www.ncconstructionnews.com WINTER 2018, Volume 13 No.1 AGC survey indicates NC market optimism, tempered by challenges in recruiting skilled workers
In this issue 4 Offsite construction – Here to stay 5 The Katerra and building technology story 8 Construction: Top 10 List of Provisions Included in 2017 Tax Reform 12 14 PROJECTS AND OPPORTUNITIES ASSOCIATION NEWS Publisher’s Viewpoint Mark Buckshon, publisher If there are two critical themes underly- ing North Carolina’s construction industry, they would be labor supply/skills and tech- nology. This issue of North Carolina Construction News covers both themes, both by report- ing on Associated General Contractors (AGC) of America data outlining the scale of labor supply challenges, and our introduc- tory report about Katerra, which aims to combine high-technology systems and fac- tory-built construction to revolutionize the industry. Katerra, I realize, hasn’t made much of an impact in North Carolina yet. Its first projects are largely in the western states, reflecting its California tech/capital orienta- tion. But its potential impact on the industry cannot be overstated. While factory-built construction has been around for decades, the difference here is the systematization of design, technology and production effi- ciency to streamline the process to an in- credible degree and change the traditional industry geographical and skills/qualifica- tions silos. While it is too early to say Katerra will be to construction like Google was to the advertising/news business, I think it is worthy of close observation and anyone in the trades and supply chain should observe/understand how it operates. You can share your observations, news releases and story ideas by sharing them via email to buckshon@ncconstruction- news.com. North Carolina Construction News (NCCN) is distributed throughout the Carolinas construction industry. For information contact: Chase, Phone: 1-888-627-8717 ext 212 chase@ncconstructionnews.com www.ncconstructionnews.com. ISSN 1940-3682. 2 — Winter 2018 — The North Carolina Construction News NCCN is circulated on a controlled circulation list to qualified readers including members of most major construction asso- ciations in the Carolinas. The magazine is supplemented by a weekly e-letter which reaches more than 4,000 industry leaders each week.
AGC survey indicates NC market optimism, tempered by challenges in recruiting skilled workers North Carolina Construction News staff writer North Carolina contractors are feeling modestly opti- mistic about their prospects for 2018, but many are struggling to recruit enough skilled workers, according to a report from the Associated General Contractors of America (AGGA). “Expecting Growth to Continue: The 2018 Construc- tion Industry Hiring and Business Outlook,” shows that 75 percent of construction firms nationwide plan to ex- pand their payrolls in 2018, based on the feeling that economic conditions will remain strong as tax rates and regulatory burdens fall. Nationwide, “construction firms appear to be very optimistic about 2018 as they expect demand for all types of construction services to continue to expand,” AGCA CEO Stephen E. Sandherr, the association’s CEO, said in a statement. “This optimism is likely based on current economic conditions, an increasingly business- friendly regulatory environment and expectations that the Trump administration will boost infrastructure in- vestments.” The survey indicates that in North Carolina, contrac- tors overall anticipate a relatively stable business envi- ronment this year, with 48 percent expecting growth, eight percent expecting a decline, and 44 percent antici- pating things will be about the same as the previous year. The most optimistic sector for growth is power, while there is an expectation of a decline in the multi- family residential sector. Significantly, the majority of contractors anticipate in- creasing their headcount; with 33 percent expecting to add one to 10 employees, 22 percent increasing by 11- 25 and 19 percent anticipating increasing headcount by more than 25. The majority of contractors (74 percent) say they are having a hard time filling both salaried and craft worker positions, while 74 percent expect the trend to continue through the year. The report shows that 63 percent of the construction firms that were polled increased their base pay in 2017 to help recruit and retain workers, while 33 percent in- creased contributions/improved employee benefits and 26 percent provided incentives or bonuses. The North Carolina Construction News — Winter 2018 — 3
GUEST COLUMN Offsite construction – Here to stay By Paul E. Davis Special to North Carolina Construction News “Modular construction” no longer evokes only mem- ories of those boxy “temporary” classrooms used by over capacity public school systems. Modular is but one of three terms commonly used to describe the construction of building components not built on site. “Offsite,” “prefabricated,” and “modular” are often used interchangeably. Modular construction is increasingly a part of new construction. The construction industry’s use of offsite construction is not new; it has been part of the indus- try for many years. For example, window and door as- semblies are prefabricated building components that have long been a part of the industry. What has changed is a broader use and greater ac- ceptance of offsite construction as a construction process. Increasingly, we are seeing a greater