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Fed, SIUE Economists Say Leading Indicators Point to a Slower Economy by 2020

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By KERRY SMITH, EDITOR, ST. LOUIS CONSTRUCTION NEWS AND REVIEW MAGAZINE

Although the current U.S. forecast is beginning to show leading indicators of a slowing economy, this year’s economic forecast of positive Real GDP and employment growth “still has legs.”

This message came from Southern Illinois University Edwardsville’s Timothy Sullivan, Ph.D., instructor in the Department of Economics and Finance. As one of two economists who addressed the large audience at the City of Edwardsville’s 2019 Business Forecast Breakfast on Feb. 5, Sullivan said U.S. Real Gross Domestic Product has grown for 18 consecutive quarters and that there’s no immediate indication that this momentum will wane.

“This is a legit expansion,” he said. “One hundred consecutive months of U.S. employment growth represents more than double the second-best record of a data set dating back to the 1930s.”

U.S. Real GDP growth will likely increase at a rate of 2.9 percent in 2019 overall, Sullivan added, lower than in 2018 but not an indicator that the country is poised for recession just yet. “I would say we’re looking at about a 15 percent probability of recession in 2019,” he said. “There are some leading indicators of a slowing economy, even though this economy has another year of legs.”

In contrast to the national Real GDP growth outlook, Illinois’ Real GDP is projected to grow at a rate of 1.8 percent throughout 2019. “Unlike a year ago when the economic dashboard was green, there are now some mixed signals,” Sullivan said. “The two things we can watch and track are consumer sentiment and interest rate spreads (between long-term and short-term interest rates on U.S. Treasuries).”

Charles Gascon, a regional economist with the Federal Reserve Bank of St. Louis, also spoke to the Edwardsville business audience on Tuesday. Gascon said that while 2018 represented a stronger economy than experts predicted, much of that had been driven by additional government spending. “My forecast is for Real GDP growth to be closer to 2 percent in 2019, but this will definitely slow over the next couple of years,” said Gascon. “Factors contributing to that slowdown will include the aging workforce, slowing productivity, faster wage growth, tighter labor markets and inflationary pressures like steel tariffs and energy price increases.”

By KERRY SMITH, EDITOR, ST. LOUIS CONSTRUCTION NEWS AND REVIEW MAGAZINE

Although the current U.S. forecast is beginning to show leading indicators of a slowing economy, this year’s economic forecast of positive Real GDP and employment growth “still has legs.”

This message came from Southern Illinois University Edwardsville’s Timothy Sullivan, Ph.D., instructor in the Department of Economics and Finance. As one of two economists who addressed the large audience at the City of Edwardsville’s 2019 Business Forecast Breakfast on Feb. 5, Sullivan said U.S. Real Gross Domestic Product has grown for 18 consecutive quarters and that there’s no immediate indication that this momentum will wane.

“This is a legit expansion,” he said. “One hundred consecutive months of U.S. employment growth represents more than double the second-best record of a data set dating back to the 1930s.”

U.S. Real GDP growth will likely increase at a rate of 2.9 percent in 2019 overall, Sullivan added, lower than in 2018 but not an indicator that the country is poised for recession just yet. “I would say we’re looking at about a 15 percent probability of recession in 2019,” he said. “There are some leading indicators of a slowing economy, even though this economy has another year of legs.”

In contrast to the national Real GDP growth outlook, Illinois’ Real GDP is projected to grow at a rate of 1.8 percent throughout 2019. “Unlike a year ago when the economic dashboard was green, there are now some mixed signals,” Sullivan said. “The two things we can watch and track are consumer sentiment and interest rate spreads (between long-term and short-term interest rates on U.S. Treasuries).”

Charles Gascon, a regional economist with the Federal Reserve Bank of St. Louis, also spoke to the Edwardsville business audience on Tuesday. Gascon said that while 2018 represented a stronger economy than experts predicted, much of that had been driven by additional government spending. “My forecast is for Real GDP growth to be closer to 2 percent in 2019, but this will definitely slow over the next couple of years,” said Gascon. “Factors contributing to that slowdown will include the aging workforce, slowing productivity, faster wage growth, tighter labor markets and inflationary pressures like steel tariffs and energy price increases.”

