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Local Construction Industry Seeing Increase in Business

     While the construction industry is not in the heyday it was a couple of years back, there is some good news for many workers in the field. According to City of Flagstaff building records, companies have taken out 21 permits to build entire homes between January and April 30. That is more than twice the number issued during the same time period in 2009, which was nine permits. This, however, was down from 2007 and 2008, when 57 and 28 permits were issued, respectively. Remodeling this year is down slightly in the first quarter of 2009. There were 35 residential remodel permits issued in 2009, versus 30 for 2010.

     Don Colegrove, co-owner of Wm. King – Colegrove Construction, says while it may appear as if there is much more business right now, some of that stems from the fact that many construction companies have left Flagstaff due to lack of work, or they have gone out of business. He says that left projects for those companies holding their ground in Flagstaff. While he is somewhat optimistic about the current outlook, he is being realistic. “I don’t think our bad economy is over, and it won’t be for a couple of years,” he said.

     Colegrove says that it is cheaper for many people to buy an existing house now, rather than building. “If you’re thinking about retiring to Flagstaff in the next five years, or want to move back here, that’s my market. We’re building, but we’re doing a lot more remodeling this year than in years past,” he said. Currently, he has one permit for a full home, and he hopes to see at least three more during the rest of the year.

     Local kitchen designer and carpenter Jason Peak, owner of Peak Kitchen Design, says the last year has been challenging. He said that a year and a half ago, he had quite a bit of volume. “Now, I have to pursue work much more because the economy is challenging.” He’s been busy for the last seven months because he helped build booths for The Lumberyard Tap Room, a recently opened restaurant/bar and brewery on South San Francisco Street. He is very pleased with the project. “We took old roof- ing from the existing old lumberyard, pulled out nails, and finished many projects. We turned the old material into usable wood for the bar. The booths are my design and the owners really gave me the reins and let me oversee the project,” he said proudly.

     What keeps Peak going? “It’s about persistence. When projects slow down, it’s reflection time. I take a deeper look at how I do business. In the end, I’m more efficient, so money is viable,” he said.

     Tom Brewster, member of the Northern Arizona Building Association, says he is trying to encourage his fellow real estate and construction industry associates. He, too, believes the worst has passed and recently sent out the following memo to members:  “We have all been affected by this challenging real estate market and our down economy. Now that the worst is behind us, we can be pleased that we have hung in there. We will serve our buyers well by encouraging them to buy quickly so they do not miss the incredible value in our market. Flagstaff is not [over-built] and did not over- build, so our recovery will take place much faster than over-built markets.” Brewster says the median priced Flagstaff home in 2006 sold for $375,000. To- day, he notes, that same home costs about $287,000. He says that unless you really have to move, you probably should hold on to your home for a while.

     In comparison, he also says homes in the Valley have significantly lost their value. A $400,000 home there now sells for ap-proximately $150,000, depending upon its location and amenities.

     John Ambrose, owner of Big Sandy Builders in Flagstaff, says residential remodeling has kept him afloat this year. However, he tackles everything from building new homes, completing historic restorations and tenant improvements for commercial operations.

     “Before, people were worried about doing much remodeling work because they were afraid they wouldn’t be able to get  enough money out of the house if they had to sell it. Now, people are starting to feel more secure,” he said. “Three to four years ago, it was a dream. There wasn’t enough time in the day for work, but last year was difficult. Now, we’re definitely in an upswing.”

      He has several small jobs to keep him busy over the summer, and, like other construction company owners, is hopeful that the increase in work continues into and beyond 2011. FBN

Sidebar  Many construction crews in Flagstaff are keeping busy repairing damage from January’s record snowfall. The unusually heavy, wet storms caused numerous roof collapses in the region.

     Construction crews are working on the JoAnn’s/Bookman’s building on Milton Road. There were some delays in the designing, permitting, and insurance adjustment processes, says Rick Newton. The owner of Newton Contracting, Inc., has been building in Flagstaff for 35 years. He says somewhere between 35 and 45 people will be working on the rebuild, which they hope to have finished by September or October.

     The Jay Lively Memorial Ice Rink is also being rebuilt, with Loven Construction head- ing up that project. Dwayne Stone says between employees, contractors and subcontractors, about 35 people will be working to complete the ice rink construction.

     On May 11, the Flagstaff City Council approved the Guaranteed Maximum Price (GMP) for the building and foundation package to repair the ice rink. That portion of the project costs $738,000. Design services were approved by the Council back in April for an additional $155,563. That is not the total price tag for overall completion, however. Estimates to finish the project will be coming before the Council prior to its summer recess, according to Elizabeth Neumayer, director of community enrichment services for the City of Flagstaff. The funding is coming from a settlement with the city’s insurer, as well as potential donations raised by users and supporters of the rink. FBN

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