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Jacksonville Report Although still active, construction starts have slowed in northeast Florida as the residential market has stalled.
By Debra Wood
A diverse economy, including a strong port and active naval station, has helped the city of Jacksonville weather the recent stagnation in residential development, but contractors are expressing mixed messages about activity in the market.
“On our side of the business, it’s excellent,” says Gordon Steadman, vice president of development for Elkins Constructors of Jacksonville, which builds office buildings for private and public clients, retail spaces, institutional projects and residential condominiums with existing clients. “We’re showing positive growth in all the markets we are in, not only product type but geographically. For Elkins, we look like we’re going to have a great year, and it’s not slowing for the next couple of years.”
But Associated Builders and Contractors member Brian Franco, vice president and director of business development for Auld & White Constructors of Jacksonville, says the market peaked 1.5 years ago, and there has been a 35% decrease in northeast Florida building permits during the first five months of 2007 compared to the same period in 2006.
“The general business cycle has clicked down,” Franco says. “There are still opportunities out there, but just not as many. That’s clear in the permit activity.”
Dan Haskell, president of the Florida First Coast Chapter of ABC, reports plenty of activity but not so much that members are turning work down.
“Our market has continued to be better than other areas of the economy as far as construction goes in northeast Florida,” he says. “Things appear steady on the commercial side. A lot of my people have shied away from multifamily. That market is down, and it appears that the development community has shied away from megaprojects.”
Bob Renaud, director of public affairs for Haskell of Jacksonville, says that while the Jacksonville construction market tends to be less volatile than in other areas of the state, contractors are continuing to deal with softening of the commercial market while residential has bottomed out entirely.
Private projects
Health care remains strong. Haskell recently began a $50 million, 220,000-sq-ft addition to Baptist Medical Center – South, which opened just two years ago. The project is part of a $400 million expansion by Baptist Health of Northeast Florida of Jacksonville.
Steadman says Elkins expects to complete in August 2008 a new four-story headquarters building for the Alfred I. duPont Testamentary Trust.
Auld & White recently began an $8 million, 55,000-sq-ft automobile dealership in Jacksonville and is just finishing a $12 million, 45,000-sq-ft day-care center for Citigroup.
The residential market has not entirely dried up. Elkins recently broke ground on Old San Jose on the River, a $230 million, 218-unit condominium project with 17 mid- and low-rise buildings.
Also, Skanska USA Building has taken over construction of the Peninsula, a condominium project by developer American Land Ventures of Miami. The Auchter Co. began that project last year, before experiencing financial difficulties prior to merging with Perry-McCall Construction of Jacksonville.
The 234-unit luxury project has sold out, with units ranging in price from the $300,000s to more than $1 million, and originally was expected to complete by this fall. However, Tom Underwood, project executive for Skanska, says the building was at the 27th of 39 floors in late June and no completion date has been set. His firm plans to try working with existing subcontractors to finish the project.
Downtown Vision, a nonprofit entity that promotes downtown Jacksonville, listed a total project cost of $150 million for the Peninsula and the Strand, an adjacent residential project Auchter completed for American Land Ventures. The Strand began as condos but the developer is now renting the units, due to slow sales.
At the Port
The Jacksonville Port Authority has multiple projects under way. The most significant is the $220 million, 160-acre TraPac Container Terminal on Dames Point, one of three marine terminals at the port.
Mitsui O.S.K. Lines (MOL) of Tokyo and its U.S. terminal operating subsidiary TraPac will use it to unload containers full of consumer goods from Asia for distribution in the United States. Completion is scheduled for December 2008.
“MOL will be great for the port and Duval County and the state in general,” says Tim Murphy, senior director of engineering and construction for JAXPORT. “With that many jobs, that many containers, it will be phenomenal.”
The Jacksonville Economic Development Commission estimates that the new terminal will produce 5,000 jobs and contribute $900 million annually to the northeast Florida economy.
W.G. Yates & Sons Construction Co. of Jacksonville received an approximately $189 million contract for site preparation, paving, utilities and dredging to create two 1,200-ft-long, 40-ft-deep berths and connect those berths with the federal channel. The work includes constructing a bulkhead and elevated platform for unloading containers.
