Alabama Report
Economists predict construction resurgence by mid 2010

While a few areas in Alabama are doing OK and some sectors are surviving, most are struggling.

Construction companies in Alabama have had better days.

Construction began in 2007 on Auburn University’s The Village, which will have eight residence halls with 1,720 beds.

“We have seen a slowdown in construction in both commercial and residential,” says Ahmad Ijaz, an economist for the University of Alabama’s Center for Business & Economic Research.

While a few pockets in the state are doing OK, such as Huntsville, and some sectors are surviving, most are struggling, Ijaz says.

He says it might be the middle of 2010 before construction projects start flowing again. “It depends on how quickly the banks clean up their mess and start lending again,” Ijaz adds. “They’ve really tightened their lending criteria.”

In the meantime, construction companies are “working a lot harder to find work,” says Jim Rives vice president of Alabama Associated General Contractors.

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Projects that do come available might have 15 to 25 bidders when a year and a half ago those same jobs would have generated three or four bids, he says.

The construction companies also are willing to take a lower profit margin — or no profit — on jobs just to keep their employees busy, Rives says.

The construction jobs have been vanishing, too. Between February 2008 and February of this year, nearly 17,000 construction jobs were lost, leaving the number of jobs at 93,300, Ijaz says.

Homebuilders also are showing restraint in the economy.

Single-family building permits issued in March were 827, down 44.2% from March 2008, according to Alabama Center for Real Estate’s New Construction Report for March.

The $61-million, 520,000-sq-ft new Enterprise High School will have three stories and be built by Brasfield & Gorrie of Birmingham.

Some areas did report significant increases in the number of permits issued from February to March. They include Huntsville, up 20%; St. Clair County, up 43.5%; and Baldwin County, with a jump of 94.4%. Overall, Alabama handed out 28.2% more permits in March than it did in February.

Still, “several of the state’s metro markets reflected substantial reductions from their 2008 statistics, but these figures are consistent with today’s economic climate,” the report says.

Housing starts in March were 610, which was off 55.7% from the same month in 2008, the report says. Housing starts slipped 1% between February and March.

Commercial construction projects have also slid from last year, says Jay Reed president of the Associated Builders & Contractors of Alabama.

“We’ve seen on average about a 40% decline in construction,” Reed says. “We’re anticipating that it gets a little worse before a turnaround.”

Reed says his association is encouraging its 700 members to focus on marketing and business development.

“While it’s always on our members’ minds, it’s never been as important as it is now to be aware of every project that is out there,” he says.

Federal stimulus money hasn’t helped construction in commercial sectors, Reed says.

Most of the stimulus money isn’t going for construction unless the project is ready to go, Ijaz says. Still, he says there are some pockets of the state that are doing well. Here are some of the larger construction projects under way:

The Von Braun Complex, Phase III, Huntsville, Ala. Archer Western Contractors of Atlanta is working on the $192.5-million, phase three construction of the Von Braun Complex at the Redstone Arsenal in Huntsville. The arsenal, which was founded in the 1940s, is home to the U.S. Army Space and Missile Defense Command.

The project features a six-story, 839,873 sq-ft administrative building that can hold up to 2,650 workers. The first phase of the tight security project is on track to be completed in April with the second phase finishing in fall 2010.

AMC/USASAC Headquarters, Huntsville, Ala. Construction began in September 2008 on the Army Materiel Command and the U.S. Army Security Assistance Command’s headquarters in Huntsville.

The headquarters at the Redstone Arsenal will have two buildings that total 400,800 sq ft. The buildings are attached by a common lobby.

The headquarters will house 1,350 AMC workers and about 370 employers from the U.S. Army Security Assistance Command.

The AMC building is five floors and the USASAC structure is three stories. Both buildings have a basement.

The Mobile District U.S. Army Corps of Engineers awarded the $105-million design-build contract to B.L. Harbert International of Birmingham, Ala.

The project is expected to be completed in January 2011.

The Village, Auburn University, Auburn, Ala. Construction started in 2007 on Auburn University’s The Village, which will have eight residence halls with 1,720 beds.

