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Small Business Administration (SBA) Loans for Small Business

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Small business loan form on a wooden table.

Submitted by Schmersahl Treloar Advisors

Under the recently passed “Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020′ small businesses and non-profit organizations may be eligible to apply for targeted, low-interest loans as a result of damages from the Coronavirus (COVID-19). Businesses and non-profits in Illinois and Missouri are eligible. Specifically, the SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to overcome the temporary loss of revenue.

These loans may be used to pay fixed debts, payroll, accounts payable and other bills that cannot be paid because of the disaster’s impact. These loans have long-term repayments in order to keep payments affordable, up to a maximum of 30 years with interest rate of 3.75% for small businesses and 2.75% for non-profits.

Some notable requirements:

  • Unlike traditional SBA loans, prospective borrowers apply directly to the SBA.
  • These loans require a guarantor, even for non-profits. Anyone that owns 20% or greater will be required to guarantee the loan
  • The ‘SBA Credit Elsewhere Test Applies’. Generally, this analysis determines whether the borrower has the ability to obtain some or all of the requested loan funds from alternative sources without causing undue hardship.
  • The business must meet the size requirements to be considered an eligible small business. The SBA’s size standards apply and can be accessed online here: Size Standards Per NAICS Codes The standards vary by industries and measured by average annual revenues or number of employees,
  • The loan program excludes certain businesses including religious and some charitable organizations. Generally, a common business-to-business or business to consumer business qualifies.
  • The deadline to apply for an Economic Injury Disaster Loan is December 21, 2020.

Loan Applications

Application for the loan is made at disasterloan.sba.gov/ela.

The applications require a number of forms and documents, including:

  • SBA Loan Application (SBA Form 5 or 5C)
  • Tax Information Authorization (IRS Form 4506T)
  • Complete copies of the most recent Federal Income Tax Return
  • Schedule of Liabilities (SBA Form 2202)
  • Personal Financial Statement (SBA Form 413)

In addition, you should expect to supply:

  • Complete copy, including all schedules, of the most recent Federal Income Tax Return for principals, general partners or managing member, and affiliates
  • If the most recent Federal Income Tax Return has not been filed, a year-end profit-and-loss statement and balance sheet for that tax year
  • A current year-to-date profit-and-loss statement
  • Additional Filing Requirements (SBA Form 1368) providing monthly sales figures. This is especially important for this type of SBA loan.

These applications are challenging for many small businesses. Your service team at Schmersahl Treloar is available to assist you as needed.

Please be aware the number of applications has overwhelmed the SBA. As a result, their website is frequently down. Be patient and persistent. None of us were prepared for the Coronavirus.

Construction Employers, Attorneys Await Details on Expanded Leave Provisions

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

Just days after bipartisan passage of the Families First Coronavirus Response Act (HR 6201) in the 116th Congress, construction industry employers are grappling with what it means to them in terms of paid and unpaid leave obligations to their employees.

Associated General Contractors of America Director of Employment Policy and Practices Claiborne Guy said navigating the outbreak is no easy matter for employers of all sizes at this juncture. Details and guidance are still emerging in the days following President Trump’s authorization of the expanded family leave act on March 18.

“We know there is a lot of uncertainty and people need to be planning, even if they don’t know all the final definitions and requirements,” said Guy. “As an association, we will continue to provide as many relevant resources as we can to equip and assist employers during these uncertain times.”

Carl Lothman, counsel with Sandberg Phoenix and von Gontard in St. Louis, said the new act comes alongside the traditional Family and Medical Leave Act of 1993 while bringing a completely new benefit.

“The first part includes paid sick leave in six categories related to people directly affected by the COVID-19 virus,” said Lothman, noting that the act provides tax credits for employers offering qualified paid sick leave and paid family leave wages – subject to certain caps and limitations – to offset the cost of providing the paid leave. FCCRA requires covered employers, defined as those with fewer than 500 employees, to provide up to 80 hours of paid sick leave to eligible full-time employees and a prorated amount of paid leave to eligible part-time employees from April 1 through Dec. 31, 2020.

The six categories are:

  • The employee is subject to a COVID-19 federal, state or local quarantine or isolation order.
  • The employee has been advised by a healthcare provider to self-quarantine due to COVID-19 concerns.
  • The employee is experiencing COVID-19 symptoms and seeking medical diagnosis.
  • The employee is caring for an individual who’s subject to a quarantine or isolation order or who has been advised to self-quarantine. (The individual may or may not be a family member).
  • The employee is caring for a child (under age 18) whose school or place of care has been closed, or whose childcare provider is unavailable due to COVID-19 precautions.
  • The employee is experiencing any other substantially similar condition specified by the US Dept. of Health and Human Services, in consultation with the US Dept. of the Treasury and US Dept. of Labor.

