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TradeWinds

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Construction Employment Increased In 33 States And D.C. Between November And December Amid Growing Sense Of Optimism Among Contractors Finding Work In More Parts Of The Country
Texas Adds the Most Construction Jobs and Nebraska Adds the Highest Percentage Year-Over-Year While Rhode Island Experiences Largest Annual and Monthly Decline

Construction employment expanded in two-thirds of all states in December and in half the nation last year as the industry showed signs of emerging from a six-year slump, according to an analysis by the Associated General Contractors of America of Labor Department data. Association officials noted that contractors responding to a recent survey expect to add more workers in 2013.

"These results show that contractors are finding work in more parts of the country than they have for many months," said Ken Simonson, the association's chief economist. "Further gains appear likely but could be derailed if lawmakers do not keep debt markets operating normally."

For 2012 as a whole, 24 states and the District of Columbia added construction jobs, 24 shed workers and two — Vermont and West Virginia — had no change. Nebraska jumped to the top ranking for percentage of new construction jobs (10.1 percent, 4,100 jobs); followed by D.C. (7.3 percent, 900 jobs); Texas (6.6 percent, 36,800 jobs); Hawaii (6.5 percent, 1,800 jobs) and Washington (6.5 percent, 9,000 jobs). Texas added the most new construction jobs over the past 12 months, followed by California (24,500 jobs, 4.4 percent), Washington and Arizona.

Among states losing construction jobs during the past year, Rhode Island lost the highest percentage (-6.7percent, -1,100 jobs), followed by Delaware (-5.8 percent, -1,100 jobs); Mississippi (-5.6 percent, -2,700 jobs) and Arkansas (-5.6 percent, -2,600 jobs). Illinois lost the most jobs (-8,600 jobs, -4.5 percent); followed by Pennsylvania (-7,700 jobs, -3.4 percent) and Florida (-16,800 jobs, -2.1 percent).

Simonson noted that 33 states and D.C. added construction jobs between November and December, while employment slipped in 16 states and held steady in Utah. Wisconsin had the largest percentage increase (5.8 percent, 4,900 jobs); followed by D.C. (3.9 percent, 500 jobs) and New Jersey (3.6 percent, 4,300 jobs). Utah had no change in construction employment over the month, while 16 states lost jobs, with Rhode Island having the steepest percentage drop (-5.6 percent, -900 jobs); followed by Montana (-4.1 percent, 1,000 jobs) and Minnesota (-3.6 percent, 3,500 jobs). Texas lost the largest number of jobs for the month (-4,100 jobs, -0.7 percent); followed by Florida (-3.500 jobs, -1.1 percent) and Minnesota.

"Construction spending has been rising for two full years but contractors have been cautious about adding workers until they knew the upturn would last," Simonson explained. "In 2013, both residential and private nonresidential construction should rise enough to offset a further slowdown in public work, and contractors will be looking for more workers."

Association officials said the monthly construction employment gains were consistent with results of its recently released 2013 Construction Hiring and Business Outlook, where 31 percent of firms reported plans to add new workers this year compared to only 9 percent that plan to make layoffs, a net positive reading of 22 percent. Officials cautioned that construction firms still face significant headwinds, noting that most firms expect public construction activity to continue to decline and remain cautious about plans to acquire new equipment.

"There is a growing sense of optimism within the construction community that the worst is over," said Stephen E. Sandherr, the association's chief executive officer. "At the same time, however, just because the worst is over doesn't guarantee that conditions are going to get significantly better anytime soon, especially if Washington can't find a way to address out-of-control entitlement spending that is making it increasingly difficult to invest in aging infrastructure and other important construction programs."

View the state employment data by rank and by state.

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Construction Material Prices Down Slightly Between November And December But Up For The Year, New Analysis Finds

Gypsum, Lumber and Plywood, Paint and Plastic Products Among the Few Products to Experience Significant Cost Increases in 2012; New Outlook Shows Most Contractors Expect Materials Costs to Increase in 2013

Prices for construction materials inched down in December, closing out a year of relatively subdued changes in both materials costs and bid prices, according to an analysis of new federal figures released today by the Associated General Contractors of America. Association officials said the price decline was likely to be temporary, noting that the vast majority of contractors predict materials prices will rise in 2013.

“Moderate price swings for several materials last year gave contractors some breathing room, but future price spikes could push many firms into the red,” said Ken Simonson, chief economist for the construction trade association. “Contractors still have not recovered from the cost increases they had to absorb in 2010 and 2011.”

For the 12 months ending in December, the producer price index for all construction inputs rose 1.3 percent, similar to what contractors are estimated to charge for new nonresidential buildings, Simonson noted. The index for new school buildings rose 1.1 percent; new industrial and office construction, 1.4 percent; and new warehouses, 2.6 percent. Materials costs rose more than 5 percent in both 2010 and 2011, while bid prices were virtually unchanged in 2010 and rose between 2.9 and 4.8 percent in 2011, depending on building type, Simonson added.

The construction economist attributed the mild annual materials price increase to moderation in fuel, metals and paving prices, which offset steeper jumps in several materials used in residential building. The index for steel mill products fell 7.9 percent in 2012 after leaping more than 12 percent in both 2010 and 2011. The index for aluminum mill shapes decreased 1.6 percent, while copper and brass mill shapes increased 1 percent. Diesel prices climbed 1.8 percent, the smallest amount since 2008. The indexes for concrete products rose 2.4 percent and asphalt paving mixtures and blocks, 4.4 percent.

In contrast, the index for gypsum products soared 14.0 percent, which Simonson said reflected the demand from new apartment and home construction, along with renovations of office and retail space. Other building products with substantial price increases included lumber and plywood, 10.8 percent; architectural coatings, such as paint, 10.1 percent; insulation materials, 5.1 percent; and plastic construction products, 4.7 percent.

Association officials noted that 90 percent of contractors surveyed for the group’s 2013 Construction Hiring and Business Outlook predict materials prices will increase in 2013. They added that an increasing number of contractors will try to pass on some of those price increases to customers this year, noting that 29 percent report they will try to raise bid prices this year, compared to only 15 percent that raised prices in 2012.

