Kevin Smith has seen good and bad times for the local construction industry, but the current environment, he said, most definitely is among the good times.
“It hasn’t been better than this in a long, long time,” said Mr. Smith, chief executive officer of the Associated General Contractors of Northwest Ohio.
Besides adding jobs, the boom in northwest Ohio and southeast Michigan construction projects has made cash registers ring for those who rent heavy equipment — everything from small forklifts to cranes that can lift 1,000 tons — to the contractors building everything from new roads to power plants.
“It’s going be a good year but a stressful year trying to keep everybody supplied and happy,” said Bryan Cox, a sales representative at NES Rentals in Perrysburg Township, a firm that rents aerial-lift equipment, boom lifts, industrial forklifts, and regular forklifts.
A crane from Jeffers Crane Services is used at a construction site at Eckel Junction Road at Dixie Highway in Perrysburg. The firm just added 50 seasonal workers. THE BLADE/LORI KING
Renting such construction and industrial equipment is a nearly $34 billion market in the United States, according to the American Rental Association.
Rental prices vary by demand and other factors, but in northwest Ohio, for example, daily rates for a 40-foot high boom lift costs about $350 a day; a backhoe-loader, $340 to $600; a bulldozer, $1,200 to $2,000, and a large excavator, $1,700 to $3,600. Cranes can be rented by the hour, often at about $100 an hour for a small crane and up to $600 an hour for a large crane, according to industry websites.
Those in the equipment industry say rentals were strong through 2006, but then the recession in 2007 dried up new construction projects and essentially left their businesses in a deep freeze. Business began to return in 2012, picked up a little more in 2013 and 2014, and exploded last year, they said.
In northwest Ohio, between the industrial work, the refinery projects, and the highway construction, is surging, said Butch Bucher, general manager of Jeffers Crane Services. The suburban Toledo company rents cranes with lifting capacity from 5 tons to 1,000 tons. Last year and the year before were strong years, but this one promises to be better, he said.
One project is the construction of the Oregon Clean Energy LLC electric plant on Lallendorf Road in Oregon. “The bulk of the machinery there is ours,” he said.
Jeffers Crane said the bulk of the equipment at the Oregon Clean Energy power plant site is from the suburban Toledo firm. It rents cranes with lifting capacity from 5 tons to 1,000 tons.
There also are heavy-equipment rentals at the Husky refinery and Potash Corp. chemical plant in Lima as well as ProMedica’s $46 million headquarters project in downtown Toledo and its $350 million 14-story tower project at Toledo Hospital.
Construction jobs increased in most metro areas across the country in January compared to a year earlier, according to the Associated General Contractors of America. Monroe had one of the biggest percentage gains, with a 30 percent increase, and metro Toledo registered a 16 percent gain, or 1,700 jobs, for a total of 12,600 jobs in January, with the second best growth in Ohio and 13th highest in the United States.
Smaller projects have bolstered local construction equipment rentals, said Mr. Cox of NES Rentals. Some of those are school projects in Northwood and Liberty Center.
“I’ve been with NES 10 years … and by far last year was my best year,” Mr. Cox said. “We’re hoping that we either stay on track with that or exceed that.”
NES, which rents forklifts for between $400 and $500 a day, has many orders for mid-April, he said.
And the area’s many highway projects have kept the equipment rental firms busy.
Jeffers Crane of Oregon just added 50 seasonal workers to help with demand for crane services.
Its storage yard “is pretty empty. We’re running on zero for availability,” Mr. Bucher said. He is now getting equipment for rental from sister companies.
Tyler Tresize, a rental representative for Ohio Cat (Caterpillar) Rental of Perrysburg, said his company has been moving equipment from other Cat Rental yards in Ohio to northwest Ohio to increase the local equipment fleet and meet increasing demand.
“It’s kind of funny to be the envy of other parts of the state finally,” Mr. Tresize said. “We’ve definitely had to add some more items to our fleet.”
Mr. Tresize, a Toledoan who has been in the construction industry since 1998, said the number of construction jobs has been growing steadily each year since 2011.
The growth has had a domino effect, as large projects mean jobs for big contractors, which means those big contractors bypass medium and smaller projects and leave more work for medium and small contractors, Mr. Tresize explained. Those medium and small contractors can’t afford to own their equipment, creating more sales for rental firms.
“Everybody I’ve talked to is very optimistic,” Mr. Tresize said. “What happens is when the big players are busy there’s a boom for the medium and small players.
“We’re renting everything from scissor lifts, to dozers and excavators to forklifts,” Mr. Tresize said. “Also, we’ve seen a big uptick in guys that are framing houses. They need truss booms and forklifts.”
Ray Cordrey, general manager at Buck & Knobby Equipment Co. in Ottawa Lake, Mich., agrees that the housing market is picking up, and that’s probably related indirectly to the rise in commercial construction, which, in turn, is a key sign of a recovering local economy.
“It’s a big vicious cycle everywhere. You can’t move anyplace without seeing orange barrels,” he said.
When the economy improves and people make money, they in turn spend it, helping others, he explained.
“As the auto industry picks up and people work overtime in construction, they buy new houses or do other home projects. My daughter’s neighbor just put in a swimming pool,” Mr. Cordrey said.
The uptick in the housing market gives Buck & Knobby, which rents forklifts, backhoes, and other equipment used in smaller construction jobs, “a bigger part to play,” he said.
Contact Jon Chavez at: [email protected] or 419-724-6128.
Read more at http://www.toledoblade.com/Economy/2016/03/27/Demand-for-equipment-heavy.html#L4bxzQkkLYydABWk.99