Total paid leave, at the employer’s regular rate of pay, is capped at $511 per day and $5,110 total per employee for employees meeting qualifiers 1 through 3 above. If employees meet conditions 4 through 6 above, total paid leave (per employee) is capped at $200 per day and $2,000 in the aggregate. If an employee uses paid sick time for items 4 through 6 above, he or she is only entitled to two-thirds of his/her regular rate of pay, subject to the cap.

Greensfelder, Hemker & Gale Attorney Amy Blaisdell said construction industry employers have unique workforce concerns as they continue to work, especially on healthcare and infrastructural projects. “With respect to the Families First Act, a lot of these construction companies are continuing their operations exempt from some of the quarantine orders, so that takes them out of some of these provisions,” Blaisdell said, “but they’re trying to navigate the remaining provisions. There’s a question of whether employees are out of work due to a child in need, or whether they’re out of work because their employer doesn’t have the work to give them. How broadly the law is going to be interpreted remains to be seen.”

How the new leave act will impact those under multi-employer collective bargaining agreements is also evolving, according to Kathleen Hamilton, a partner with HeplerBroom. “The act says that employers will comply by contributing to a fund, plan or program from which employees can draw money,” Hamilton said. “I can imagine that in the coming weeks, bargaining efforts will be made to expand upon what is being provided in the act. Employers need to look to the DOL for future guidance, make sure they’re updating their PTO (paid time off) and FML plans and talking with their tax advisors to make sure that these agreements comply with the act and that any funds they contribute can be used by employees.”

Environmental Firms Remediating Sites, Disinfecting Surfaces During COVID-19 Outbreak

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specialists in hazmat suits cleaning disinfecting coronavirus cells epidemic MERS-CoV warehouse interior wuhan 2019-nCoV pandemic health risk full length horizontal vector illustration

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

St. Louis-based environmental remediation firms are working around the clock to remediate and disinfect sites during the COVID-19 outbreak.

Crossroads Construction Services, Inc. President Jeremy Rodriguez says his company is in the midst of an asbestos abatement project in a Saint Louis University social sciences building. Although no classes are currently taking place on campus due to the pandemic, Rodriguez said his crew is working quickly to finish the remediation – hopefully by next week – so SLU facilities staff can completely shut down the campus for the time being.

“We’re still doing our work, but social distancing and other safety-related requirements make it difficult,” Rodriguez said. “We’re feeling a tightening in the supply chain with some of the critical equipment we need, such as half-face and full-face respirator masks. We’re blessed right now to still be working, but I’m trying to weigh at what point it’s most beneficial to shut it down. The safety my guys is everything. I’d rather lose jobs but keep my guys safe. It is what it is,” he added.

Thom Wellington, president of Wellington Environmental, is in a similar situation. Wellington wears several hats, one of them as head of Wellington Environmental and another as co-founder of Infection Control University. The cloud-based learning center provides staff and healthcare with 24/7 training to manage risks and reduce hospital-acquired infections.

“We’re training everyone who enters hospitals through the back door – construction crews, pharmaceutical sales professionals and others – what to do so they don’t unintentionally cause infection through the work they’re doing at healthcare institutions,” said Wellington. “Right now with COVID-19, it’s a big deal. Last weekend we had an individual at a construction site, a renovation of a commercial building in West (St. Louis) County, who tested positive for the virus. Wellington Environmental was called upon to disinfect that construction site. Earlier this week we disinfected another construction site early in the morning, prior to when crews returned to work that day.”

Disinfecting high-rise construction sites across St. Louis has also been keeping the firm busy.

“We’re currently going into a lot of these high-rises and fogging with a small particle grade disinfectant,” he said. “We’re not ruining anything, but we are coating everything. So if there is any virus living on a surface, this will kill it. We’re getting a lot of surfaces such as elevator buttons and areas in break rooms or rest rooms that aren’t typically reached (with disinfectant). COVID-19 has caught a lot of people off guard in terms of the degree to which it is impacting construction sites, and buildings and people.”

Kadean Construction Moving Toward April 30 Completion of 1st Phorm HQ in Fenton

Published on in Companies/News

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

Fenton-based Kadean Construction is completing nutrition supplements and athletics apparel manufacturer 1st Phorm’s new headquarters in the location of the former Chrysler plant.

Kadean Construction Project Director Travis Mulder said the 185,590-square-foot, $11.6 million project is expected to wrap up in late April. The building will house more than 400 employees and consolidates several 1st Phorm locations that are currently in South St. Louis County (in Green Park Industrial Court) into this singular facility within Fenton Logistics Park. The project broke ground in late June 2019.

“This is a world-class build-to-suit facility,” said Mulder, noting that the new space allows for 1st Phorm’s future growth. Office and warehousing space, space for company sales representatives and coaches, customer service reps and warehouse employees is all included in the layout.