use of larger, more complex components built offsite such as MEP (mechanical, electrical and plumbing) compo- nents that are delivered to the project site already wired and fitted with ductwork and piping. Offsite con- struction runs the gamut from a window assembly to the construction of a complete room such as a dormitory room or a hotel bathroom. Last fall, developers in Winston-Salem an- nounced they would be erecting a Hyatt Place hotel using a modular stacked method. Devel- opers of this six-story, 56,000 sq. ft. hotel stated that use of modular construction would reduce construction time from 15 to seven months. Similarly, Marriott hotels recently announced that it plans to use some form of modular con- struction on 13 percent of its new hotels. Its use of modular construction will include prefab- ricated bathrooms and complete modular gue- strooms. Industry experts point to the labor shortage the industry has faced in recent years as a sig- nificant factor driving the greater use of offsite construction. Industry econo- mists report that contractors can expect to continue to see signifi- cant labor shortages for years to come. The use of prefabrication 4 — Winter 2018 — The North Carolina Construction News and modular construction is said to have a direct, measurable effect of shortening project schedules and, therefore man hours and costs. Proponents also note that there is a different type of “green” attribute to offsite construction. Building a component in a factory should reduce waste as the workers perform repetitive tasks in a controlled envi- ronment. The use of climate-controlled facilities to build components may also reduce the potential for high levels of moisture being trapped in new construc- tion compared with building the same components on site. Offsite construction is not suitable for all types of vertical construction. It is best suited for projects with repetitive and redundant features, such as student housing, education buildings, hospital rooms, and ho- tels. Mixed-use and office space is not ideal for offsite or prefabrication as building occupants will often re- quire space reconfigurations, which can be problem- atic with load bearing walls. This industry is known for its resistance to change. Construction techniques and practices are slow to evolve. Certainly, once something is tried and proven to work, others will follow, copy, and improve. But who wants to go first? There is a mistaken belief that taking advan- tage of modular construction or prefabrication as a construction tool is an all or nothing proposi- tion. On the contrary, most projects, except per- haps for those modular temporary classrooms, can benefit in many ways from an increased use of either prefabrication or modular construction without a sacrifice in the elegance of design or the quality of construction. Paul E. Davis is a partner in the Raleigh office of Conner Gwyn Schenck PLLC. He regularly rep- resents public and private owners, developers, contractors, and construction managers. Paul, along with the other lawyers at Conner Gwyn Schenck PLLC, are authors of N ORTH C AROLINA C ON - STRUCTION L AW , a treatise published by Thomson Reuters. Paul’s full bi- ography can be viewed at www.cgspllc.com.
The Katerra and building technology story North Carolina Construction News staff writer Is a technological/business model revolution about to overtake North Carolina’s construction industry – yet we hardly see it coming? If building materials consultant Mark Mitchell’s per- ception is correct, Katerra, a new high-tech start-up combining technology, design, distribution and modu- lar (factory) construction will soon reshape the industry in manners similar to the way Uber tore apart the local taxi industry and Craigslist decimated local newspa- pers. “In its own way, I predict this will have as much ef- fect on residential and commercial new construction,” writes Mitchell, based in Boulder, CO. “Lack of effi- ciency will make the way (building products) manufac- turers do business now irrelevant in new construction. They may be relegated to competing with each other in the repair/remodel, big box and smaller high-end custom construction.” Of course modular building has been around for decades, serving several niche markets in North Car- olina and elsewhere. The difference this time is the in- tegration on a multinational level between technology, design, manufacturing and delivery – and massive capi- tal funding for the new enterprises. Currently leading the pack, Katerra’s company head- quarters are the Sand Hill Rd. tech venture capitalist epicenter in Menlo Park, CA, with a construction office in Scottsdale, AZ and design office in Seattle. It also is building a Cross Laminated Timber (CLT) factory in Spokane, WA. The start-up purportedly has a valuation of about $2.5 billion, according to PitchBook Data. Early in- vestors have raised as much as $244 million – and pub- lished reports indicate the company is preparing to raise another $200 million this year, at least. Currently the organization, founded in 2015, has projects underway in California, Oregon, Washington, Idaho and Nevada, but there is little stopping it from The North Carolina Construction News — Winter 2018 — 5
