What if the surety market changed overnight, and it became much harder to get bid, performance, and payment bonds? It’s not something most contractors think about, because the surety market has been relatively stable for the past 20 years. That can make it easy to take for granted that it will always be that way. […]
Potential Changes in the Surety Industry Read More »
We are asked often for our opinion about where the construction market and general economy stand, and it’s part of the reason we came up with this report. What’s interesting about this year is our answer really depends on which part of the market we are addressing. This inspired the title for this year’s report
2024 Construction Market Outlook Read More »
California tends to have a lot of very large projects, and with very large projects often comes significant liquidated damages. Surety companies generally consider liquidated damages greater than $5,000 per day to be fairly significant, but we see many large projects that have LD’s of $10,000 to $30,000 per day, which creates significantly more exposure
Limiting Exposure to Liquidated Damages Read More »
The definition of “Risk” is the chance of loss, and in construction this can apply to many areas. I’m going to focus on financial loss on a single projection or financial loss to the company as a whole. When discussing a “chance of loss”, we are really talking about probabilities. The probabilities or “odds” in
We created this snapshot to give you a quick idea of how the California construction market is doing halfway through the year. We use data from Construct Connect, one of the largest project data sources in the United States, along with our proprietary data from our more than 300 contractor customers in California. While there
2024 Midyear California Construction Market Snapshot Read More »
Watch any news program these days, and there is still a lot of talk about inflation and interest rates. Half the experts seem convinced inflation has been extinguished and the other half seems to doubt it is really gone. The Slope of Inflation I’m not sure anyone really knows the answer, including the Federal Reserve,
Is Inflation Behind Us? Read More »
Each year our agency puts together a report to look at trends of profitability, backlogs, and overall competition in the California construction industry based on the proprietary data of our contractors. This data is unique to our agency, and to our knowledge, there is no other report published quite like it. Riding the Rollercoaster One
2023 Construction Market Outlook Read More »
Employee Stock Ownership Plans (ESOP) are becoming an increasingly popular way for owners of construction companies to exit their business. According to data from The National Center for Employee Ownership, there are 160 ESOP construction companies in California, and almost a quarter of those were formed in the last 5 years. This article will provide
An Introduction to ESOPs for Construction Companies Read More »
As baby boomers continue inching towards retirement, the continuity plans of construction companies is becoming an increasingly common topic. There are many ways to transition ownership of a business, and this article will address one specific method we’ve seen used by several of our clients when selling their business to key employees, which many call
Ownership Transition using Oldco/Newco Read More »
If you’ve decided that selling your construction company to a third party is an option that you’re interested in exploring, there are a few key items to consider before leaping in with both feet. How to continue with the company’s bond program and eliminate your liability under the surety’s indemnity agreement are two of those
Selling Your Construction Business to a Third Party Read More »