“The days of low bids and relatively inexpensive construction costs are clearly numbered,” said Stephen E. Sandherr, the association’s chief executive officer. “While the construction industry is still facing some difficult headwinds, there is a clear sense that the industry is slowly turning a corner.”

Click here to view December 2012 PPI table.

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Englert Unveils Line Of Insulated Wall Panels

Englert, Inc. will be unveiling its new line of four insulated wall panels at Booth 743 at the International Roofing Expo. giving the company the opportunity to compete in the highly lucrative section of the metal roof and wall panel market.

Englert’s new line are being used in a large number of commercial, industrial, institutional and cold storage applications because of their excellent performance characteristics and competitive costs. These include airport hangars, manufacturing buildings, office buildings, sports facilities, distribution centers and schools and universities.

The panels are formed by a continuously poured-in-place, manufacturing process which binds interior and exterior steel facings to an insulating foam core. Englert’s panels can be installed both vertically and horizontally and are available in the following textures:

  • Smooth Texture with no ribs or embossment

  • Stucco Embossed Texture with light or heavy, non-directional embossed pattern

  • “Mesa” Texture with a series of high and low flat surfaces\

  • “Wave” Texture with a very minor striation over the panel face

All are available in Cool, Low Gloss full Strength Kynar 500 finishes.

“This is an important step for Englert in the metal construction market and a real opportunity for us to be even more competitive in helping our customers get new business,” said Dave Rowe, Director of Product Management. “It’s a very competitive line and one that contractors will find is consistent with Englert’s tradition of delivering quality products to the metal building marketplace.” For more information, visit Booth 743 or contact Rowe at d.rowe@englertinc.com.

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Maxwell Systems Releases ProContractorMX Web-Based Construction Project Management Software

Maxwell Systems, Inc., a leading provider of complete construction business management software solutions, announced today its release of Maxwell Systems™ ProContractorMX® Web-Based Construction Project Management software. This innovation delivers seamless capabilities for bidding, budgeting, scheduling, field reporting, documents, resources, cost control, and more – all online and available in a single solution.

The Construction Project Management solution from Maxwell Systems is a web-based solution that provides integrated online scheduling, reporting, alerts, collaboration, and document control so contractors can complete projects as efficiently and effectively as possible.

“ProContractorMX Construction Project Management has saved us countless hours of pain and frustration,” said Harry Pettyjohn, President of HP Flanagan, Inc. “ProContractorMX has several weapons in its arsenal. With the Daily Field Reports we can update multiple projects in minutes versus the hours it used to take. The Work-In-Progress reports allow us to update the schedules in real-time; this allows us to see if items are on track to meet deadlines or moving ahead of schedule. ProContractorMX is an intuitive system that sends us alerts and notifies our trades. The real values are better visibility and one stop organization; everything can be managed in a central location. No longer are there stacks of paperwork to bog down our time, it allows us to be where we belong – out in the field building. Everything we need to track is in the system – ProContractorMX is truly the solution to streamlining my business and making us as efficient as possible.”

The notable capabilities delivered in the comprehensive ProContractorMX Construction Project Management solution include:

· Online Bid Solicitation and Management
· Scheduling, Resource Management, and Alerts
· Collecting Daily Field Reports and Timecards
· Online Project Collaboration and Discussion Forums
· Centralized, Secure Project Document Storage and Sharing

This breadth of easy-to-use functionality equips construction companies to: be more efficient and more competitive in the marketplace; eliminate duplicate entry of information; organize and share documentation and access it quickly and easily; know where pending documents are, if they are overdue and how they may affect the schedule; quickly inform the project team when changes occur; and reduce risk because everything about the project is recorded within the solution.

“With the Construction Project Management solution, construction businesses can improve communication among team members within the company, as well as with external players and third-parties, such as design professionals, stakeholders, subcontractors, vendors, and more,” said Jason Davis, Product Manager for ProContractorMX, Maxwell Systems. “Critically important to completing projects on time and within budget, contractors use the solution to securely view up-to-the-minute schedules and information – anytime, anywhere. And with document sharing, online collaboration, and discussion forums, owners and project managers will have answers organized and on-hand whenever needed, streamline approvals and eliminate delays, and stay on target for optimal profit.”

Maxwell Systems ProContractorMX is a comprehensive, all-in-one construction management software solution that includes key capabilities for takeoff; estimating; bids and proposals; management of projects, financials, procurement, inventory, employees, payroll, and equipment; and intelligent dashboards and critical reports for timely analysis of projects or the overall business.

ABOUT MAXWELL SYSTEMS
Maxwell Systems is a leading provider of complete construction business management and property management software solutions and services. Founded in 1975, Maxwell Systems is dedicated to helping its 10,000 customers streamline their estimating, job cost accounting, and project management processes and improve profitability. To deliver true end-to-end control of critical business processes, the company’s product offerings include: ProContractorMX®, American Contractor®, Management Suite™, StreetSmarts®, Colonial™, and Estimation®. To further help customers grow their business while maximizing the return on their technology investment, Maxwell Systems provides comprehensive support and maintenance, training, and consulting. The company’s headquarters are in King of Prussia, Pa., with offices in Baltimore, Md., Fort Collins, Colo., Santa Cruz, Calif., and Sarasota, Fla. More information is available at www.maxwellsystems.com.

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New Ecophon® Wall Panels Help Tackle Acoustical Challenges in Interior Spaces

CertainTeed Ceilings is introducing the Ecophon® Wall Panel™, providing superior sound absorption and a wide range of design options for dynamic interior spaces. The panels are ideal for areas where additional sound absorption is desired —such as schools, offices and healthcare facilities or spaces where a traditional suspended ceiling system cannot be used.

The Ecophon Wall Panel is comprised of a high-density glass wool core, providing class A sound absorption according to ISO 11654. The panels are available in a variety of surface options for added performance and versatility in interior designs.

“There are a number of situations where a wall-to-wall suspended ceiling system either cannot be installed or would not be sufficient to create desired acoustics,” said Dawn Chittick, director of marketing for CertainTeed Ceilings. “Daycare centers or schools for younger children, for example, may require additional sound absorbing material to reduce overall sound levels. Ecophon wall panels provide a versatile solution that not only provides outstanding sound absorption, but helps create truly inspired interior spaces.”

