Project starts in Arizona, Nevada and New Mexico remained strong in many sectors. The 20 projects on ENR Southwest’s annual Top Starts ranking, with contractors beginning work in the region between Jan. 1, 2022, and Dec. 31, 2022. represent $8.1 billion in value for last year.

Infrastructure projects were led by the $331-million Interstate 17/Anthem Way Interchange in Phoenix. It is being built by a Kiewit-Fann JV for the Arizona Dept. of Transportation. In Cameron, Ariz., the Navajo Nation Project Development Dept. began the $250-million Cameron Solar Generation Plant, and in North Las Vegas, Novva Inc. saw work start on its $400-million Novva Data Center Complex.

The Sun Streams 3 project in Arlington, Ariz., led by McCarthy Building Cos., began in September 2022 for Longroad Energy. The 215-MW/860-MWh battery energy storage system project is employing more than 300 people. McCarthy previously built Longroad’s 200-MW sister project, Sun Streams 2. Sun Streams 3 is set for substantial completion and will begin operations in May 2024 and help avoid 460,000 metric tons of carbon dioxide emissions annually.

The $193-million Superstition Vistas Infrastructure Improvement Project in Apache Junction, Ariz., broke ground in 2022 and is being led by Garney Construction.
Photo courtesy of McCarthy Building Cos. and Willmeng Construction

Manufacturing & Warehousing Strong

Manufacturing and warehousing start-ups were particularly robust. Led by Mortenson, construction of the $300-million Kohler Manufacturing Facility started in Casa Grande, Ariz., an hour south of Phoenix.

In addition, also in Phoenix, Willmeng Construction began construction of the $180-million CapRock West 202 Logistics Phase 1, a master-planned industrial development on 183 infill acres comprising eight buildings totaling approximately 3.4 million sq ft.

In February 2022, Layton Construction Co. began the $460-million Park 303 Phase 2 warehousing project in Glendale, Ariz., for Lincoln Property Co. One of the largest-ever spec industrial projects in the Phoenix West Valley, with 2.4-million sq ft on 150 acres, the campus consists of three 40-ft-clear buildings with significant expansion opportunity. This represents 2.4-million sq ft on 150 acres, requiring 164,280 cu yd of concrete. The project should be complete by May 2023.

Layton also began work in June 2022 on the $224-million Hub @202 Speculative Industrial Complex in Mesa for Wharton Properties. The project will have 11 Class A buildings with 28-ft to 36-ft clear heights. The Layton team has had to coordinate with different municipalities and relocate existing communication lines and adjust procurement material lead times, especially for girders and joists. Project completion is estimated for March 2024.

Layton Construction Co. began the $460-million Park 303 Phase 2 warehousing project in Glendale, Ariz., for Lincoln Property Co. last February.
Photo courtesy of McCarthy Building Cos. and Willmeng Construction

Current and Future Markets

Hospitality construction, which has been severely hurt by the pandemic, began a strong rebound last year, led by the $420-million Dream Las Vegas Hotel that was begun in May 2022 by contractor McCarthy Building Cos.

The commercial market construction outlook for Nevada continues to look robust with a new wave of projects that appear to be seemingly on the horizon, according to Ross Edwards, senior vice president of McCarthy.

But there are concerns. “We’re fortunate that we have a strong backlog, but getting new projects to pencil with an increase in interest rates and the decreased lending appetite has become much more difficult,” says Andrew Geier, executive vice president at Layton. “A pause by the Federal Reserve would have a positive impact.”

Geier adds that “for ongoing projects, pricing volatility has subsided; however, the supply chain remains an issue, with extended lead times pushing both commencement and completion dates.”