“Since 1st Phorm hosts visits from athletes whom the company is seeking to sign on to market its brand, the features of the new space that athletes will use were of paramount importance in terms of design and construction,” Mulder said. “We’d describe the locker rooms, showers and bathrooms within the gym as Mizzou-style. It’s truly a top-of-the-line workout facility,” he added, noting that the new headquarters’ full gym has a full-size basketball court with a wood floor.

A 100-plus-seat media room is also part of the new building’s layout. Mulder said the space will be used to present, train and speak to large internal and external audiences via videoconferences, podcasts and more.

Two of the four large executive offices which are located on the mezzanine level are equipped with full-height glass walls and doors to provide executives, overlooking the gym.

An expansive lobby adorned with the company’s branding. Oversized doors on the front of the building will accommodate entrance of a high-end racecar that will reside in the lobby, also bearing the 1st Phorm logo. Two large break rooms to accommodate employee recreational activities are also within the building’s footprint.

Kadean Construction is the general contractor for both the construction of the building shell and the tenant improvements. Other project partners include: U.S. Capital Development (owner); M+H Architects (designer); Stock & Associates (engineer); and subcontractors including O. J. Laughlin Plumbing Co.; Reinhold Electric Inc.; Wiegmann Associates (HVAC); Excel Fire Protection; Fenix Construction (concrete); Atlas Iron Works, Inc. (structural steel); Square Up Builders, LLC (carpentry); Wies Drywall Construction; Leach Painting Co. and Flooring Systems Inc.

People On The Move In The Local Construction Industry

Published on in Companies/News

The latest People in the News highlighting new hires, promotions, honors & recognition of the men and women in the St. Louis building community.

FSA, LLC Welcomes Katherine Mark as Office Administrator

Katherine Mark

FSA, LLC is excited to welcome Katherine Mark as our team’s Office Administrator. Katherine has over 10 years of experience in customer service, sales, and retail management. She attended Lindenwood University, where she studied International Business and Marketing. Katherine displays excellent communication and organization skills making her a vital team member.

FSA is an architectural and design firm specializing in healthcare, laboratory design, higher education facilities, K-12 education, and master planning. Being well rounded in all aspects of an administrative role, FSA is anxious to see all the talent Katherine will bring to our team.

Spellman Brady & Company Hires Jessica Flannery, Office Manager

Jessica Flannery

Spellman Brady is pleased to announce that Jessica Flannery has joined the firm in the new role of Office Manager.  In addition to providing support to HR, IT and senior management, Ms. Flannery is responsible for organizing, streamlining and coordinating office administrative procedures to ensure their effectiveness and efficiency.

Ms. Flannery, who has a Bachelor of Science in Leadership/Management and a Master of Business Administration from Maryville University, is also Lean Six Sigma Green Belt for Government certified.  As a Green Belt, she has a comprehensive understanding of Lean Six Sigma principles, methodology and tools for identifying and eliminating any unnecessary waste in business processes and procedures.  Most recently she provided similar services for the State of Missouri, Department of Natural Resources and brings 14 years of experience to her new role at Spellman Brady.                        ,

Spellman Brady & Company is an award-winning St. Louis–based interior design firm specializing in senior living, healthcare, and higher education environments.  The firm maintains design excellence by delivering comprehensive interior design, furniture, artwork master planning, and procurement services. For more information about Spellman Brady & Company, please visit www.spellmanbrady.com.

Michael Prost Promoted to Director of Technology at Feeler S. Architects

Michael Prost

Michael Prost has been promoted to Director of Technology at Feeler S. Architects. Michael joined FSA, LLC in 2012 as architectural associate/ BIM manager. With Michael’s vast knowledge and skills in design and technology, he has been an asset to the team. Michael graduated from The University of Kansas with his master’s in architecture in 2011. His passion for building information modeling (BIM) has allowed him to be creative within design. Michael is a problem solver who continuously strives to push for technology advancements within the office. He finds new ways to aid our staff therefore, providing satisfaction for our customers.

March 20, 2020

Walker Promoted to Senior Vice President-Mortgage at Midwest BankCentre

Rebecca Walker

Rebecca Walker has been promoted to senior vice president of mortgage at Midwest BankCentre. She reports to Erin Erhart, executive vice president of consumer banking and fee services.

Walker, who joined the bank as vice president of mortgage in July 2019, leads the bank’s mortgage department and manages mortgage loan processing from origination to funding. Her focus includes identifying opportunities to increase efficiencies in processes, policies and procedures, including automation and technology enhancements. Walker also manages investor and mortgage insurance relationships.

Walker has been in the banking industry for 19 years. She most recently served as mortgage loan manager for Scott Credit Union. Walker is a member of the board of directors for the Center for Hearing and Speech.

