CT Construction Digest Friday January 28, 2022
Contractors Strategize How Best to Fill Job Openings
LUCY PERRY
Two big construction industry outlook reports released in early January show promising construction industry stats where workforce is concerned. The supply-chain issues and labor shortages continue, yet respondents to both surveys said they plan to hire and increase staff this year. Contractors across the construction spectrum are encouraged to follow suit.
In its latest construction hiring survey, the AGC found that 74 percent of more than 1,000 member firms plan to add to their payroll in 2022. And three quarters of the civil contractors and engineers who responded to a recent quarterly survey by a Dodge Construction Network partnership are upbeat about their workload this year and plan to hire more workers to meet the need.
The latest issue of the Civil Quarterly (TCQ) detailed survey results that show optimism among civil contractors regarding the construction economy in 2022. Contractors believe worker shortages will still have a major impact, however.
The survey found that approximately half of responding contractors expect revenue and profit margin gains this year. They also strongly believe the workforce pool is strengthened through building enrollment in technical high schools and vocational training programs.
Asked about worker recruitment and retention, the majority of respondents expect a reputation for solid benefits and high pay to carry them through hiring challenges. In fact, they consider high pay their best tool to recruit workers under age 30.
Civil contractors recruit via traditional advertisements and working with industry organizations and local unions. The Dodge partnership's survey found that respondents believe local trade unions are the best route to workforce recruiting.
"Contractors are, overall, very optimistic about the outlook for the construction industry in 2022," said Stephen E. Sandherr, CEO of the AGC. "While contractors face challenges this year, most of those will be centered on the need to keep pace with growing demand for construction projects."
One State's Jobs Picture
Texas' biggest employment gain in December 2021 was the construction industry, according to the Texas Workforce Commission. Construction added 10,400 jobs in December and 3,600 in November, accounting for more than half the job growth in the industry there in the past year.
"We are finally seeing the long-hoped-for change in mentality about the industry being a great career choice," Phil Crone, executive director of the Dallas Builders Association, told the Dallas Morning News.
Construction job wages have increased between 7 percent and 10 percent, said Crone. This, despite the fact that record numbers of builders are experiencing labor shortages.
Job gains have been the norm in Texas' mining and logging industries, which includes the oil and gas sector, for a while now. The industry's 32,400-worker gain represents an 18.5 percent increase over the past year, making construction the highest of any sector.
"All the liquefied natural gas plants on the Gulf Coast are running at capacity, and they're building new ones about as fast as they can," said Bruce Bullock, director of the Maguire Energy Institute at Southern Methodist University. "And when the pay gets high enough, people will work."
Expansion Is a Good Thing
In the AGC's 2022 Construction Hiring & Business Outlook, more members indicated they expect 15 of the 17 project categories to expand than contract. According to the organization, contractors are most optimistic about highway and bridge construction, at a 57-percent net reading.
The areas of transit, rail and airports projects are seen positively as well, with a net reading of 51 percent. Water and sewer projects also drew positive responses, with a net reading of 50 percent.
The AGC attributes the upbeat picture in these segments to the Bipartisan Infrastructure bill. Contractors also are happy about demand for federal construction projects and power construction. Those sectors saw net readings of 37 percent and 29 percent, respectively.
Warehouses and healthcare facilities produced the highest expectations among private-sector categories, with a net reading of 41 percent each. This includes clinics, testing facilities and medical labs. The outlook for hospital construction also is strong, with a net reading of 38 percent, according to the AGC.
The association reports that contractors were encouraged in regard to multifamily residential construction, with a net reading of 32 percent, and manufacturing construction, at 27 percent.
Members were less enthusiastic about public buildings, school construction, higher education facilities and lodging. The AGC reported that only two categories received negative net readings, both of -8 percent. They were retail and private office construction.
"Optimism about growing demand for many types of construction projects is leading many firms to plan to hire workers this year," said the AGC. In fact, 74 percent of respondents expect their firms will expand headcount in 2022. Just 9 percent expect to log a decrease.
And 47 percent of firms expect to increase their headcount by 10 percent or less. However, 22 percent said their headcount will grow by 11 to 25 percent and 5 percent anticipate an increase of more than 25 percent, according to the survey.
The association sees challenges ahead for those contractors seeking to add staff. Almost all members said they are having a hard time filling some or all salaried or hourly craft positions.
