Tornado economy reaches into Springfield

Companies in and around Springfield tied to the construction industry are seeing opportunities emerge in the wake of the May 22 EF-5 tornado that did more than $2 billion in damage to homes and businesses in south Joplin.

While the circumstances surrounding the call for supplies and labor are tragic, a very real need for cleanup, new houses and offices, and remodeling in Joplin exists.

José Miranda, director of client advocacy for Oakland, Calif.-based catastrophic risk modeling firm Eqecat Inc., said its initial estimate of Joplin tornado damages has been supported by a June insurance industry study that calculated damages to be in excess of $2 billion.

“Our estimate that we provided roughly 36 hours after the event was $1 billion to $3 billion in insured losses, and all indications are that that estimate was correct,” Miranda said.

Several notable Springfield-area companies are busy trying to meet the needs of those adversely affected by the storm.

Ozark-based contractor Larry Snyder & Co. may have secured the most dramatic and direct impact to its bottom line due to the tornado.

Snyder & Co. Vice President Dusty Emmert said the company secured a $40 million debris-removal contract that runs through Nov. 1, with two $20 million extension options. With payment based on the debris tonnage the company delivers to the landfill, Snyder officials are expecting around $15 million in revenues from the job, which would represent roughly 20 percent of 2011 projected revenues, Emmert said.

The company now has between eight and 10 crews in Joplin with a minimum of 10 people per crew working daily from sunup to sundown.Charlie Meek, general manager of Springfield-based Meek’s Lumber Co., said Meek’s has doubled its Joplin staff to 30 employees and increased store inventories of lumber, roofing materials and framing equipment.

He said companywide revenues, which were roughly $212 million in 2009 and 2010, should increase by 5 percent to 10 percent in 2011, due to an estimated 10 percent to 15 percent increase in sales in Missouri and Arkansas. Meek’s operates 34 locations in four states and employs roughly 750, Meek said.

Meek said the severity of storms throughout the U.S. this spring already had increased demand and reduced supply of shingles and other roofing materials.

In response, Joplin-based TAMKO Building Products Inc., a manufacturer of roofing and building materials, has established a rebate program for victims of the Joplin tornado to offset price inflations due to supply and demand.

Paul Baldassarre, general manager for Meek’s Lumber in Joplin, said most of the construction activity to this point has been on repair projects in outlying areas, though he is beginning to see some commercial rebuilding start in the path of the tornado.

“We’ve brought extra trucks in, extra inventory, extra labor, extra everything and, really, the building hasn’t even started yet,” Baldassarre said.

Even with a 60-day building permit moratorium issued in the damaged area June 20, he said builders from Springfield, Texas and even Alabama are on the scene in Joplin.

Sam Clifton, owner of Nixa-based Millstone Custom Homes LLC, said he has a tentative agreement with Joplin-based Four State Homes to help it meet expected higher volumes.

He and Four State Homes owner Charlie Kuehn are ironing out the details, but Clifton said the partnership could net him five remodeling or new home jobs in the short-term.

With a reputation for building homes in excess of $300,000 and known for the lead role in building for ABC’s “Extreme Makeover” home in Ash Grove, Clifton and company is prepared to handle jobs ranging from roof repairs to completely gutting and re-framing houses.

Clifton has hired a full-time project manager to work in Joplin, so he can stay connected to his Springfield-area customer base.

He said the revenue potential in Joplin could equal a full year or two in volume.

“I could do 10 $70,000 jobs or I could do five $600,000 jobs. We just don’t know,” Clifton said. “There’s just so much that has to be done there.”

Geoffrey Butler, CEO and president of Springfield architecture firm Butler, Rosenbury & Partners Inc., expects the recovery process in Joplin will take five to 10 years.

Butler said the company purposely stayed out of Joplin following the tornado because it did not want to take advantage of the situation or give any such appearance.

“Our approach is not to go out aggressively and start chasing ambulances. Those people were traumatized,” Butler said.

“We have been down there, and people have called us to do structural evaluation and code evaluations on their buildings. We’ve been doing that over the last month or so,” Butler added.

He said many people in the area are still determining their next steps. Butler expects another six months to a year before most plans are established, largely because service businesses such as Commerce Bank, which lost two locations to the storm, may not want to rebuild on the same sites if other businesses and residents don’t also come back to the area.

“St. John’s is like the gorilla that is going to dictate a lot of what happens. Where they pick their site, that whole area is going to get a lot of migration to it,” Butler said.

St. John’s spokeswoman Cora Scott said the health system would select its site within weeks.[[In-content Ad]]