Local builders calm in wake of hurricanes

As a kid growing up in Lewes, Randy Burton of Burton Builders heard many stories about the Great March Storm of 1962, a nor’easter that caused $200 million in damage and cleared the way for rebuilding communities from Milton to Fenwick and beyond.

With that in mind, he paid close attention to hurricanes Harvey, Irma and Maria. When asked about the possibility that talented construction labor will head south to restore communities hard-hit by those storms, he said he wasn’t worried.

"As a company, we do not anticipate any significant downward trend in the near future to our labor pool," he said. "That's largely because of longstanding, locally based trade-partner relationships and a large internal staff of qualified field employees."

Alyssa Titus, marketing director for Schell Brothers, is equally untroubled. "We have strong relationships with our trade partners, so our available workforce will not be greatly impacted," she said.

But what about the costs of materials? Will the demand for lumber, masonry and everything else needed to rebuild Houston jack up prices elsewhere?

"We source many of our materials locally and buy in bulk," Titus said. "Thus far, we have not seen a huge impact on pricing, but that can certainly change unexpectedly."

Burton recalled that after Hurricane Andrew in 1992, lumber prices soared 25 percent to 45 percent. "What's interesting about that increase is that it came at the same time Canadian tariffs were being added to all imported lumber, which was done in an effort to increase U.S. lumber production. The coupling effect was devastating."

The good news so far, Burton said, is that although he saw a recent bump in lumber prices, the futures are not rising as fast as they have in the past.

One factor in that, he adds, is that petroleum costs are reasonable, keeping prices stable. He said he's been told not to expect a large wholesale increase.

Abby Steele, who has worked alongside her father, Alan Steele, at Herring Creek Builders for a decade, also sees little reason to worry about a shortage of labor.

"We use subcontractors who are from around the area," she said. "They're not going anywhere."

Boardwalk Builders owner Patty McDaniel is also confident she will have a sufficient labor pool, although she notes that the cost of materials can be based on varied factors that have nothing to do with the storms.

"The costs of materials are based on such a complicated formula," she said. "If costs go up it could be based on a false narrative that it happened because of the storms even though there are other factors, like trade agreements with other countries and the value of the dollar, which play a bigger role."

The most likely impact of the storms, she said, is that materials that are manufactured in the affected communities will be more expensive to produce and ship to builders around the United States and beyond.

Trends bode well for Cape Region

National Association of Home Builders Senior Economist Michael Neal echoes the message that many forces affect movement of labor and costs of materials as communities hit by storms rebuild.

"It's possible that labor will be more mobile, but right now the data doesn't confirm it," he said. Migration to major construction projects as a result of natural disasters tends to be more locally focused, with more workers going from Alabama to Texas, for example, than all the way from Delaware to Texas.

That's because it's easier for construction companies and workers to travel shorter distances, and because the longer the distance, the more planning and flexibility the businesses must have, Neal said.

The pace of rebuilding after storms is also driven by varied market factors, Neal said. "If you have a stronger economy and more people have a stake in it, they're more apt to come back." Hurricane Katrina hit the Gulf Coast just as the national housing crisis was happening, and the storm affected many low-income communities. Many residents of the hardest-hit areas did not return.

The strength of the oil industry should give people a good reason to rebuild in Houston, Neal said, and a robust tourism industry bodes well for communities that were affected by storms in Florida. He also said the Cape Region's economy is cause for optimism among residents who worry about climate change and future storms. While the damage could be devastating, the area's appeal as a major vacation destination could speed the pace of rebuilding – and smarter building practices – in the years that follow.