In fact, only 8 percent said they are having no difficulty. And three-fourths of respondents believe recruiting challenges will continue or become more difficult this year.
Association members point to the pandemic as a major impact on the construction industry. The majority of respondents reported higher-than-anticipated costs, and 72 percent reported longer-than-anticipated projects, both because of the pandemic.
To compensate for these challenges, 69 percent of members surveyed admitted putting higher prices into bids or contracts, while 44 percent have specified longer completion times.
Supply-chain issues continue to stymie the construction industry. Only 10 percent of the AGC's member firms reported not having had any significant supply chain problems. However, 61 percent have turned to alternative suppliers for materials, while 48 percent have specified alternative materials or products as a solution.
The industry has seen a "significant" number of project delays and cancellations, according to the AGC, which attributes the issues to rising construction costs and slowing schedules. Delayed but rescheduled projects during 2021 were reported by 46 percent of contractors and 32 percent experienced a project postponement or cancellation that was not rescheduled.
"The last two years have become increasingly unpredictable, due in large part to the coronavirus and public officials' varied reactions to it," said Ken Simonson, chief economist of the AGC.
"But assuming current trends hold, 2022 should be a relatively strong year for the construction industry," he added.
Fighting Industry Threats
The Associated Builders and Contractors released its own analysis of Bureau of Labor Statistics indicating the construction industry added 22,000 jobs in December 2021. Nonresidential construction employment gained 27,000 jobs.
"Overall, the industry has recovered slightly more than one million or 92.1 percent of the jobs lost during earlier pandemic stages," said the ABC. Nonresidential specialty trade added 12,900 jobs; heavy and civil engineering added 10,400; and nonresidential building employment increased by 3,700 positions.
Construction unemployment rose to 5 percent in December 2021. Unemployment across all industries fell from 4.2 percent in November to 3.9 percent in December.
"Today's jobs report has economists shaking their heads," said ABC Chief Economist Anirban Basu. "Not because it was an especially terrible report, but because the data are so difficult to interpret."
He noted that the headline number of 199,000 jobs added economy-wide is "deeply disappointing" as it makes December the fourth month in five that the headline number has fallen short of expectations.
"Dig a bit deeper, and the labor market appears much tighter and stronger than indicated by the payroll growth number," said Basu, adding that economy-wide unemployment dipped to 3.9 percent as the labor force participation rate remained unchanged.
"While it is true that the construction industry rate of unemployment ticked higher, this is likely because of seasonal factors as opposed to a rush of Americans joining the construction workforce," he added.
And while the data are puzzling in many ways, the implication for contractors is reasonably straightforward, said Basu: "The labor market remains extremely tight going into 2022," he added.
"Contractors will be competing fiercely for talent. They already have been, according to ABC's Construction Confidence Indicator, but that competition will become even more intense as dollars from the infrastructure package flow into the economy."
Basu warned that contractors should expect another year of rapid wage increases in 2022, and concluded "those rising costs, along with others, must be included in bids if margins are to be sustained."
To compensate for a tight industry labor market, the AGC wants public officials to help the industry recover in 2022 and avoid measures that will undermine the sector.
The association maintains that the Biden administration's vaccine mandates will prompt many vaccine-hesitant workers to leave the relatively few employers covered by the orders.
The AGC believes these workers will migrate to smaller firms that are not covered by the rule. This pool of companies employs more than 60 percent of the industry's workforce, according to the association.
"Given how many firms are currently looking to hire, many vaccine-hesitant workers will be able to switch jobs instead of taking a shot they have already resisted for over a year," Sandherr said.
He also pointed to the administration's plans to increase tariffs on Canadian lumber and maintain existing ones on other key construction materials as further hamstringing firms to accurately bid upcoming projects and complete them on schedule.
Sandherr said the association will continue to push for new federal investments in workforce development and make sure Congress keeps its promise to boost funds for infrastructure.
The association also will continue to encourage construction workers to get vaccinated, he said. The AGC is planning to release new Spanish-language public service ads on the subject soon. They follow a series of ads encouraging vaccinations released last year.
"Our ultimate goal is to make sure that contractors' optimistic outlook for 2022 becomes a reality," Sandherr said. CEG
‘There’s no perfect option’: Norwalk presented with two designs for new high school
NORWALK — The two options to build a new Norwalk High School provide no easy choice for the Board of Education or the city.