Photo Above: Charles Gascon

Contegra Construction Named Business of the Year in Edwardsville

in Companies/News

By KERRY SMITH, EDITOR, ST. LOUIS CONSTRUCTION NEWS AND REVIEW MAGAZINE

Edwardsville-based Contegra Construction Company – a homegrown Metro East firm known for building projects such as World Wide Technology and Amazon warehouse/distribution/fulfillment centers – was granted the City of Edwardsville’s “Business of the Year” award for its work and charitable efforts throughout 2018.

Edwardsville Mayor Hal Patton presented Contegra President Eric Gowin with the honor during the city’s annual Business Forecast Breakfast on Feb. 5th.

“Contegra’s commitment to Edwardsville since its inception 15 years ago is monumental,” said Patton. “The firm’s work represents nearly 48 percent of the dollar value of all new permits issued by our city during 2018. Contegra is also deeply committed to community involvement, and the company hires eight interns from Southern Illinois University Edwardsville every year.”

Gowin said the company is blessed to be an active part of the fabric of a dynamic, growing community. “Our integrity is an essential part of our culture,” he said. “It drives our dedication to excellent service, which results in project success. We work closely with our clients and fellow professionals. By committing to a true partnership, we look out for everyone’s best interest. We’re delighted and humbled to accept this honor from the City of Edwardsville.”

Other Contegra projects include Ironworks, the 22,000-square-foot, mixed-use retail/residential development in Edwardsville that will reach completion in early spring, and New Poag Richland Residential, a nine-building, 486-bed privatized student housing development near SIUE.

Contegra’s nonprofit arm, Contegra Cares, regularly volunteers time, energy and financial support to causes including Ronald McDonald House, Habitat for Humanity, The BackStoppers, St. Louis Children’s Hospital (KIDstruction), Songs 4 Soldiers and Pedal the Cause.

Photo Above: Eric Gowin

IMPACT Strategies Begins Work on Siteman Cancer Center at Memorial Hospital East

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IMPACT Strategies has begun construction on the new Siteman Cancer Center to be housed in a new medical office building on Memorial Hospital East’s Shiloh campus. The new building will add approximately 70,000 square feet of treatment facilities and office space to this Illinois campus.

 

IMPACT Strategies will contract up to 25% of the construction of this project to minority and women-owned business entrepreneurs. Further, in cooperation with Metro East area construction unions, efforts will be made to employ minority and women, and apprentices.

 

Construction of the medical office building is set for completion by late 2019, with Siteman’s opening planned for January 2020.

 

HDA Architects Completes Distribution Center for Panattoni Development in Edwardsville, IL

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HDA Architects recently completed a 768,678 Square Foot Distribution Center (Lakeview 5) for Panattoni Development in Edwardsville, Illinois. The tilt-up panel warehouse is designed to have four tenants with office spaces at each corner of the building. This is the second Distribution Center HDA has designed at Lakeview Commerce Center for Panattoni Development. Kadean Construction was the General Contractor.

Nolan Office Interiors Announces Corporate Name Change to COCRE8 Interiors

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Founded in 1982, Nolan Office Interiors will be changing its name to COCRE8 Interiors and introducing a new corporate identity reflecting the fundamentals of their core values…Collaborative Creation. The new name will contain the tagline “Infinite Possibilities” demonstrating the endless products and full line of services offered including furniture, architectural, and space planning. COCRE8 Interiors is a solution provider for any organization that aspires to transform their space to create extraordinary environments which promotes positive culture and work-life balance, stimulates collaboration, and maximizes productivity.

According to Nathan Maurer, CEO, “The new name, COCRE8 Interiors allows us to emphasize our wider ranging business objectives of being a trusted partner with building owners, end-users, architects, and contractors but equally recognizing and understanding the fundamental shift in space planning for today’s commercial office, education, and healthcare spaces.

The new name is effective immediately and will be implemented across the company’s services and marketing moving forward.

COCRE8 Interiors represents 200+ furniture and architectural solutions manufacturers including OFS, AIS, Sit-On-It, Muraflex, Maxon, ESI, Carolina, Carvart, Benetti, Three H, and many more. To learn more visit www.cocre8.net

Sierra Club Congratulates Anheuser Busch on Renewable Energy

in Associations/Companies/News

Wind energy takes center stage in Super Bowl ad for powering breweries.

Anheuser Busch, makers of the Budweiser brand of beers, recently aired its 2019 Super Bowl commercial, which features Clydesdales, wind turbines, and Bob Dylan, proclaiming that Anheuser Busch “now brews with wind power for a better tomorrow.”