Midwest BankCentre, a mainstay of St. Louis community banking since 1906, employs a staff of about 280 working at 17 bank locations in the City of St. Louis and St. Louis, Jefferson and St. Charles counties. 

March 13, 2020

Cathy M. Westerheide promoted to Director of G&S Acoustics/FabricWall Sales 

Cathy Westerheide

St. Louis-based G&S Acoustics has promoted Cathy M. Westerheide to Director of G&S Acoustics/FabricWall Sales. She is responsible for improving processes, developing new products and increasing sales, as well as leading the sales teams in providing product information, competitive bids and global representation.

“I’ve always enjoyed the challenges of providing sound solutions for our clients,” says Westerheide of her career with G&S Acoustics. “Every job is unique, and we have a great team of people developing and creating customized solutions.”

Westerheide has been with G&S Acoustics since 1994, having worked as an estimator, sales assistant, sales representative and national sales manager.

G&S Acoustics® is a leading manufacturer of acoustical, tackable and sound diffusing wall and ceiling products distributed worldwide. For more information, email G&S Acoustics or call 800-737-0307.

SWT Design Welcomes Lance Klein, PLA as Kansas City Studio Manager

Lance Klein

SWT Design is pleased to announce Lance Klein has joined our team as the Studio Manager for our Kansas City office. Lance brings 24 years of Landscape Architecture and Urban Design experience including parks, corridors, and nodes that transform communities.  He’s passionate about the public realm and the critical role it plays in elevating our everyday lives. As a resident of Kansas City, MO his familiarity with the region combined with his design talent and civic involvement will deepen SWT Design’s roots in the community. Lance earned his Master of Science in Architecture and Bachelor of Landscape Architecture from Kansas State University.

For 25 years, SWT Design has developed a diverse and award-winning portfolio of outdoor spaces, approaching planning and design as a living, breathing thing with a passion for innovation. SWT Design has grown to become one of the largest landscape architecture firms of its kind in the Midwest. As a strong proponent of sustainable design, the firm was at the forefront of developing the Sustainable Sites Initiative, working closely alongside other founding partners and agencies to develop what has become the world’s first comprehensive rating system for the design, development, and management of sustainable landscapes around the globe. Sustainability continues to be a core principle addressed in all the firm’s projects. SWT Design is located in St. Louis, MO, Kansas City, MO, and Louisville, KY.

For further questions, please contact Ashley Jenkins, Marketing Coordinator for SWT Design by e-mail at ashleyj@swtdesign.com or call 314-644-5700.

March 6, 2020

HDA Architects Hires Two

Brice Zickuhr

HDA Architects have hired Brice Zickuhr as Director of Operations. Brice will oversee day-to-day office activities, managing resources and schedules as well as quality control. He will provide oversight and leadership to all of HDA’s project teams, reviewing the drawings throughout their development. Brice brings 30 years of experience and is part of HDA’s Management Team.

Tim Piskorski

HDA Architects have hired Tim Piskorski as a Senior Project Manager.  Tim will oversee all aspects of the design and construction process of a building project, from developing and reviewing building plans to making sure a project meets environmental and zoning standards. Tim has 27 years of experience and a love for the craft of designing and constructing a building, while respecting client’s budgets, schedules and project parameters

The UP Companies Hires David E. Murrell as Kansas City Regional Director

David E. Murrell

The UP Companies (UPCO) proudly announces the hiring of David E. Murrell of Leawood, Kansas to its new Regional Director position.

Murrell takes on the leadership role during a time of considerable growth for UPCO, one of the region’s largest full-service contractors, and will be responsible for heading operations, developing new business relationships, strengthening existing client partnerships and directing business strategy in the greater Kansas City area.

“UPCO has forged a path in the Kansas City marketplace over the last couple of years as steadfast electrical and carpentry contractors,” said Brian Arnold, UPCO Vice President. “Kansas City is a dynamic and bustling market with lots of opportunity and the outlook continues to be bright. With all these exciting developments, we made the decision to hire a local Regional Director for The UP Companies. David is a homegrown Kansas Citian and a 30-year veteran in the design and construction industry, which we feel is important to gain quicker traction in this marketplace. We believe David relates perfectly to our target customers while representing our core values.”

Murrell has more than 30 years of architecture and construction industry experience, having previously worked as Director of Business Development for Multivista in Overland Park, Kansas; Preconstruction & Project Management for United Excel Construction in Merriam, Kansas; Business Development & Preconstruction for AEC Connections in Overland Park, Kansas; and Project Architect/Construction Manager for Gould Evans Architects and BNIM Architects, both of Kansas City, Missouri.

Murrell has a BFA from the University of Kansas in Architectural Design and is a member of the Kansas City Chapter of Health Care Engineers (KCAHE).