Architects from Kaestle Boos Associates presented two concept designs on Wednesday to members of the Norwalk BOE Facilities committee and the Common Council’s Land Use and Building Management committee, breaking down the cost, time and challenges presented by each scenario.
The first design, Option A, would use a phased approach. More than half of the new high school would be built on the footprint of the existing school, requiring parts of the old school to be torn down while the new school is under construction. Some of the demolition would occur while school is in session, requiring special permits from the state Department of Public Health.
The estimated cost for Option A is $191 million for a 347,000 gross-square-foot building. The construction timeline of the project is estimated at 55 months, spanning between May 2023 and December 2027.
Option B would place the new school building where the high school football field and tennis courts are currently located on the south side of the property. The estimated cost is $193 million for a 331,000 gross-square-foot building. The project would be completed in two phases over an estimated 51 months.
The cost of Option B accounts for the reduced reimbursement from the state to rebuild the athletic facilities.
In October 2020, the state approved an 80% reimbursement for the Norwalk High School project at a cost of $189 million. Common Council included the school construction in its five-year capital budget earlier that year at an estimated cost of $50 million. The projected cost of the project was estimated at $200 million when the new school was announced in December 2019.
Designs for both options included the addition of a natatorium, but the pool is not included in the total cost for each project. Construction Solutions Group, which consults for the city, instructed Kaestle Boos to place the indoor swimming pool in an area where it could be added later if funding can be found.
The city can only receive 50% reimbursement for the pool from the state, according to Jim Giuliano, president of Construction Solutions Group.
Facilities Chairwoman Diana Carpio, BOE member Erica DePalma, Common Council member Heidi Alterman and several members of the public expressed their concern with losing another public pool in the city if the natatorium isn’t part of the final building plans. The city lost its other pool at the YMCA when the West Avenue facility closed in 2012.
Both options provide P-TECH Norwalk with a three-story wing and Norwalk High School with a four-story wing.
In Option A, the building’s current science wing would be renovated and extended to create the new P-TECH wing. The plans also include separate administrative offices, a lecture hall, and classrooms built specifically for engineering and computer science.
The four-story Norwalk High wing would be constructed first under Option A to allow the students and teachers to move into the new building while demolition starts on the old classroom spaces. To accommodate P-TECH students and other programs, some parts of the existing building would have to be retrofitted to use in a different fashion until they’re ultimately demolished as well.
“In phase two, P-TECH classrooms are demolished so the entirety of the P-TECH school has to be in temporary classrooms. That’s affecting 500 students,” said Kate Jessup, the education planner for Kaestle Boos Associates. “There are some pretty significant impacts and when we think about the duration of construction from an education lens, this is the entirety of a student’s high school experience here.”
Many of the questions brought by elected officials and the public revolved around the hardships that students would face during construction under each option.
Under Option A, the existing cafeteria wouldn’t be operational for nearly three years nor would the culinary arts classrooms. The two small gymnasiums would be closed for 20 months. A temporary outdoor walkway would have to be used to move between the P-TECH and Norwalk High wings, causing a possible safety and security hazard.
Meanwhile, Option B would drastically reduce parking spaces for students to allow for construction staging.
Specifically with athletics, Option B takes away the football, track and tennis facilities for at least four years, forcing the district to transport affected student-athletes to other facilities. DePalma noted this would also affect younger athletes who use the same facilities elsewhere in the city and cause greater competition for the already limited space for youth athletics.
Under Option A, the high school would temporarily lose its softball field and practice soccer field. New fields wouldn’t be built until school construction was completed.
Other concerns voiced during the meeting included building a bus loop off the residential King Street under Option B, having an imposing four-story structure at the corner of Strawberry Hill Avenue and County Street under Option A, and if the state’s earlier commitment to an 80% reimbursement rate would account for skyrocketing inflation.
“We have proposed these two options in front of us. There are many, many questions and concerns that we need to continue to work together to address,” said Alan Lo, buildings and facilities manager for the city. “The two options, there’s no perfect option here but at the same time, I respect all the comments and all of this needs to be evaluated.”
Carpio and councilman Tom Livingston, her counterpart on the Land Use and Building Management committee, both agreed to table a vote on approving either option until more of the issues could be thoroughly addressed and more public feedback could be attained.