Headquartered in St. Louis, Anheuser Busch committed to moving to 100% clean energy in 2017. That commitment helped inspire adoption of a similar goal by the City of St. Louis, which has led to St. Louis local power provider, Ameren, announcing plans to invest in 700 MW of wind – 557 MW of which has already broken ground. Ameren is also developing a separate proposal for an additional 400 MW wind farm that large commercial customers and cities can subscribe to.

When Anheuser Busch made its clean energy commitment in 2017, CEO Carlos Brito said: “Climate change has profound implications for our company and for the communities where we live and work. Cutting back on fossil fuels is good for the environment and good for business, and we are committed to helping drive positive change. We have the opportunity to play a leading role in the battle against climate change by purchasing energy in a more sustainable way.”

In response to the Super Bowl ad, Andy Knott, Senior Campaign Representative for the Sierra Club’s Missouri Beyond Coal Campaign issued the following statement: “CEO Carlos Brito’s words in 2017 and Anheuser Busch clean energy commitment proves that corporate leadership can inspire government and utility action. Companies are flocking to clean energy not just to combat climate change, but because it is good for their bottom line. RE100, a coalition of “the world’s most influential companies committed to 100% renewable power” has grown to 161 corporations. While we congratulate Anheuser Busch, we hope that this moment will continue to push local utilities such as Ameren, corporate offices, suppliers, and distribution centers to power all of America with clean renewable energy and move away from dirty fossil fuels.”

NorthPoint Development Announces Plan for New Industrial Park in St. Louis Metropolitan Area

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JLL retained as exclusive leasing agent

NorthPoint Development has announced plans for a new 600-acre, seven million-square-foot institutional quality industrial park in Pontoon Beach, Illinois. Gateway TradePort will begin taking shape this March when crews break ground on the park’s lead building, Gateway TradePort 1, a 540,000-square-foot building set to deliver in early Q4 of this year.

NorthPoint has retained commercial real estate firm JLL as the exclusive leasing agent and marketer for the project. David Branding, SIOR, managing director of JLL’s industrial real estate platform, has been named the project’s lead leasing agent. The company previously represented NorthPoint’s Hazelwood Logistics Center, which delivered its last of eight fully occupied buildings in July 2018.

Gateway TradePort is located at the intersection of I-270 and I-255 in one of St. Louis’ fastest growing submarkets; an area that has delivered more than 5 million square feet of new industrial warehouses since 2014. NorthPoint has delivered more than 3.7 million square feet of new industrial warehouses in St. Louis. This is the company’s fourth industrial development in this market since 2016, and its first development in St. Louis’ Metro East submarket. NorthPoint closed on the land purchase on January 31, 2019.

Johan Henriksen, vice president of development for NorthPoint Development, said, “We are excited to work with David and JLL on our proposed Gateway TradePort. This park will complement our offerings on the Missouri side using our formula for success: great location, continuous spec program with flexible building layouts, along with market leading tax abatement for bulk users in the Metro East submarket.”

Pontoon Mayor Mike Pagano said, “The Pontoon Beach Village Board and myself are very excited about the new development coming to Pontoon Beach. Gateway TradePort will bring many construction jobs and many regular jobs after completion. This new development will be very good for all our surrounding communities.”

A private real estate investment firm focused on outstanding risk adjusted returns through acquiring, developing, and operating industrial properties on a national platform. The firm was founded in 2012 and has developed more than 58 million square feet for tenants such as Chewy.com, Home Depot, Amazon, Walmart, GE, and General Motors. 

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. For further information, visit jll.com.

2019 ASCC Officers Elected

in Associations/News

Chris Forster, Largo Concrete, Tustin, CA, has been elected president of the American Society of Concrete Contractors (ASCC), St. Louis, MO for 2019-2020. Bill Bramschreiber, Charles Pankow Builders; Anthony DeCarlo, TWC Concrete Services; and Mario Garza, Barton Malow, were re-elected vice-presidents. Chris Klemaske, T.B. Penick & Sons, was elected a vice president and Kevin Riley, Belfast Valley Contractors, was elected treasurer. Dr. Heather Brown, Middle Tennessee State University; Maizer Ouijdani, Conco; and Keith Wayne, Wayne Brothers, were elected as directors and Heston Hamilton, Ductilcrete Slab Systems; David Somero, S&S Concrete Floors; and Jason Swagert, Citadel Contractors, were re-elected directors.

