Good Times

Design Firms Are Expecting a Strong Development Push

Design firms in the New York, New Jersey, and Connecticut Region are plenty busy. But they are expecting the workload and opportunities to increase further next year - all bringing back a boomtime after several lean years.

by Katherine S. Robertson

	Design experts: Michael Burton of URS, left, and Greg Kelly of Parsons Brinckerhoff.

For design engineers, 2005 might very well be the calm before the storm. If everything lines up as projected, a rush of programs and projects that have been bottled since 2001 may hit the marketplace seeking designers.

"A lot of projects are just waiting to start," said Michael Burton, senior vice president for San Francisco-based URS, and manager for its New York office. "If the current economy continues and all the major programs planned are funded and move forward at the same time, the volume of work could push the industry to the limit."

There are, of course, wild cards. If interest rates rise as threatened, the housing side of the industry - which has been the strongest piece of the market over the past four years - will suffer. And, if voters fail to pass the $2.9 billion New York Transportation Bond Act in November, some of the state's high profile transportation projects will take a hit. Included in the bond proposal are $1.35 billion for the state's highways and bridges, $450 million for the East Side Access program linking Long Island trains to Grand Central Terminal, $450 million for the JFK Rail link, and $450 million for core city infrastructure.

advertisement

While designers and architects haven't been seeing the dramatic growth they experienced in the late 1990s, the industry never truly slumped, said Gregory Kelly, senior vice president for New York-based Parsons Brinckerhoff. "Five years ago, things were really booming," he said. "Anything short of that is seen as a downturn."

New Jersey appears to have stayed hot, propelled by a strong mix of public and private projects, according to Kevin Toolan, president of Middletown-based T & M Associates. His 35-year-old company has seen on average 10 percent annual growth in revenues and staff since the turn of the century, growth which he sees as fueled by strong residential and commercial development and a stable backlog of publicly-funded school and infrastructure projects. "We really didn't see a slump at all," he said.

Toolan predicts strong continued growth on the private side spurred by New Jersey's pharmaceutical industry and by the focus of public resources on reclamation of urban areas, particularly the state's waterfront properties. "In Jersey, a lot of the premiere land - including the waterfront property - was industrial," he said. "Redevelopment is good for the engineering community."

	The design for Blue at 105 Norfolk on Manhattan's Lower East Side, by New York-based architect Bernard Tschumi, calls for a "pixilated" blue glass and concrete slab condominium tower with an irregular shape.

The architectural side has also kept moving, a trend spurred by developers trying to stay ahead of the competition, retain and accommodate expanding tenants, or to change their brand to attract better tenants, said Edward Rothe, senior vice president at Fletcher Thompson Architecture Engineering's New Jersey office. County colleges have been a major driver of his company's growth, 25 percent and 36 percent in the last two years, and will be a source of continued growth. Hospitals are also strong, as they keep up with state of the art healthcare delivery and more complex patient care, Rothe said.

Commercial real estate has been soft, he added. His firm shifted its portfolio toward public work, changing from a 75 percent to 25 percent ratio to a virtual 50-50 split today.

If next year is poised to bring more work, it may indeed stretch limits. Various other architects are busy with design and construction of buildings and master plans for private developers, institutions, and public agencies.

A major plan in the making is a community development program prepared by Apollo Real Estate Advisors and the Spector Group Project Team for Riverhead, N.Y., on Long Island. The development aims to make the town both a robust place to live and a visitor's destination, with plans for new and renovated residential and retail spaces along with extensive historic preservation and relocation of existing designated structures. The plan also calls for developing riverfront access, museums, and special entertainment attractions.

In Manhattan, Gruzen Samton recently completed a design for Boymelgreen Development's adaptive rehabilitation of 20 Pine Street. The $120 million building, which will be converted into approximately 400 residential condominium properties, also will have retail at the base. Gruzen's design objective was to create modern, efficient residential dwellings, while retaining the historic grandeur of the existing structure.

And Graf & Lewent Architects recently completed a design concept master plan for Vaughn College of Aeronautics and Technology. Located in East Elmhurst near LaGuardia Airport, the engineering technology, management, and aviation college was looking for a comprehensive architectural program and plan review. The preliminary design for the renovation and construction of campus facilities includes conceptual planning for a new 200-student residence hall.

And Blue at 105 Norfolk, a $17 million "pixilated" blue glass and concrete slab condominium tower in Manhattan, started this summer by New York developers Angelo Cosentini & John Carson, is a study in design as defiant response to constraint. Faced with three different zoning regulations concerning height, bulk, and air rights on the Lower East Side parcel, New York architect Bernard Tschumi cantilevered the building from the fourth floor up on the south side, then went straight up from the 12th floor, but cantilevered in the opposite direction on the east side. It also takes out a rectangular chunk from the top of the west side. As a result, at its base, the building measures 100 by 50 ft. At its narrowest, it is 71 ft. by 20 ft. on the north and 12 ft. on the south.

On the infrastructure side of the design world, the long-awaited reauthorization of the federal transportation funding bill is also promising more work. The Safe, Accountable, Flexible, Efficient, Transportation Equity Act - a Legacy for Users, otherwise known as SAFETEA-LU, pumps more than $286 billion into transportation projects over the next six years nationally. After nearly three years of patching together bridge, highway and transit projects through stop-gap continuing resolutions - a funding mechanism that put a virtual halt on larger projects requiring multiple years of funding - President Bush signed the long awaited bill in early summer.

According to Patrick Natale, president of Reston Virginia-based Association of Consulting Engineers, SAFETEA-LU provides the bare minimum of what is needed to shore up and expand the nation's T-21 reauthorization. The industry had been pushing for a federal investment of $375 billion to address a backlog of needs and provide the transportation infrastructure needed to service the country's economy.

In the tri-state area, only New York came in among the top 10 states in funding awarded through the bill. It would receive $8.5 billion, less than half of the more than $17 billion designated for California and far below the $14.5 million allocated for Texas. New Jersey is up for $4.7 billion and Connecticut, $2.48 billion.

SAFETEA-LU will not be an immediate panacea for the design community. Northeastern states are will be paying a higher percentage of the cost of highway and transit infrastructure projects than they had historically, a cost that has to be covered by state-generated revenue via vehicles such as bond issues, gas tax increases, or tapping into existing trust funds.

"The continued lack of local funding can cause the market to come to a standstill," said Peter Allen of ACENJ. "The reauthorization of a dedicated Transportation Trust Fund, with new revenue sources, is needed to insure a strong future economy in New Jersey. Without an immediate funding source for the trust fund, the transportation market will come to a halt and there will be a continuing deterioration of the existing transportation system in New Jersey."

The federal bill's passage can, however, release projects for construction that have languished in design, waiting for the funding bill to pass, allowing states to move forward with projects with multiyear contractual commitments, Natale said. "SAFETEA-LU has done a nice job of opening the gates a little," he added.

Overall, the design consultant industry has been strong, Natale said. "Like many other sectors, it has had its share of mergers and acquisitions," he said. "Some people may have lost jobs due to consolidation, but they've easily found others. The market has been steady."