Kathi Littmann looked in her appointment book in July, 1999, and saw an unusual sight—empty space. Just two years earlier, she had maneuvered herself into an enviable position as real estate consultant for a new movie production studio for director Steven Spielberg. The $200-million project would be the first production backlot built in Los Angeles in a quarter century. It was the type of exalted assignment that culminated a long journey, both in time and miles, for the Oklahoma-raised former schoolteacher, architecture student and contracting project manager. So when Spielberg's company, Dreamworks, pulled the plug on its studio plan, Littmann
Inflation measured by ENR's two cost indexes traditionally moves in tandem, separated by perhaps half a percentage point. On occasion, however, the trends shown by the Construction Cost Index (CCI) and the Building Cost Index (BCI) can diverge, showing very different escalation rates. That was the case for most of last year. At their greatest degree of separation, during July of last year, the CCI showed an annual inflation rate of 3.1% and the BCI only 0.7%. By March 2003, the indexes had come back in line, with annual inflation measured by the CCI at 1.9% and the BCI at
The start of ground fighting in Iraq over the past week intensified the military's infrastructure and logistical challenges and unleashed award of a number of new support contracts. Activity also included a Bush Administration request to Congress for $74.7 billion to fight the war, provide humanitarian relief and combat terrorism in the U.S. and abroad. The "engineering demands are astounding early on," in a military engagement, Army Corps of Engineers Major General Hans Van Winkle told attendees at the Associated General Contractors convention March 20 in Honolulu. The deputy Corps commander described the modern battlefield as a "continuum." Changes in
COSTLY Mold suit seeking $2 billion alleges that apartments costing $3,000 per sq ft are worthless. It is a "mold new world" out there and construction industry firms think that it stinks because of increasing liability for things that they feel they cannot control. But like it or not, they are going to have to change the way they do business and build projects as mold litigation hysteria sweeps through the nation. There definitely is something to fear and for which to prepare. In June 2001, a Travis County, Texas, trial court set match to tinder when it awarded a
One of the first victories in the Iraq War came on the economic home front. A speculative bubble that pushed prices for oil and natural gas to near-record levels during the first quarter finally burst. Ironically, as hostilities became inevitable, energy prices tumbled, as the benchmark price for West Texas Intermediate crude fell from a peak of $37.83 per barrel on March 12 to below $29 in about a week, says Bruce Cavella, oil analyst with the forecasting firm Global Insights, Lexington, Mass. That is only about $2 more than last December's price, he notes. "OPEC for months has been
A prolonged strike shutting down Venezuela's exports of crude oil to the U.S. and uncertainty leading up to the Iraqi war caused a surge in oil prices that immediately impacted the asphalt paving industry during the first quarter. From last November to this month, the price of the benchmark West Texas Intermediate crude oil rose 43%, from $26.29 per barrel to $37.50. Asphalt paving prices soon followed. During the first quarter, ENR's 20-city average price for liquid asphalt increased 10%, to $174.87 per ton. And it may take another month or two for the full impact of the March oil
A labor strike in Venezuela, conflict in the Middle East and a bone-chilling win-ter are all blamed for record-high fuel prices this month. Although costs appear to be subsiding for the first time since the fall, heavy-equipment managers have their eyes locked on fuel rates. As of March 17, the U.S. Dept. of Energy reported the average gasoline per-gallon price at $1.73 and diesel at $1.75. Retail gasoline reached $2.14 per gallon in California, while on-highway diesel hit $1.99 per gallon in New England. In February, diesel prices abroad rose as well, with the U.K. at $2.81 per gallon and
The exploding South Florida concrete construction market, with an annual put-in-place value of $350 million, is proving a successful organizing target for the Laborers' International Union of North America. The union began exploring the Florida concrete market in mid-2001. It is a market with a number of high-rise hotels and condominium projects along the Florida coast being built by contractors that often tap the immigrant community for craft workers despite deficiencies in language and skills. The contractors were "all competing using the people that were available at the competitive wage rate," says Bob Hanna, director of the Ohio Valley and
Inflation that was contained through the expansion of the last decade may be crushed by the severe downturn in today's commercial markets. "I'm putting 0% escalation into my current estimates," says Larry Cockrum, president of Ripley, Miss.-based consulting firm Cockrum & Associates and current president of the American Society of Professional Estimators. "I priced a recent job as I normally would and then discounted everything 8% and that is probably where it is going to hit." Severe competition is more than undercutting the modest increase in direct labor and material input costs reflected by 11 general purpose commercial building cost
LOOMING Flue-gas desulfurization is beginning to move into the market as SCR installations are coming to an end. (Photo courtesy of Babcock Power Environmental Inc.) Before the Enron and WorldCom debacles and subsequent telecom meltdown, the outlook for new powerplant construction had engineering and construction firms juiced about their future. But scandal, a slumping economy and prolonged anxiety about war in Iraq have short-circuited any near-term hope for sector expansion. If there is a silver lining for power engineers and contractors, it's in the pollution-control retrofit market. One consultant predicts the U.S. flue-gas desulfurization market will top $20 billion over
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