The year is young, but 2001 appears to be a promising time for contractors in the Southeast. Brasfield & Gorrie of Birmingham, Alabama, will generate a revenue of over $1 billion of work this year, which is a milestone for the company and a big jump from 2000, according to John Mills, Brasfield & Gorrie's Florida vice president. "We feel very positive for 2002. Ninety percent of our work is repeat bsusiness, so we feel good about the future."

Jim Satler, CEO of Chattanooga, Tennessee-based EMJ Corporation, echoes this optimistic tone for the future. "We see our business being very good, and see 2001 and 2002 as being encouraging, very positive years for us," he says. Other contractors express the same sentiments, which can be evidenced by the amount of activity going on in the region.

In the Pipeline

The Southeast as a whole is generating an increasing amount of development. Brasfield & Gorrie has been building in the Southeast for 30 years. "For the Southeast in general, the future is great," says Mills. "People in the construction and development business can't find a better place to work. It will continue to be a great place to work and live."

Approximately half of Brasfield & Gorrie's projects are office developments; health care accounts for about one-third, and the remainder is found in retail, industrial and sewage treatment. In Orlando, the company is getting started on the second phase of Milenia, a 180,000-square-foot office building. The St. Joe Company is the developer of Milenia, which will be complete in four phases. With a total cost of approximately $150 million, Brasfield & Gorrie is currently working on its largest project to date: three towers planned for BellSouth in the Midtown area of Atlanta. One building recently topped out, and the others will follow.

Batson-Cook Company of West Point, Georgia, is underway with two projects in Charlotte. In March of 2002, the company will complete Hearst Tower, a 46-story, $140 million project for Bank of America. Also in Charlotte, Batson-Cook is building First Union Commons, a $50 million project with an underground parking facility and a condominium development. In a few months the company will begin constructing a $20 million terminal for a cruise line in Tampa.

Hoar Construction, a 60-year-old company based in Birmingham, Alabama, is putting the finishing touches on Dolphin Mall for the Taubman Company in Miami. The 1.6 million-square-foot mall will open in March or April. In Raleigh, Hoar Construction is building Triangle Town Center, a new regional mall for The Richard E. Jacobs Group of Cleveland, Ohio. The five-anchor, two-level project is a $35 million contract that will open in the spring of 2002. "We're also building a new operations center for Regions Bank in Birmingham," says Mike Lanier, vice president of preconstruction services. "The project is a $40 million, 300,000-square-foot build-to-suit office building. Construction is underway, and it will be complete in June of 2002."

Choate Construction Company of Atlanta is developing a number of notable projects in the Southeast. This August, the company will complete Commscope Manufacturing, a 420,000-square-foot wire manufacturer with distribution center in Charlotte, North Carolina. Also included in the project is a 40,000-square-foot Class A office area, 10 loading docks with dock leveler and ESFR sprinkler system. Choate recently completed 510 Glenwood, a 160,000-square-foot mixed-use development in downtown Raleigh, North Carolina. The project will include retail, Class A office, restaurants and high end residential condominiums.

EMJ Corporation is currently working on a two-level mall in Huntsville, Alabama, called Parkway Place. This project involves a two-phase demolition of an existing mall and additions including a Parisian and two parking decks. Parkway place will open next year. The company also has several remodeling projects underway including Georgia Square in Athens, Georgia, and in North and South Carolina, the company is working on expansions of several existing malls. EMJ is also currently constructing a five-story, 150,000-square-foot office building in Chattanooga.

Atlanta-based Holder Construction Company recently broke ground on The Donna and Marvin Schwartz Center for Performing Arts at Emory University in Atlanta. The 87,000-square-foot facility will be complete in July of 2002. The company is also constructing Gainesville Technology Center in Gainesville, Virginia. The 228,000-square-foot data center is being built for America Online and will be complete this October. "This project is significant because it's the third data center we've built for AOL," says Bob Salmon, senior vice president of Holder Construction. The others are located in Dulles and Manassas, Virginia. This December, Holder will complete One West 4th Street, a 461,000-square-foot speculative office building in Winston-Salem, North Carolina, for Magnolia Partners.

Although The Yates Companies is involved in construction projects ranging geographically from the $550 million Borgata Casino & Hotel in Atlantic City to a Procter & Gamble facility in Jackson, Missouri, the vast majority of Yates' service area lies within the Southeast.

Examples of projects by The Yates Companies in the Southeast include Beau Rivage Resort & Casino in Biloxi, Mississippi, a $600 million development; the $240 million Portofino Condominiums in Pensacola, Florida; and the $23 million The Inn on Biltmore Estate in Asheville, North Carolina. Over the course of a 14-year relationship, the company has done over $70 million in construction projects for Jeff Anderson Medical Center in Meridian, Mississippi.

"Yates has completed or is currently handling over $1.25 billion in construction management projects alone and will soon begin the construction management of site development for a newly announced major Southeastern Nissan plant in Canton, Mississippi, " says Jody Tidwell, business development representative for The Yates Companies, Inc.