The Ecophon Wall Panel is available in two finishes — Texona and Super G. The Texona fabric range boasts 16 different color options that were carefully developed in collaboration with interior designers, architects and textile designers. Each color alludes to a flavor, such as Blueberry, Rhubarb and Wasabi, and offers a wide range of expressively tasteful design solutions.

The Super G fabric range for the Ecophon Wall Panel features a glass fiber laminate designed for high impact resistance and added durability in high-traffic environments. The Super G finish is available in three colors—White, Grey and Green.

The Ecophon Wall Panel is available in one size, 2700 mm x 600 mm x 40 mm (approximately 24-inch x 106-inch x 1.5-inch). The panels have beveled edges on the long sides creating a narrow groove between panels when installed. Both panel options utilize CertainTeed’s Connect WP profile, an extruded aluminum channel trim that creates a defined frame around the wall panels. The Connect WP profile is available in White, Black and Anodized. Ecophon wall panels with Texona and Super G finishes are easy to install, while providing exceptional acoustical benefit in new and renovated commercial building applications.

As experts in the science of sound, CertainTeed Ceilings serves as a single source for high-quality ceilings that create acoustically friendly, aesthetically captivating environments. Encompassing the Performa, Ecophon and Gyptone brands along with Decoustics — a leader in high-precision, custom-engineered solutions — the company offers the perfect balance of innovation, budget and beauty with products that range from basic high-performance panels to premium, customizable systems. Through its emphasis on Environmental Acoustics™, CertainTeed Ceilings provides solutions that promote healthier interiors, while having a smaller impact on the environment, which includes ceiling products with one of the highest concentrations of recycled content in the industry as well as a recycling program for used ceiling panels. The company is the first ceilings manufacturer to issue Environmental Product Declarations through UL Environment and The Green Standard. For more information, visit www.certainteed.com.

About Ecophon
As part of Saint-Gobain, the world leader in the habitat and construction markets, Ecophon is a leading, global supplier of sound absorbing ceilings and wall absorber systems. Featuring outstanding acoustical performance and functionality, Ecophon products contribute to interior environments that promote the well being and performance of building occupants. Ecophon systems and products are marketed in North America through CertainTeed Corporation.

About CertainTeed
Through the responsible development of innovative and sustainable building products, CertainTeed, headquartered in Valley Forge, Pa., has helped shape the building products industry for more than 100 years. Founded in 1904 as General Roofing Manufacturing Company, the firm's slogan "Quality Made Certain, Satisfaction Guaranteed," quickly inspired the name CertainTeed. Today, CertainTeed® is North America’s leading brand of exterior and interior building products, including roofing, siding, fence, decking, railing, trim, foundations, pipe, insulation, gypsum, ceilings and access covers.

A subsidiary of Saint-Gobain, the world’s largest building products company, CertainTeed and its affiliates have more than 6,000 employees and more than 60 manufacturing facilities throughout the United States and Canada. Recognized as a 2009 and 2010 ENERGY STAR Partner of the Year by the U.S. Environmental Protection Agency, CertainTeed earned the 2011 and 2012 ENERGY STAR Sustained Excellence Award, the highest level of recognition for outstanding contributions to protecting the environment through energy efficiency. The group had total sales of approximately $3.2 billion in 2011. www.certainteed.com

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Dur-A-Flex® Expands Applicator Training Program, Cites Growing Demand

Leading seamless flooring manufacturer’s California facility to serve as additional training center

Flooring contractors looking to elevate their quality-focused project assessments and product installations via Dur-A-Flex’s Applicator Training Program (ATP) now have a second location to choose from. The company announced their west coast facility, located at 3969 East Guasti Road, Ontario, Calif. is the latest location holding ATP sessions.

“Providing guidance and education on proper application techniques is our main focus when helping flooring contractors achieve their full jobsite potential. Our world class technical service department provided fantastic support for over 45 partners last year at our East Hartford, Conn. headquarters,” Patrick J. Meade, vice president of sales and technical service said. “In meeting the growing demand, we are now offering this second venue and additional program dates, making it even more convenient for our contractors to attend,” he concluded.

Dur-A-Flex’s California facility totals over 10,000 square feet, carries product inventory, floor samples and has a dedicated staff including sales representatives, technical support and customer service. The shipping and receiving department expedites product shipments to Asia Pacific and west coast regional customers. Dedicated training space to house the ATP has since been added. The program will be facilitated by Dur-A-Flex’s western region technical and operations manager Marcus Gray. Gray has been with the company for close to 20 years.

Interested contractors will have an opportunity to sample the ATP’s benefits during the World of Concrete, Feb. 5 – 8, 2013. Dur-A-Flex will be showcasing the training program in their outdoor booth, #O40844. For those who are not able to attend the much anticipated international construction tradeshow in Las Vegas, additional information about the ATP can be obtained by contacting their regional sales representative.

Named one of the “Best Places to Work in CT” for the fourth time by the Hartford Business Journal-sponsored awards program, Dur-A-Flex is a privately-held, leading manufacturer of quality epoxy, urethane, methyl methacrylate and colored aggregates offering a complete line of high performance polymer flooring and wall systems. The versatile seamless applications provide improved safety, minimal downtime and easy maintenance to all industries. To learn more about Dur-A-Flex, see www.dur-a-flex.com.

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Architecture Billings Index Signaling Gains for Fourth Straight Month
Positive business conditions for all building sectors

Billings at architecture firms across the country continue to increase. As a leading economic indicator of construction activity, the Architecture Billings Index (ABI) reflects the approximate nine to twelve month lag time between architecture billings and construction spending. The American Institute of Architects (AIA) reported the November ABI score was 53.2, up from the mark of 52.8 in October. This score reflects an increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 59.6, up slightly from the 59.4 mark of the previous month.

You can see this press release online here: http://www.aia.org/press/releases/AIAB096939

“These are the strongest business conditions we have seen since the end of 2007 before the construction market collapse,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “The real question now is if the federal budget situation gets cleared up which will likely lead to the green lighting of numerous projects currently on hold. If we do end up going off the ‘fiscal cliff’ then we can expect a significant setback for the entire design and construction industry.”

Key November ABI highlights:

  • Regional averages: Northeast (56.3), Midwest (54.4), South (51.1), West (49.6)

  • Sector index breakdown: multi-family residential (55.9), mixed practice (53.9), commercial / industrial (52.0), institutional (50.5)

  • Project inquiries index: 59.6

The regional and sector categories are calculated as a 3-month moving average, whereas the index and inquiries are monthly numbers.

