Pratt & Whitney reaches agreement to sell 300-acre former airfield near Rentschler Field

Zachary Vasile

East Hartford jet engine maker Pratt & Whitney announced Monday that it has reached an agreement to sell its 300-acre former airfield to a Massachusetts-based development and investment firm, which plans to use the site for unspecified commercial development.

In a statement, the manufacturer, a subsidiary of Raytheon Technologies, said the land, known as Rentschler Field, will come under the control of National Development, which has its headquarters in Newton Lower Falls, just west of Boston.

A purchase price was not disclosed.

Commercial real estate services and investment firm CBRE, which was involved in facilitating the deal, said the property includes more than 280 developable acres, making it perhaps the largest development site available between New York City and Boston.

The site was marketed as a potential logistics hub, given the significant demand for new warehouse space in Greater Hartford. It’s the same site where a developer previously pursued construction of a $105 million, 70-store shopping outlet center for about five years before abandoning the project in 2018.

“This brings tremendous opportunity for economic development to Rentschler Field, which could have a very positive impact on the overall Greater Hartford area,” said Shane Eddy, senior vice president and chief operations officer at Pratt & Whitney. “With neighbors like Pratt & Whitney, Cabela’s and UConn football, the site offers an attractive place to do business with incredible access to major highways as well as the estimable talent available in the region’s job market. We are pleased with the work CBRE has been able to do and look forward to an exciting next step for this historic piece of property.”

Rentschler Field functioned as a military airfield and then as a private, company-run airport until 1999, when it was formally decommissioned. Part of the property was split off and developed as Pratt & Whitney Stadium at Rentschler Field.

“National Development is very enthusiastic about the potential for the next phase of development at Rentschler Field,” said Edward Marsteiner, managing partner at National Development. “The combination of the central location, the immediate highway accessibility and the access to a densely populated labor pool is unparalleled and we are already hard at work evaluating possibilities for the site. We have a long track record of partnering with communities to deliver best-in-class projects, and we look forward to collaborating with local and state agencies to finalize the sale and bring economic development to this currently underutilized parcel.”

CBRE began advertising the land last winter. At the time, Pratt said it wanted to sell the property by September 2021.

Road work: How the state plans to spend billions on infrastructure

PAUL HUGHES 

The big infrastructure bill is directing $1 billion a year in federal funding for road, bridge, rail and transportation-related infrastructure projects in Connecticut over the next five years.

In anticipation of its long-awaited passage, officials at the state Department of Transportation have been pouring over near- and long-term capital plans for months reassessing project listings and prospective timetables.

The DOT staff is weighing what projects slated in the current five-year capital plan could be expedited, and what projects in the long-range transportation plan could be moved forward in the planning, design and construction stages.

“We are working on it. Stay tuned. You’ll see the timetable,” Transportation Commissioner Joseph Giulietti said.

Connecticut is scheduled to receive nearly $5.4 billion in direct funding from the infrastructure act over the next five years. It a more than $1.6 billion increase over the most recent transportation bill enacted in 2015.

“Look, we’re going to get well over $1 billion a year. It is going to be transformative for our state,” Gov. Ned Lamont said.

The state is getting $3.3 billion to tackle major corridor congestion and safety, accelerate construction projects, and increase safety for drivers, pedestrians, and bicyclists, another $1.3 billion to enhance bus and rail public transit, and $561 million to bring aging bridges into a state of good repair.

In addition, the state will be eligible to compete for $30 billion in grant funding for improving rail service in the Northeast Corridor and another $100 billion in other transportation grant funding. Lamont and DOT officials are confident Connecticut will be able to get its share of these competitive grants.

THE MIXMASTER REHABILITATION is the biggest ongoing transportation project in Greater Waterbury, and the now $212 million project is expected to extend the service life of the elevated interchange of Interstate 84 and Route 8 for another 25 years.

The latest renovation of the network of bridges and elevated ramps that cross the Naugatuck River is slated to be completed in June 2023, nine months over schedule and $60 million over budget.

A 2018 analysis estimated that another rehabilitation in 2045 despite an estimated cost of $1 billion would not improve how the interchange functions, nor would it extend its life span significantly relative to the cost of a full replacement.

