Page 30 - BusinessWest December 26, 2022

has raised concerns that a recession is imminent in the new year. Regardless of the label, the econ- omy is slated to significantly slow, unemployment will edge higher, and for parts of the construction sector, it will feel like a recession.”
Some sectors are expected to perform well, he added, including data-center construction, man- ufacturing starts — especially chip-fabrication plants and electric-vehicle battery plants — and publicly funded infrastructure projects. Mean- while, the office, warehouse, hotel, and retail sectors are expected to lag. Branch also expects single-family starts to drop about 5% next year.
Laplante said remodeling, additions, renova- tions, and home improvements comprise 30% to 40% of his firm’s work, and the pandemic played a role there.
“Again, the demand carried over from 2021; demand for remodeling was really high, and a lot of that was just people being home during the pandemic. They were able to work from home and wanted to make a nice office or put a bed- room suite in. We saw that pretty much across the board. People weren’t traveling overseas; they were putting in poolhouses and sunrooms and outdoor kitchens, things like that.”
While he expects interest rates to slow activity in the home-building and remodeling industry, Laplante said the large size of some of his proj- ects, which can take from six months to a year, tends to dampen any slowdown.
“Smaller remodelers are probably seeing more of an effect with interest rates slowing things down quicker than we will see it,” he said. “And then, of course, we’re working with a lot of cus- tomers who aren’t interest-rate-sensitive.”
He added that subcontractors may see a
slowdown before builders because they don’t deal with the same project duration.
The Cape Cod expan- sion is a strategic move partly based on the fact that Laplante was already build- ing there, and it’s also a fairly high-end market, where, as he noted, clients are more willing to weather higher interest rates. “So part of that was a hedge against the economy; you don’t see the deep swings in demand you would see in the Western Mass. market.”
Fontaine said his compa-
ny, while also expanding its
reach geographically, is tak-
ing on more housing work
now that it’s starting to become a priority again. “We did a lot of it for a long time, and we’re see- ing a lot more public housing, affordable housing, make its way back through the funding pipeline.”
His most notable current project in that realm is the ongoing transformation, with Winn Devel- opment, of the Court Square Hotel in Springfield into 71 units of market-rate housing, accompa- nied by retail on the ground floor.
Fontaine’s longtime presence in the educa- tion sector is also strong right now, with projects including the new DeBerry-Swan Elementary School in Springfield, an elementary school in Tyngsborough, a middle school in Walpole, a proj- ect at UMass Chan Medical School in Worcester, and the $240 million Doherty Memorial High
A worker from Fontaine Brothers works on the facade of the former Court Square Hotel.
Photo by Joe Santa Maria, Kill the Ball Media
School, the largest project in the city of Worces- ter’s history.
Help Wanted
After inflation and supply woes, the third chal- lenge construction companies are dealing with remains a workforce crunch, which has affected many other sectors of the economy as well.
“The number of people going into the trades is way, way down,”
Laplante said. “There’s got to be
Challenges
Continued on page 32
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