About the AIA Architecture Billings Index
The Architecture Billings Index (ABI), produced by the AIA Economics & Market Research Group, is a leading economic indicator that provides an approximately nine to twelve month glimpse into the future of nonresidential construction spending activity. The diffusion indexes contained in the full report are derived from a monthly “Work-on-the-Boards” survey that is sent to a panel of AIA member-owned firms. Participants are asked whether their billings increased, decreased, or stayed the same in the month that just ended as compared to the prior month, and the results are then compiled into the ABI. These monthly results are also seasonally adjusted to allow for comparison to prior months. The monthly ABI index scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline. The regional and sector data are formulated using a three-month moving average. More information on the ABI and the analysis of its relationship to construction activity can be found in the White Paper Architecture Billings as a Leading Indicator of Construction: Analysis of the Relationship Between a Billings Index and Construction Spending on the AIA web site.

About The American Institute of Architects
For over 150 years, members of the American Institute of Architects have worked with each other and their communities to create more valuable, healthy, secure, and sustainable buildings and cityscapes. Members adhere to a code of ethics and professional conduct to ensure the highest standards in professional practice. Embracing their responsibility to serve society, AIA members engage civic and government leaders and the public in helping find needed solutions to pressing issues facing our communities, institutions, nation and world. Visit www.aia.org.

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New Dealer Locator Mobile App Helps Customers Find Retail Locations for Simpson Strong-Tie® Products Quickly and Easily

Simpson Strong-Tie introduces its new Dealer Locator mobile app, enabling customers to quickly and easily locate dealers carrying Simpson Strong-Tie® products while on the go.

Using the mobile app, customers can get instant results for dealers within a specific zip code, and can map to a location in seconds. Customers also can visit dealer websites, instantly copy store information to the clipboard, and dial a dealer phone number directly from the iPhone® with the app. In addition, the Dealer Locator mobile app displays the Simpson Strong-Tie product lines carried by each dealer.

North American customers can download the free Dealer Locator mobile app to their iPad® or iPhone by visiting the App Store™. For Android®, BlackBerry and other mobile devices, visit www.strongtie.com/mobiledl for the mobile-optimized version of the Dealer Locator. A list of all the Simpson Strong-Tie mobile apps is available at www.strongtie.com/apps.

About Simpson Strong-Tie Company Inc.
For more than 55 years, Simpson Strong-Tie has focused on creating structural products that help people build safer and stronger homes and buildings. Considered a leader in structural systems research, testing and innovation, Simpson Strong-Tie works closely with industry professionals to provide code-listed, field-tested products and value-engineered solutions. Its structural products are recognized for helping structures resist high winds, hurricanes and seismic forces. The company’s extensive product offering includes connectors, fasteners, fastening systems, lateral-force resisting systems, anchors and products for concrete repair, strengthening and protection. Simpson Strong-Tie is committed to helping customers succeed by providing exceptional products, full-service engineering and field support, product testing and training. For more information, visit the company’s website at www.strongtie.com.

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Strong Preference for Infill Locations and Neighborhood Amenities
Billings at residential architecture firms growing in every region

A combination of housing market conditions, changing lifestyle preferences and shifting demographics has led to a re-shaping of our communities in recent years. There has been a move away from automotive-centric locations, along with a strong desire for households to have employment and entertainment options in closer proximity to where they live. There has also been a preference for lower maintenance and more energy-efficient properties.

Residential architecture firms across the country are reporting improving business conditions, with remodeling activity leading the way followed by some segments of new construction also seeing growth. These findings are from the American Institute of Architects (AIA) Home Design Trends Survey for the third quarter of 2012 that focused on community and neighborhood design.

“In many areas, we are seeing more interest in urban infill locations than in remote exurbs, which is having a pronounced shift in neighborhood design elements,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “And regardless of city or suburban dwellers, people are asking more from their communities in terms of access to public transit, walkable areas and close proximity to job centers, retail options and open space.”

AIA Home Design Trends Survey highlights

Community design elements

2012

2011

Infill development

64%

65%

Access to public transportation

59%

47%

Multi-generational housing

50%

44%

Higher density development

50%

38%

Mixed-use developments

45%

37%

Community gardens

41%

n/a

Dedicated open space

40%

33%

Popular Home Exteriors Features

2012

2011

Low maintenance exterior materials

70%

68%

Front porches

41%

40%

Sustainable roofing

29%

23%

Windows (number and size)

24%

19%

Contemporary design

23%

10%

Single story homes

17%

24%

(% respond. report. popularity of feature “increasing” minus % report. “decreasing”; Q3)

Housing market business conditions

AIA Home Design Survey Index for Q3 2012 (any score above 50 is positive)

  • Billings: 55

  • Inquiries for new projects: 62

Baker noted, “The market for remodeling and alteration projects has been quite strong going back several quarters, but it is encouraging to see positive business conditions for both the move-up and first-time buyer sectors.”
 

Specific construction segments 2012 2011
Additions / alterations 58% 35%
Kitchen and bath remodeling 51% 37%
Move-up home market 8% -36%
First-time buyer / affordable home market 5% -37%
Custom / luxury home market -0.80% -27%
Townhouse / condo market -8% -35%
Second / vacation home -39% -61%

(% of respondents reporting sector “improving” minus % reporting “weakening”; Q3)

About the AIA Home Design Trends Survey
The AIA Home Design Trend Survey is conducted quarterly with a panel of over 500 architecture firms that concentrate their practice in the residential sector. Residential architects are design leaders in shaping how homes function, look, and integrate into communities and this survey helps to identify emerging trends in the housing marketplace. Business conditions are also monitored on a quarterly basis. Future surveys will focus on kitchen and bath trends (February 2013), overall home layout and use (June 2013), and specialty rooms and systems (September 2013).

About The American Institute of Architects
Founded in 1857, members of the American Institute of Architects consistently work to create more valuable, healthy, secure, and sustainable buildings, neighborhoods, and communities. Through nearly 300 state and local chapters, the AIA advocates for public policies that promote economic vitality and public well being. Members adhere to a code of ethics and conduct to ensure the highest professional standards. The AIA provides members with tools and resources to assist them in their careers and business as well as engaging civic and government leaders, and the public to find solutions to pressing issues facing our communities, institutions, nation and world. Visit www.aia.org.