DANBURY - A novel plan for a $99 million high school and middle school in a sprawling westside office complex was unanimously approved by the Zoning Commission, clearing the way for City Hall to finalize a reimbursement commitment with the state.
The Zoning Commission’s unanimous approval this week of redrawn blueprints at the 1.2 million-square-foot Summit complex is the latest step in Danbury’s scheme to meet its school overcrowding crisis by building a career academy for 1,400 upper grade students.
The career academy, which would be the first condominium-style public school in Connecticut, is expected to open in the fall of 2024, in a city where enrollment has hit a new high of 12,080 students.
As much as the city is counting on the additional schools at the Summit, a commitment by the state to reimburse Danbury for 80 percent of the cost is yet to be finalized, officials said during a hearing on Tuesday.
To cover all the bases, the Zoning Commission’s approval came with a caveat that if Danbury does not buy 200,000-square-feet of office space from the Summit for the schools, that space may be retrofitted by the Summit into apartments.
“This is a dynamic and vibrant facility,” Zoning Commission member Milan David said during Tuesday’s hearing. “They made a lot of progress in the last three years. It is realty shaping up.”
David was among the Zoning Commission members who wanted to put off a vote on the Summit two weeks ago to first take a tour of the high-profile project.
Summit attorney Tom Beecher told the Zoning Commission on Tuesday that the project speaks for itself.
“It is certainly nice to see that building is alive and well and thriving as opposed to what it was like just a short three years ago,” Beecher said.
Beecher was referring to the failed former Matrix Corporate Center at 100 Reserve Road, which lost $46 million and was 15 percent occupied at its low point.
The Summit bought Matrix off the foreclosure market for a bargain of $17 million in 2018. The Summit went on to earn city approvals to retrofit the office park with apartments, stores and conference space.
Then the city came to the Summit with the novel idea of buying three office park “pods” to build two badly needed westside schools. That required a new approval, which the Zoning Commission granted this week.
“I don’t know how you could have voted on this with a clear conscience unless you went there and saw this,” David said to his colleagues on the Zoning Commission before Tuesday’s vote.
David raised the only question of the hearing to Summit Project Manager Mike Basile about school bus circulation.
The short answer is the buses will enter through the north end of the building and exit to the south.
The brevity of the hearing and the lack of discussion before Tuesday’s vote contrasted with two weeks ago, when the Zoning Commission came perilously close to a “no” vote without knowing quite how to get itself off the ropes.
In the end, some crafty parliamentary work helped the commission maneuver away from a showdown, and allowed members to take a tour of the facility.
“I just want to thank everybody for letting us go (on the tour),” David said on Tuesday. “It was worth the two weeks’ wait.”
Bank Street modular apartments developer was once named one of New York’s ‘10 worst landlords’
It didn't take long, in trying to learn a little more about Neil Rubler, the New York real estate developer for whom New London changed its zoning rules to accommodate his proposed controversial apartment tower on Bank Street, to discover some of his troubled history as a landlord.
It turns out, according to numerous national news stories published in 2018, including in The Washington Post and Newsweek, Rubler is friends with Donald Trump's son-in-law Jared Kushner, who once intervened to keep some negative stories about Rubler's company out of Kushner's newspaper, The New York Observer.
One of them was about Rubler being named one of New York's 10 worst landlords.
Indeed, a 2010 story from the now-defunct Village Voice is still online and includes a long description of how the newspaper came to put him so high on its list of worst landlords.
The reasons they gave centered around a complaint brought by then New York Attorney General Andrew Cuomo, accusing Rubler and his real estate company, Vantage Properties, of aggressively forcing out long-term tenants with frivolous eviction proceedings, to be able to rent the apartments for more money.
Rubler and his company eventually agreed to a $1 million settlement with Cuomo, money set aside to compensate abused tenants but also provide money to nonprofits to help provide free and educational legal services to tenants.
The harassment of tenants described by Cuomo, the Village Voice said, exacerbated the shortage of affordable housing at the time.
According to the Village Voice, Cuomo said Rubler's company sometimes didn't cash or returned rent checks before beginning eviction proceedings for nonpayment of rent.