Whether through intensive rehabilitation or replacement, the latest long-term planning program anticipates a phased project progressing from 2020s through the early 2040s.

The federal infrastructure funding coming to Connecticut could help the DOT plan for what comes next with the Mixmaster.

ANOTHER BIG INTERCHANGE PROJECT in the works is the overhaul of the junction of Interstate 91, Interstate 691 and Route 15 in Meriden roughly 20 highway miles from the Mixmaster.

Due to funding constraints, the DOT is planning to split the reconstruction of the I-691 chokepoint into three separate projects. The Lamont administration estimated an overall cost of $265 million to $300 million last year. The plans under development involve widening I-91, relocating connections to I-91 and Route 15, and widening and replacing ramps.

Construction on the first the three projects was tentatively scheduled to start in the fall of 2022, but a revised schedule now anticipates the contract going out to bid in late 2024.

The DOT’s latest five-year capital plan included project listings for the overall project totaling $229.4 million, with a state share of $198.4 million and a federal share of only $31 million.

SMALLER SCALE PROJECTS on the DOT’s to-do list that are important locally are also dependent on the availability federal funding, including another interchange project to the west of the massive Mixmaster rehab.

The DOT has planned a $29 million reconstruction of the interchange of Route 63, Route 64 and I-84 on the Waterbury-Middlebury line. The latest five-year capital plan anticipates $23.2 million in federal funding and $5.8 million in state funding.

The project will involve widening sections of Routes 63 and 64, constructing a new roadway to connect Chase Parkway with Route 63 and a multiuse trail to connect the Middlebury Greenway, widening an I-84 off-ramp to Chase Parkway, and altering and adding traffic lights. There is also a new commuter parking lot planned,

The DOT is now scheduled to advertise the contract in September 2022. Initially, construction was anticipated to begin in the spring of 2022. Construction is expected to take three years, but the start of work depends availability of funding, acquisition of rights of way, and approval of permits.

CLOSE TO 250 CONNECTICUT BRIDGES were rated in poor condition in the Federal Highway Administration’s most recently released report in 2020

The list of structurally deficient bridges includes some the state’s largest and most heavily traveled spans such as the Gold Star Bridge that carries Interstate 95 and Route 1 over the Thames River between Groton and New London.

There is also state bridge No. 06129, a two-lane, 110-foot bridge that supports Napco Drive over the Pequabuck River in Plymouth. After 40 years since its last rehabilitation, the twin asphalt-coated metal pipe arches carrying the bridge have seriously deteriorated.

DOT is estimating a construction cost of $2.7 million to replace the metal pipe arches with a precast box culvert, reconstruct headwalls, wingwalls and cutoff walls at the inlet and outlet, and reduce its length to 100 feet to re-establish the natural stream channel and to minimize cost.

Construction is anticipated to begin in spring 2024, and the DOT expects the proposed rehabilitation to be accomplished during one construction season. Again, the timetable depends on the availability of funding, acquisition of rights of way, and approval of permits.

This project also anticipates federal government will cover 80% of the cost and the state will pick up the other 20%.

THE ONLY COMMUTER RAIL LINE serving the Naugatuck Valley could also see additional improvements as a result of the infrastructure bill.

The state is wrapping up a $116-million upgrade to the single-track Waterbury branch of the Metro-North Railroad that will allow trains to pass in both directions. Three new passings will make two-way service possible in mid-2022. The project also involved signalization upgrades and the installation of a positive train control system that automatically reduces train speeds when needed.

The DOT is using a combination of federal and state funding to add five new trains on the Waterbury line, increasing the number of daily trips from 15 to 22

Now, the state is going to receive $1.3 billion to enhance commuter rail and bus service, and local officials up and down the approximately 28-mile spur connecting Waterbury to Milford are envisioning even more upgrades, including new train platforms and additional train stations, and even the construction of a second rail line.

State legislators in the bipartisan Waterbury Line Caucus have already pitched the governor’s office for funding support. Another bipartisan group of state legislators in Western Connecticut just renewed a funding request for electrifying the existing Danbury branch line between the South Norwalk and Danbury stations and extending passenger rail service from Danbury to New Milford.

