Plenty of federal action
“The federal sector is where the money is right now for the design-construction industry,” says Cryer, adding that PageSoutherlandPage sees strength in military health and Veterans Affair’s projects. The firm’s Fort Worth office is working on a VA project.
“There has been enormous spending in both of those sectors,” Cryer says. “We’re also seeing spending out of the General Services Administration.”
Some stimulus dollars are slated for energy-efficiency upgrades to older buildings.
McCarthy’s Peck says an “incredible amount of federal work is programmed in 2009 at major military installations,” and his firm is pursing those projects.
“Texas is going to get the benefit of stimulus money applied to Department of Defense projects and expansion of the bases in Texas,” Peck adds.
While substantial federal work is under way, with more expected, contractors report exponential growth in the number of firms bidding.
“When you throw every contractor into the public market, prices go down, bids take a nosedive,” Speed Fab-Crete’s Bloxom says. “We’re seeing bids at cost or 1% to 2% over cost. That’s not a healthy market.”
Preparing for a bright future
Huckabee’s CEO says clients are requesting a significant amount of assessment work, outlining capital needs, which he considers a positive trend. The firm is working on six to eight bond elections in 2010.
“In my business, assessment work leads to projects,” Huckabee says. “We’re doing more assessment work than we have done in the last four years.”
Ziegler also indicates an up tick in the market, with lending conversations starting for multifamily and commercial projects.
Bloxom and Williams have noted an increase in residential building and expect commercial will follow if money starts flowing again.
Peck says he is concerned that contractors could feel the effects of the recession in 2010 because construction seems to lag other industries coming out of economic downturns.
JE Dunn has upgraded and aligned its operating systems across the country. Its people continue studying building information modeling and sustainability.
“Slowing down a little bit gave us an opportunity to fine-tune our capabilities,” Ariss says. “The company invested in training our people. We’re getting ready for the next wave.”