Pratt & Whitney reaches agreement to sell 300-acre former airfield near Rentschler Field
East Hartford jet engine maker Pratt & Whitney announced
Monday that it has reached an agreement to sell its 300-acre former airfield to
a Massachusetts-based development and investment firm, which plans to use the
site for unspecified commercial development.
In a statement, the manufacturer, a subsidiary of Raytheon
Technologies, said the land, known as Rentschler Field, will come under the
control of National Development, which has its headquarters in Newton Lower
Falls, just west of Boston.
A purchase price was not disclosed.
Commercial real estate services and investment firm CBRE,
which was involved in facilitating the deal, said the property includes more
than 280 developable acres, making it perhaps the largest development site
available between New York City and Boston.
The site
was marketed as a potential logistics hub, given the significant demand for
new warehouse space in Greater Hartford. It’s the same site where a developer
previously pursued construction of a $105 million, 70-store shopping outlet
center for about five years before abandoning the project in 2018.
“This brings tremendous opportunity for economic development
to Rentschler Field, which could have a very positive impact on the overall
Greater Hartford area,” said Shane Eddy, senior vice president and chief
operations officer at Pratt & Whitney. “With neighbors like Pratt &
Whitney, Cabela’s and UConn football, the site offers an attractive place to do
business with incredible access to major highways as well as the estimable
talent available in the region’s job market. We are pleased with the work CBRE
has been able to do and look forward to an exciting next step for this historic
piece of property.”
Rentschler Field functioned as a military airfield and then
as a private, company-run airport until 1999, when it was formally
decommissioned. Part of the property was split off and developed as Pratt &
Whitney Stadium at Rentschler Field.
“National Development is very enthusiastic about the
potential for the next phase of development at Rentschler Field,” said Edward
Marsteiner, managing partner at National Development. “The combination of the
central location, the immediate highway accessibility and the access to a
densely populated labor pool is unparalleled and we are already hard at work
evaluating possibilities for the site. We have a long track record of
partnering with communities to deliver best-in-class projects, and we look
forward to collaborating with local and state agencies to finalize the sale and
bring economic development to this currently underutilized parcel.”
CBRE began advertising the land last winter. At the time,
Pratt said it wanted to sell the property by September 2021.
Road work: How the state plans to spend billions on infrastructure
PAUL HUGHES
The big infrastructure bill is directing $1 billion a year
in federal funding for road, bridge, rail and transportation-related
infrastructure projects in Connecticut over the next five years.
In anticipation of its long-awaited passage, officials at
the state Department of Transportation have been pouring over near- and
long-term capital plans for months reassessing project listings and prospective
timetables.
The DOT staff is weighing what projects slated in the
current five-year capital plan could be expedited, and what projects in the
long-range transportation plan could be moved forward in the planning, design
and construction stages.
“We are working on it. Stay tuned. You’ll see the
timetable,” Transportation Commissioner Joseph Giulietti said.
Connecticut is scheduled to receive nearly $5.4 billion in
direct funding from the infrastructure act over the next five years. It a more
than $1.6 billion increase over the most recent transportation bill enacted in
2015.
“Look, we’re going to get well over $1 billion a year. It is
going to be transformative for our state,” Gov. Ned Lamont said.
The state is getting $3.3 billion to tackle major corridor
congestion and safety, accelerate construction projects, and increase safety
for drivers, pedestrians, and bicyclists, another $1.3 billion to enhance bus
and rail public transit, and $561 million to bring aging bridges into a state
of good repair.
In addition, the state will be eligible to compete for $30
billion in grant funding for improving rail service in the Northeast Corridor
and another $100 billion in other transportation grant funding. Lamont and DOT
officials are confident Connecticut will be able to get its share of these
competitive grants.
THE MIXMASTER REHABILITATION is the biggest ongoing
transportation project in Greater Waterbury, and the now $212 million project
is expected to extend the service life of the elevated interchange of
Interstate 84 and Route 8 for another 25 years.
The latest renovation of the network of bridges and elevated
ramps that cross the Naugatuck River is slated to be completed in June 2023,
nine months over schedule and $60 million over budget.
A 2018 analysis estimated that another rehabilitation in
2045 despite an estimated cost of $1 billion would not improve how the
interchange functions, nor would it extend its life span significantly relative
to the cost of a full replacement.
