With July 2009 construction spending down more than 10 percent compared to a year ago, only manufacturing and power projects have seen a year-over-year up-tick, according to the Census Bureau.
As a result, the market for residential and commercial subcontractor services has contracted as well. But two companies are refusing to take the recession sitting down. Here are their stories in brief summary.
A tight economy has taken some companies from the marketplace, but has not deterred a few creative and tough-minded commercial construction related firms from forging on.
Jerry Novak, division manager for the Development Services Group at Classic Cos., has seen 14 years of commercial development take root in El Paso County — and isn’t about to leave a rewarding career in a field he enjoys.
But, that said, he has had to dig deep into company marketing and networking reservoirs to win jobs in a highly competitive environment.
A Classic Co. veteran who began his career at University Park during 1995, Novak said his firm, like many others, “is just trying to keep lights and heat on.” He attributes the firm’s success in winning new jobs to long-time relationships with former clients and city building inspectors.
“Our subs also know that if we get the job, they’ll get paid,” he said, adding that earning client respect over time means some projects don’t always have to be “low bid.”
Novak said that recent contracts have helped keep DSG in the black.
“We bid on a lot of non-Classic construction management, general contracting for civil projects as well as on consulting jobs,” he said, adding that he currently employs a team of just three full-time employees, plus several regular subcontractors.
And the recession has not stopped work for Nor’Wood at Interquest, Flintco or on the new $100 million Renaissance Hotel.
“In the past, we (Development Services Group) have done as much as $35 million during one year for Classic,” he said. “Now we’re doing a lot of same stuff, but just a little broader, different market. I’ve done expert witness testimony, and we’re blessed to be able to do sewer, water, paving — and even specialized projects like cement-treated sub-base for road paving.”
But Novak isn’t limiting his vision.
“We’d really like to work on the Airport Business Park, when that RFP comes up,” he said.
Old World Designs owners Chris and Michelle Lobato have created elaborate interior finishes for dozens of million-dollar-plus estates and luxury homes.
Their work has been on display at some of the city’s most elaborate Parade of Homes’ models, but the market for upscale wall finishes and Tuscan features has softened during the past two years.
“As projects have slowed down, we decided to get creative — this time for ourselves,” Chris Lobato said, adding that the company recently invested in a major remodel of its showroom.
The authentic Italian plaster and custom architectural limestone specialists have created an environment where clients who need “to see what it will look like” can view the latest trends in modern Venetian plaster wall finishes.
Lobato said that newer style of re-plastered walls can complement traditional or existing lime plaster walls — a versatile option for those who want to remodel or redecorate and stay within a budget.
The couple’s goal is to “find that client that will let us do a complete ‘Tuscan’ interior makeover,” he said.
Even as custom builder clients have cut back on speculative projects and have lost clients now short on cash, the Lobatos are completing a 5,000-square-foot showroom at 4630 Forge Road and redesign of the company’s Web site, www.owdesigns.com. Their goal: to make prospective customers more aware of Old World’s more diversified products and services.
“We’ve also incorporated a new product — a standard line of limestone fireplace surrounds,” Lobato said, adding that his showroom now includes the “the Milano” prototype. “We want anyone who has a home to feel welcome to something beautiful.”
Becky Hurley covers real estate for the Colorado Springs Business Journal.