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Construction Material Prices Continue To Fall In November As Costs For Key Components Drop And Threat Of Fiscal Cliff Dampens Demand

Price Declines Driven By Big Drop in Diesel Costs, Smaller Decreases in Cost of Other Materials, as Amount Contractors Charge for New Structures Remains Mostly Flat for the Month and Up Little for the Year

Construction materials costs dropped in November, aided by a plunge in diesel prices along with smaller decreases in a variety of other inputs, according to an analysis of new federal figures released today by the Associated General Contractors of America. Association officials noted that some of the price declines may be related to the fact that the threat of the fiscal cliff is already having an impact on demand for construction and related materials.

"The recent price decreases are very welcome after years of price spikes that contractors could not pass on in a weak construction market," said Ken Simonson, chief economist for the construction trade association. "These price declines may be yet another sign that the threat of the fiscal cliff has already taken a toll on demand."

For the 12 months ending in November, the producer price index for all construction inputs rose 1.0 percent, closely matching the increase in prices contractors charge for new buildings. Between October and November, however, construction materials prices fell by 1.1 percent, while the amount contractors charge to build industrial buildings, new offices and new warehouses was unchanged and down 0.3 percent for new school construction.

Simonson said prices fell for the month and the year for diesel fuel (-7.4 percent for the month and -4.0 percent for the year), steel (-1.3 percent for the month and -9.3 percent for the year), copper (-3.3 percent for the month and -0.9 percent for the year) and aluminum (-0.8 for the month and -3.5 for the year). The overall decrease was offset by increases in prices for gypsum products such as wallboard (0.4 percent for the month and 14.9 percent for the year), lumber and plywood (1.7 percent for the month and 9.3 percent for the year) and architectural coatings (unchanged for the month, but up 10.5 percent for the year).

"Demand for gypsum and architectural coatings products has risen sharply as apartment and home construction have soared in recent months," Simonson commented. "The gypsum and lumber price increases might also reflect the surge in demand from areas hit by Hurricane Sandy."

A survey of nearly 600 construction firms release by the association last week indicated that many firms have already changed business practices because of the twin threat of spending cuts and tax increases included in the fiscal cliff. In particular, many firms noted they were cutting back on investments in construction equipment and supplies, likely contributing to the decline in materials prices, association officials cautioned.

"Washington's inability to resolve the threat of the pending fiscal cliff is already having an impact on construction activity and employment levels," said Stephen E. Sandherr, the association's chief executive officer. "Construction activity would unquestionably be stronger if firms knew what they would be paying in taxes starting three weeks from now."

Click here to view the November PPI table.

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Construction Employment Declines By 20,000 Jobs In November As Many Contractors Report Making Layoffs, Hiring Delays Due To Fiscal Cliff

Industry's unemployment rate hits 12.2 percent as majority of contractors will cut back hiring, equipment if Washington officials cannot avoid fiscal cliff's tax increases & spending cuts

Construction employment declined by 20,000 jobs in November while the industry's unemployment rate hit 12.2 percent, according to an analysis of new federal data released today by the Associated General Contractors of America. The construction employment figures likely reflect the fact many contractors have already cut staff and delayed hiring new employees because of the threat of the "fiscal cliff," according to results of a survey of member firms the association also released today.

"It is discouraging that construction employment is still struggling after more three years of expansion in the overall economy," said Ken Simonson, the association's chief economist. "As disappointing as these numbers are, they will only get worse if Congress and the White House allow huge tax increases and spending cuts to occur on January 1."

Construction firms employed 5.514 million people in November, down from 5.534 in October, Simonson noted-a decrease of 0.4 percent. The sector's overall employment in November is 6,000, or 0.1 percent, lower than one year earlier when firms employed 5.520 million workers. Both residential and nonresidential construction lost jobs in November, with nonresidential construction suffering significantly more job losses than residential construction for the month.

Residential contractors lost 3,600 jobs in November, as residential building contractors lost 6,800 employees while residential specialty contractors added 3,200 new workers. Nonresidential building contractors lost 15,900 jobs in November. Nonresidential specialty trade contractors lost 7,800 jobs for the months while nonresidential building contractors lost 4,300 jobs. Heavy and civil engineering construction firms lost 3,800 jobs during the month.

The threat of the fiscal cliff's tax increases and federal spending cuts are already having an impact on construction employment, according to a survey of 551 construction firms the association conducted between November 28 and December 6. Fifty-four percent of firms report the threat of tax hikes has forced them to adjust their business plans. Among those firms, 67 percent report postponing hiring, 65 percent report delaying or cancelling capital expenditures and 32 percent report having already made layoffs.

Should tax rates increase, nearly two-thirds of firms (63 percent) that haven't already acted report they will change their business plans next year. Among the changes those firms would make, 62 percent say they will postpone or cancel capital expenditures, 59 percent say they will delay hiring and 31 percent say they will reduce the size of their workforce.

Association officials noted that allowing personal income tax rates to increase would have a significant impact on many construction employers. That is because nearly 70 percent of firms participating in the survey report they pay under the individual tax rate. Most of these firms are small – over half report employment fifty or fewer people – with little capacity to absorb additional costs, association officials added.

Even the $6 billion worth of cuts to federal construction programs that are part of the "sequestration" cuts planned for next year have impacted hiring and spending behavior among construction firms. Thirty-nine percent of firms report those spending cuts have already forced them to delay hiring, lay off staff and delay major expenditures. Meanwhile, 62 percent of firms that have yet to change their operations report that will make similar changes next year if the spending cuts actually occur.

"The fiscal cliff is already having a significant, negative impact on construction firms and their middle class workers," said Stephen E. Sandherr, the association's chief executive officer. "Considering the impact the threat of tax hikes and spending cuts is having already, it is clear that many more construction workers will suffer should Washington officials allow the fiscal cliff to occur."

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On Center Software Announces New Product Release for On-Screen Takeoff®, Quick Bid, and Digital Production Control™

On Center Software, the first name in construction automation, announces today the latest release of its award winning portfolio: On-Screen Takeoff®, Quick Bid, and Digital Production Control™.

