Top executives who banked on big bonuses during the boom years have seen a significant portion of their compensation packages washed away during the current recession. Related Links: Economics: Despite Upturn in Steel, Lumber and Energy Prices Deflation Sweeps Cost Index Board Markets: Survey Shows Contractor Confidence Slowly Rising Homebuilding: Lumber, Wallboard Prices Perk up With Modest Rebound Glass: Recession Shatters Prices, More Cuts Expected During 2010 Methodolgy: What is Driving Costs> ENR's Complete First Quarterly Cost Report 2010 City Indexes: Inflation from Atlanta to Seattle and L.A. to Boston Stats: How to use ENRs indexes How to Find Cost
Prices for diesel fuel, structural steel, lumber and gypsum-wallboard products started to stir during the first quarter, but most increases were coming off dismal lows in 2009 and were not strong enough to break the stranglehold the recession has on construction costs. Eleven of 15 major industry cost indexes tracked by ENR showed costs falling below a year ago. These drops included year-to-year declines of 5.8% for warehouse construction, 4.7% for office buildings and 1.7% for school construction, according to the U.S. Commerce Dept.’s January cost indexes. The agency also reported in January another 3.6% decline in homebuilding costs during
Non-residential buildings started the year 21% below January 2009’s level, while non-building construction began the year 8% behind last year’s start, according to McGraw-Hill Construction’s data for new construction starts. The housing market is showing signs of turning around, beginning this year 18% above a year ago. The drop in the non-residential building market would have been even more severe if not for the inclusion of the $3-billion mass- transit hub in Lower Manhattan, which was included in the January data. Highway construction in 2009 was supported by stimulus spending that resulted in a 5% increase in the market. Without
Because the owner and developer remain at odds, the fate of much of the 16-acre World Trade Center site in Lower Manhattan may now be in the hands of a third party. The site’s owner, The Port Authority of New York and New Jersey, and New York City developer Larry Silverstein, who has a 99-year lease on the property, failed to reach an agreement by March 12 on a financing plan and schedule for three towers on the property’s eastern side. Structural-steel placement on the site’s structural centerpiece, One World Trade Center, reached the 20-story milestone in February, with construction
Orlando has approved the sale of $69 million in bonds to partially plug a gaping funding hole in its originally priced $1.1-billion downtown building program and kick-start construction of the $250-million first phase of the city’s new performing-arts center. Photo: DPAC Performance center will go forward with mix of private funds and public bonds. Funding for the second piece of the city’s venues program shrank when the recession cut revenue from the tourist development tax (TDT). The city had originally budgeted $130 million for the project; to date, TDT has generated only $10 million. Roughly $70 million in Community Redevelopment
The Senate has passed a $123-billion measure that would extend a collection of tax breaks through December, including some that could benefit construction. The extensions would be retroactive, because many of the incentives have expired. The largest item in the “extenders” bill, which the Senate approved March 10, would continue unemployment benefits and COBRA health-care coverage through 2010. Those provisions’ estimated 2010-2011 cost is $98.5 billion. For the Real Estate Roundtable, the bill’s most important provision would extend 15-year depreciation for interior improvements to leaseholds and certain other facilities, says David F. Pearce Jr., vice president and counsel. It would
The city of Orlando has approved the sale of an additional $69 million in bonds to partially plug a gaping funding hole in its originally $1.1-billion Community Venues building program and kick-start construction of the $250-million first phase of the city’s new performing arts center. Photo: Orlando Magic The Amway Center, future home of the Orlando Magic, is scheduled for an October opening near downtown Orlando. Funding for the second piece of Orlando’s venues program had taken a hit when revenue from the tourist development tax plunged as a result of the recession. The city had originally planned to have
Two construction companies, a designer and a contractor with major footholds in South Africa, take somewhat different views of the country’s market prospects in these tougher economic times. Photo: Mott MacDonald Mott MacDonald, which designed the innovative roof of South Africa’s Mbombela soccer stadium, site of the World Cup in June, is bullish about regional growth. U.K.-based Mott MacDonald Group, London, accelerated its upward trajectory in South Africa last month by announcing its acquisition of the Johannesburg-based power-sector designer Merz and McLellan Pty. Ltd. The 45-person firm, with offices in South Africa and Botswana, has been a player in the
The federal government plans to use a small army of newly trained agents to audit 6,000 companies in a nationwide crackdown on misclassification of independent contractors by employers. Construction firms could be hit hard by the enforcement actions and regulatory changes contemplated by federal and state governments desperate for funds to close budget deficits. The Obama administration has tasked the Dept. of Labor and the Internal Revenue Service with increasing enforcement this year and is calling for additional resources in the 2011 federal budget. Last year, the Dept. of Labor added 250 new investigators hired within its Wage & Hour
In a unanimous decision, the Mississippi Supreme Court ruled on Feb. 11 that contractors are covered under their commercial general-liability policies for subcontractor work later found to be defective, adding momentum to a national battle being fought over whether insurers are actually providing coverage defined and paid for in those policies. The ruling has national implications “because the policies being written and enforced throughout the U.S. are identical to the policies the Mississippi court has addressed,” says Mike Kennedy, general counsel of the Associated General Contractors. “The court made it clear that insurance carriers should be held to the terms
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