Northwest Builders Busy As Activity Continues To Crest
Construction in the Northwest remains robust, according to industry leaders. Construction employment for Oregon and Washington is up year over year again as well, according to the U.S. Bureau of Labor Statistics and the Associated General Contractors.
Construction employment in Oregon is leading the way, with an increase of 11,200 jobs, or 12.5%, between June 2016 and June 2017 on a seasonally adjusted basis.
The state of Washington is also recording positive gains in construction employment with an increase of 10,400 jobs, or 5.6%, over last year. In Alaska, year-over-year losses of 800 jobs were offset by a gain of 100 jobs in this June over May.
Portland and Seattle are experiencing the most growth.
In Seattle, crews are disassembling the tunnel boring machine named Bertha that was used to create an underground roadway that will replace the Alaskan Way Viaduct. The razing of that structure may open up sites for more real estate development, say observers.
Seattle and Portland are also in the midst of a hotel building boom. In the past two years, construction has begun that will result in the addition of more than 1,500 rooms by the end of 2018, according to the Downtown Seattle Association and the Portland Business Alliance.
Multifamily housing construction has predominantly driven the Portland market as new residents drive up housing costs, says Jim Kilpatrick, president of Fortis Construction, Portland.
The city’s new affordable housing requirements could put a damper on that, he adds. Kilpatrick thinks the residential boom will run out in about two years. “After that, the requirements will change the market pretty markedly,” he predicts.
According to the July 2017 Rider Levett Bucknall Crane Index, the number of cranes in Portland is up 25% to about 30. Seattle is holding steady at about 60. Both cities have more cranes than New York City, which has about 20.
According to the Downtown Seattle Association’s 2017 Mid-Year Development Guide, the value of construction projects downtown is about $5 billion.
As a result Northwest contractors are searching for ever-increasing ways to meet demand.
“An overheated market forces ingenuity, innovation and lean practices to successfully deliver increasingly complex projects,” says Mark Kane, COO, GLY Construction, Bellevue, Wash. “With a record-breaking number of cranes on the skyline, subcontractors, skilled labor and materials are in high demand.”
Northwest firms are building for major firms, including Boeing, Amazon and Microsoft. The client demands are often more intense for high-profile firms than for other types of clients, Kane says.
“We work in an environment that is incredibly competitive. Our clients are making heavy investments in research and development, in improving their practices throughout their organizations and in attracting the best talent in the marketplace to maintain their competitiveness,” Kane says.
The results of ENR Northwest’s Top Contractors survey can be found in the following pages.