Customers with current active licenses on maintenance will benefit from the following new features:

  • Windows 8 compatibility

  • MAC compatible using virtualization software

  • Expanded Licensing Management

  • New Product Functionalities

On Center Software leads in industry standards and understands the importance of staying on top of the latest technology regarding operating systems. Although Windows 8 will be a feature customers will undertake in due time, On Center supports it today.

"We participated in the company's Beta Program to not only get a sneak peak of the new release functionalities and features but also to have early hands-on experience with them. We depend on On Center solutions to make us more competitive, more efficient and more profitable, especially in this challenging economic environment. This new release will help us track our licenses and take our productivity to the next level. I would recommend every contractor moving to this release as soon as possible." says James Cole, Sole Director, at Superior Industries Group.

"Construction automation has become essential to the industry. We partner with On Center Software because we know they always have the contractor's need and requirements in mind when they design new features and functionalities. Whether it is keeping track of where licenses are located or doing more work faster and with fewer clicks, On Center Software is a valued partner for our success," says Colleen Stempien, President at Vision InfoSoft Corporation.

"I am excited about this new release," stated Leonard Buzz, CEO, On Center Software. "Based on the valuable and continued customer feedback and execution of our excellent design team, estimators will immediately notice that the new features and functionalities provide higher levels of efficiency, ease-of-use, and flexibility, all of which in turn will help maximize productivity, increase profits and fit personal preferences. We are holding a series of conference calls, training webinars, and even providing 1 on 1 support assistance to migrate customers to the new release."

On Center Software, The First Name in Construction Automation

On Center Software, Inc. is a privately held company providing software and training to construction industry professionals for over 24 years. Located in The Woodlands, Texas, the company's mission is to transform the takeoff, estimating, and labor-tracking experience with comprehensive software solutions that turn winning bids into profitable projects. On Center Software solutions include On-Screen Takeoff®, Quick Bid, and Digital Production Control™. Customers in the United States, Canada, Australia, New Zealand, United Kingdom, South Africa, and 60 other countries around the world leverage On Center Software's internationally recognized solutions. For more information about On Center Software.

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Parex Launches New Green Eifs Brochure

Parex USA, Inc., the parent company of leading building material brands; Parex, Teifs, LaHabra, El Rey, and Merkrete, announces a new Parex brochure to inform architects, engineers, owners and subcontractors about its green EIFS products, tools and practices.

The “Wrap Your Building in Green – Selecting and Specifying Parex Green EIFS Solutions” provides an overview of the sustainable features of designing with EIFS, including energy efficiency, continuous insulation and durability. The brochure further demonstrates designing a “greener” EIFS project utilizing Parex’s unique green products. Starting with the air & water-resistive barrier all the way to the final finish, Parex offers products that help designers achieve a truly Green EIFS project utilizing the following products:

· Dry-Tex or AquaSol finish
· 121 Wet in a Box, 121 Dry EIFS Basecoat and Adhesive or Quick Base
· WeatherSeal Water and Air-Resistive Barriers
· ColorFast pigments

“Wrap Your Building in Green” is also supported with specifications available for download at www.parex.com

About Parex USA
Parex USA, Inc., a California Corporation, is a subsidiary of the ParexGroup, a division of Materis, S.A., a French Corporation. The ParexGroup is one of the world's leading manufacturers of specialty chemicals and ready-to-use mortars for the construction industry. With over 55 manufacturing sites, 9 R&D centers in 20 countries the ParexGroup employs more than 3,100 industry professionals who are the corner stone of this thriving global organization. For more information regarding Parex USA, Inc. visit www.parexusa.com.

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Dodge Momentum Index Holds Steady in November

The Dodge Momentum Index held steady in November, according to McGraw-Hill Construction a division of The McGraw-Hill Companies. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The Dodge Momentum Index registered a 92.5 (2000=100) in November, a 0.5% increase relative to October’s revised 92.0. After reaching a low point in mid-2011, the turnaround in the Momentum Index has been a relatively slow and hesitant one, with monthly upward movement often followed by a decline. A full-fledged recovery in future development plans, particularly for commercial building, has been hampered by the business sector’s anxiety about future economic conditions. Meanwhile, continued tight fiscal conditions at all levels of government have led to an uneven pattern for the institutional side of the index.

The modest gain in the November Index was the result of an increase for institutional building, which grew by 1.7% in November. The education component of the Index was a bit stronger in November, though it’s likely to settle back in the coming months as budget constraints linger. The increase in institutional building plans was partially offset by a decline in the commercial component of the index, which in November eased 0.6% from October. New development plans for office projects slipped in November, although new plans for store projects rose modestly over the month. The gain in the retail segment of the index was helped by the recent revival of plans for the Shops at Summerlin, a previously stalled project in northwest Las Vegas.

About McGraw-Hill Construction:
McGraw-Hill Construction’s data, analytics, and media businesses—Dodge, Sweets, Architectural Record, and Engineering News-Record— create opportunities for owners, architects, engineers, contractors, building product manufacturers, and distributors to strengthen their market position, size their markets, prioritize prospects, and target and build relationships that will win more business. McGraw-Hill Construction serves more than one million customers through its trends and forecasts, industry news, and leading platform of construction data, benchmarks, and analytics, including Dodge BuildShare and Dodge SpecShare. To learn more, visit www.construction.com.

About The McGraw-Hill Companies:
McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial's leading brands include Standard & Poor's Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services and J.D. Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available www.mcgraw-hill.com/.

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Apartment and Condominium Market Remains Steady in Third Quarter

The Multifamily Production Index (MPI), released by the National Association of Home Builders (NAHB) today, remained steady with an index level of 52. It is the third straight quarter with a reading over 50.

The MPI, which measures builder and developer sentiment about current conditions in the apartment and condominium market on a scale of 0 to 100, was essentially unchanged in the third quarter, only dropping two points from 54 in the second quarter.

The MPI provides a composite measure of three key elements of the multifamily housing market: construction of low-rent units, market-rate rental units and "for-sale" units, or condominiums. The index and all of its components are scaled so that any number over 50 indicates that more respondents report conditions are improving than report conditions are getting worse. In the third quarter of 2012, the MPI component tracking builder and developer perceptions of market-rate rental properties recorded a level of 69 and has been over 60 for five consecutive quarters--the longest sustained period of strength since the inception of the index in 2003. For-sale units had its highest reading since the fourth quarter of 2005, coming in at 44, while low-rent units dropped 15 points to 46.

