Good times, still: contractors will keep busy this year, confounding earlier, gloomier, predictions

New Mexico Business Journal, Jan-Feb, 1999 by Susan Craig

A year ago, many New Mexico construction industry watchers were predicting a decline in activity that would be manifested by 1999. However, with the new year upon us, the picture looks decidedly better than that.

Commercial construction in the southern part of the state "looks very stable for 1999," says Ray Wooten, owner/president of Wooten Construction Company in Las Cruces. Projects include the Las Cruces Public Schools stadium, one new school and the remodeling of three or four others, a $5 million addition to the Dona Ana County detention facility and $25 million worth of work on Memorial Medical Center. Wooten is also building a detention facility for Luna County and several projects are in the pipeline for Alamogordo Public Schools. "There are a lot of smaller, under $1 million, projects in the private sector," Wooten says, "mostly retail, fast food, shopping centers and churches. This is a busy town."

Jeff Merillat, senior vice president and chief estimator for Bradbury Stamm, agrees that things look good. "We're staying constant," he says. "We did $145 million in 1998 and expect similar work this year. A number of decent jobs are bidding in Albuquerque, Las Cruces and Farmington in both the private and public sectors. There are a lot of midrange $2 to $5 million schools jobs. We stay in touch with architects and engineers and see their work remaining steady."

Highway work in Lea, Chaves and Eddy counties is described by Bill Armstrong Jr., president of Armstrong Construction Company, Inc. of Roswell, as a great economic stimulus. A big part of highway department funding is going to US 285 improvements from Carlsbad to Clines Corners. Roswell is booming, says Armstrong, with a great deal of commercial activity such as a Comfort Inn, Holiday Inn Express and other motels, Lotaburger, new professional office developments and construction of a new plant for Complete Packaging Corporation. "Roswell's census will soon reach 50,000 and the city will really blossom," he says. "The mood is very positive. We've been in business since 1922 and plan to be active far into the millennium."

Things are looking good in the Farmington area as well. Jaynes Corporation's projects for the coming year include the San Juan Regional Medical Center expansion and a gaming casino. "There is a thriving market on the low end in Farmington also," says vice president of marketing Norm Gable, "like small owner/user office buildings."

Gerald Martin Construction is on its eleventh design/build jail project in New Mexico. The company is building casinos, a hospital in Grants and schools in Crownpoint and Rio Rancho. "We have more backlog than we've had in our history," says president and chief executive officer Gerald Martin. "Right now we have $80 million under negotiation and we're already thinking about 2000. We're very upbeat, very optimistic."

The Santa Fe market looks strong for 1999, also. Jaynes' $9 million La Posada Hotel job includes renovation and the addition of a spa and administrative office; their $11 million El Castillo Retirement Center job is twofold, an addition to the assisted living and social services area and 22 units of new condominiums. They're also building a new Whole Foods grocery store and are looking at the potential for a new grocery in nearby Pojoaque Pueblo. Klinger Constructors Inc. will remodel Santa Fe's Lensic Theatre into a performing arts center this year, as well as build an addition to and remodel the Wheelwright Museum.

Commercial projects continually arise. Jaynes will work this year on a new Digital project, a $4 million General Technologies circuit board manufacturing plant, the Bob Turner Ford dealership and a new administrative headquarters for the New Mexico Educators Credit Union. Gable says that he anticipates about a five percent decrease in commercial construction compared to a five percent increase in 1998. "Some issues in the marketplace are unsettling things a bit," he says. "As the public sector tries more and more design/build and construction management projects there will be a learning curve for businesses and agencies who haven't used (these types of) delivery services before."

Darrell Calsbeek, Klinger's vice president, is among the optimists, emphasizing that "with the passage of all the bonds across the state, there will be a lot of public work this year." His firm is planning two significant private projects: a 200,000 square-foot manufacturing facility on the West Side and a "pretty good-sized development" in the South Valley of Albuquerque. "If it goes," he says of the South Valley project, "you'll see a lot more development there. Land prices are still reasonable."

Office space construction is predicted to burgeon this year, though not so much in the large developments as in smaller condominium projects. This type of development, says Doug Vaughan of the Vaughan Company, "appeals to a market that hasn't been there for awhile." He projects development of about 200,000 to 250,000 square feet of office condos.