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Construction business is booming


Visitors to Greater Des Moines, especially those from cities of similar size, often comment about the number of construction projects in town and the number of cranes in the sky. Between the Capital City Vision Projects, the Jordan Creek Town Center and Wells Fargo & Co.’s new office complex in West Des Moines, business is booming for local contractors.

About 15 months ago, the Greater Des Moines Partnership conducted a survey of city planning offices. The survey asked what construction projects were under way, and the budgets of those projects. The total was $1.5 billion in public and private projects in Greater Des Moines, according to Partnership spokeswoman Susan Ramsey, and although the survey has not been updated, she would guess the current total would be “fairly consistent” with that figure.

Vision Iowa is a financial assistance program established by the 78th General Assembly of the Iowa Legislature to fund construction projects related to recreation, education, entertainment and cultural activities, according to the Web site, www.visioniowa.org. The program, which became effective July 1, 2000, provides financial assistance for major attractions costing at least $20 million, though it does have smaller divisions that assist smaller projects and schools.

The Capital City Vision Project brought $50 million to Polk County for the new Iowa Events Center, $15 million for a new Science Center of Iowa, and $5 million for the construction of the Iowa Hall of Pride. The loan is contingent upon the completion of a new downtown Des Moines Public Library, the development of the John and Mary Pappajohn Higher Education Center, and the rehabilitation and development of the current downtown library building to house the World Food Prize Center. The total projected cost of these projects is $338.5 million. Of the $75 million requested from the state, $70 million was received in the forms of a grant and a forgivable loan.

As the Vision Iowa projects, the Interstate 235 reconstruction, Jordan Creek and the Wells Fargo building projects draw to a close in the months to come, some wonder what will happen to the local economy and the local construction industry .

“The Central Iowa economy is extremely strong,” said Mike Blouin, director of the Iowa Department of Economic Development and statutory member of the Vision Iowa board of directors. “I don’t see a letup of that growth. After the [Vision Iowa] projects are built, the projects themselves will keep the ball rolling. Success begets success. Look what a small investment in the East Village has done.”

Blouin said he recently toured several cities with new arenas and convention complexes, and each community had one thing in common: Several blocks around the arenas and convention complexes had undergone redevelopment. He says one of the main purposes of a project like Gateway West is to stimulate growth in the surrounding area.

“Not a lot of companies are willing to spend a lot of private dollars right now,” said Eric Taylor, director of business development for Taylor Construction Group. “Public funding has created a lot of excellent projects, and Des Moines is poised to see more growth. If the economy improves, Des Moines should be a great place to grow in, with even more building.”

Taylor’s biggest project currently is the $6.5 million Jasper County Law Enforcement Center in Newton. It is scheduled for completion by the end of 2004.

“We’re very fortunate to have the Events Center, Wells Fargo expansion, the new library, the Science Center and the Pappajohn [Higher] Education Center under construction,” said Marshall Linn, president and chief executive of Neumann Bros. Inc. “We’re very blessed to have a community that is moving forward. That momentum started last September with the stock market turnaround. People were reinvigorated.”

Neumann is currently working on the Science Center, the Des Moines University expansion and the new façade for the Federal Building. The general contractor is also in its 22nd year of performing renovations on the Iowa Capitol. Linn said he sees excitement building over the Western Gateway and downtown housing.

“We should all be proud to live in a city this vibrant,” he said.

“The construction industry is robust right now, and the outlook is bright,” said Shane Madison, vice president of Russell Construction Co. Inc. “If interest rates stay low, like they are, we have a great possibility of continuing this momentum.”

Russell’s biggest project right now is the Village at Jordan Creek, a $8 million, 215,000-square-foot complex of retail buildings. Madison sees a possible advantage to the completion of some of Greater Des Moines’ major construction projects, because the high volume of work has put some stress on the local labor pool. That can drive up wages and –– as companies try to do more work with fewer people –– decrease quality.

“For Jordan Creek and the Iowa Events Center, a lot of work is being done by out-of-state firms,” he said. “We don’t have the labor pool for that much work.”

“Everybody [in Des Moines’ construction industry] is busy, and the labor market is tight,” said Douglas Dieck, vice president of development for Ryan Companies U.S. Inc. His company’s biggest projects locally are Target stores in West Des Moines and Altoona, and an office building and an airplane hangar for Principal Financial Group Inc. Dieck says ING Groep’s March 18 announcement that it would add 105 workers to its Des Moines workforce in the next few months is evidence that the local economy is improving. Job growth drives office development, Dieck said. He also said public money for infrastructure will help keep the ball rolling for the local construction industry.

“In general, Jordan Creek and Wells Fargo added a sense of euphoria to the construction community,” he said. “It’s great to see, and hopefully it can be maintained.”

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