Whether through intensive rehabilitation or replacement, the
latest long-term planning program anticipates a phased project progressing from
2020s through the early 2040s.
The federal infrastructure funding coming to Connecticut
could help the DOT plan for what comes next with the Mixmaster.
ANOTHER BIG INTERCHANGE PROJECT in the works is the
overhaul of the junction of Interstate 91, Interstate 691 and Route 15 in
Meriden roughly 20 highway miles from the Mixmaster.
Due to funding constraints, the DOT is planning to split the
reconstruction of the I-691 chokepoint into three separate projects. The Lamont
administration estimated an overall cost of $265 million to $300 million last
year. The plans under development involve widening I-91, relocating connections
to I-91 and Route 15, and widening and replacing ramps.
Construction on the first the three projects was tentatively
scheduled to start in the fall of 2022, but a revised schedule now anticipates
the contract going out to bid in late 2024.
The DOT’s latest five-year capital plan included project
listings for the overall project totaling $229.4 million, with a state share of
$198.4 million and a federal share of only $31 million.
SMALLER SCALE PROJECTS on the DOT’s to-do list that are
important locally are also dependent on the availability federal funding,
including another interchange project to the west of the massive Mixmaster
rehab.
The DOT has planned a $29 million reconstruction of the
interchange of Route 63, Route 64 and I-84 on the Waterbury-Middlebury line.
The latest five-year capital plan anticipates $23.2 million in federal funding
and $5.8 million in state funding.
The project will involve widening sections of Routes 63 and
64, constructing a new roadway to connect Chase Parkway with Route 63 and a
multiuse trail to connect the Middlebury Greenway, widening an I-84 off-ramp to
Chase Parkway, and altering and adding traffic lights. There is also a new
commuter parking lot planned,
The DOT is now scheduled to advertise the contract in
September 2022. Initially, construction was anticipated to begin in the spring
of 2022. Construction is expected to take three years, but the start of work
depends availability of funding, acquisition of rights of way, and approval of
permits.
CLOSE TO 250 CONNECTICUT BRIDGES were rated in poor
condition in the Federal Highway Administration’s most recently released report
in 2020
The list of structurally deficient bridges includes some the
state’s largest and most heavily traveled spans such as the Gold Star Bridge
that carries Interstate 95 and Route 1 over the Thames River between Groton and
New London.
There is also state bridge No. 06129, a two-lane, 110-foot
bridge that supports Napco Drive over the Pequabuck River in Plymouth. After 40
years since its last rehabilitation, the twin asphalt-coated metal pipe arches
carrying the bridge have seriously deteriorated.
DOT is estimating a construction cost of $2.7 million to
replace the metal pipe arches with a precast box culvert, reconstruct
headwalls, wingwalls and cutoff walls at the inlet and outlet, and reduce its
length to 100 feet to re-establish the natural stream channel and to minimize
cost.
Construction is anticipated to begin in spring 2024, and the
DOT expects the proposed rehabilitation to be accomplished during one
construction season. Again, the timetable depends on the availability of
funding, acquisition of rights of way, and approval of permits.
This project also anticipates federal government will cover
80% of the cost and the state will pick up the other 20%.
THE ONLY COMMUTER RAIL LINE serving the Naugatuck
Valley could also see additional improvements as a result of the infrastructure
bill.
The state is wrapping up a $116-million upgrade to the
single-track Waterbury branch of the Metro-North Railroad that will allow
trains to pass in both directions. Three new passings will make two-way service
possible in mid-2022. The project also involved signalization upgrades and the
installation of a positive train control system that automatically reduces
train speeds when needed.
The DOT is using a combination of federal and state funding
to add five new trains on the Waterbury line, increasing the number of daily
trips from 15 to 22
Now, the state is going to receive $1.3 billion to enhance
commuter rail and bus service, and local officials up and down the
approximately 28-mile spur connecting Waterbury to Milford are envisioning even
more upgrades, including new train platforms and additional train stations, and
even the construction of a second rail line.
State legislators in the bipartisan Waterbury Line Caucus
have already pitched the governor’s office for funding support. Another
bipartisan group of state legislators in Western Connecticut just renewed a
funding request for electrifying the existing Danbury branch line between the
South Norwalk and Danbury stations and extending passenger rail service from
Danbury to New Milford.