The public contractors poised to benefit most from infrastructure funding

Leslie Shaver

The morning after the $1.2 trillion bipartisan infrastructure bill passed the House of Representatives earlier this month, dozens of stocks tied to construction experienced a boost, with some funds even passing record highs, according to CNBC.

The package, which President Joe Biden signed into law Nov. 16, pays for power, broadband and water infrastructure, among other things, and promises to boost construction firms public and private from around the country for years to come.

"I think this is going to be a rising tide for most construction firms that are involved in various flavors of infrastructure," said Matt Arnold, senior equity analyst for St. Louis-based financial services firm Edward Jones. "But given the breadth and the sheer size of this bill, it's going to be an environment where it would be hard to picture your average construction company not finding some opportunity coming their way."

But some engineering and construction companies will benefit more than others. Construction Dive spoke with several stock market analysts to determine which public companies stand to gain the most from the spending measure. Here is a rundown of the biggest winners as well as the challenges on the horizon:

AECOM. Nearly every analyst mentioned Dallas-based AECOM as a clear winner when it comes to infrastructure projects, and optimism about the spending package is already permeating throughout the large public contractor. During its recent fourth-quarter earnings conference, CEO Troy Rudd said the legislation would provide much-needed, long-term funding certainty across the company's strongest markets, such as transit modernization, electrification, environmental remediation and climate resilience.

"Importantly, we are positioned to benefit from nearly every line item in this bill," Rudd said. "We anticipate this funding will increase our addressable market and our most profitable business by double digits over the coming years, and we expect the most meaningful benefits in fiscal 2023 and beyond."

AECOM gains 35% of its revenues from transportation and 28% from environment and water end markets, according to Krzysztof Smalec, an equity analyst on the industrials team for Chicago-based financial services firm Morningstar. "If you look at a company like AECOM, almost two-thirds of their revenue is very well aligned with the [infrastructure] spending," he said

Jacobs. Other industry analysts also placed AECOM in the winner's category, but the construction behemoth wasn't alone. Dallas-based technical, professional and construction services firm Jacobs Engineering Group also stands to benefit.

"If you look at the overall bill, I would say that the two companies that are the best positioned are AECOM and Jacobs," Arnold said. "They both have a very strong competitive position, particularly in the transportation, water and environmental markets."

Smalec agrees. He said 17% of Jacobs' revenue comes from transportation work, 12% are in water projects and 6% are in the environmental space. "Those are some areas where I think they can really see some upside," he said.

Fluor. While Smalec also thinks Irving, Texas-based engineering and construction company Fluor should benefit because of its strong position in transportation, including the highways and bridges space, its upside will be limited. 

"Fluor will see less growth just because I don't think they are as broadly exposed to the priorities in the infrastructure bill," Smalec said. "They're a little bit more focused on legacy oil and gas type work."

In the past, Fluor has had issues with cost overruns on fixed-priced projects — something many public firms have dealt with in recent years — which could make the company less aggressive, according to Smalec.

"I think they're going to try to be more conservative,” he said. “They've indicated before that they're going to focus on states where they have a proven track record. So I think a company like Fluor will likely be more selective with pursuing opportunities to make sure that they're not just chasing revenue, but that they're also keeping in mind margins."

Sterling/Tetra Tech. Outside of the overall boost that massive national companies like AECOM and Jacobs will enjoy, other companies will benefit from certain pockets of spending. Sean Eastman, equity research analyst at Cleveland-based corporate and investment bank KeyBanc Capital Markets, expects the 30% increase in baseline transportation funding to boost Houston-based heavy civil construction company Sterling Construction Co. and the $55 billion investment in water infrastructure to help Pasadena, California-based consulting and engineering services firm Tetra Tech.

Other beneficiaries. With $65 billion in funding slated for rural broadband and electric grid modernization, Eastman said companies in that sector as also poised to benefit. They include:

Palm Beach Gardens, Florida-based telecommunications and infrastructure contractor Dycom Industries.

Coral Gables, Florida-based infrastructure engineering and construction firm MasTec.

