The number of construction cranes in Seattle shot up to 60 late last year, but if what some commercial builders are seeing continues, that number will start to fall.
“I’m sensing a slowdown,” said George Schuchart, president of Schuchart Construction.
It’s the same story at the Seattle office of West Coast company BNBuilders, where Marketing Director Ross Wildman said his colleagues foresee some commercial markets cooling in the next two years.
Last year, Washington state added 9,900 jobs, a nearly 6 percent gain, according to the Associated General Contractors of America. In and around downtown Seattle, 37 private construction projects were completed in 2015, according to the Downtown Seattle Association, and 39 projects are going up now. Despite all that activity, there are signs that the construction market is decelerating.
Construction employment in the Puget Sound region has been growing by double digits for roughy three years and continues to do so. Those digits are not quite as large anymore, though. The rate of growth ended 2015 flat compared the year before, according to Mortenson, a national firm. The fourth quarter Mortenson Construction Cost Index recommended that clients plan for costs to rise 3.5 to 4.5 percent. Compare that to last summer when Mortenson forecast an increase of up to 6 percent.
Schuchart said a year ago, people were trying to hire him, but his company was so busy he had to turn it away.
“That’s not the case today,” he said. “We are happily looking at any opportunity.”
Also telling is what Shuchart is seeing in the bellwether subcontracting community. In the past, subs said they were so booked that they weren’t even looking at bid opportunities. Now they’re returning calls, Schuchart said.
A slowdown is to be expected after the industry’s phenomenal growth.
“We believe this is true as it relates to Seattle’s commercial construction market, even with several upcoming high-profile projects planned for the city,” said Wildman, who added that BNBuilders is planning for the slowdown by diversifying where and what kinds of projects it does. The company is seeing more opportunities in the public sector.
The count of 60 cranes was tallied in December, and came from Rider Levett Bucknall, an international property and construction consulting firm. That was up 43 percent over May. The count area is between Northgate and Boeing Field and Elliott Bay and Lake Washington. Cranes in the suburbs were not counted, though RLB said it had confirmed there were at least 20 cranes on the Eastside.
–Marc Stiles covers real estate for the Puget Sound Business Journal.
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