Real Estate & Construction  December 22, 2006

Northern Colorado builders see mixed fortunes for 2007

Depending on what they are building, and where, Northern Colorado’s general contractors look toward 2007 with views ranging from bright optimism to bleak resignation.

Most commercial construction companies are predicting new revenue records, rising employment and full project pipelines.

But homebuilders, having struggled through a slumping residential real estate market, have seen their ranks thinning and their project lists shrinking.

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Business Report regional economist John Green in his quarterly forecast (Pages 24-25) shows the total value of construction in the region sinking to its lowest level since 2000. But with homebuilding accounting for more than 80 percent of that total, the rosier outlook for commercial builders gets lost in the numbers.

“I think this next year will be the best year in the history of the company,´ said David Neenan, founder and CEO of Fort Collins-based Neenan Cos. “We work more and more nationally now, but we’re busy locally, more busy than we have been in the past.”

On the Neenan plate for next year is the two-story, 72,000-square-foot Redstone medical office building on the Harmony Campus of Poudre Valley Health System, a project that will house medical practices and PVHS’ administrative offices. Add to that a $20 million contract for renovation and construction for Estes Park’s school system.

Other builders in the commercial sector also are bullish on the year ahead.

“The effort that we’ve put into bidding and getting work means we’re doing better than we have in many, many years,´ said Matt Walsh, president of Walsh Construction Inc. in Loveland, a specialist in utilities, parks, excavating and erosion control projects. “I started last year thinking that things were going to get really soft, but it’s proving to be just the opposite. When I talk to competitors, they also say they’re just swamped.”

On the “home” front, though, builders have worked their way through a year that saw double-digit percentage drops in the number of single-family home building permits issued in the region.

The number of those permits acquired by builders in Larimer and Weld Counties through October of this year was 3,456, a drop of 34 percent from the 5,250 pulled during the same period of 2005, according to the most recent numbers gathered by the Home Builders Association of Northern Colorado.

Some in the home-building community had given up on Northern Colorado during the past couple of years, relocating to the state’s Western Slope or other Rocky Mountain region hot spots.

But association Executive Director Dottie Weber said membership had remained steady throughout, and that most of the group’s members had weathered the storm and were looking for a better 2007.

“The standing inventory has decreased, and we’re optimistic that that will continue,” she said. “I think most of our members are cautiously optimistic about the year ahead.”

Windsor-based home builder Gary Hoover, who also builds in Fort Collins, Greeley and Johnstown in the higher-end residential category, said his business in 2007 would surpass the current year’s level.

“We’re holding up pretty well,” Hoover said. “We’re a bit less affected by the economy than people in some other niches.”

Depending on what they are building, and where, Northern Colorado’s general contractors look toward 2007 with views ranging from bright optimism to bleak resignation.

Most commercial construction companies are predicting new revenue records, rising employment and full project pipelines.

But homebuilders, having struggled through a slumping residential real estate market, have seen their ranks thinning and their project lists shrinking.

Business Report regional economist John Green in his quarterly forecast (Pages 24-25) shows the total value of construction in the region sinking to its lowest level since 2000. But with homebuilding accounting for more than 80 percent of that total, the rosier outlook…

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