"The landlord was forcing longterm, rent-regulated tenants to move out of their homes in order to impose significant rent increases on new tenants and increase profits," the Voice quoted from a statement from Cuomo's office.
When I caught up with Rubler this week I was responding to an email he sent to me, asking to talk about a column I had written about his controversial Bank Street five-story tower, which the city's Planning and Zoning Commission approved without discussing unanimous objections to it by members of the city's Historic District Commission.
Rubler said he was seeking my opinion about how the project might be made better.
When I turned the conversation to the Cuomo investigation and settlement, he said the history speaks for itself and he has nothing more to say about it.
Rubler then refused to discuss on the record other questions about the Bank Street project and his new company, Vessel Technologies, which is proposing it. The company is promoting the use of prefabricated modular units to create stacked apartment buildings.
The company claims the cheaper construction means savings can be passed on to tenants. But there is nothing in writing guaranteeing the apartments in the proposed Bank Street tower would be less than market rate.
The other thing that Rubler refused to discuss on the record is the ownership of the property for the new building at 174 Bank St.
According to city land records, a concrete company took title in March 2011. That might have been about the time that a proposed building project there failed, and only the concrete footings for the foundation were built.
The title passed in April 2011 to something called 174 LLC.
Rubler refused to answer any questions about whether he has an ownership in 174 LLC or is leasing the property or plans to buy it.
The planning commission, with the blessing of Mayor Michael Passero, made an extraordinary accommodation to a developer once named one of the 10 worst landlords in New York.
Commissioners changed zoning rules so that Rubler's new building, unlike all the existing buildings on Bank Street, could have residential, not commercial, space facing the sidewalk.
And then they voted unanimously to approve a project that insults all the hardworking, preservation-minded volunteers and property owners who are doing the right things to preserve New London's unique, historical downtown, with appropriate buildings in the right scale.
I'll say it again: Shame on the mayor and all the city planning commissioners who turned their back on one of the city's greatest assets: Bank Street's whaling-era streetscape.
This is the opinion of David Collins.
Developer eyeing Farmington office park for 199-unit apartment building
ANew York-based developer is looking to build nearly 200 apartment units adjacent to two office buildings near Interstate 84 in Farmington.
The “Pond View Apartments” are planned to be situated at 74-76 Batterson Park Road and would consist of a single, four-story, 56,000-square-foot building, according to project documents submitted to the town’s wetlands commission by SLR International Corp., an environmental consulting firm.
The complex would accommodate 199 apartment units, SLR said, as well as a courtyard containing a 2,100-square-foot pool and a surrounding paved parking lot and access drives.
Pond LLC, which lists an address in Manhattan, is the entity behind the proposal. It is controlled by Sovereign Partners, a commercial real estate agency also headquartered in New York City.
According to town property records, Pond LLC bought the existing office buildings at 74-76 Batterson Park Road in the summer of 2019 for almost $20 million. Both sit directly to the west of Batterson Park and Batterson Park Pond.
Space in the buildings is leased to a number of different tenants.
Pond LLC has not yet made a formal application to Farmington’s Planning and Zoning Commission for the Pond View Apartments.
Manchester nixes partnership with Parkade developers on mixed-use project
More than two years after picking the developer to revitalize a section of Broad Street, Manchester officials announced this week they have ceased its partnership with Manchester Parkade 1.
The massive project on the former parkade site was expected to break ground on initial construction this spring, but town officials will now go back to the drawing board after citing numerous delays and an unclear timeline as reasons for moving on from the Easton-based developer.
Redevelopment Agency Chair Aaron Wlochowski thanked Manchester Parkade 1 developers for their work but said it was time to move on.
“The RDA has decided that it’s necessary to end discussions with the current developer,” Wlochowski said. “While we are disappointed to end our relationship with Manchester Parkade I, the RDA has always worked in the best interest of the Town and its taxpayers. We have stayed true to the original Redevelopment Plan and bond fund approval.”
Harry Freeman, one of the principals at Parkade 1, said the news from Manchester town officials came as a surprise to him and his business partner, Michael Licamele.
“We’ve been working in good faith,” Freeman said. “We were very surprised that the town took this action.”
The town first bought the multi-parcel property in 2011 after Manchester voters approved an $8 million bond to revitalize the Broad Street area. In 2019 the town named Manchester Parkade I LLC as the preferred developer for the site.