The UP Companies (UPCO) is one of the region’s largest full-service contracting companies offering all-inclusive and convenient solutions for general contractors, owners and facilities management professionals. For more information, go to www.theupcompanies.com or call 314.865.3888.

Michael Moehn Joins Midwest BankCentre’s Legal Board of Directors

Michael Moehn

Michael Moehn, executive vice president and chief financial officer of Ameren Corporation and chairman and president of Ameren Services, has been elected to the legal board of directors of Midwest BankCentre.

Moehn was named to his current role with Ameren Corporation in December 2019. Previously, he was president of Ameren Missouri, working with more than 4,000 team members to provide electrical power to more than 1.2 million electric customers and about 127,000 natural gas customers. After a nine-year career at Price Waterhouse Coopers LLP as a CPA leading client engagements across multiple industries, Moehn has served Ameren in a succession of leadership roles that have deepened his insights and experiences in strategic planning, finance and operations.

Moehn is deeply engaged in the bi-state community. He serves as board chair for the United Way of Greater St. Louis, while also serving as a member of the board of the Urban League of Metropolitan St. Louis since 2016. In addition, Moehn serves on the finance planning committee of Christian Hospital, and the budget and finance committee of Concordance Academy of Leadership.

He graduated with a bachelor’s degree in accounting from Saint Louis University and a master’s in business administration degree from Washington University. Moehn was selected for the Eisenhower Fellowship, participating in its International Leadership Exchange Program, with a focus on South American energy. He is a member of the American Institute of Certified Public Accountants.

Midwest BankCentre, a mainstay of St. Louis community banking since 1906, employs a staff of about 280 working at 17 bank locations in the City of St. Louis and St. Louis, Jefferson and St. Charles counties. 

Enterprise Bank & Trust Launches Multiple Loan Relief Programs

Published on in Companies/News

Additional offerings focus on continuing virtual Enterprise University courses and best practices for business owners

To provide relief for customers during the COVID-19 (coronavirus) outbreak, Enterprise Bank & Trust has launched programs to provide temporary relief for those hit hard by the pandemic. The bank has moved some existing programs, such as Enterprise University and client networking, online to continue providing ongoing business education, while avoiding the risks associated with COVID-19. Additionally, in an effort to share best practices with business owners and leaders, Enterprise is collecting trends from hundreds of clients on a daily basis to provide immediate insights, actions, and solutions for sharing.

Loan Relief Programs

Enterprise introduced the programs today, focusing on solutions that offer temporary relief for those hit hardest by the pandemic. Relief programs are being offered to impacted clients in all of Enterprise’s markets.

The consumer program focuses on the extreme need for deferment of personal loans resulting from hardship related to the pandemic. Business clients experiencing financial hardship are asked to contact their Relationship Manager or Business Banking Portfolio Manager directly to discuss solutions.

Enterprise is now offering the following relief options:

Consumer Loan Deferral Program: This program allows consumer clients whose loans meet specific “good standing” criteria to request loan payment deferrals. Consumer clients may request a deferral of one consumer loan payment for financial difficulty due to the COVID-19 outbreak.

Consumers who are experiencing significant hardship should visit the Enterprise website where they can find an application and more information about the program. https://www.enterprisebank.com/about/covid-19-update.

Credit Card Program: Consumers and Small Business clients will see a message in an upcoming statement with details regarding the option to defer their next payment.

Small Business Loan Program: This program provides existing Business Banking clients who meet certain criteria the opportunity to obtain a fixed-rate working line of credit up to $25,000. Clients should contact their Business Banking Portfolio Manager for more details.

Commercial Loan Relief Program: Other loan options have been developed to provide relief for those businesses most heavily impacted by the COVID-19 pandemic.  Commercial and Business Banking clients are encouraged to work with their Relationship Manager or Business Banking Portfolio Manager to discuss their situation and explore potential solutions that may provide appropriate relief.

Additional Resources

In addition, Enterprise is monitoring the development of federal, state and local government-sponsored programs available to small businesses suffering economic injury as a result of COVID-19. Summary updates and links to these programs will be posted on the website as updates are available.  Clients are encouraged to consult their Relationship Manager or Business Banking Portfolio Manager for more information.

“We understand the uncertainty that many of our clients are facing. We believe that it’s our responsibility as a financial institution to help customers with the greatest hardship, and we take that very seriously,” said Scott Goodman, President of Enterprise Bank & Trust. “That’s why we want to do our part to help address the immediate needs of our customers who are economically vulnerable, not only through loan relief but with education and best practices as well.”

Thought Leadership and Education Resources

Goodman says the leadership team has prioritized continuing to offer Enterprise University courses online, with the understanding of how important it is for business leaders to have continued access to industry experts, at no cost, during this time. In addition, the bank is offering clients virtual networking, crisis communication education, and access to a growing resource catalog of best practices provided by business leaders across the region.

