are seeing price increases that are pushing some owners out of the market. "We are concerned that owners' budgets will not keep pace with price increases, and projects will die," Monroe says.
"Construction costs are increasing quickly, so project budgets will start getting pinched," Green adds.
"We are challenged with effectively allocating resources while not over-staffing to maintain lean and competitive fees, high design standards and profitability," says John Yonushewski, COO/principal at RNL, Denver.