expanding its scope and geographical range. Katerra says it has about 1,000 employees in four countries and already is among the top 25 general contractors in the U.S. “Katerra is bringing fresh minds and tools to the world of architecture and construction,” the company says in its corporate outline. “We are applying systems approaches to remove unnecessary time and costs from building development, design, and construction.” “With the latest technology at our fingertips, effi- ciency no longer has to come at the expense of quality or sustainability. Led by a team that combines expert- ise from the most groundbreaking technology, design, manufacturing, and construction companies, we are transforming how buildings and spaces come to life.” “The way we think about a construction site is to turn it into an assembly site and make it a factory like we used to do at Flextronics,” CEO Michael Marks said in a published report. (Marks led Flextronics in the 1990s and early 2000s.) “The thing that is so messed up in the real estate business is how many different parties are involved in getting anything done.” In his weekly newsletter, Mitchell – who provides marketing consultancy services to a diversity of build- ing product manufacturers – says the coming construc- tion technology/manufacturing revolution envisaged by Katerra will take place when the company approaches “builders and developers with an offer they can’t re- fuse – to design and build for them at a lower cost with higher quality, and to do it faster.” “What if the builder could eliminate the need for de- signers, estimators, installation labor, and materials sourcing,” he writes. “Just like Nike or Apple, builders will become brands who don’t need to actually make anything themselves.” Mitchell suggests the integrated, technology-based modular construction process will uproot the tradi- tional new construction market with these changes: 6 — Winter 2018 — The North Carolina Construction News • The builder, Katerra, will be ordering truckloads of products to be delivered to their factories. No more need for distributors, dealers or contractors; • Labor shortages and installation errors will be a thing of the past; • The builder will be taken out of the equation when it comes to product sourcing. There will be no more rebates. Katerra will want the best bottom line price, period; and • Katerra will be able to look at making really big changes in how homes and buildings are built. Be- cause of their scale and process, it will be easy for Katerra to consider big changes like changing to metal framing in residential construction. Mitchell predicts Katerra’s industry changes will happen fast. “And just like the taxi industry, the Na- tional Association of Home Builders (NAHB) and some builders may try to push back with legislation that may slow but won’t stop this change,” he writes. Writing to building products manufactures, Mitchell says: “In two to three years, or sooner, you will feel the effects of this change as your larger builders will no longer be buying from you. It will also happen to you in the commercial area.”
Looking for a solid legal foundation? Our construction attorneys can help you reach new heights. Mitchell also predicts there will be some high level competition to Katerra, just as Lyft competes with Uber. “Look for people like Elon Musk or others to cre- ate new companies designed to compete with Katerra.” Katerra and other high-level integrated technol- ogy/modular builders will gain traction in part because of an increasing number of successful completed proj- ects, coupled with pressures on labor supply caused in part by increasing immigration restrictions in the U.S., says another consultant. “In 2018, I believe we will see a perfect storm of factors – an aging global workforce, a lack of new en- trants and growing restrictions on free movement of labor - begin to decisively accelerate the uptake of construction integrated manufacturing,” writes Kenny Ingram, global industry director at IFS, a software de- veloper. “Government, regulatory bodies and the industry alike will start to realize that, while getting more peo- ple into the industry is important, as well as trying to increase the number of people onsite, the most strate- gic solution would be to fundamentally change the way we build in the first place.” “New technology is making it easier to work prof- itably on a global level as well,” he writes. “With 3D printing, for example, costs for both material and long transports are decreasing substantially. Using tech- nologies such as these, the partnerships will focus more on global competence exchange rather than long-haul transports.” “All three of these trends are woven tight together. Contractors need to work hard to ensure that the right competences are secured while considering how to implement new business models for modular build- ings and construction integrated manufacturing — all this in a construction industry that is becoming more global and offers new forms of partnerships. The play- ers who master this balancing act will be the winners in 2018.” Click here for a related video. A U.S. News and Best Lawyers ® National Tier 1 Ranking Law Firm for Construction Litigation for three consecutive years (“Best Law Firms,” 2015 – 2017). Companies large and small meet their challenges at the job site, at the deal table, in court and in the halls of government with Nexsen Pruet. More than 190 lawyers in Charlotte, Greensboro and Raleigh, NC, and Charleston, Columbia, Greenville, Hilton Head and Myrtle Beach, SC. nexsenpruet.com The North Carolina Construction News — Winter 2018 — 7