“Many clients are also being presented with opportunities for additional business or to assist their communities and customers. We want to ensure that everyone gets the guidance they need to achieve continued financial success, and it’s not a one-size-fits-all approach,” Goodman said.

Enterprise Financial Services Corp (NASDAQ: EFSC), with approximately $7 billion in assets, is a bank holding company headquartered in Clayton, Mo. Enterprise operates 34 branch offices in Arizona, Kansas, Missouri and New Mexico. Enterprise offers a range of business and personal banking services and wealth management services. Enterprise Trust, a division of Enterprise Bank & Trust, provides financial planning, estate planning, investment management and trust services to businesses, individuals, institutions, retirement plans and non-profit organizations. Member FDIC; Equal Housing Lender.

Project Delays Hit 28% of Respondents in AGC Survey

Published on in Associations/News

Submitted by the Associated General Contractors Association

A growing number of contractors have reported impacts on building projects and products from the coronavirus outbreak. An online survey AGC conducted March 17-19 drew 909 respondents, of whom 28% answered “yes” to the question: “Has any owner, government agency or official directed you to halt or delay work on any projects that are either active or expected to start within the next 30 days?” In addition, 11% replied “yes” regarding projects they were expecting to start more than 30 days from now. Respondents reported various causes for project delays or disruptions: shortage of materials, equipment or parts, 16%; shortage of essential craftworkers (including subcontractors’ workers), 11%; shortage of government workers (whether to issue permits or certificates of occupancy, or to conduct inspections or lettings, or to make project awards), 18%. About 22% of respondents said suppliers had notified them or their subcontractors that deliveries will be late or cancelled. Readers (including previous respondents) are invited to visit https://www.agc.org/coronavirus-covid-19 for a wide range of resources and a link to take AGC’s updated survey.

Data reports released last week do not reflect impacts of the pandemic but provide some indication of the state of the industry heading into the crisis. The reports were mixed but generally showed continued growth from a year earlier.

Construction employment, not seasonally adjusted, increased year-over-year (y/y) between January 2019 and January 2020 in 200 (56%) of the 358 metro areas (including divisions of larger metros) for which the Bureau of Labor Statistics (BLS) provides construction employment data, fell in 95 (27%) and was unchanged in 63, according to an analysis AGC released on Friday. (BLS combines mining and logging with construction in most metros to avoid disclosing data about industries with few employers.) The largest gain occurred in Houston-The Woodlands-Sugar Land (12,400 construction jobs, 5%), followed by the Dallas-Plano-Irving division (9,800 combined jobs, 7%). The largest percentage gain occurred in Lewiston, Idaho-Wash. (15%, 200 construction jobs), followed by Panama City, Fla. (14%, 900 combined jobs). The largest job loss occurred in Baton Rouge, La. (-6,600 construction jobs, -12%). The largest percentage loss occurred in Springfield, Ill. (-22%, -700 combined jobs), followed by Laredo, Texas (-17%, -700 combined jobs). BLS made routine benchmarking revisions dating back several years.

There were 274,000 job openings in construction at the end of January, 8.3% less than the January 2019 total of 299,000, but still the second-highest January total in the series’ 20-year history, BLS reported on Tuesday in its latest Job Openings and Labor Turnover Survey (JOLTS) release. Construction firms hired 385,000 employees in January, not seasonally adjusted, 4.5% less than the January 2019 total of 403,000. Layoffs and discharges increased by 4.3% y/y, to 242,000 from 232,000 in January 2019. Quits declined by 12%, to 155,000 from 176,000 in January 2019. All of these y/y changes are consistent with a modest slowdown in construction, although construction employment increased 2.0% over that span, BLS reported on March 6.

The value of new construction starts dipped 1% from January to February at a seasonally adjusted annual rate, Dodge Data & Analytics reported on Tuesday. “Large projects in the office and healthcare sectors provided a boost for overall nonresidential building, while residential and nonbuilding construction starts moved lower. With only two months of data available for 2020, it is difficult to ascribe a 2020 trend. However, some perspective can be gleaned by examining a 12-month moving total. For the 12 months ending February 2020 total construction starts were 3% higher than the previous 12-month period.” Nonresidential building starts were 3% higher, residential starts were up 1%, and nonbuilding starts increased 7%.

Housing starts (units) in February decreased 1.5% at a seasonally adjusted annual rate from January but soared 39% y/y from February 2019, the Census Bureau reported on Wednesday. Multifamily (five or more units) starts slumped 17% from January but jumped 44% y/y, although the data are typically volatile and often substantially revised in later months. Single-family starts increased 6.7% for the month and 35% y/y. For the first two months of 2020 combined, total starts surged 35% compared to January-February 2019, with multifamily starts up 74% and single-family starts up 21%. Residential permits slipped 5.5% for the month but gained 14% y/y. Multifamily permits declined 20% and 5.0%, respectively. Single-family permits rose 1.7% and 23%. However, the coronavirus epidemic appears certain to cause a huge drop in all residential construction for the next several months, despite a drop in mortgage interest rates.