The public contractors poised to benefit most from infrastructure funding
The morning after the $1.2 trillion bipartisan
infrastructure bill passed
the House of Representatives earlier this month, dozens of stocks tied
to construction experienced a boost, with some funds even passing record
highs, according
to CNBC.
The package, which President Joe Biden signed
into law Nov. 16, pays for power, broadband and water infrastructure,
among other things, and promises to boost construction firms public and private
from around the country for years to come.
"I think this is going to be a rising tide for most
construction firms that are involved in various flavors of
infrastructure," said Matt Arnold, senior equity analyst for St.
Louis-based financial services firm Edward Jones. "But given the breadth
and the sheer size of this bill, it's going to be an environment where it would
be hard to picture your average construction company not finding some opportunity
coming their way."
But some engineering and construction companies will benefit
more than others. Construction Dive spoke with several stock market analysts to
determine which public companies stand to gain the most from the spending
measure. Here is a rundown of the biggest winners as well as the challenges on
the horizon:
AECOM. Nearly every analyst mentioned
Dallas-based AECOM
as a clear winner when it comes to infrastructure projects, and
optimism about the spending package is already permeating throughout the large
public contractor. During its recent fourth-quarter earnings conference, CEO
Troy Rudd said the legislation would provide much-needed, long-term funding
certainty across the company's strongest markets, such as transit
modernization, electrification, environmental remediation and climate
resilience.
"Importantly, we are positioned to benefit from nearly
every line item in this bill," Rudd said. "We anticipate this
funding will increase our addressable market and our most profitable business
by double digits over the coming years, and we expect the most meaningful
benefits in fiscal 2023 and beyond."
AECOM gains 35% of its revenues from transportation and 28%
from environment and water end markets, according to Krzysztof Smalec, an
equity analyst on the industrials team for Chicago-based financial services
firm Morningstar. "If you look at a company like AECOM, almost two-thirds
of their revenue is very well aligned with the [infrastructure]
spending," he said
Jacobs. Other industry analysts also placed AECOM in
the winner's category, but the construction behemoth wasn't alone. Dallas-based
technical, professional and construction services firm Jacobs Engineering Group
also stands to benefit.
"If you look at the overall bill, I would say that the
two companies that are the best positioned are AECOM and
Jacobs," Arnold said. "They both have a very strong competitive
position, particularly in the transportation, water and environmental
markets."
Smalec agrees. He said 17% of Jacobs' revenue comes
from transportation work, 12% are in water projects and 6% are in the
environmental space. "Those are some areas where I think they can really
see some upside," he said.
Fluor. While Smalec also thinks Irving, Texas-based
engineering and construction company Fluor should benefit because of its strong
position in transportation, including the highways and bridges space, its
upside will be limited.
"Fluor will see less growth just because I don't think
they are as broadly exposed to the priorities in the infrastructure
bill," Smalec said. "They're a little bit more focused on legacy
oil and gas type work."
In the past, Fluor has had issues with cost overruns on
fixed-priced projects — something many
public firms have dealt with in recent years — which could make
the company less aggressive, according to Smalec.
"I think they're going to try to be more conservative,”
he said. “They've indicated before that they're going to focus on states where
they have a proven track record. So I think a company like Fluor will likely be
more selective with pursuing opportunities to make sure that they're not just
chasing revenue, but that they're also keeping in mind margins."
Sterling/Tetra Tech. Outside of the overall boost that
massive national companies like AECOM and Jacobs will enjoy, other companies
will benefit from certain pockets of spending. Sean Eastman, equity research
analyst at Cleveland-based corporate and investment bank KeyBanc Capital
Markets, expects the 30% increase in baseline transportation funding to boost
Houston-based heavy civil construction company Sterling Construction Co. and
the $55 billion investment in water infrastructure to help Pasadena,
California-based consulting and engineering services firm Tetra Tech.
Other beneficiaries. With $65 billion in funding slated
for rural broadband and electric grid modernization, Eastman said companies in
that sector as also poised to benefit. They include:
Palm Beach Gardens, Florida-based telecommunications and
infrastructure contractor Dycom Industries.
Coral Gables, Florida-based infrastructure engineering and
construction firm MasTec.