Henderson, Colorado-based holding company of specialty electrical construction service providers MYR Group.

Houston-based infrastructure services provider Quanta Services.

Dallas-based specialty construction and infrastructure firm Primoris Services Corp.

"That [electric grid funding] is an end market that's already got a lot of momentum behind it and this just seems materially additive," Eastman said.

Infrastructure act likely to spur higher construction wages

Zachary Phillips

The good news is that President Joe Biden has signed the long-awaited, $1.2 trillion infrastructure spending package into law. The Infrastructure Investment and Jobs Act (IIJA) represents the largest federal spending in roads and bridges in 70 years.

The bad news — or at very least, the downside to the welcome influx of civil work — is that the bill's passage comes at a time when the industry is already in desperate need of workers. 

Supply for skilled construction workers has not met demand for decades, and now, that demand is going to increase. Among other issues, this will mean that contractors will have to pay their onsite workers more, experts told Construction Dive.

Wage changes

The supply and demand issue will be exacerbated by the influx of infrastructure projects, Joe Natarelli, national leader of Marcum's Construction Services practice, told Construction Dive, and he predicts wages will go up "significantly." Natarelli said he has already spoken to clients who are trying to secure labor to work on their existing projects and to prepare for the deluge of work that's on the horizon.

A report from Marcum shared with Construction Dive shows a breakdown of current hourly wages of carpenters, electricians and heavy equipment operators across 24 states. The highest earners, according to the report, include:

Carpenters in Wisconsin, who earn $30.31 per hour, on average.

Electricians in Massachusetts, who earn $35.18 per hour, on average.

Heavy equipment operators in California, who earn $38.11 per hour, on average.

With the infrastructure spending package, those skilled workers will only become more valuable. Natarelli said current wage rates will be even higher three months from now, as a direct result of the infrastructure bill. 

Tatenda Tazarurwa, director for Turner and Townsend, indicated that wages are changing, but will also be spread out — often skilled workers move to where the work is. Even beyond the infrastructure spending, workers may head to burgeoning markets like Nashville, Tenn. or Austin, Texas.

A major goal of the infrastructure package, which will infuse roughly $550 billion into roads, bridges and other forms of transit, is to create jobs that don't require a college education, Michelle Meisels, a principal in Deloitte Consulting's technology practice, told Construction Dive. 

"It is expected to create increased demand for predominantly low-wage construction jobs and therefore drive up wages," Meisels said.

The infrastructure plan will likely increase earnings and conditions for workers in two ways, said Meisels: first, the bill will likely tighten the labor markets in which contractors operate, and second, there will likely be direct government wage mandates embedded in the bills.

"Contractors need to be cognizant of the fact that the new bill requires the vast majority of construction projects to pay prevailing wages based on an average of the pay scale for local construction work,"  Meisels said. 

The bill also includes stringent provisions that require all federal infrastructure projects to use construction materials largely manufactured in the U.S., which will increase the number of other types of jobs, and therefore, wages, Meisels said.

Wages to increase 'significantly'

The Great Resignation, partially brought on by the pandemic, has only made things more difficult. The mean workforce age in construction has climbed into the 40s as the industry struggles to recruit younger workers, Tazarurwa told Construction Dive. 

Additionally, the pandemic limited the number of migrant workers, as traveling became harder for some and impossible for others.

On the one hand, Tazarurwa said, the shortage could take some time to get over, but on the other, there has been a skilled shortage for decades, and employees are seeing their power increase.

"No time in the past generation or past ages have employees had more power," Tazarurwa said.

An uphill battle

Contractors may have to get creative to secure labor. Natarelli said he's already spoken to clients who are interested in creating joint ventures to secure work. Some companies can secure financing and bonding, but struggle with the labor. Two contractors joining forces can mitigate that, Natarelli told Construction Dive.

Nevertheless, there's a lot of work to be done. The Department of Labor estimates the industry will need to add 747,000 workers by 2026. The key to filling out those jobs? Continuing to elevate recruiting efforts.

"I see the industry really trying to reinvest back into this and reaching out to folks in high school to let them know there are careers here that are really good careers," Natarelli said.