The Architecture Billings Index climbed in February to a 13-month high of 53.4, seasonally adjusted, from 52.2 in January, the American Institute of Architects reported on Wednesday. The index measures the percentage of surveyed architecture firms that reported higher billings than a month earlier, less the percentage reporting lower billings. Any score above 50 (on a 0-100 scale) indicates an increase in billings. Scores (based on three-month moving averages) topped the breakeven 50 mark for all practice specialties: residential (mainly multifamily), 53.5, up from 51.9 in January; institutional, 52.8, up from 52.0; mixed practice, 52.7, up from 52.4; and commercial/industrial, 52.4, down slightly from 52.5. “‘However, firms were just beginning to feel the impact of the dramatic slowdown caused by COVID-19 as this survey was being conducted in early March,’ said [chief economist Kermit Baker.] ‘The rapid pullback in activity throughout the economy will obviously be felt in the design and construction sector, and architecture firms will be one of the first to see how these events play out.’”

Labor & Management Work Together During COVID-19 Crisis

Published on in Associations/News
Team Work on the Mechanism of Metal Gears.

Submitted by the Associated General Contractors Association

 

Safety and running safe job sites are top priorities within the construction industry, with millions of dollars spent each year on personal protective equipment, stringent safety training requirements, daily inspections and other safety precautions.  Therefore, area contractors and labor already have much of the infrastructure in place to help confront the current COVID-19 crisis. But there’s much more that needs to be accomplished quickly.  Jointly, labor and management are doing that important work.

According to Charlie Goodwin, chair of the Associated General Contractors of Missouri Labor Policy Committee and president of Goodwin Brothers Construction Co., “Labor and management have all moved swiftly to take care of the workers, contractors and owner employees working on or near job sites, and work is moving forward in a safe and prudent way. Constant and regular communications has helped us stay on top of the situation and implement shared best practices.”

“We’ve established a special ‘PROTECT YOURSELF. PROTECT OTHERS.’ COVID-19 online resource center (https://tinyurl.com/wnjxrpw )where contractors and suppliers are sharing best practices,” said Leonard Toenjes, CAE, AGCMO’s president. “Contractors are following, and many, exceeding  CDC and OSHA guidelines, and we’re issuing daily updates with the latest information and findings.  In addition to all the hand washing, social distancing and other protections, contractors also are disinfecting gang boxes, shared tools and work spaces, and  using daily safety toolbox talks to help prevent spread of the virus.  Many contractors already have implemented daily signed questionnaire protocol on job sites.    Depending on the owner, some are even performing daily temperature checks. “

Toenjes added that a new “PROTECT YOURSELF. PROTECT OTHERS.” telephone hotline was added today at 314-781-2356 extension 1050 for anyone with any concerns regarding the potential safety of a job site to report concerns anonymously. “Labor and management do not want any worker to feel intimidated by a co-worker or supervisor,” added Toenjes.  “Our goal is full transparency on all job sites.”

Labor is playing an important leadership role in collaborating with management to confront COVID-19. “We’re in daily contact with contractor associations and are working closely with them to keep our workers safe and employed,” added Al  Bond, executive secretary/treasurer of the St. Louis-Kansas City Carpenters Regional Council. “I am extremely proud of our workers who are leaving their families at home and showing up for work to help build many critical projects.  It speaks volumes about the caliber of our people and the industry as a whole.”

John Stiffler, executive secretary/treasurer of the St. Louis Building and Construction Trades Council, observed,  “I am very proud of our owners, contractors and workers right now. This is a very challenging situation which requires constant communications, monitoring and tremendous cooperation.   We are fully aware that much of our construction work involves critical infrastructure for our healthcare systems, utilities, municipalities and supply chain companies that are all on the front lines and under severe duress right now.  The community is counting on us to help provide the infrastructure to keep all of these companies and organizations operating during this critical time.”

For additional information, visit www.agcmo.org or contact AGCMO at 314.781.2356 or call Toll-Free at 844-60-MOAGC.

Slow-moving Nature of Pandemic Makes Economic Projections Difficult, Economics Say

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

The prolonged, unprecedented nature of the COVID-19 pandemic makes it difficult to predict and project when and how the U.S. economy will recover.

Scott Colbert, executive vice president, chief economist and director of fixed income for Commerce Trust Company (a division of Commerce Bank), says the unique distinction between the coronavirus pandemic and other disruptive events such as natural disasters lies in the mystery of its longevity.