CONSTRUCTION TOP 10 LIST of Provisions Included in 2017 Tax Reform By Sarah Windham Special to North Carolina Construction News The last major tax reform legisla- tion was passed in 1986. Since then, the tax rules – Internal Rev- enue Code amendments, regula- tions, procedural guidance and court case law – have morphed into a complex system for tax paying contractors. The recently signed bill is a significant modification to the existing system and the consensus is clear. Most businesses expect their income tax expense to de- crease, including contractors. Though there are many moving 8 — Winter 2018 — The North Carolina Construction News parts in the new tax law with the potential to affect businesses and individuals to varying degrees, this article highlights what we consider 10 of the most significant changes for construction companies. 1. Individual tax rates and corporate tax rates The final bill settled on keeping the same number of individual tax brackets as in current existence: seven. However, the new tax law re- duces individual income tax rates to 10, 12, 22, 24, 32, 35 and 37 per- cent, and raises the income levels subject to each tax rate. These rates apply to tax years beginning after Dec. 31, 2017 and beginning before Jan. 1, 2026, unless subsequently extended by future legislation. On the corporate side, the current grad- uated tax rate was removed in favor of a flat 21 percent rate for tax years beginning after Dec. 31, 2017. 2. Increase in Small Contractor Exemption Amount Under prior tax law, contractors whose average annual gross re- ceipts were less than $10 million were exempt from using the per- centage of completion (PCM)
method of accounting for income tax purposes. Under the new bill, the average annual gross receipts requirement has been increased to $25 million. This is effective for any contracts entered into after Dec. 31, 2017. It is important to note that for commercial contracts, percent- age of completion is still required to be used for purposes of the alterna- tive minimum tax (AMT). While under the final bill AMT was repealed for businesses taxed as a ‘C’ corporation, it was not re- pealed for individuals. However, it did provide for increased individual exemptions. The 2018 exemption amount was increased from $86,200 to $109,400 and the phase out threshold increased from $164,100 to $1 million for married filing joint taxpayers. The exemption amount for single taxpayers in- creased from $55,400 to $70,300 and the phase out threshold in- creased from $123,500 to $500,000. Contractors, other than ‘C’ cor- porations, considering making the switch to a method other than PCM for 2018, will want to consider the potential for AMT impacts before making a final decision. If a contrac- tor switches to a method other than PCM for 2018, any contracts en- tered into before Dec. 31, 2017, would be taxed under the prior method of accounting even if the contract continued into 2018. 25 percent of W-2 wages, plus 2.5 percent of the unadjusted basis of all qualified property. This deduction applies for tax years beginning after Dec. 31, 2017 and beginning before Jan. 1, 2026. 4. Standard deduction, charitable contributions and the Pease Limitation Personal exemptions are re- moved in the bill in favor of a higher standard deduction effective for tax years beginning after Dec. 31, 2017 and beginning before Jan. 1, 2026. The new standard deduction amounts will be $24,000 for married filing joint or surviving spouse, $18,000 for an unmarried individual with at least one qualifying child, and $12,000 for single filers. Charitable contributions – which, under old law, were limited to 50 percent of a taxpayer’s AGI – will now be limited to 60 percent of AGI effective for tax years beginning after Dec. 31, 2017 and beginning before Jan. 1, 2026. The bill will also repeal the current 80 percent deduction for certain contributions to universities made in connection with athletic seating rights. The overall limitation on itemized deductions referred to as the Pease Limitation will be suspended for tax years beginning after Dec. 31, 2017 and beginning before Jan. 1, 2026. This limitation essentially reduced the value of certain itemized deduc- tions for high income taxpayers by three percent for every dollar over the taxable income limit. The phaseout was capped at 80 percent of the total value of itemized deduc- tions. 2017-2018 edition 3. Pass-through income deduction Aligning with a reduced corpo- rate tax rate, Congress provided pass-through entities with a deduc- tion for a percentage of their tax- able income. Starting in 2018, a deduction will be allowed for tax- payers who have qualified business income (QBI) from a partnership, ‘S’ corporation, or sole proprietorship, subject to limitations. The 20 per- cent deduction is limited to the lesser of (1) 20 percent of their pass-through business income or (2) the greater of (a) 50 percent of the W-2 wages paid in the qualified trade or business, or (b) the sum of The North Carolina Construction News — Winter 2018 — 9
