Short supplies throw wrench in construction

Just ask Rick Quint, vice president at Walton Construction.

“We had a (church) here earlier, and I came right out and asked them, ‘Do you really need to build now? Is this something that can wait?’” he said. “If you had a choice, my advice would be that you might wait a little while and let this thing settle itself out.”

With all of the uncertainty in the market, Quint said that advice would be appropriate for many companies or individuals looking to build.

Springfield Contractors Association President Bill Nesbitt agrees.

“We all expect that within six months, building materials will be a hell of a mess and in short supply all over the country,” Nesbitt said. “We’ve already had calls – where we had shop drawings in process and the suppliers knew that we were going to buy their equipment – we’ve had them call and say, ‘You probably need to arrange to take delivery on that to make sure you’ve got it,’ even though we’re not going to need it for another four to six months.”

Many materials – cement, lumber and roofing products – were already in short supply before the devastation of Katrina. Ken Simonson, chief economist for the Associated General Contractors of America, said in a Sept. 1 news release that 32 states were experiencing cement shortages in August.

The storm certainly won’t help; 80 percent of the country’s cement supply – the main ingredient in concrete – comes into the country through New Orleans.

The shortage is being felt locally, too.

“Prior to the hurricanes there was a cement shortage and had been for several years. That probably will continue because of the building boom here and overseas,” said Tom Baird IV, director of sales for Conco Cos.

He said his company has seen an increase of $15 per ton – about 12 percent – on the cost of cement. He said some projects have gone to a four-day workweek because of shortages.

“It hasn’t put us in a bind yet, but if the weather stays nice and we have a mild winter, we could be in a critical situation,” Baird said.

AGC’s Simonson also said that the price of lumber has jumped in response to anticipated surge in demand, while goods such as cement and rubber, which previously entered the country through the Port of New Orleans, also will see price increases.

“The disruption to ocean, barge and rail transport from Katrina, and the loss of power to cement plants in the storm’s path, will cut further into cement supplies,” Simonson added. “At the same time, the urgent need to stabilize and rebuild roads, other infrastructure and buildings will increase demand for cement and other materials.”

But “anytime you have tragic circumstances like this, you look for silver linings,” said Matt Morrow, executive officer of the Home Builders Association of Greater Springfield.

According to Morrow, there are some positives that could come about as a result of the storm in the Gulf Coast, most notably the fact that much of the work will come at a time when other regions are slowing down.

“Also, the rebuilding that needs to happen down there, while it is immense, is going to take a long time. So the economic pressure on items like materials and labor will be spread out over a period of many years,” Morrow said.

Worker shortage

The impact on the industry, however, is not limited to materials availability. There is also an overwhelming need for construction workers – contractors and laborers – in the stricken areas.

Rick Quint, senior vice president and division manager for Walton Construction in Springfield, said there are Walton projects affected by the storm that are in desperate need of workers, such as West Jefferson Hospital just outside of New Orleans.

“They had about 60 workers on that job before the storm hit. Today, they had a total of five,” Quint said. “That shows you that with these projects, even though you can get back to them and go to work, you don’t have any workmen.”

Along with shortages of workers, Nesbitt said, there also will be an abundance of swindlers.

“We’ve seen the greatest in people, and we’ll see the worst in people. Every worthless (S.O.B.) in the world that ever cheated anybody out of a nickel will show up down there and profess that he’s a contractor,” Nesbitt said. “People will start projects for people who have gotten their insurance payments, draw heavy on the first payment because most people don’t have much knowledge about the construction business, and they’ll take off.”

Qualified firms also are looking to chip in. Bo Hagerman of Hagerman New Urbanism said that while his firm is not yet doing design work for any of the rebuilding efforts in that region, he would like to help.

“I have a couple of people on my marketing staff, and they’re trying to figure out who to even talk to,” he said. “They need somebody to step in and say ‘If you need something, put your name on this list, and if you have something to offer put your name on this list.’ Right now we’re still trying to figure out how we can get involved.”