The planned $140 million project, called Silk City Green, would convert the vacant Broad Street site into a mixed-use development with housing, retail space, and a hotel.
The Town and Manchester Parkade I signed a development agreement in April 2021, which was subsequently twice extended as the developer grappled with financing issues related to Department of Housing and Urban Development funding.
Those funding issues have since been resolved, Freeman said, and the developers planned to add a new partner to the project. Freeman said they were still planning to break ground on initial site work in the spring, with vertical construction expected to begin in the late fall.
“We thought we had all the ducks in order,” Freeman said. “In our mind we still have an agreement and we still have rights to the property and we’re going to proceed as such.”
The developer said Parkade 1 has already pumped $1.3 million of its own money into the project, so they’d be consulting with their legal team about what options they have.
“The Town and RDA recognize and share the community’s frustration with these timing delays and are eager to move forward in delivering progress on the Parkade site,” General Manager Steve Stephanou said in a statement. “In the coming weeks, we expect to announce next steps for the development of the site.”
Now, the RDA and town officials will go back to the drawing board and work on a new development strategy for potential developers.
“This is an attractive opportunity for a developer to create a signature project at an excellent location in an established market,” Manchester Director of Planning & Economic Development Gary Anderson said. “While we regret that we are unable to proceed with the current development group, I’m confident that the hard work of the RDA and town staff will lead to a positive outcome for the community and Broad Street.”
HARTFORD — Hartford’s Parkville Market opened in 2020 just as the first wave of the pandemic swept through Connecticut, the odds seemingly stacked against it.
Two years later, however, the market has steadily added to its dining options, now offering 20 restaurant vendors, plus three bars.
Even with delays in the return of office workers to downtown, the market’s developer, Carlos Mouta, sees a bright future. He is launching expansions into two of four buildings that encompass the market site, with plans for small and large event venues, a rooftop deck and a new home for the Hog River Brewing Co., which has outgrown its quarters across the street.
All together, the expansions come in at about $6 million and include $4 million in publicly funded loans from a joint development fund from the city of Hartford and the Capital Region Development Authority. The public loans target the building with the entertainment options.
What is Parkville Market?
The market is a food hall styled after larger ones such as Chelsea Market in New York City and the Reading Terminal Market in Philadelphia.
The market was created in the old Capitol City Lumber Co. building that stood vacant and decaying for years.
Vendors offer a smorgasbord of international delicacies and dining options that range from fried chicken and poke bowls to pho and ice cream. The market also hosts popups and special holiday-themed events.
A new restaurant will debut in February called “The Lettuce Bar,” which will offer soups and salad.
The market has been averaging 65,000-75,000 visitors a month this winter, a number that is lower than expected because of the recent coronavirus surge but is expected to pick up as the latest wave of the coronavirus subsides.
Where will the expansion be?
The second phase of the market, to be known as “The Hall at Parkville Market,” will be created in a 30,000-square-foot building just to the east of the main market building.
This building will focus on entertainment options, including an 11,000-square-foot ground floor space for concerts, stand-up comedy, weddings, corporate functions and other events.
Mouta said he hopes the space will be ready by late spring or early summer and will include a bar.
Elsewhere on first floor, the plans envision a sports bar or restaurant and a commercial kitchen for catering events.
On an upper floor, there will be a smaller event space and bar, roughly half the size of the one on the ground floor. Above that, there would be a rooftop deck.
“There are no rooftops around here, and people love rooftops,” Mouta said.
All this could be done for the fall, Mouta said, with more, larger restaurant stalls on the upper floor coming sometime in the future. The stalls would be up to 1,000 square feet, nearly triple what is available in the main market building to accommodate vendors that are growing.
Where is the brewery going?
The Hog River Brewery plans to expand across Park Street to a new, larger location. The building would include larger spaces for its brewing operations, a rooftop deck and a patio that would feature a firepit. There also are discussions about building stairs that would link the brewery, set up on a hill, to the street below.
The relocation of the brewery could come later this year.
How does Parkville Market fit into the larger plans for the neighborhood?
There is a push by city leaders and the private sector to create an arts and innovation corridor in Parkville, with Bartholomew Avenue as its “spine.” The vision calls for a mixed-use community of new apartments, restaurants and arts venues and start-up space fostering innovation, building on the neighborhood’s long history of manufacturing.