5. State and local tax deduction 6. Depreciation changes A very impactful change included in the final bill is the limiting of the deduction available to individuals for sales, income, or property taxes paid to state or local tax authority to $10,000 ($5,000 for a married tax- payer filing a separate return) for tax years beginning after Dec. 31, 2017 and beginning before Jan. 1, 2026. This limitation does not apply to property taxes paid or accrued in connection with carrying on a trade or business. The limitation does not apply to state and local taxes of businesses taxed as a ‘C’ corporation. The bill specifically includes a provision that disallows a 2017 de- duction for prepaying state or local income tax for a taxable year begin- ning after Dec. 31, 2017. Any amount paid in a taxable year begin- ning before Jan. 1, 2018 shall be treated as being paid on the last day of the tax year for which the tax ap- plies. The bill includes a provision that allows for 100 percent expensing through bonus depreciation of cer- tain business assets placed in serv- ice after Sept. 27, 2017 through Dec. 31, 2022. The amount of bonus depreciation allowed is then phased-down over four years as fol- lows starting: 80 percent in 2023, 60 percent in 2024, 40 percent in 2025, and 20 percent in 2026. The requirement that the property be new was also removed and re- placed with a requirement that the property simply be new to the tax- payer – an impactful distinction. The bill includes some additional changes that have the potential to benefit many contractors. For exam- ple, Section 179 expensing limits will be increased to $1 million with the phase-out threshold being in- creased to $2.5 million with both thresholds subject to inflation in- creases for tax years beginning after Dec. 31, 2017. Furthermore, the definition of qualified property is expanded to include improvements to non-residential real property in- cluding roofs, heating, ventilation, and air-conditioning property, fire protection and alarm systems, and security systems if placed in service after the date such real property was first placed in service. 7. Interest expense deduction limitation The bill also includes a provision that limits the deduction for interest expense incurred by a trade or busi- ness to the sum of business inter- est income, floor plan financing interest and 30 percent of the ad- justed taxable income of a taxpayer for the year. For tax years beginning before Jan. 1, 2022, adjusted tax- able income will be computed with- out regard to depreciation, amortization, or depletion expense. Adjusted taxable income is other- wise generally defined as a tax- payer’s taxable income without regard to any income, gain, deduc- tion or loss not properly allocable to the trade or business, any business Check out our construction equipment at www. jamesriversequipment .com 10 — Winter 2018 — The North Carolina Construction News
interest expense or business interest income and any net operating loss. Real property trades or businesses, including rental property activities that qualify as a trade or business, may elect out of the interest deduction limitation if that trade or business uses the alternative depreciation sys- tem, which generally results in longer, slower deprecia- tion deductions. Any interest not deductible for any tax year shall be carried forward indefinitely and treated as business interest paid or accrued in the succeeding tax year. An exemption to these rules applies to taxpayers with average annual gross receipts for the prior three tax years of less than $25 million. 8. Domestic Production Activities Deduction (DPAD) repealed For tax years beginning after Dec. 31, 2017, DPAD (also known as Section 199) is repealed. DPAD was a de- duction allowed under pre-act rules that allowed contrac- tors performing new construction or substantial renovation in the U.S. to claim a deduction of up to nine percent of taxable income (with certain limitations). 9. Like-kind exchanges Under the new law, like-kind exchanges are limited to only exchanges involving real property that is not prima- rily held for sale. This new limitation applies to ex- changes completed after Dec. 31, 2017; however, a transition rule allows like-kind exchange treatment for any property disposed of in an exchange on or before Dec. 31, 2017, or for any property received by a taxpayer in an exchange on or before the same date. This excep- tion generally allows for like-kind exchanges already in process to still take advantage of the current like-kind ex- change rules. This may have an impact to contractors who have typically exchanged equipment and machinery in the past. 10. Estate and gift taxes and generation-skipping transfer tax The law doubles the base estate and gift tax unified credit exclusion to $10 million, effective for decedents dying and gifts made after 2017 and before 2026. The bill also increases the GST exemption to $10 million. This ef- fectively increases the inflation-adjusted exclusion and exemption amounts to $11.2 million ($22.4 million for a married couple) for 2018. These increased exclusion and exemption amounts will provide planning opportunities for contractors look- ing to transition their estate in the coming years. In conclusion . . . As there are far more elements to the tax reform than covered here, contractors may consider familiarizing themselves with the finer details of the changes. Loop- ing in your trusted advisor and CPA is strongly recom- mended to ensure you are prepared for the oncoming effects – both favorable and complex – to your financial posture. Sarah Windham is a partner at the Dixon Hughes Goodman LLP (DHG) office in Charleston, SC. She can be reached at (843) 727-3708 or by email at sarah.windham@dhgllp.com. Al Windle • 704.945.2176 • awindle@slk-law.com The North Carolina Construction News — Winter 2018 — 11