To elevate the traffic on Interstate 65 in Shelby County, a 5.34-mi stretch of interstate between County Road 52 to 17 is being widened.

The $100-million project is expected to finish this summer and be ready for students in the fall, says Mike Lanier, vice president of Hoar Program Management of Birmingham, the project’s program manager. White-Spunner Construction of Mobile, Ala., is the general contractor for the project.

Three of the buildings will be for sororities and have space for meeting rooms. Another building will be for the Honors College. The remaining four buildings will be for coed housing for both freshmen and upperclassmen and include classrooms and study spaces.

Most of the Village units will be suites with four single bedrooms, two bathrooms and a common living and dining area.

All the buildings are four floors but range in size from 145 beds to 330, Lanier says.

The buildings have brick and architectural precast with wood trim and bay windows.

The architect was Williams Blackstock Architects of Birmingham.

Enterprise High School, Enterprise, Ala. On March 1, 2007, a tornado ripped through Enterprise, destroying the Enterprise High School and killing eight students.

Construction started on the replacement high school in January, says Bob Tomberline, administrative assistant to the Enterprise superintendent and who oversees the buildings.

The $61-million, 520,000-sq-ft building will have three stories and be built by Brasfield & Gorrie of Birmingham, Tomberline says.

The steel-framed building will have a brick exterior and serve about 1,500 students. The building will feature a 1,800-seat auditorium. An 8,000-seat stadium also will be at the site.

Currently Enterprise students are having classes at Enterprise-Ozark Community College. The new high school is scheduled to be finished in July 2010.

Interstate 65 from County Road 52 to 17, Shelby County, Ala. Driving to Birmingham in the mornings on Interstate 65 is filled with delays. Leaving the city in the afternoons on the three-lane interstate that turns into two lanes is jammed with vehicles as well, according to the Alabama Dept. of Transportation.

To elevate the traffic in Shelby County, a 5.34-mi stretch of interstate between County Road 52 to 17 is being widened.

Wiregrass Construction Co. of Ariton, Ala., started construction on the $78.5-million project in August. The project calls for all the drainage, base work and paving needed to add another lane and 12-ft shoulder.

The approximately 1-mi stretch that has three lanes in each direction will beexpanded to four lanes and the remaining two lanes of traffic in each direction will have three lanes.

The project is on track to finish in May 2011.

Basketball fans should enjoy the view in the new 252,000-sq-ft basketball arena at Auburn University when it opens in June

Ridgecrest Student Housing, The University of Alabama, Tuscaloosa. Construction started on the University of Alabama’s Ridgecrest Student Housing in April 2008 to add 962 beds to the campus.

The $47.2-million, 350,000 sq-ft residence hall has five levels and is being built by Jim Parker Building Co. of Auburn. Most of the suites have four bedrooms, two bathrooms, a shared living room and kitchen.

The concrete post-tensioned frame structure has a metal truss roof system with shingles, an aluminum cornice system and 1,500 aluminum hurricane-rated windows. The frame was built by ARD Contracting of Birmingham, Ala. The exterior of the building is brick and stucco veneer with a cast stone entrance.

Also at the site is a three-level, 1,000-car parking deck.

The project is expected to finish in August.

University of Auburn Basketball Arena. Basketball fans should enjoy the view in the new 252,000-sq-ft arena when it opens in June, says Andrew Francolini, senior project manager for Robins & Mortin Group of Birmingham, which is program manager for the $60.4-million structure.

The farthest seat will be 40 ft in elevation from courtside, and two-thirds of the seats will be less than 30 ft in elevation from the court. The arena will have chair back seats along with bleachers.

The three-level reinforced concrete structure will hold 8,700 fans for basketball games, but the arena could seat up to 9,200 people for other events, such as concerts, Francolini says.

Other amenities of the arena include a high-definition scoreboard and 12 luxury suites that open to the outside of the stadium.

The perimeter skin of the building is architectural precast and brick.

Construction started in July 2008. The building was designed by 360 Architecture of Kansas City, Mo., and Davis Architects of Birmingham.