GroundBreak Carolinas 2018 Outlook Survey Feedback
Last month, GroundBreak Carolinas asked our readers for their thoughts on 2018. While your feedback was generally positive, there were some very interesting comments.
We’ve compiled some of your comments and feedback. Our editorial staff categorized your comments.
Business
“Medical costs continue to be a huge burden for small contractors like us. We have 60 people at any given time and our cost has gone up every year since Obamacare passed. Last year our premiums went up 22%. We ate some of the cost but had to pass it along to the employees. This can’t continue.” -Mechanical Contractor, Raleigh, NC
“Tax reform is going to have a significant impact on our industry. The tax cuts will drive capital investment, and the tax cuts will have a significant impact on construction firms.”-General Contractor, Raleigh, NC
“The AIA contract changes go into effect this year. All contractors need to become familiar with the changes.” Construction Law Firm, Charlotte, NC.
“The new OSHA Silica legislation has impacted how we manage our job sites. We spent the last few months training and educating our employees on the new standard. We have invested money in new equipment and containment systems.” -Subcontractor, North Augusta, SC
“Finding qualified subs that have capacity is going to be a challenge again this year. There recently was a public project in Charlotte that we could not find a single contractor in a certain discipline that was interested in bidding the work. We ended up taking numbers from subs in Tennessee.” – General Contractor, Charlotte, NC
“The market for insurance market architects, engineers, lawyers, CPAs and other professionals remains competitive with a large number of companies competing for preferred accounts.” Commercial Insurance Broker, NC
“Technology is changing the way we do business. Our firm has invested in technology for our guys in the field. It wasn’t as easy as we thought, but we are finally seeing user adoption increase. We are seeing improvements in efficiency, productivity, quality and safety.” -General Contractor, Wilmington, NC
“Owner expectations are unreasonable. After years of waiting to start projects, everyone has to have their project tomorrow.” General Contractor, Raleigh, NC
“There has been a slight uptick in some costs, but we are not seeing the cost escalation that others are seeing around the country.”- General Contractor, Charlotte, NC
Commercial Real Estate
“The economy is doing well and sellers and landlords demand higher prices and rents. However, buyers will see rising interest rates and won’t want to adjust their offers to meet seller demands.” – Commerical Real Estate Broker, Charlotte, NC
“The Charleston market is solid and will remain so for the foreseeable future.” -Civil/Site Engineering Firm, Charleston, SC
“Overall, we are cautiously optimistic. We expect to see steady growth in the Carolinas.” – Real Estate Developer, Greensboro, NC
“Driven by e-commerce growth, the logistics, distribution and warehousing sectors will be strong in 2018.” Commerical Developer, Mount Pleasant, SC
“I’m bullish on the data center market. We have won our fair share here in North Carolina. The increase in data consumption, storage requirements, and the technology evolution will continue to drive this demand. We have a great story to tell in North Carolina.” Business Recruiter (Power Company), Charlotte, NC
“I think you will continue to see a move back to urban centers. Just about every city in the Carolinas is enjoying a strong construction economy. I am concerned that the market may overheat in some areas.” Commerical Real Estate Broker, Columbia, SC
“Raleigh is on fire right now. The local commercial real estate market is strong and will only get better.” – Commercial Real Estate Broker, Raleigh, NC
“We are are starting to see more tear downs in Myrtle Beach… Activity has been brisk and we anticipate that to continue in 2018. My biggest challenges are finding qualified contractors and subs. The projects are there.” -Developer, Myrtle Beach, SC
“Despite what you may read in the headlines, retail is not dead. Yes, there are store closings, but there is interest in the right retail projects.” -Developer, Raleigh, NC
“The Charlotte to Atlanta corridor is missing out on opportunities due to a lack of available industrial inventory.” Commerical Real Estate Broker, Spartanburg, SC
Economic Development
“There are several projects looking at the Carolinas, but the decision makers seem to be hesitant to move forward due to economic and political uncertainty. I think that will change after tax reform is passed.” – Site Selection Consultant, Greenville, SC
“North Carolina finally seems to have its house in order when it comes to economic development. As a state, we are starting to win more projects. I believe we are going to have a strong year attracting new investments and jobs.”- General Contractor, Charlotte, NC
“We are seeing significant interest from Asian firms in the Southeast. Our team is tracking a number of Chinese projects that are looking in the Southeast.”-Law Firm (Economic Development Speciality), Charlotte, NC
“I am concerned about the overall economy. We are, in my opinion, at the end of a long growth cycle, the stock market can’t keep this pace of growth, the bitcoin craze is going to bust, tax reform only adds to our debt, Washington is a mess and we are trying to end trade policies that will have a negative impact on our economy.” -Architect, Wilmington, NC