The Multifamily Vacancy Index (MVI), which measures the multifamily housing industry's perception of vacancies, dropped three points 33. With the MVI, lower numbers indicate fewer vacancies. After peaking at 70 in the second quarter of 2009, the MVI declined consistently through 2010 and has been at a fairly low level throughout 2011 and 2012.

"The multifamily market has recovered substantially since the end of 2010, and now stands at about 70 percent of the way back to a sustainable level. Our baseline forecast calls for further steady growth in the rate of multifamily production," said NAHB Chief Economist David Crowe. "However, there are reasons for concern, especially at the affordable end of the rental apartment market, where builder confidence dropped dramatically in the third quarter. That was likely due to a specific provision of the Low-Income Housing Tax Credit set to expire at the end of the year. The prospect of dealing with this is making lower-rent projects difficult to underwrite. Ongoing deficit-reduction negotiations in Congress need to address this issue, or a serious shortage of affordable rental housing may develop."

Historically, the MPI and MVI have performed well as leading indicators of U.S. Census figures for multifamily starts and vacancy rates, providing information on likely movement in the Census figures one to three quarters in advance.

For data tables on the MPI and MVI, visit www.nahb.org/mms.

ABOUT NAHB: The National Association of Home Builders is a Washington-based trade association representing more than 140,000 members involved in remodeling, home building, multifamily construction, property management, subcontracting, design, housing finance, building product manufacturing and other aspects of residential and light commercial construction. NAHB is affiliated with 800 state and local home builders associations around the country. NAHB's builder members will construct about 80 percent of the new housing units projected for this year.

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Gilbane Publishes Winter 2012 Construction Industry Economic Report
Report Outlines Impact of Recent Events; Predicts Continued Movement, While Slow, Toward Recovery

Gilbane Building Company today announces the publication of the Winter 2012 edition of Construction Economics -- Market Conditions in Construction. Based on an array of economic data, construction starts, and material cost trends, this free report indicates an increase in construction spending over last year but cautions of an expected downturn again in early 2013.

"Supported by overall positive growth trends for year 2013, I expect margins and overall escalation to climb more than we've seen in five years, particularly in the rapidly expanding residential side of construction.," says Ed Zarenski, the report's author and a 40-year veteran of the construction industry.

According to the report, margins are up a slim 1% to 2% year over year for 2012. Once 2013 growth in nonresidential work picks up and both residential and nonresidential are active, the industry may begin to see some labor shortages and productivity losses, which will push up escalation. Also, as it did in 2012, even moderate growth in activity will allow contractors to pass along more material costs and increase margins.

Potential impact of recent events:

-- According to the Associated General Contractors (AGC), Hurricane Sandy may not add any economic impact to the construction industry. For the most part, any funds directed to reconstruction will be diverted from some other potential or previously planned construction project and will be spread over a long time span.
-- Bond issues considered in the recent elections amount to just over half ($30+ billion) of what was approved in 2008 elections ($60+ billion), signaling a reduction in publicly funded work.
-- At the recent McGraw Hill Outlook conference, none of the economists expect the fiscal cliff to happen. However, sequestration or the compromises agreed upon will likely reduce funds available for federal and public projects.

Among the topics covered in this comprehensive report are:

-- Construction Starts, Spending, & Costs
-- Material Price Movement
-- Trends and Costs for Structural Steel, Recycling Steel, & Copper
-- Architectural Billings Index
-- Current Inflation Forecast
-- ENR Index -- BCI History

This free report is available for download at http://info.gilbaneco.com/construction-economics.

About Gilbane, Inc.
Gilbane provides a full slate of construction and facilities-related services -- from sustainable building to the latest in construction technology -- for clients across various markets. Founded in 1873 and still a privately held, family-run company, Gilbane has more than 60 office locations around the world. For more information, visit www.gilbaneco.com.

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Pace of New-Home Sales Virtually Unchanged in October

Sales of newly built, single-family homes in October held virtually unchanged from a downwardly revised pace in the previous month, at a seasonally adjusted, annual rate of 368,000 units, according to figures released by HUD and the U.S. Census Bureau today.

"New-home sales have been occurring at a fairly steady pace since this summer, with October sales running about 17 percent ahead of the pace set at the same time last year," noted Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla. "While this is encouraging, housing's recovery is being significantly constrained by overly tight mortgage lending conditions at this time, and policymaker discussions about changes to the mortgage interest deduction could cast a shadow on future housing demand."

"After steady improvement in home sales through most of this year, the pace of that activity effectively leveled off over the four months from July to October," added NAHB Chief Economist David Crowe. "The latest numbers are right in line with our forecast, which projects that sales will resume a slow, upward trajectory going forward and will end 2012 about 20 percent ahead of 2011."

Regionally, new-home sales numbers were mixed in October. The Midwest posted a 62.2 percent gain following a big dip in the previous month, and the West posted a solid 8.8 percent increase. Meanwhile, the South and Northeast posted declines of 11.6 percent and 32.3 percent, respectively - the latter of which was likely impacted by storm preparations at the end of the month.

The inventory of new homes for sale rose marginally to a still-slim 147,000 units in October, which is a 4.8-month supply at the current sales pace.

ABOUT NAHB: The National Association of Home Builders is a Washington-based trade association representing more than 140,000 members involved in remodeling, home building, multifamily construction, property management, subcontracting, design, housing finance, building product manufacturing and other aspects of residential and light commercial construction. NAHB is affiliated with 800 state and local home builders associations around the country. NAHB's builder members will construct about 80 percent of the new housing units projected for this year.

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Thyssenkrupp Elevator Introduces Enviromax™, The Industry’s First Performance-Improving Vegetable-Based Hydraulic Fluid

ThyssenKrupp Elevator Americas has introduced eviromax™, the elevator industry’s first performance-improving vegetable based-hydraulic fluid for use in hydraulic elevators.