The Decorative Concrete Council (DCC), a specialty council of the ASCC, elected Karen Keyes, The Art of Concrete, Denver, CO as council director. Jeff Eiswerth, H&C Decorative Concrete Products, Cleveland, OH was elected secretary. John Anderson, Solomon Colors; Marshall Hoskins, Butterfield Color; Tonia Primavera, SUNDEK; and C.J. Salzano, Salzano Custom Concrete, are newly elected directors.

The ASCC Safety & Risk Management Council (SRMC) re-elected Mike Schneider, Baker Concrete Construction, Monroe, OH, as council director for 2019. Aron Csont, Barton Malow, Southfield, MI was re-elected secretary. Rodney Hartline, BURNCO, was elected as a new director. Heather Baines, North Coast Concrete; Jamie Czuba, Breigan Concrete Construction; Jason Sisk, Wayne Brothers; and Matt Stier, McD Concrete Enterprises, were re-elected as directors.

Jeremy Clark, Stego Industries, LLC, Chicago, IL was re-elected council director of the Manufacturers’ Advisory Council Board for 2019. Jeff Wells, SUNDEK, was re-elected secretary. Jim Becker, W.R. Meadows; Jeff Johnson, Allen Engineering Corp.; Doug Rhiel, Schwing, were re-elected as directors and Mike Tracy, ARDEX Americas, was elected as a new director.

The Concrete Polishing Council (CPC) elected Shawn Halverson, Surfacing Solutions, Temecula, CA as council director and Scott Metzger, Metzger & McGuire, Concord, NH as secretary. Re-elected as a director was Bruce Ferrell, PROSOCO. Newly elected directors are Bill Bencker, David Allen Co.; Lance Drabzcyk, Jon-Don; John Haines, Hyde Concrete; and Jessica Ledger-Kalen, Royale Concrete.

The American Society of Concrete Contractors is a non-profit organization dedicated to enhancing the capabilities of those who build with concrete, and to providing them a unified voice in the construction industry. For more information, visit www.ascconline.org or call the ASCC office at (866) 788-2722.

Color Art Announces Leadership Team Additions

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Industry leader promotes long-time executive and hires two more 

Color Art is St. Louis’ largest interior solutions provider and has been family and employee owned for more than 70 years. The company is pleased to announce the promotion of long-time employee Christine Hoffmann to President of Color Art Furniture; the hiring of Todd Nixon as Executive Vice President of Furniture, and Jennifer Clark as Vice President Operations of Furniture and General Manager of Color Art’s Installation and Moves Team.

“Part of our success can be credited to Color Art’s tradition of hiring, and keeping, the best and brightest people on our team,” said Gary Mindel, CEO of Color Art. “Recent changes to executive leadership will continue this tradition.”

Christine Hoffmann has been promoted from Executive Vice President to President of Color Art Furniture, the company’s largest and longest-standing division. She brings with her a careers’-worth of sales experience and more than two decades interacting with furniture solutions. During her tenure, Christine has successfully launched and maintained dedicated Healthcare and Workplace Strategies Teams, in addition to numerous other initiatives. “There’s always a new challenge. There’s always something new to do, some new task to take on,” remarked Christine. “There’s a really strong entrepreneurial spirit here. We want to do things right but are also willing to take risks.”

Todd Nixon was recently hired to fill the role of Executive Vice President of Furniture and returned to the industry after 15 years’ executive leadership experience. Todd began his career in commercial furniture and held positions in sales and leadership at both local dealerships and corporate headquarters. “I knew a lot of the good, quality people I’d worked with in the past were at Color Art and that spoke volumes to me about the culture. I also liked all the integrated capabilities Color Art offers. I’ve never had access to all of this under one roof.” Todd joins Christine leading the Furniture Sales Team. He’s particularly involved with strategic planning and sales growth in corporate, education and healthcare markets.

Jennifer Clark is another addition to Color Art’s Leadership Team, accepting positions as both Vice President Operations of Furniture and General Manager of Color Art’s non-union Installation and Moves Team. Jennifer is an Air Force Veteran who studied mechanical engineering and has worked in manufacturing, operations, and engineering for almost 25 years. “I’ve always had a process improvement mindset,” she says, “I love observing and analyzing processes and finding creative ways to streamline.” Jen will use her Lean Six Sigma Master Black Belt (LSSMBB) training to help reorganize Color Art’s receiving and warehousing processes as well as oversee teams of installers and movers.

