The construction industry has been one of the hardest hit markets during the current economic downturn, with approximately a third of the firms folding.
But, despite the obstacles, there are a few local companies that have been able to grow their business and earn a profit, one of which is PCL Construction Services Inc.
Dale Kain, district manager of the PCL Construction San Diego office, said the company as a whole – which has 28 district offices around the United States – was setting records two years ago in terms of project backlog.
“In San Diego we are going to have our best year ever,” said Kain about 2011, where he estimates the district office will bring in $185 million in construction work. PCL Construction has been in San Diego since 2004 with Kain heading the local district office for the last 14 months.
Kain said the reasoning for the successful year has been the projects they have been able to win.
Some of their portfolio and backlog of projects include a student services building at San Diego Mesa College; a continuing education building in Linda Vista for the San Diego Community College District; the 6.8-acre Mercado del Barrio mixed-use redevelopment project; and the construction of the new San Diego Fish and Wildlife Complex.
The largest project currently on the books for PCL in San Diego is the expansion of Terminal 2 at Lindbergh Field. This is a joint-venture design-build project – including Turner, PCL and Flatiron Construction – that will add 10 additional gates along with more restaurants and shops inside the terminal.
PCL’s San Diego office also has a “special projects division,” which focuses on jobs ranging from $5,000 to $5 million that deal with smaller work like elevator upgrades and tenant improvements.
“It’s been a tough year economy wise but we have fared very well because of projects we have been able to pick up,” said Kain. “We have been real smart on the (projects) we have gone after and been able to win, which are mostly design-build.”
This year, the local office has been able to hire 12 new employees because of the volume of work currently on the books. Kain said the company is also looking at hiring a few more people because of projects that will be breaking ground in the first quarter of 2012.
“We’ve had some good success because we’ve done a really good job in addressing what the owners are looking for (and) drilling down what’s important,” said Kain.
When it comes to deciding what new market sector to get into and what areas of San Diego County to explore for new opportunities, Kain said this decision is a collaborative effort between all senior staff members.
“We have a strategic vision of what we want to do and how we want to grow (our) San Diego (operation),” said Kain, based on the company's strengths.
PCL also pays attention to what is happening in the industry in other parts of the country.
“We have business development conference calls monthly, with all of the other districts across the U.S.,” said Kain, who has been with PCL for 26 years. “We also try to understand what the national economy is doing. Then my job is to help pull that back into ‘how does that affect San Diego and how we can move forward in the San Diego market?’”
PCL plans to fully get back into the high-rise multi-family housing construction market in the near future, and has already started this process.
“We have actually budget several mid-rise apartment type projects in the last two-three months,” said Kain, adding that a couple are moving forward in downtown San Diego, but declined to give specifics on the two projects.
Kain believes once consumer confidence returns in the economy, banks will lend more, development will ramp up again and construction will grow.
“So what do we do now? We try and understand who are going to be the movers and shakers of the private market,” said Kain, “and we just make sure we build relationships with them now, so that two to three years down the road, we can help do some of their work.”
Kain believes the downturn in the construction industry has bottomed out, but he estimates there will be roughly six months where there will be no growth at all.