With a long run of strong construction activity under its belt, can the Billings area keep up the pace in 2006?
The answer from those in the industry locally is a firm yes. While there are constraints on the business including fuel prices, land prices, material prices, labor supply and interest rates, there is no lack of demand. Across the board, an abundance of construction projects is keeping local contractors busy — very busy.
New hotels, projects at hospitals, new homes, remodelings, land development, renovations and major projects at refineries and in public roads and utilities all indicate that 2006 will be another boom year in Billings.
Construction activity "is as strong as it's ever been," said Rick Leuthold, president and CEO of Engineering Inc.
He should know. Engineering Inc. gets a preview of many of the new developments coming our way as clients come to the firm with their development concepts.
There is a renewed surge in commercial development, Leuthold said, as well as some tremendous multifamily projects in the mill, but construction is strong across all segments.
"We're pretty bullish on the region," Leuthold said.
Engineering Inc., which has offices in Bozeman as well, has started on some of the bigger projects slated for the Shiloh Road corridor, even though reconstruction of Shiloh won't happen for a couple of years. It's not too early, since these are large, multiyear projects, he said.
And Engineering Inc. itself is growing. Leuthold said that the company has technical positions it would like to fill. It continues to scour the local market for qualified employees, but the company's past three hires were out-of-state people it managed to attract and get to move here.
Some builders have said they have turned away projects for lack of workers. Contractors, both in-state and out-of-state companies, are scooping up workers. According to state data, the construction industry added more than 1,400 jobs from January to February. In fact, the increase in construction jobs accounted for nearly half of the state's total gain of 3,200 jobs for the month.
The Department of Labor and Industry's Business Standards Division confirms the brisk pace of hiring in construction, noting that the Building Codes Bureau issued 86 building permits in February for commercial and public projects statewide with a total valuation in excess of $26 million.
"This is an increase of 30 percent in permit numbers for February 2006 as compared with 2005," said Labor Commissioner Keith Kelly, "and a 209 percent increase in project valuation."
Laborers are hard to find these days, agreed Bruce Rost, senior project manager at COP Construction LLC in Billings, which "would indicate to me that everybody has an opportunity to look at work and to bid work," he said.
In Billings, perhaps the grand-daddy project is the $325 million coker plant construction at CHS refinery in Laurel — the largest single construction project in the refinery's history.
Hardrives Construction Inc. owner Jim Bailey has a nice lineup of work.
Even with higher costs for builders, there is "a real good construction season ahead of us," Bailey said.
"Billings has been growing a long time, and I don't see that ending in the near future."