The Paul Hemmer Companies of Fort Mitchell, Kentucky, the third largest contractor in the Louisville market, is celebrating its 80th anniversary this year. The company's recent accomplishments include a $6 million manufacturing project in Louisville for Prologis called Plastex Manufacturing Facility.

Roy Anderson III, president and CEO of Roy Anderson Corporation in Gulfport, Mississippi, says the company is currently working on stadium expansions for Mississippi State University and the University of Mississippi. Roy Anderson Corp. is also underway with a 100,000-square-foot medical office building at Gulfport Memorial Hospital in Gulfport.

Trends

Meredith Leapley, president of Atlanta-based Leapley Construction, says the Atlanta, Baltimore and Washington, D.C., markets are continuing to see an influx of more high-tech companies, especially businesses that are attracted to the inner harbors in Baltimore. David Mazzuca, general manager of Leapley's Washington, D.C./ Baltimore divisions, says that many older manufacturing type buildings are being converted to non-traditional office space. The design includes leaving the ceilings exposed, showing mechanical systems such as piping and electrical conduits. The existing building's raw material, including brick walls and concrete columns, are also being left exposed and featured as architectural finishes. This combines the industrial feel with the high-tech offices of tomorrow.

Batson-Cook predicts a slow-down in high-tech projects, which the company saw a lot of in 2000. "Last year we had a lot of high-tech and telecommunications industry projects, and I think that will probably slow down now because those companies have been in such a hurry to get their projects on-line," says Edmund Glover, chairman and CEO. Raymond Moody Jr., president and COO, says the industry may see a lot of industrial or light manufacturing work because these types of projects have been out of favor for several years due to lack of demand. "These things go in cycles - eventually manufacturing facilities will get used up, and companies will have to start building more," Moody adds.

Hoar Construction is currently building more build-to-suits, and not any spec office buildings. The company is also getting requests in many markets for office renovation, bringing buildings that were built in the 1980s up to 1990s and 2000s standards rather than building new facilities.

Choate Construction is seeing the growth of the design/build partnering approach with the design professionals to design and construct new facilities. "This trend is not limited to any specific project type, and is occurring in all project types," adds Bill Bland, vice president of sales and marketing for Choate Construction.

A major trend in retail is toward the lifestyle centers where mall tenants are put into an open-air environment, according to Lanier. "There are several developers around the nation that are trying to capitalize on that concept," he says. "These centers are smaller, usually running in the range of 200,000 to 300,000 square feet, whereas regional malls are in excess of 1 million square feet and power centers typically run over 500,000 square feet." EMJ Corporation sees a trend in renovations and expansions of regional malls instead of building new malls.

Hot Markets

One of the hottest markets in the Southeast is Orlando, a city driven by tourism, where several hotels and resorts are being planned. The city's convention center is expanding and the airport is doubling in size. The multifamily market is thriving with a number of apartments and condominiums under construction near downtown. The office market is healthy with a low vacancy rate.

In addition to the Milenia project in Orlando, Brasfield & Gorrie is getting ready to begin Florida Hospital Waterman, a $70 million project in Tavares, an area that is seeing a lot of growth. In the Orlando suburb of Heathrow, the company has several office buildings underway including one each for Colonial Properties Trust and The Pizzuti Companies.

Another market catching the eyes of developers, contractors and businesses is Atlanta. Batson-Cook is staying active in the Atlanta area with the development of Galleria 600, an 18-story office building on which the company recently broke ground. The $35 million project is a joint venture with Childress Klein properties.

In addition to construction on The Donna and Marvin Schwartz Center for Performing Arts at Emory University, Holder Construction is also building the corporate headquarters/ central park for Cox Enterprises Inc. in the perimeter area of Atlanta. The 514,000-square-foot building will be complete in February of 2002 and is notable because Holder also built Cox Enterprises' first headquarters building.

Brasfield & Gorrie is planning to build a 12- to 15-story building for Lincoln Property Company in Atlanta, and is currently underway with an addition to a Methodist church in the Buckhead area of Atlanta. The company is also working on a number of health care developments in Atlanta, as well as in Birmingham. Other Brasfield & Gorrie projects in Birmingham include an office building for Blue Cross and an operations center for AmSouth Bank. Brasfield & Gorrie is also the construction manager for $250 million of work at the University of Alabama at Birmingham. On the industrial side, the company has buildings for Acipco and Navistar underway.

The Raleigh, North Carolina, area appears to be an active location for Brasfield & Gorrie. Projects in the city include a headquarters for John Deere, a hospital in Kinston, an office building for Daniel Realty and a health care job at Wake Medical.

Choate Construction Company services Marietta and Savannah, Georgia, Charlotte and Raleigh, North Carolina, and Columbia, South Carolina. "All of these markets are growing for our company," says Bland. "This is due to a couple of reasons. Our reputation allows us to gain market share and our diversity allows us to be agile and adjust to changing marketing conditions. A higher percentage of revenue is due to the larger Atlanta and Charlotte markets."


©2001 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.