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Feature Story - April 2004
Madison Metro Report
Energy, Other Projects Fuel 50 Percent Growth

Growth in Madison, Wis., resulted in a quadrupling of infrastructure starts in 2003, primarily because of an $180 million power project. Highway and sewer work are strong. Construction at the University of Wisconsin is healthy primarily because of two life sciences projects, BioStar and HealthStar, as well as other projects. Stores and residential projects are robust, and school referenda have recently been approved.

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A power project is playing a major role in the expansion of the Madison, Wis., construction market.

In October, Madison Gas and Electric Co. started the $180 million West Campus Cogeneration Facility, said Jeff Newman, vice president and treasurer for the company. The facility will supply the University of Wisconsin campus.

When complete in spring 2005, the natural-gas-fired station will provide about 150 MW of energy, 20,000 tons of chilled water for air conditioning and 500,000 tons an hour of steam for heating to the campus.

Alliant Energy Integrated Services, a subsidiary of Madison-based holding company Alliant Energy Corp., is the construction manager on the project.

Local firms are serving as subcontractors, added Bob Barker, executive vice president of the Madison-based Associated General Contractors of Wisconsin Inc.

Partly because of the project, construction starts in infrastructure in the Madison area surged an incredible 348 percent in 2003, to $373 million, according to McGraw-Hill Construction data. Other major infrastructure increases were seen in sewers, up 173 percent to $30.5 million, and highways, up 83 percent to $55.7 million.

Widening and other upgrades are being done on the Beltline expressway to Madison's south and on U.S. Highway 12 between Madison and Sauk City to the west.

"More people are moving to Madison and the surrounding areas," Barker added. "That translates into the need for good roads and wider roads."

50 Percent Growth

Overall, the Madison market saw construction starts grow an amazing 50 percent in 2003, to $1.5 billion.

John Rodell, vice president in Milwaukee for Madison-based J.H. Findorff and Son Inc., said growth is so strong that nearly a dozen cranes can be seen downtown. In Milwaukee, whose population is about 10 times greater, there are only a couple of cranes.

Strong Madison markets include stores, up 72 percent to $72 million; multifamily residential, 24 percent to $147 million; and K-12 education, 14 percent to $42 million.

The Wisconsin government and university help keep the market buzzing.

The renovation of UW's venerable Camp Randall Stadium, which is profiled in this issue, is resulting in $100 million in activity. Two multi-element projects - the $317 million BioStar Initiative and the $210 million HealthStar Initiative - will ensure construction for years to come and the university's impact on life-sciences research and education.

Construction is expected to finish this year on the Biostar's $27 million BioTech Genetics Addition building. Other projects to come include the $100 million Microbial Sciences building, an $85 million biotechnology building upgrade and a $105 million interdisciplinary biology building.

In HealthStar, a joint university and state program, the $65 million Health Sciences Learning Center was scheduled to be complete in March. Only one major element remains, the Interdisciplinary Research Complex. Already complete are the new School of Pharmacy and infrastructure that includes utilities, roadwork and parking.

Not all contractors are reaping the benefits of the strong market, Barker said. Small- and medium-size contractors sometimes struggle to find work.

"I think the market will be gradually improving," he added. "We have a builder's exchange, and we have run out of room for plans, so there is a lot on the drawing board."

Elsewhere in the Madison area, activity is strong in nearby small towns.

A $100 million office was started in the fall in Verona for software firm Epic Systems Corp. In addition, a $23 million school referendum passed in February in Waunakee to the north, and the same month, a $22 million referendum passed in Sun Prairie, also on the north.

Madison Metro Report (in millions)

The Madison, Wis., market is jumping. A 50 percent increase in construction starts was recorded in 2003.

 

2000

2001

2002

2003

%ch. 03/02

Total Nonresidential

$337.4

$428.7

$253.4

$381.9

+51%

Total Residential

$492.7

$599.4

$669.2

$756.1

+13%

Total Infrastructure

$70.1

$76.5

$83.3

$373.3

+348%

Total Construction

$900

$1,105

$1,006

$1,511

+50%

Source McGraw-Hill Construction

 

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