JAXPORT also awarded the Tower Group of Jacksonville a $31 million contract to build seven buildings and two canopies for trucks accessing and leaving the terminal.
Also at JAXPORT, Hal Jones Contractor of Jacksonville is rebuilding a berth at the Talleyrand Marine Terminal. The $9.5 million project is scheduled for completion in June. The company also is adding a $1.8 million stern ramp at Blount Island Marine Terminal that will allow vehicles to drive off of ships docked at it.
The port authority hired Onas Corp. of Jacksonville to clear a 40-acre site for Rinker Materials of West Palm Beach, which will build an aggregate terminal there. Onas has completed about two-thirds of the $2.5 million project, which includes creating stormwater retention ponds and rudimentary roads to provide access to the site. Murphy says he expects the work to wrap up by this month.
Highway Projects
The Jacksonville Transportation Authority has more than $800 million in projects under way, and the Florida Department of Transportation has several ongoing projects in the area.
Archer Western Contractors of Jacksonville continues work on a $150 million interchange at interstates 10 and 95. The job includes 17 bridges and is scheduled for completion in 2011.
Hal Jones is making progress on construction of the $57 million Trout River Bridge Replacement. FDOT expects the project to wrap up next summer. It will connect to a widened I-95 now under construction. Archer Western is managing that $21.3 million project, which must finish at the same time as the Trout River Bridge.
Superior Construction Co. of Jacksonville began rebuilding the $81.2 million State Road 9A/State Road 202 (J.T. Butler Boulevard) interchange in June 2005. The project will add circular ramps, widen existing bridges and roadways and eliminate traffic signals. It is scheduled for a fall 2009 completion. That project will complete the interstate beltway system around the city, says FDOT spokesperson Mike Goldman.
Superior Construction also began work in January on a $60.8 million, 4.8-mi, limited-access highway, State Road 23, with a new interchange at I-10. Completion is expected in 2009.
Other Public Work
M.A. Mortenson of Minneapolis broke ground in April on a $123 million, 277,000-sq-ft aircraft hanger at the Naval Air Station Jacksonville. The hanger is scheduled to open in 2009.
Also at the naval station, Walbridge Aldinger Co. of Detroit has a $41 million contract to design and build an H-60R helicopter hangar, configured as five repetitive contiguous hangar modules.
The contract includes demolishing two World War II-era hangars and constructing support spaces for five squadrons.
An additional $31 million is needed to finish the project and is pending congressional approval. The project is scheduled for an October 2009 completion.
At the Jacksonville airport, Balfour Beatty of Jacksonville began work in June on a $69 million, 112,600-sq-ft concourse replacement project. The two new steel-frame concourses will add flexibility as to the type of aircraft the jetways can accommodate, says Debbie Jones, spokesperson for the Jacksonville Aviation Authority, which expects the work to finish in 2009.
And the saga of the new Duval County Courthouse continues. Originally awarded to Skanska USA Building in 2003 as a $225.3 million project, the last vertical piece of the Better Jacksonville Plan was scuttled in 2004 due to sharp increases in its overall cost, with plans to redesign the project’s scope.
After rebidding it, the city of Jacksonville had selected a joint venture between the Auchter Co., Perry-McCall Construction, Rink Design Partnership of Jacksonville and DLR Group of Orlando to design and build a $203.5 million courthouse.
However, when Auchter ran into its recent financial and legal difficulties, Perry-McCall approached the city in April about continuing the project with Auchter as a subcontractor, says Susie Wiles, chief of communications and special initiatives for Mayor John Peyton. The city decided to rebid the job again rather than leaving it with Perry-McCall.
“The threshold for qualification was barely met by the joint venture,” Wiles says. “When Auchter was out financially, the companies were not capitalized well enough to meet the bond requirements.”
Owner consultant Spillis Candela DMJM of Coral Gables and architect Rink Design Partnership of Jacksonville are collaborating on the courthouse design and expect to complete 30% of the design drawings by late summer, at which time the city will seek new bidders.
Useful Sources
The Strand
http://www.thestrandsouthbank.com
JaxPort TraPac Container Terminal at Dames Point
http://www.jaxport.com/sea/mol.cfm
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