“The natural disaster is easy to understand from an economics perspective,” said Colbert, “because it comes and goes and then recovery begins. The question with COVID-19 that everyone is trying to figure out is, ‘What period of time will elapse before cases in the U.S. begin to decelerate?’ What we’re experiencing is akin to a very, very slow-moving natural disaster quite unlike any other recession. I do think this is going to be the sharpest recession we’ve ever had in terms of economic impact, but it’s also going to be one of the quickest once we get our arms around it.”

Unlike the most recent recession that began with one small foreclosure and coupled into another and another, compounding upon itself relative to economic impact, Colbert says the true metric to watch to gauge the start of economic recovery will be a decrease in the number of COVID-19 cases identified across the U.S.

“Once we hit the bottom, it’s going to compound quickly but then we’ll be able to begin seeing the economy begin to pick back up,” Colbert said. “Unfortunately, many small businesses won’t be able to survive, particularly the ones that don’t have reserves and liquidity. Larger businesses will make it with the help of furloughing and other measures.”

Enterprise Bank & Trust Regional President Steve Albart concurs, refencing feedback from a recent impromptu survey of the bank construction clients. “The really key concern they cited was about the length of this outbreak and their access to cash,” Albart said. “If it’s only a few weeks, versus if it stretches out 60-90 days or more. Construction companies here will finish up their jobs and then wonder what’s on the other side of this and what 2021 will be like.”

Tim Sullivan, PhD, instructor and director of the Office of Regional Economic Analysis at SIUE, compares the emerging effects of the COVID-19 pandemic to the Great Flood of 1993, when the Mississippi River and tributaries flooded some 30,000 square miles from April to October that year.

“We’re in unchartered territory in a lot of ways,” Sullivan said. “It’s difficult to forecast this because there’s no similar past experience to reference. Even September 11th doesn’t align well with what we’re looking at with COVID-19. Just like the flood, this pandemic keeps coming and coming. We’re looking at something that is going to last for a long time. We know how it’s already affecting things, but the economic data are moving slowly. Most governmental data now being released is from February. Like individuals who’ve been exposed to COVID-19 but won’t show symptoms for some time (up to 14 days), our economy has been exposed to this, but we won’t get an accurate reading for several more weeks. And it might be a year from now before we can truly analyze the data and put a magnitude on the impact.”

Major disruption to the global supply chain will likely be the next impact of the pandemic, according to Sullivan and Ken Simonson, chief economist for the Associated General Contractors of America.

Simonson says contractors and others – especially those in major cities such as Boston, where on March 17 all regular construction activity shut down at the direction of the mayor – are feeling the uncertainty, and that’s bound to impact productivity.

“Contractors and others are beginning to report diverse impacts on building projects and products from the coronavirus outbreak,” Simonton said. “According to a report from a consultant to construction lenders based upon draw inspections (site visits during which the lender verifies that work to support the construction loan dollars has been completed), there are delayed deliveries of drywall, glass, steel, HVAC and electrical equipment from China and curtainwall from Italy.”

Simonson added that according to investment-research firm Jefferies Inc., 70 percent of the global elevator subcomponent market is sourced from factories located within a 60-mile radius around the city of Shanghai.

Jobsite Workarounds Increasing as Construction Firms Practice Social Distancing

Published on in News

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

Social distancing is being practiced everywhere, including on commercial construction job sites in and around St. Louis and the nation.

One such example is the practice of transporting construction workers up the floors of high-rise projects via a buck hoist, a temporary external elevator that transports workers and equipment up the side of a building that’s under construction.

John Wilson is owner of Penn Services LLC, a steel erection, curtainwall and rebar specialty contractor whose current St. Louis projects include the 29-story One Cardinal Way (St. Louis Luxury Apartments) and the 36-story 100 Above the Park luxury residential tower in the Central West End. Wilson says the not-more-than-10-people population density restriction is impacting many job site facets, including how many workers and how many trips it takes in the buck hoist.

“Normally we’re transporting more than that,” Wilson said. “Now, we’re not allowing more than 10 people in a buck hoist at one time. That means more trips and more time. It’s taking a concerted effort on the part of owners and contractors to understand the schedule-related impacts of keeping everyone safe.”

Staggering starting times at job sites in order to reduce the numbers of workers in close proximity is also occurring. Stretch and flex, the routine job site daily warm-up exercise normally performed as a large group, is now being done in increments with smaller groups of 10 or fewer, Wilson said.

“Safety talks that normally involve the entire job site crew are now taking place with just the general foreman and a few others at one time in one location,” he said. “And lunch breaks that were often spent as a group on a job site have evolved into a worker eating lunch in his or her vehicle. Crew sizes are being paired back and that’s a big deal because crew sizes equal production. There’s so much you don’t think of in terms of everyday behavior on a construction job site that now needs to change…even stringent disinfecting of tools and break areas. Safety is our number-one concern.”

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