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July 9, 2009

INDUSTRY ACCESS*

Farley Acquiring GBO Vinyl Window and Steel Door Operations

GBO Inc., parent company of Bonneville Windows & Doors, has entered into an agreement with Farley WinDoor Ltd., to sell the operating assets and related inventories of GBO's vinyl and steel door divisions. The transaction, valued at $12.5 million (CDN), includes a vinyl window plant in St-Joseph-de-Beauce, Que., as well as a steel door facility in Lévis, Que, reported Window & Door. Full Story

Click here for more Industry Access news including recent new hires, merger & acquisition activity and who's offering new products.

* DHI Members may submit news releases to be considered for inclusion in DHI's IndustryWatch. Send to: jmadden@dhi.org.

BUSINESS UPDATE

Manufacturers and wholesalers are starting to see positive signs for economic recovery, according to the third annual RSM McGladrey Manufacturing and Wholesale Distribution National Survey. Respondents to the survey say they expect their companies to rebound from the current recession beginning in late 2009 (46%) and early 2010 (44%). In general, companies predict an earlier rebound for their own businesses than for their industry or the U.S. economy, reported Modern Distribution Management. Full Story

As part of LEED v3, the latest version of the U.S. Green Building Council's program for green building design, construction, operations and maintenance, buildings seeking LEED certification will begin submitting operational performance data on a recurring basis as a precondition to certification. Full Story (PDF file)

The overall RSMeans' Construction Cost Index for the U.S. as a whole has slipped into decline for the latest quarter ending in April, 2009. The quarter-to-quarter change was -2.0%, which translates to -7.9% on an annualized basis. The total index decline was all due to materials, as installation rates stayed high, reported Reed Construction Data. Full Story

The International Code Council has launched its International Green Construction Code (IGCC) initiative, which will aim to reduce energy usage and the carbon footprint of commercial buildings. Entitled "IGCC: Safe and Sustainable By the Book," the initiative is committed to develop a model code focused on new and existing commercial buildings. It will focus on building design and performance. Full Story

While there are signs of economic recovery in several key sectors, commercial office construction is not one of them. This observation is reinforced by Cushman & Wakefield LePage's latest office statistics which reported that the national office vacancy rate jumped from 6.1% to 7.6% in the second quarter, its largest one quarter increase on record. This increase has been primarily driven by a steady contraction of private sector office-based employment which started in August of 2008 and has extended into the second quarter of 2009, reported Reed Construction Data. Full Story

CONSTRUCTION & DESIGN

Construction spending for education expanded modestly but steadily through March, while at the same time growth for other institutional construction had stalled earlier in 2009. Education spending is now at or near the peak for this building cycle. The value of education starts is off 9% year-to-date compared to 2008. April starts fell 14% to the lowest total in more than three years. Building Design & Construction projects a 3–4% dip in education construction spending into early 2010, and then a recovery by the end of next year, which will bring spending up to early 2009 peak levels. Full Story

Despite the glut of hotel rooms and declining consumer demand, the owners of Sears Tower have unveiled an ambitious project to build a luxury hotel adjacent to the landmark skyscraper. As part of the plan, the 110-story Sears Tower would undergo a $350 million environmental face-lift designed to reduce electricity use by up to 80%. The owners hope Sears Tower's green efforts, including solar panels and possibly wind turbines, would supply all the power needed for the 50-story, 500-room luxury hotel, reported the Chicago Tribune. Full Story

About $135 billion in federal economic-stimulus money is being pumped directly into construction projects, reported the Richmond Times Dispatch. That will do some good for the hard-hit construction industry, but it will take time, said Kenneth Simonson, chief economist of the Associated General Contractors of America. But even the so-called "shovel-ready" projects targeted by the stimulus take time to get going, Simonson said at a Richmond Association for Business Economics meeting. Full Story

As work dries up, contractors aggressively bidding on projects are driving down construction costs, reported New York Construction. Sharon Greenberger, president and CEO of the NYC School Construction Authority (SCA), is seeing 7-to 12 bidders on projects which last year might have seen two to four. Costs and escalation rates are coming down and bid ranges are tightening. "Where the price range might have been 20% now it's more like five percent," she says. Full Story

SECURITY & SAFETY

Doors are an extremely important part of a reliable means of egress, and are thus an important part of any building's fire protection provisions. Ensuring that doors are not blocked, that their hardware works properly, that fire doors will close and latch, and that they can perform their intended function is an important part of building maintenance, reported NFPA Journal. Full Story

Proper integration is essential for the correct operation of a fire system and the building systems tied to it, under both routine and emergency conditions. A recent Consulting-Specifying Engineer article provides a recipe of high-level and detailed information to consider on your next integration project. Full Story

GOVERNMENT AFFAIRS

National Clearinghouse for Educational Facilities has published a summary chart of ARRA Funding and Tax Credit Bonds for School Modernization. Full Story (PDF file)

As of July 1 the Wisconsin Division of State Facilities will require all projects with a total budget of $5 million or more and all new construction with a budget of $2.5 million or more to have their designs begin with a Building Information Model, reported Building Design & Construction. Full Story

SMALL BUSINESS NEWS

Health Care Reform

We have gotten our first inkling of our health care "shared responsibility" future. The Senate Health, Education and Pension Committee is the first committee to tip its hand on what they think an employer mandate should look like. They have released new draft language with a mandate to either provide coverage (play) or pay a penalty for choosing not to do so (pay) that would be required of any employer that employs more than 25 employees on business days during the preceding calendar year.

The draft bill does not seem to have a precise definition of what an "employee on business days" means for determining whether an employer has passed the threshold for the mandate.

In order to avoid the "pay" penalty (incidentally, not something all employers will try to avoid), the employer must provide a minimum level of coverage and also pay at least 60% of the monthly premiums for such coverage for each month.

If the employer does not "play," the employer must "pay" into a central fund. The annual amount shall be equal to $750 for each full-time employee and $375 for each part-time employee which does suggest that under the methodology for counting employees to determine whether an employer has crossed the mandate threshold, it will not be just full time employees that are counted.

DHI's Jerry Heppes sits on the board of the Small Business Legislative Council. If you'd like more information on these or other issues affecting small businesses, feel free to contact him at jheppes@dhi.org.

This material is protected under copyright law and contains confidential information. It is for the sole personal, informational use of DHI members. It cannot be distributed, reprinted, referenced as a source for attribution, or otherwise made public.

DHI NEWS

Take Advantage of ADVANCE REGISTRATION SAVINGS for DHI’s 34th Annual Conference and Exposition, September 16 – 25, 2009 in Orlando, FL!

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Industry Marketplace
Forum for the Future Kick-off Luncheon
Exhibit Hall
Opening Reception on the Trade Show Floor
Forum for the Future, including the release of cutting edge industry research, a short and long-term economic forecast as it impacts our industry, problems to avoid as the recession ends and ways to recession-proof your business, and a discussion of distribution channel partners' best practices.
Forum for the Future Wrap-Up Luncheon
Closing Reception on the Trade Show Floor
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DHI has contracted Indian River Consulting Group and their nationally recognized team of supply chain experts to conduct an independent industry research project and present their findings at the 2009 Forum for the Future in Orlando, FL this September. Gain valuable insight from the results of this cutting-edge industry research about today's industry conditions and possible scenarios of how they might evolve in the future, key industry benchmarks and trends, and supply chain issues and relationships between the various segments of the distribution channel.

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