“enviromax is formulated from materials that have minimal effects on the environment and offers building owners benefits that can extend the life of their elevator. It reduces energy consumption and the possibility of temperature related performance issues,” explains Brad Nemeth, ThyssenKrupp Elevator’s director of sustainability.

ThyssenKrupp Elevator Americas partnered with BioBlend Renewable Resources LLC to co-develop enviromax. The product is formulated from rapidly renewable, canola basestocks and is designed specifically for use in elevators. It is a USDA biopreferred product with 92 percent biobased content. It is also 95 percent petroleum free and 100 percent recyclable.

enviromax uses high oleic base oils that reduce the tendency of the oil to oxidize. Oxidation decreases the effectiveness of oil and results in increased service calls. enviromax also promotes consistent performance across a broad temperature range so valves that maintain elevator entryway leveling do not need to be frequently adjusted during extreme weather. Using enviromax can also eliminate the need for temperature control devices used to prevent oil from thickening. “Now, building owners can save money by eliminating these devices that waste energy because they cycle on even when the elevator is not in operation,” explained Nemeth.

To learn more about ThyssenKrupp Elevator America’s enviromax, please visit http://www.enviromaxperformance.com.

About ThyssenKrupp
ThyssenKrupp is a diversified technology and materials group. It has 170,000 employees in over 80 countries developing ideas and innovations into solutions for sustainable progress. In fiscal year 2010/2011 ThyssenKrupp generated sales of €49 billion.

For us innovations and technical progress are key factors in managing global growth and using finite resources in a sustainable way. With our engineering expertise in the areas of “Material”, “Mechanical” and “Plant”, we enable our customers to gain an edge in the global market and manufacture innovative products in a cost and resource efficient way.

The Elevator Technology business area brings together the ThyssenKrupp Group's global activities in passenger transportation systems. With more than 46,000 employees, sales of €5.3 billion euros in fiscal 2010/2011 and customers in 150 countries, ThyssenKrupp Elevator is one of the world's leading elevator companies. Its portfolio includes passenger and freight elevators, escalators and moving walks, passenger boarding bridges, stair and platform lifts as well as tailored service solutions for all products. 900 locations around the world provide an extensive sales and service network to guarantee closeness to customers.

ThyssenKrupp Elevator Americas is the largest producer of elevators in the Americas, with more than 13,500 employees, more than 200 branch and service locations. ThyssenKrupp Elevator Americas oversees all business for the operations in the United States, Canada, Central and South America. It is a subsidiary of ThyssenKrupp Elevator AG.

ThyssenKrupp companies in North America offer a range of products and services, including premium carbon steel; high-performance alloys; automotive components and systems; elevators, escalators, moving walkways and passenger boarding bridges; and plant construction material trading, logistical and industrial services. In fiscal year 2010/2011, ThyssenKrupp companies in Canada, the United States and Mexico employed more than 24,000 and recorded sales of over $10 billion.

About BioBlend
BioBlend Renewable Resources, LLC is the leading manufacturer and marketer of high performance, bio-based lubricants, oils, and greases. The company's advanced lubricant products provide a renewable alternative to petroleum based lubricants while delivering superior lubricity and excellent performance and protection characteristics. BioBlend markets its biodegradable products, and supports environmentally responsible local sourcing and sustainability efforts, through a network of highly qualified lubricant distributors. BioBlend's products are cost competitive with traditional lubrication products and include industrial lubricants, food grade lubricants, aerosols and a growing offering of specialty and custom formulations. Find out more or locate a local distributor near you at www.bioblend.com, or by calling (630) 227-1800.

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Belden Brick Company Donates Pavers for New Logo during Pro Football Hall of Fame’s Largest-ever Expansion and Renovation Project

The Belden Brick Company, a manufacturer of brick and masonry-related construction products and materials, donated to the Pro Football Hall of Fame’s $27 million expansion and renovation project, a 20-foot diameter custom Hall of Fame logo composed of clay pavers. The company also supplied 60,000 face brick and 27,000 pavers for the 2-phase project that is scheduled for completion in June 2013, the same year the Hall of Fame celebrates its 50th anniversary.

“Belden Brick has been an instrumental part of the Pro Football Hall of Fame since its inception,” said William Belden Jr., Belden Brick’s chairman and Pro Football Hall of Fame board member. “My father, William Belden Sr., was a founding member of the Hall of Fame Board of Trustees, and we’re proud to continue giving to this influential fixture in our community with both construction products as well as support from our family.”

The 2-year expansion and renovation project began its initial phase in September 2011, and it was completed in June 2012. The first phase focused mainly on external expansions which added 37,000 square feet to the building. This included the addition of the Ralph Wilson, Jr. Pro Football Research and Preservation Center, named in recognition of a generous gift from the Buffalo Bills’ founding owner and pro football Hall of Famer.

Michael Lombardi, project manager for the Fred Olivieri Construction Company and lead contact for the renovation, expressed how important it was to match various existing exterior brick from several generations of expansions. “The consistency of the exterior brick is important for the visual experience of the hundreds of thousands of visitors the Hall of Fame has every year and the 75,000 motorists that drive by the Hall of Fame on interstate 77 every day.”

Speaking on behalf of the Pro Football Hall of Fame ‘s members, trustees, staff and volunteers, Stephen A. Perry, president and executive director stated that, “Everyone associated with the Pro Football Hall of Fame is sincerely grateful to the Belden Brick Company and the Belden family for their longstanding and continued strong support of America’s premier sports museum and showplace.”

The initial expansion also included a spectacular new main entrance and grand lobby, a large events center and an administrative office wing. Belden Brick supplied brick that matched that of the earlier expansions in the 1970s and 1990s. Phase two, which consists primarily of internal renovations, began the day after Labor Day this year, and it will be complete in June 2013. This phase will include renovation of the exhibit galleries in the original iconic rotunda building, internal construction, new exhibit galleries and renovation of the museum store.

The Belden Brick Company traces its roots to the Diebold Fire Brick Company organized in Canton, Ohio, in 1885 by Henry S. Belden and four associates. The Belden Brick Company owns and operates six plants in Tuscarawas County, employs approximately 500 people and has an annual production capacity of nearly 250 million standard brick equivalent (sbe). In the US brick industry, The Belden Brick Company is the sixth largest (by production volume) manufacturer. Belden Brick is the largest family owned and managed brick company in the United States.

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