Henderson, Colorado-based holding company of specialty
electrical construction service providers MYR Group.
Houston-based infrastructure services provider Quanta
Services.
Dallas-based specialty construction and infrastructure firm
Primoris Services Corp.
"That [electric grid funding] is an end market that's
already got a lot of momentum behind it and this just seems materially
additive," Eastman said.
Infrastructure act likely to spur higher construction wages
The good news is that President Joe Biden has signed the
long-awaited, $1.2
trillion infrastructure spending package into law. The Infrastructure
Investment and Jobs Act (IIJA) represents the largest federal spending in roads
and bridges in 70 years.
The bad news — or at very least, the downside to the
welcome influx of civil work — is that the bill's passage comes at a time
when the industry is already in desperate need of workers.
Supply for skilled construction workers has
not met demand for decades, and now, that demand is going to increase.
Among other issues, this will mean that contractors will have to pay their
onsite workers more, experts told Construction Dive.
Wage changes
The supply and demand issue will be exacerbated by the
influx of infrastructure projects, Joe Natarelli, national leader of Marcum's
Construction Services practice, told Construction Dive, and he predicts wages
will go up "significantly." Natarelli said he has already spoken
to clients who are trying to secure labor to work on their existing projects
and to prepare for the deluge of work that's on the horizon.
A report from Marcum shared with Construction Dive shows a
breakdown of current hourly wages of carpenters, electricians and heavy
equipment operators across 24 states. The highest earners, according to the
report, include:
Carpenters in Wisconsin, who earn $30.31 per hour, on
average.
Electricians in Massachusetts, who earn $35.18 per hour, on
average.
Heavy equipment operators in California, who earn $38.11 per
hour, on average.
With the infrastructure spending package, those skilled
workers will only become more valuable. Natarelli said current wage rates will
be even higher three months from now, as a direct result of the infrastructure
bill.
Tatenda Tazarurwa, director for Turner and Townsend,
indicated that wages are changing, but will also be spread out — often
skilled workers move to where the work is. Even beyond the infrastructure
spending, workers may head to burgeoning markets like Nashville, Tenn. or Austin,
Texas.
A major goal of the infrastructure package, which will
infuse roughly $550 billion into roads, bridges and other forms of transit, is
to create jobs that don't require a college education, Michelle Meisels, a
principal in Deloitte Consulting's technology practice, told Construction
Dive.
"It is expected to create increased demand for
predominantly low-wage construction jobs and therefore drive up
wages," Meisels said.
The infrastructure plan will likely increase earnings and
conditions for workers in two ways, said Meisels: first, the bill will likely
tighten the labor markets in which contractors operate, and second, there will
likely be direct government wage mandates embedded in the bills.
"Contractors need to be cognizant of the fact that the
new bill requires the vast majority of construction projects to pay prevailing
wages based on an average of the pay scale for local construction
work," Meisels said.
The bill also includes stringent provisions that require all
federal infrastructure projects to use construction materials largely
manufactured in the U.S., which will increase the number of other types of
jobs, and therefore, wages, Meisels said.
Wages to increase 'significantly'
The Great Resignation, partially brought on by the pandemic,
has only made things more difficult. The mean workforce age in construction has
climbed into the 40s as the industry struggles to recruit younger workers,
Tazarurwa told Construction Dive.
Additionally, the pandemic limited the number of migrant
workers, as traveling became harder for some and impossible for others.
On the one hand, Tazarurwa said, the shortage could take
some time to get over, but on the other, there has been a skilled shortage for
decades, and employees are seeing their power increase.
"No time in the past generation or past ages have
employees had more power," Tazarurwa said.
An uphill battle
Contractors may have to get creative to secure labor. Natarelli
said he's already spoken to clients who are interested in creating joint
ventures to secure work. Some companies can secure financing and bonding, but
struggle with the labor. Two contractors joining forces can mitigate that,
Natarelli told Construction Dive.
Nevertheless, there's a lot of work to be done. The
Department of Labor estimates the industry will need to add 747,000 workers by
2026. The key to filling out those jobs? Continuing to elevate recruiting
efforts.
"I see the industry really trying to reinvest back into
this and reaching out to folks in high school to let them know there are
careers here that are really good careers," Natarelli said.