Stevens Construction Corp. is changing the face of Downtown Madison with multimillion-dollar, mixed-use projects on two of its most visible corners.
Even as other high-profile projects have hit snags or collapsed, the two Stevens projects — one at Park and Regent streets, the other at the corner of West Washington Avenue and South Bedford Street — are on schedule for completion this summer.
They will feature first-floor retail with apartments or townhouses for rent on several stories above. And they will require hundreds of thousands of work hours by some 200 people at each site, generating business for 20 or so suppliers as well, Stevens Construction President Geoffrey Vine said.
The labor on each site includes about 52 field workers from Stevens doing the carpentry and concrete work, plus dozens of others working for subcontractors hired by the Madison-based company.
"As far as the city is concerned, they're two very good projects," said Brad Murphy, director of Madison's planning division. "They're both mixed-use developments, and they are both very much in keeping with the neighborhood plans for the area."
For Stevens, which has about 150 construction workers and field supervisors plus an office staff of 30, the two projects have helped spur a return to full employment — after about 50 people were laid off in the fall — and extra hires.
"We brought everybody back and added a dozen new (construction) workers," Vine said. "We've been through the worst of it, and now we're actually seeing good times."
Shaping up to be a good year
And the company doesn't expect to slow down soon.
While building activity has been anemic in Madison for the past few years — the two Stevens jobs were among only 13 mixed-use and multi-family permits issued last year in the entire city — Vine said things really began picking up for his company after Jan. 1.
"Since then, we have just seen this unbelievable increase in activity, with people contacting us about opportunities, and that's continuing," he said. "We're into our third month now of that increased activity, so for us it's starting to shape up that the second half of 2010 will be back to above-average business."
Founded in 1952, Madison-based Stevens Construction builds for the multi-family, retail, commercial, industrial, office, hospitality and senior housing markets. Individual jobs include water parks, resorts, hotels, banks, apartment buildings, restaurants, interior finishes and community projects such as libraries, fire stations and churches.
About the only type of building that Stevens doesn't do is health care facilities, something Vine hopes to change at some point. But he also said branching out isn't as important as continuing to improve quality from within.
"The goal is to get better at what we do, not necessarily bigger," he said.
One way to do that, Vine said, is to focus more on green building techniques that can save clients money over time — through lower energy bills or improved structural longevity — in addition to being better for the environment, Vine said.
"Everybody is being more frugal now," he said.
Among the state's 20 or so biggest general contractors, Stevens Construction has typically earned around $100 million in revenues per year, though it's been less than that the past few years, Vine said. It focuses on a market within a 60-mile radius of Madison.
Stephen Stone, president of Associated Builders and Contractors of Wisconsin, said Stevens Construction is well known in the industry and has a "very good reputation" for doing quality work, being competitive and taking on some "very large and visible projects."
Watching the company grow over the years, Stone said he was struck by how involved its leaders and employees have been in the training programs provided by the trade association.
"Just about everything we offer, they've taken," Stone said, from executive training to apprenticeship and safety programs for superintendents and craft-level professionals. "When a company takes advantage of that, whether they're very small or very large, they tend to excel."
Better ways to build
In a typical year, Vine said his company does 10 projects in the $5 million to $20 million range, 10 projects in the $500,000 to $5 million range, and 20 projects at $500,000 or less. But the company did only about half its usual workload in 2008 and 2009, he said.
What keeps Vine and others at the company going, good year or bad, is the satisfaction and challenge of building, he said.
"Building buildings is a very concrete, rewarding thing," Vine said. "You can see your efforts, and we all share and celebrate the buildings that we build. The most enjoyable thing is going out and finding a better way for building buildings."
"You would think that buildings have been built the same way for the last 20 years, but that's not true," he added. "They are constantly evolving, and there are new things we learn and come up with on every job."
At the same time, Vine said, the toughest part of being a general contractor is the "huge amount of coordination required" between all the parties on a job, including the owner, architect, engineers, subcontractors and suppliers.
"The challenge is being able to be involved and get things done within that larger group effort," Vine said. "All of these players, they change from project to project. It's the same sort of thing, over and over, but with a new group of human beings who are very variable."
The commercial construction business is beginning to pick up now, Vine said, in part because of reduced costs for material and labor.
"There's less demand, so prices (for supplies) have come down, and there's an aggressiveness with the subcontractors (competing for jobs) that results in lower pricing," he said.
Vine estimated costs for supplies such as lumber are down as much as 20 percent now, helping to push total project pricing down by about 10 percent from its peak a few years ago. But he predicts that won't last, with construction pricing increasing by perhaps 10 percent plus inflation in three years.
"That's what makes building now such a great opportunity," he said.
Bucking the city trend
City officials can only hope Vine's report of increased business since Jan. 1 will be replicated by other builders and developers.
Over the past six years, total commercial permits in Madison have decreased by 75 percent — from 202 issued in 2004 to just 51 in 2009 — and it's difficult to imagine them going much lower, Murphy said.
"I would expect that given where permits have been for the last couple of years, that we will see an uptick in the next couple of years and hopefully that will begin to occur yet this year," he said.
"We continue to talk to a fair number of property owners and developers about construction Downtown," Murphy added. "My crystal ball would not be any better than yours, but there are a number of projects that are in the preliminary discussion phases.
"We don't even have concept plans yet, but there are projects that could be coming in the near future."
But given the general slowdown in building, the two Stevens projects — easily among the largest privately held developments being built in Downtown Madison today — become that much more crucial, Murphy noted.
"They were important projects to get approved and we're very pleased to see the construction occurring," he said. "They are very visible."