{"id":2730,"date":"2020-11-18T09:22:05","date_gmt":"2020-11-18T14:22:05","guid":{"rendered":"https:\/\/www.construction.com\/newsroom_details_pag\/covid-recession-puts-damper-on-large-construction-projects\/"},"modified":"2025-08-07T09:52:18","modified_gmt":"2025-08-07T13:52:18","slug":"covid-recession-puts-damper-on-large-construction-projects","status":"publish","type":"post","link":"https:\/\/www.construction.com\/reports\/covid-recession-puts-damper-on-large-construction-projects\/","title":{"rendered":"COVID recession puts damper on large construction projects"},"content":{"rendered":"

The trade group Associated General Contractors of America reported that more projects were canceled than were started in the last 12 months, and that construction employment declined<\/a> in most metro areas.<\/p>\n

The Houston area lost the most construction jobs of any big city over those 12 months.<\/p>\n

Before COVID-19 hit and the economy tanked, Houston Methodist Hospital<\/a> was well along in its plans to expand downtown. Centennial Tower is a $700 million-plus project to serve more patients.<\/p>\n

\u201cThe day that I had to call the architects and the engineers and the general contractor back in March and tell him we\u2019re gonna put this on hold, that was a hard call,\u201d said Sid Sanders, senior vice president for design, construction and real estate at Houston Methodist.<\/p>\n

Sanders said the tower was put on hold because the economy\u2019s too unpredictable right now.<\/p>\n

\u201cCentennial is over a million square feet,\u201d he said. \u201cIt\u2019s going to be somewhere around 30 floors. It will probably peak out with close to 1,000 people on that job site during the peak of construction.\u201d<\/p>\n

Sanders said he\u2019s hoping to get started on building the Centennial Tower in the first part of 2022 \u2014 about a year later than first planned.<\/p>\n

Richard Branch, chief economist for Dodge Data & Analytics, said total construction spending in Houston in the first nine months of 2020 was about $15 billion.<\/p>\n

\u201cThat sounds like a lot of money. However, that\u2019s full 17% below where Houston was during the same period of 2019,\u201d he said.<\/p>\n

One of the reasons Houston is a little worse off than the U.S. as a whole is because of the slowdown in the energy sector. Patrick Jankowski, senior vice president of research at the Greater Houston Partnership, said COVID-19 is making chemical plants and refineries along the Houston Ship Channel hit pause.<\/p>\n

\u201cWe\u2019ve seen a lot of those projects put on hold now, as the industry is trying to assess where we are going with energy demand and where are we going with demand for chemicals and plastics,\u201d he said.<\/p>\n

The demand for construction workers is down, too.<\/p>\n

\u201cIn February, just before the pandemic hit, we had 244,000 people working in the construction industry in Houston. The pandemic cost us 31,000 of those jobs. We\u2019ve only gotten back about 3,000. We\u2019ve gotten back less than 10% of what we lost,\u201d Jankowski said.<\/p>\n

Stan Marek said his Houston workforce is down 20% from last year. He\u2019s CEO of Marek Brothers, one of the largest commercial interior contractors in Texas. He was all set to bid on the Centennial Tower project at Houston Methodist when the project got delayed.<\/p>\n

\u201cNow as far as the workload, yes, there have definitely been jobs stopped. But, you know, there\u2019s work,\u201d Marek said.<\/p>\n

Marek said there\u2019s still some work because of contracts secured before the pandemic. But he\u2019s not expecting things to get much better until 2022.<\/p>\n","protected":false},"excerpt":{"rendered":"

The trade group Associated General Contractors of America reported that more projects were canceled than were started in the last 12 months, and that construction employment declined in most metro areas. The Houston area lost the most construction jobs of any big city over those 12 months. Before COVID-19 hit and the economy tanked, Houston…<\/p>\n","protected":false},"author":41,"featured_media":23698,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_uag_custom_page_level_css":"","footnotes":""},"categories":[75],"tags":[],"class_list":["post-2730","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-reports"],"acf":[],"yoast_head":"\nCOVID recession puts damper on large construction projects | Dodge Construction Network<\/title>\n<meta name=\"description\" content=\"The COVID-19 recession has slowed down large construction projects. 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