PROJECTS AND OPPORTUNITIES Asheville’s Overlook Village to be redeveloped after $25.5M GBT Realty Corp. acquisition Overlook Village, an Asheville shopping center that houses HomeGoods, T.J. Maxx and Ross Dress, will be redeveloped after being acquired by GBT Realty Corp. for $25.5 million, the company said in a news release. The company plans to finalize re- development plans of the site by the spring, The Citizen Times re- ported. The shopping center opened in 1989, with several notable tenants including T.J. Maxx, Phar-Mor Drugs store, Circuit City and several smaller specialty shops. While Overlook Village has lost several tenants in recent years, GBT said it is currently 80 percent leased.” High Point sells $35 million in taxable bonds to finance Bluefish minor league baseball team stadium The Brentwood, TN-based real estate development company, said Overlook, located off South Tunnel Rd. near the Asheville Mall, is its third acquisition in the past six months under its Capital Holdings division. It was purchased Dec. 20 from KIMCO Realty, represented by Berkeley Capital Advisors. GBT said it launched its Capital Holdings division to pursue “value- add and core-plus” commercial op- portunities. Scott Porter, the division’s managing director, called the Overlook shopping center an “ideal acquisition opportunity,” sin- gling out its “locational drivers, bar- riers to entry and upside potential with the lease-up of the existing vacancies.” “The vacant anchor space for- merly occupied by HHGregg fronts South Tunnel Road and is well-posi- tioned due to its accessibility via two traffic signals and its adjacency to the Whole Foods center,” Porter said in a news release. “The avail- able space is a top option for ten- ants entering the market as well as those seeking to improve their ex- isting storefront due to the mar- ket’s limited inventory of traditional junior box storefronts.” 12 — Winter 2018 — The North Carolina Construction News High Point is furnishing itself a new economic development gam- bit – a stadium, Bloomberg News reports. The furniture manufacturing community 75 miles north of Char- lotte is selling $35 million in taxable bonds to finance a 5,000-seat sta- dium for the Bluefish minor league baseball team. The stadium is part of the city’s plan to revitalize its downtown with restaurants, shops and new apart- ments, the news service reports. The project comes as the manu- facturing sector in the city, which calls itself the Home Furnishings Capital of the World, recovers from the recession. City manager Greg Demko said the project will help fight urban blight in an area where the commercial tax base has de- clined by an estimated $250 million since 2008, an 11 percent drop, ac- cording to city estimates. “The construction of a stadium is like an anchor for the revitaliza- tion and development of a down- town,” Demko was quoted as saying. “What we’re really inter- ested in is not necessarily the sta- dium but the development around it.” A private fundraising push led by High Point University president Nido Qubein raised $50 million to help buy the team and to support the creation of projects near the stadium, such as a children’s mu- seum and an events center, the published report says. Spirit AeroSystems to spend $50 million to expand Kinston facilities To meet the increasing demands of its customers, Spirit AeroSys- tems has announced a $55.7 mil- lion investment for the expansion of its operations at Global TransPark in North Kinston. The aerospace manufacturer’s announcement only stated that funds will be spent over a five-year period. The investment is expected to improve the regional economy by generating more job opportuni- ties. Construction details were not disclosed. Governor Roy Cooper expressed his support for the project in De- cember. “We are excited to see Spirit AeroSystems strengthen its invest- ment in North Carolina with this major expansion. This sends a clear signal that eastern North Carolina can compete for business and is ready for new opportunities that bring jobs to this region,” he said.
PROJECTS AND OPPORTUNITIES Global Transpark executive direc- tor Allen Thomas also gave his ap- proval, saying: “This expansion further reinforces North Carolina’s position as one of the top four states in aerospace manufacturing in the nation and sends a message to the high quality of skilled labor in eastern North Carolina.” Since opening its operations at Global TransPark in 2010, Spirit AeroSystems has already invested more than $206 million for multiple facilities, including a 500,000-sq ft. plant and a 33,000-sq ft. training center. Two years ago, KWK Architects designed the university’s unique Levine Hall, which combines an honors program within a traditional residence hall. Green Globes elements, and its ex- terior design will reflect the existing architectural style on campus. A two-phase demolition and construction schedule for the entire site is planned over a two year pe- riod, with construction of the new residence hall expected to begin in spring 2019. Best People. Best Practices. ® KWK Architects selected as design architect for UNC Residence Hall Phase XVI KWK Architects, based in Web- ster Groves, MO, has been se- lected the design architect for a new residence hall at the University of North Carolina – Charlotte to re- place existing Sanford and Moore Halls. Charlotte, NC-based Jenkins Peer Architects is the architect-of- record on the project. Sanford Hall (opened in 1969) and Moore Hall (opened in 1970), which each house 500 students and have 12 floors, will be demol- ished as part of the