September 16, 2002
Idaho Business Review
Area Architectural firms note increased activity

Like many Idaho architects, Rob Thornton and Andy Erstad knew they had time before the brunt of the economic downturn that was creeping through the design and construction industry last year would hit the architects.

"The developers and the bankers were the canaries in the coal mine," Thornton said in assessing the health of the architectural industry in Idaho. "Eighteen, 19 months ago, in March, they essentially slowed down and began preparing for a downturn in the economy. We began to see the fruits of that a year ago in September."

To prepare for the slowdown, Erstad Thornton Architects, Boise, began "getting different kinds of work and began diversifying as much as possible," said Thornton.

"In the past two, three months, there has been significant interest on the part of developers to re-enter the market and begin working again," he said. "Things are really looking up."

Those at the Boise Valley’s biggest architectural firms agree. Like Erstad Thornton, the ones that have best weathered the economic doldrums of the past 18 months are the ones that had the luxury of seeing the tough times coming and then taking cover by adjusting their project portfolio.

Erstad Thornton recently submitted paperwork for the new Veltex Building in east downtown. Thornton said that building is "significantly preleased and presold" and ground should be broken before bad weather rolls in later this fall.

The ongoing state budget crisis, however, has stalled most state construction work. The most spectacular example of that is the long-awaited Idaho State Capitol renovation, a signature project by the state’s largest architectural firm, CSHQA, Boise.

The economic grind has also forced developers and their lenders to hold back. Still, the firms that managed to diversify their portfolios have found bright spots, such as medical construction, education, federal projects, and even church construction, that weren’t affected as much by the downturn.

"We’re holding our own," said Steve Simmons of Lombard-Conrad Architects, which worked on the new Ada County Courthouse, but whose plans to begin work on the proposed new Boise Police headquarters were sidetracked in August when a judge told the city it had to put funding for the project before voters.

"That particular ruling affects a lot of projects," Simmons said, adding the city now has less leeway in launching new construction projects without voter approval. The city also hoped to secure funding for a large branch library in an ex-Ridley’s store at Cole and Ustick Roads.

Simmons said his firm was ready to begin the police station project – much as CSHQA was about to launch the $40 million-plus Capitol restoration before Gov. Dirk Kempthorne and the Legislature stripped away the funding to make up for budget shortfalls.

CSHQA’s Jeff Shneider has been involved in the planning and design of the Statehouse project almost since its inception. His firm has other big-ticket projects under way, including the Boise Airport expansion.

While he and his firm are frustrated by the delay of such a high-profile project – easily the biggest renovation in Idaho history – Shneider remains confident the industry is nimble enough to surface from the down economy in good shape.

"You have to look harder for work, and the project mix has changed," Shneider said. "Those two factors mean you’ve got to get innovative."

He said state construction business "disappeared – they’re off the horizon and will be for a couple years. The guys that were depending on that are really going to have to look elsewhere."

"So that mix changes, and you’ve got to look at where the pockets are that are continuing, and hopefully you make wise decisions to diversify and keep your market range diversified."

As an example, Shneider said, "The airport been a terrific project for us and continues to be."

Most local architect shops continue to keep a tight grip on spending and payroll, Simmons said.

"We’re watching ourselves – our expenditures – and we’re managing to keep our crew of 27, 28 people busy," he said. He said Lombard-Conrad has adapted to the current construction crunch by looking for projects out of state and also for new kinds of projects. The firm is now wrapping up work on the Cathedral of the Rockies in downtown Boise, as well as the new Wood River High School in Hailey.

"We do a lot of school work out of state as well," he said. "And this whole 9-11 thing has got people thinking a lot … church work is raising its head a little. Simmons agreed with Thornton that medical construction has remained steady and likely will remain so as the population ages and demand grows regardless of economic conditions.

At Hummel Architects in Boise, Marketing Coordinator Rachel Reese said her firm had many projects in progress when the economy began to sour, so Hummel had time to plan its response.

"We found that we had to kind of breathe, we like to say, with the market’s ups and downs," she said. "We have gone to a kind of tighter ship, a smaller core group of people that we know, regardless of the kind of work that comes in, we can still perform to the quality and standards we have."

No question the times of big growth – including added draftspeople, bigger work spaces and more administrative costs – are gone for now.

"I know it’s hitting every firm, and it’s hitting us a little late," Reese said. "One of the wonderful things about Hummel Architects is, we’re a generalist firm. We’ve been around since 1896." Hummel’s portfolio includes a mix of government, education, and public projects. But with things as tight as they’ve gotten, Reese said her firm tracks down as many leads as possible, even if the firm doesn’t end up submitting proposals.

Thornton said developers and their lenders appear to be rumbling back to life, and before long the renewed activity will be seen on the streets.

"From what I’m seeing in us, I would expect to see the trades become significantly healthier at the first of the year," Thornton said.

In the four years since its establishment, ETA has received several awards and commendations from the community, including a Preservation Idaho Orchid Award (2001) from the Idaho Historic Preservation Council for their work on Grove Street Place in the historic Basque block, and a City of Boise Design Review Committee Award for Design Excellence (2001) for Capitol Village, a mixed-use project near Boise State University.

And ETA has no plans to slow down anytime in the near future. Expect to see this energetic team making its design mark on the slopes at Bogus Basin, downtown in the business core, on campuses and classrooms throughout the Treasure Valley, and more.