“We expect Foreign Direct Investment (FDI) activity to pick up in 2018. While there have been several large investment announcements like Foxconn, we haven’t seen as many of the $30 to $100 million announcements in our area. European investments were down in 2017. In fact, German investment was down significantly, other than BMW and its suppliers. I expect that to change in 2018.” -Law Firm (Economic Development Speciality), Charlotte, NC
“North Carolina needs to have a big win in 2018. We seem to be missing out on the big investments that South Carolina, Tennessee, Virginia and Georgia are winning. I don’t think we are a serious player for Amazon’s HQ2, but winning the Toyota-Mazda project is a real possibility for North Carolina.” -Economic Development Business Recruiter, NC
“Our firm, CBRE, believes 2018 will be a strong year for the multifamily sector. We expect a high number of completions during this year.” -Commerical Broker, Raleigh, NC
“The shifts in the economy continue to push the demand for goods online. Construction will start to catch up to absorption in this area. I think low vacancy will remain the norm for this sector and rents will continue to climb, particularly in the Greenville-Spartanburg and Charlotte markets.” -Commercial Broker, Spartanburg, SC
Economy
“We are seeing an uptick in activity in all commercial segments. Our backlog is solid and I think owners are going to turn loose more project in the first quarter.” -General Contractor, Raleigh, NC
“The manufacturing industry seems to be very solid in both North Carolina and South Carolina right now.” -Specialty Contractor, Matthews, NC
“The industry continues to ride the waves of one of the longest economic expansions in our history. Real estate professionals, in general, are cautious about its potential impact on individual sector fundamentals.” Economist in the Commerical Real Estate Sector, Charlotte, NC
“Our backlog is at an all-time high. Architecture firms have historically been a harbinger of future construction activity. I am encouraged.” -Architecture and Planning Firm, Charlotte, NC
“Both states have funding for road and infrastructure projects. We also are anticipating an increase in funding as a result of President Trump’s Infrastructure bill. I think we are going to see a few solid years for highway and road construction in the Carolinas.” -Heavy/Highway Contractor, Columbia, SC.
“The self-storage, student and senior housing, and medical office building segments have all experienced growth over the past few years in the region. The growing and aging population will continue to fuel this market. These sectors are being viewed as prime investment opportunities.” -Commercial Lender/Banker, Charlotte, NC
Workforce
“Finding qualified workers is the biggest challenge we face as an organization right now.” – Mechanical Contractor, Anderson, SC
“I can’t bid anymore work because I don’t have the crews.” -Electrical Contractor, Fort Mill, SC
“The general market seems strong, however, many of the big E&C firms that do industrial, energy and manufacturing work have reduced staff recently. Fluor, Day and Zimmerman, CH2M and others that do large international projects have been impacted. The Jacobs/CH2M merger has created uncertainty. There is a significant amount of experienced engineering and project management talent that is available.” -Recruiting/Staffing Company, Greenville, SC.
“Everyone knows about the shortage in skilled labor, but we are having trouble finding seasoned project managers. There have been several GCs moving into South Carolina and throwing big numbers to recruit our people.” -General Contractor, Columbia, SC
“The industry needs to develop craft training classes at local high schools. ABC, AGC and CECA, and other associations need to collaborate to develop craft training with local technical colleges…for sheet-metal installers, pipe fitters, plumbers, carpenters, etc. Our workforce is aging out and the young people don’t want to go into construction… Maybe we need a marketing and branding program to promote the industry.” – General Contractor, Winston Salem, NC
“We have had over a dozen open positions since August and can’t fill them.” – Specialty Contractor, Lexington, SC
“Our industry is facing a significant labor shortage. I’ve been in this industry for 30 years, and we can’t seem to solve this problem. Other industries, like manufacturing, seem to find a way to work together and address the workforce challenges. The construction industry is too fragmented and resists working together.” -General Contractor, Raleigh, NC
“We need people.” -Residential Builder, Conway, SC
“Finding, developing, and retaining talent at all levels of our organization is a key focus for our firm. We are a self-performing General Contractor that has needs for project managers, estimators, and craft professionals. We hired our first full-time recruiter this year. We are offering referral bonuses for craft professionals, and are getting involved with the Career and Technical Education (CTE) programs in Mecklenburg County.”- General Contractor, Charlotte, NC
Do you have a perspective on 2018 that you want to share? Contact the editorial team at GroundBreak Carolinas.