project. The new, proposed residence hall (cur- rently referred to as Residence Hall Phase XVI) will feature 650 to 800 beds with double rooms supported by community bathrooms, lounges and laundry rooms on each floor, common areas and multipurpose rooms. The new complex will also be designed and built using LEED or 2018 CONNECTIONS CONFERENCE Wednesday, April 11, 2018 - 9 am to 4 pm Greensboro Coliseum, Greensboro, NC Pre-register by Friday, March 30     to save on admission and be entered into a drawing for prizes which include: A Grizzly Cooler donated by Federated Insurance A Milwaukee Tool Kit An overnight stay at the Holiday Inn Resort, Wrightsville Beach One Couple’s Registra on to the PHCC of NC 2018 Summer Conven on . . . And More! To register, click HERE Details & Vendor Registra on available at www.phccnc.com ADMISSION $5.00 in advance, $7.50 at the door Admission proceeds bene t the PHCC of NC Auxiliary Scholarship Fund The North Carolina Construction News — Winter 2018 — 13
ASSOCIATION NEWS J. Paul Mashburn becomes new CAGC chair J. Paul Mashburn of Mashburn Construction Co. Inc., based in Columbia, SC, has taken office as the 2018 Carolinas Associ- ated General Contrac- tors (CAGC) chair. Mashburn graduated from Clem- son University in 1991 with a Bach- elor of Science in Building Science and Management. He joined Mash- burn Construction after graduation and in 2010 he was named presi- dent and chief operating officer, the company says on its website. “One of Paul’s greatest strengths is his unique ability to view the job from multiple perspectives including the field employees, superintendent, designer, and owner.” “As president of Mashburn Con- struction, Paul has made sure the company continues to help fund various department projects, hires the department’s interns and per- manent employees and is a corpo- rate partner.” Other elected CAGC directors in- clude: • Chair-elect: Ron Brown, State Utility Contractors, Inc. • Treasurer: Casey Schwager, Sloan Construction Company • Vice-chair: Susan Lewis, Beam Construction Co., Inc. • Immediate past chair: Marty McKee, King Asphalt, Inc. • President and CEO: Dave Simp- son, CAE • Carolinas AGC Building Division chair: Charlie Wilson, C. T. Wil- son Construction Company • Highway-Heavy Division chair: T. Lee Barrack, Jr., The Lane Con- struction Corporation • Utility Division chair: Shane Her- bert, Buckeye Bridge, LLC • Specialty Advisory Council chair: Barry Wells, SimplexGrinnell • Supplier/Service Advisory Coun- cil chair: Tyler Turnbull, Catalyst Surety Partners, LLC • Directors at large: Mark Johnnie, 14 — Winter 2018 — The North Carolina Construction News Balfour Beatty; Greg Hughes, Contract Construction, Inc.; and Carlos Norris, Crowder Construc- tion Company • Appointed directors: Kristen Har- wood, Rodgers; and Melvin Williams, S&ME, Inc. Doug Carlson leaves ABC Carolinas for Rocky Mountains Doug Carlson, who has been the president and CEO of the Associated Builders and Contrac- tors (ABC) of the Car- olinas for the past 14 years, has moved to accept a new role at ABC’s Rocky Mountain Chapter, search commit- tee chair Brian Gallagher from O’Neal, Inc. has reported. Search committee members in- clude chapter chair Casie Sears Kerr, Sears Contract; Tom Headlee, Watson Electric, Dave Knudson, Choate Construction; and Art Odom, David Allen Company. “The search committee is work- ing closely with ABC National on the search. In addition, the ABC of the Carolinas’ board of directors is working closely with staff to man- age activities and to ensure a smooth transition,” Gallagher re- ported in a note relayed by Casie Sears Kerr. As Carlson moves west, he also has taken on the role as chapter president’s liaison to the national ABC organization’s executive com- mittee. “In this role, Carlson serves as chair of the council’s executive committee and is responsible for the coordination of communications between ABC’s 70 chapters and the national organization. He also pro- motes professional development for the chapter presidents while com- municating their concerns, ideas and opinions to the ABC executive committee,” an ABC national biog- raphical document says. 2018 PHCCNC president aims to advance apprenticeship program, continue building strategic plan framework for association Cobe LeMunyan of SPC Mechanical Cor- poration in Winston- Salem has taken the helm as 2018 Plumb- ing Heating Cooling Contractors of North Carolina (PHC- CNC) president. “I would like to start out by thanking Tommy Barbour for setting the bar going into 2018,” he wrote in a note to members. “With that in mind we will continue assisting the local chapters and newly formed chapters across the state to com- municate and in sharing ideas and practices to become the best choice for our customers. He writes that “two items of con- tinued focus” will be: • Advancing the apprenticeship program for heating and air con- ditioning and plumbing trades; and • Continuing the framework for a strategic plan to meet the objec- tives of the association. PHCCNC’s 2018 executive and directors include: • Rob McClintock, McClintock Heating & Cooling, Matthews (vice-president); • Rick Whitaker, Brown Brothers Plumbing and Heating, Durham (treasurer); and • Jennifer Warren, Warren-Hay Mechanical, Hillsboro. Associate directors include: Jason Brantley, Weeks-Williams-De- Vore, Matthews; and Brooks Jester, Murray Supply, Charlotte. The PHCC National Zone 2A Di- rector is Joel Long, GSM Services, Gastonia.