Color Art is the largest commercial interiors solutions provider in the Midwest and serves clients in 30 states as well as internationally. For more information visit https://www.color-art.com.

Photo Above: Christine Hoffmann

KAI Design & Build Announces Restructuring, New Leadership Roles

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New branding, website and logo to unveil in February

KAI Design & Build, an integrated architectural, engineering and construction services firm providing design and construction solutions across the country for nearly 40 years, has announced a corporate restructuring and will now be known as KAI Enterprises. KAI Enterprises, which will simply go by KAI publicly, will serve as the parent company of four new subsidiaries—KAI Design, KAI Engineering, KAI Build and KAI 360 Construction Services (KAI 360 CS). As part of the restructure, KAI will launch a new branding effort in February that includes a new corporate brand identity, logo and tagline as well as a new website.

The name change and restructure reflects KAI’s broader commitment to its clients and the AEC industry and unifies the company’s operations under a new core focus and set of core values.

CEO Michael Kennedy, Jr. officially launched the new structure in October 2018, with Darren L. James, AIA, transitioning to President of KAI Enterprises. James, a shareholder within the company since 2010, was formerly the President and COO of KAI Texas.

“This is a new day for service delivery in the design and construction industry,” said James. “The continued evolution towards better and greater communication enhances the work environment for our staff and provides a more comprehensive experience for our clients. We believe in long-term, mutually beneficial relationships with our clients and our restructuring is our investment in continuous improvement, evolution and reinvention to better serve our clients, staff and community.”

In 2017, Michael Kennedy, Sr., founder and chairman of KAI Design & Build, retired and sold his company shares to his son, Michael B. Kennedy, Jr. The younger Kennedy decided at that time to restructure KAI and create new entities for each of the company’s business lines under the umbrella of a new holding company.

KAI is now poised through its four distinct business units to serve its clients with national resources from its headquarters in St. Louis and offices in Atlanta, Dallas, Omaha and San Antonio.

“As a shareholder of the KAI family of companies, it is my intention to strategically place the parent company and each business unit in the most advantageous position for growth, stability and profitability, regardless of the external economic climate,” said James. “As the President of KAI Enterprises, it is my role to create opportunities that sustain our business unit’s individual goals, and nurture and grow our staff with exciting projects with a purpose to transform the communities we touch.”

The four new entities and respective leadership under the restructuring include:

  • KAI Design – The architectural and interior design side of the business is now exclusively channeled through KAI Design. These services were previously offered through KAI Texas, but under the new structure, KAI Design will focus on providing design services at all KAI office locations throughout the U.S. KAI Design is led by President Matt Westphal, who also heads up KAI Engineering.
  • KAI Engineering – KAI Engineering is an industry leader in BIM technology, and its engineering professionals have decades of combined experience in project leadership, design execution and advanced engineering concepts on a wide variety of building types. Through the recent acquisition of Atlanta-based Dorsey Engineering, KAI expanded its reach, enabling greater opportunities in a prime engineering-focused role to owners, architects, federal and state government agencies, and design-build contractors nationwide. KAI Engineering is led by Matt Westphal, who holds a dual leadership position as President of KAI Design and KAI Engineering.
  • KAI Build – KAI Build provides design-build services, general contracting, construction management and a full suite of preconstruction services. The company, led by President Brian W. Arnold, recently elevated their presence in the construction market through the acquisition of reputable St. Louis-based Volk Construction Company, which brought more than 50 years of diverse expertise in the public and private sectors. Additionally, Marcus Moomey, AIA, DBIA, has been promoted to the new position of Director of Design-Build to lead this division of KAI Build.
  • KAI 360 CS – KAI’s Program and Construction Management group is now named KAI 360 Construction Services (KAI 360 CS) because of its ability to provide “full circle” expertise to plan, structure and deliver projects to meet clients’ budgets, schedules, quality and operational requirements, and to lead a project or program from concept to turnover. KAI 360 CS is led by President Bruce Wood.

“The new structure allows stronger flexibility to add investors, shareholders and M&A activity to align better with KAI’s strategic goals,” said KAI Enterprises CEO Kennedy, Jr.

KAI Enterprises is a national design and build firm providing delivery-oriented building solutions with a diverse portfolio of experience, in-house multi-discipline professionals, and expertise in both design and construction delivery. To learn more about KAI, visit www.kai-db.com.

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