JK Scanlan Company, Inc.

2011 Forecast by John Scanlan published in The NEREJ

As we roll into 2011, the dynamics of the real estate and construction markets are beginning to show some stability as the underpinning of each are becoming more positive. The U.S. Department of Labor estimated that over 100,000 construction jobs have been lost in 2010, a figure that is significantly lower than in 2009. The avalanche of foreclosures and short sales seemingly is abating as noted in the uptick in real estate transactions in December, 2010. It has been reported that the holiday sales were more robust than the prior year. More and more people are sticking their heads out of their foxholes and beginning to spend again as their confidence is rising on what lies ahead.

These psychological changes should begin to diminish the unemployment rate as well – as this is what ultimately drives the commercial market. As people regain their confidence and economic footing, the commercial real estate markets will feel pressure to respond and the banking industry will look to make money again on real estate loans. There are many backlogged projects waiting for impetus.

This trickledown effect can take some time to congeal and for its impact to be felt in the construction industry. Late 2011 appears in my crystal ball to be where projects will begin to emanate. The Obama administration will also feel significant pressure to stimulate the economy but this time the injection will come from fiscal policy rather monetary cash grants policy and there will be a longer lag time.

In the meantime, our firm has weathered this storm by staying fairly diverse. For J. K. Scanlan, markets that are still active are in the alternative energies; healthcare; senior/assisted living and affordable housing; and the government and municipal markets. While larger scale construction projects have slowed down, hospitals continue to improve their facilities. The “Green” movement continues its momentum in construction and healthcare is no exception. In addition to environmental issues, hospitals and healthcare centers implement these “Green” practices within new and renovation projects, creating more pleasing environments for their patients.

Wind Energy projects have become a focus for our firm, since our venture into this territory our firm has been awarded over 13 megawatts of wind turbine construction projects. Wind power is one of the fastest-growing sources of energy around the world. It is popular because it is abundant and provides many communities with a clean, local source of electricity as opposed to imported fossil fuels. The Department of Energy has estimated that wind power could account for 20 percent of the nation’s electricity supply by 2030. It has been reported that despite the crippling recession and tight credit markets, the American wind power industry has grown at a remarkable pace in 2009, adding 39 percent more capacity. In fact, the United States is close to the point where 2 percent of its electricity will come from wind turbines. The American Wind Energy Association reported that the growth of wind power was assisted by the federal stimulus package which extended a tax credit and provided other investment incentives for the wind industry. This trend slowed in 2010 as the recession idled many manufacturers and new orders weakened. These trends seem to be sustained and I am optimistic that our revenues will be stable until the commercial and institutional markets regain their legs.

So my opinion is, there is cause for optimism. While the economy and construction industry are still slow to recover, new developments will create jobs and help sustain the local economies, in turn the national economy will also regain its momentum. For many Americans, this recovery is taking longer than we would like, but I am cautiously optimistic. The firms that prosper will have this same or similar market diversity and be able to strategize how to get over the mountain until later this year.

Good luck!

Dennis Manse Museum - Historical Renovation Complete

Nantucket Airport Aircraft Rescue and Fire Fighting Building Complete

J.K. Scanlan Co. Inc. Completes construction of Two Wind Turbines in Gardner, MA

J.K. Scanlan Company, Inc. recently completed the erection of four wind turbines in Gardner, MA as part of two separate contracts for the Division of Capital Assest Management (DCAM). Two of the Vestas V82 1.65MW turbines are located at the Mt. Wachusett Community College campus and the other two are at the North Central Correction Institute (NCCI). Both projects included the design of the turbine, tower, foundation and connection into the grid. The turbines will cover 100% of the yearly power consumption for each building.

As a way to educate visitors, J.K. Scanlan has provided informational kiosks for both facilities. The kiosks include information on the wind turbines, how they operate and how much power they create. J.K. Scanlan is dedicated to the implantation of renewable energy and to green building. A joint collaboration of DCAM and the Department of Energy Resources (DOER) through the “Leading by Example” program, Gov. Deval Patrick’s wind power goal is coming to life. The construction of these two turbines not only benefits the two institutions but also the Massachusetts taxpayers through savings provided by surplus electricity produced by the turbines.

The project team was led by Andrew Baker, Project Executive, Greg Inman, Project Manager, Patrick Scanlan, Assistant Project Manager and Joe DiPeitro, Project Superintendent.

J.K. Scanlan Co. Inc. Completes Construction of the Methuen Readiness Center

J.K. Scanlan Company, Inc. recently completed construction of the Methuen Readiness Center located in Methuen, MA. This brand new 67,000 square foot building located on 5.5 acres will be used as a training center for the Massachusetts Army National Guard. The two-story facility includes administrative offices, classrooms, locker rooms with showers, a commercial kitchen, storage areas and a vehicle maintenance and training bay. Also at the very center of the building is a large assembly hall with a beautiful and unique exposed concrete floor.

The $11,465,000 contract was awarded to J.K. Scanlan Company, Inc. in May 2010 and was completed and turned over to the state in February 2011. The contract included demolition of the existing garages, while the original building remains untouched. The new brick façade building is currently awaiting confirmation on its LEED Silver certification. Some of the green aspects of the building include use of energy efficient HVAC & lighting systems, a white roof to lessen the heat island effect, 75% diversion of construction waste including recycling of construction waste. The design of the building also allows for daylight to enter 75% of the spaces. All of the landscape is natural to the Northeast so the use of an irrigation system is unnecessary as the plantings adapt well to the climate.

The project team was led by Jack Dankert, Project Executive, Chris Kerr, Project Manager and John McDermott, Project Superintendent. For more information please contact the JKS team at 508-540-6226.

Community Health Center of Cape Cod in Mashpee

J.K. Scanlan Company, Inc., has recently been awarded the contract for the addition to the Community Health Center of Cape Cod in Mashpee. The 22,000 square foot outpatient facility located adjacent to the existing health center will have a construction cost of $6.5 million. The completed center will provide a range of medical, behavioral health, and dental services and will be designed to serve the towns of Mashpee, Sandwich, Bourne, and Falmouth, as well as the surrounding communities.

Preconstruction services began in January of 2011, and construction is set to kick off in June of 2011. The environmentally conscious building will be designed to achieve a silver rating with the Leadership in Energy & Environmental Design (LEED) criteria. The addition is anticipated to reach completion in September of 2012.

J.K. Scanlan’s Healthcare construction team includes Project Executive Ward Jaros, Senior Project Manager Christy Murphy, and Assistant Project Manager Russell Brown. Architectural services are by Anshen + Allen Architects, a Stantec Company.

The Community Health Center of Cape Cod is an independent, non-profit 501c(3), Federally Qualified Health Center. It operates two satellites (Falmouth and Bourne, MA) and a School Based Health Center located within Barnstable High School. It has been in operation approximately 13 years.

In addition to the Healthcare Division, J.K. Scanlan Company, Inc. provides Construction Management services in educational, commercial, and historic restoration projects, as well as providing renewable energy services within the newly developed JKS Wind, LLC, a division that designs and constructs wind turbines. J.K. Scanlan Company, Inc. is located in East Falmouth, MA. For additional information, please visit our website at www.jkscanlan.com, or call 508-540-6226.