CAGC leads at first statewide diversity construction summit Betsy Bailey, the Carolinas Associated General Contractors (CAGC) government relations and building division director, shared observations as the keynote speaker for the first statewide diver- sity construction opportunities summit in Raleigh in early January. The summit welcomed more than 200 participants with the goal of connecting diverse-owned con- struction firms with billions of dol- lars in construction contract opportunities, CAGC reported in its weekly news brief. Bailey delivered the Construction Spending, Labor and Materials Out- look prepared by AGC of America’s economist Ken Simonson, which showed strong construction growth for the nation and for the state. NC’s growth, however, is ham- pered by the state’s acute construc- tion labor shortage which Bailey highlighted throughout her presen- tation. “NC is one of nine states that is seeing construction employment numbers decreasing,” Bailey said. “But we are also one of the fastest growing states in the country. This presents a unique challenge for NC’s construction industry.” Bailey said that CAGC and its members recognize the labor chal- lenge and are aggressively working with workforce development and education partners to recruit work- ers to the industry. A construction industry branding campaign is one of the significant recruitment proj- ects that should be underway by next month. CAGC secured funding for this project in the state budget last year and is partnering with the NC Com- munity College System and North Carolina Department of Transporta- tion (NCDOT) to conduct the cam- paign. The rest of the day and a half long summit featured networking opportunities with representatives from government agencies and pri- vate contractors through a trade show and focused workshops that helped participants learn about projects in the pipeline and how to find and bid on these projects. Workshops with NCDOT, State Con- struction, universities and commu- nity colleges, local government and private developers and owners pro- vided valuable one-on-one interac- tion with construction buyers and decision-makers. ABC of the Carolinas announces 2018 Board of Directors Associated Builders and Contrac- tors (ABC) of the Carolinas has an- nounced its 2018 Board of Directors. Five board members are based in South Carolina with the re- mainder located in North Carolina. Casie Sears Kerr of Raleigh- based specialty contractor Sears Contract, Inc., has been elected 2018 chairman, representing more than 1,800 member firms in North and South Carolina. Sears-Kerr is excited to start im- plementing the association’s newly developed strategic plan. “ABC is dedicated to being the ‘Construction Association of Choice’ in the Carolinas by bringing value to each of our members through workforce development training, health and safety offerings, membership growth and engage- ment, chapter development and po- litical advocacy,” she said in a statement. “Through all of the aforementioned goals, ABC pro- motes the merit shop construction philosophy — encouraging open competition and a free enterprise approach.” Directors include: • Casie Sears Kerr, Sears Contract. Inc. – Raleigh, NC, chairman • Dave Knudson, Choate Construc- tion Company – Raleigh, NC, vice-chairman • Tom Headlee, Watson Electrical Construction – Wilson, NC, sec- retary/treasurer • Brian Gallagher, O’Neal Inc. – Greenville, SC, past chairman • Scott Colter, Colter Electric Com- pany – Winston Salem, NC, CECA liaison • Allen Amsler, McCrory Construc- tion Company – Columbia, SC • Rob Beale, W.M. Jordan Com- pany – Wilmington, NC • Kurt Eyring, Miller-Valentine Group – Columbia, SC • Harley Garrison, Starr Electric – Greensboro, NC • Sam Hayes, Landmark Construc- tion Company Inc. – North Charleston, SC • Derek Lanning, Miles-McClellan Construction – Charlotte, NC • Chris Moore, Carolina Power – Greenville, SC • Art Odom, David Allen Company – Raleigh, NC • Eric Perkinson, Brasfield & Gorrie – Raleigh, NC • David Philyaw, T.A. Loving – Goldsboro, NC vSteve Smith, Smith Terry & Johnson Construction Law– Char- lotte, NC • Ryan Wathen, Rodgers Builders – Charlotte, NC The North Carolina Construction News — Winter 2018 — 15
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