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February 2, 2006

Construction Industry Spotlight: Experts offer a rosy construction forecast

  • But, a strong regional construction market this year will drive up costs for labor and materials.
    • By TERRY STEPHENS
    Special to the Journal

    A CONSTRUCTION roster filled with Northwest projects is expected to keep the regional economy rolling this year and for several years to come, although it will put a strain on labor and materials, the Northwest Construction Consumer Council was told last week.

    Here come the projects
    Some of the construction projects summarized at last week’s NWCCC meeting include:

    • BP Cherry Point refinery is seeing a decline in Alaskan North Slope crude oil and is searching for replacement oil, including some from Canada. The plant will have a host of small capital projects until 2012-2015.

    • Shell Opus Anacortes refinery is wrapping up a $400 million investment program that began several years ago, the largest upgrade since the plant was built in the mid-1950s, with $30 million worth of work remaining this year.

    • Sea-Tac Airport has more than $400 million in projects this year, including further construction of the third runway, which will see concrete poured next year and a late-2008 opening. Work will begin in 2007 on a $250 million rental car-processing terminal, to be finished by 2010. In March, bids will be sought for realignment of the north expressway into the airport, part of a $100 million investment to extend Sound Transit light rail to the northwest corner of the parking garage.

    • Sound Transit is building light rail from the Seattle convention center to the airport, has plans to update its Sounder train system, and will start building light rail in 2008 north from the convention center to the University of Washington. Those projects could top $2 billion. Work also includes light rail stations in Seattle’s International District, Pioneer Square, University Street, Westlake, four stations in the Rainier Valley, the Beacon Hill tunnel and station projects, plus stations in the Sodo district, Sounder rail projects at several stations and work at several regional bus transit centers.

    • The University of Washington’s major focus for the next five to seven years will be renovating older buildings on campus, beginning with Spector Hall. Other projects include a $300 million construction program at Harborview Medical Center and a $100 million parking garage with 125 apartments on top at the Tacoma campus.

    • With the new state gas tax to finance highway construction, the typical $1 billion of biennium construction by the state Department of Transportation in recent years will increase to $3 billion in 2007-09.

    • Washington’s General Administration office has 149 construction projects costing $780 million in the 2005-07 biennium budget, including $22 million for a new Arts and Science facility at Everett Community College; $20 million to renovate the Cherberg office building in Olympia; $19 million for a science building at Tacoma Community College; a $9.5 million theater and Mukilteo Hall at Edmonds Community College and $4.7 million to renovate Brier Hall; $5 million for state Route 522 off-ramp construction at Cascadia Community College; and $2.2 million for an automotive coursework building at Shoreline Community College.

    • Amgen plans to expand its Bothell facilities in Canyon Park, where about 150 employees are engaged in research.

    • Vulcan Real Estate’s $200 million South Lake Union project with 261 condominiums, a Pan Pacific hotel, Whole Foods Market and retail is due to open this fall. The company also has The Martin, with 170 condominiums and street-level retail at Fifth Avenue and Lenora Street, and the 320 Westlake project, a city block of mixed-use development with a new Group Health headquarters, that will begin construction early this year.

    • Boeing reported record sales of 1,002 aircraft during 2005 and plans for $100 million to $150 million in construction at the Everett plant for the 787 program, continuing at nearly the same level in 2007.

    • Port of Tacoma’s 2006-10 capital improvement budget includes up to $2 billion in projects, including $301 million already planned, $1.2 billion projected and $451 million in potential projects. Most of the projects will focus on marine terminal growth, industrial development and increased infrastructure capacity.

    Seventy NWCCC members filled a Sea-Tac Marriott conference room to hear a panel of 11 representatives of various project owners in major industries and four experts in commodity markets.


     
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