Facing a significant construction labor shortage, the city of Denver recently announced it needs an additional 40,000 workers to meet “all-time high” levels of construction.
For contractors who have the labor force required, this represents a sizable opportunity.
General contractors Kiewit Corp., Adolfson & Peterson Construction, and Hensel Phelps Construction Co. have topped Denver’s list of the largest contractors in recent years, recording 2020 Colorado revenues of $1.32 billion, $581 million, and $552 million, respectively.
Denver also has multiple major construction projects underway or slated to begin soon.
Denver International Airport is currently over a year into its roughly $2 billion Great Hall Project. Originally designed to handle 50 million passengers per year, the airport expects to reach 100 million annual travelers in the next decade. The Great Hall Project, led by general contractor Hensel Phelps, will make a number of much-needed upgrades to the terminal in order to improve operations and passenger flow and is expected to be completed by 2028.
A $217 million expansion of the Colorado Convention Center is also underway. Projected to create or support over 2,600 construction jobs, the project will expand one of Colorado’s largest buildings and generate $85 million in annual economic impact. Hensel Phelps was also selected to design and build this project, which is projected to be completed in 2023.
Work on Denver’s 16th Street Mall Project is slated to begin in the spring of this year. Led by over a decade of community planning, the project will make a number of structural improvements and aims to revitalize the popular shopping area for residents and visitors. A $149 million design and build contract was given to PCL Construction Services and work is expected to continue until late 2024.
For contractors interested in Denver’s booming market, it’s important to be mindful when picking up public projects. Contractors working on public projects typically get paid slower, and cannot follow the typical mechanics lien process in the event of non-payment. Most public projects require a payment bond, and contractors will need to file a claim against the bond in order to get paid.
Another roadblock for contractors to keep in mind: Denver’s construction licensing restrictions can create barriers for workers coming in from outside the area (even from elsewhere in Colorado).
The good news for workers interested in Denver’s hot construction market is that Colorado has no state-level licensing requirements for general contractors. This only applies to general contractors, however — plumbing and electrical contractors must obtain a state-issued license to do business in Colorado.
However, there are a number of other challenges: The first is that Colorado’s individual municipalities each have their own licensing requirements for general contractors. That means each city a contractor does business in will have its own set of requirements, and few allow for licensing reciprocity.
On top of that, Denver in particular is the most restrictive major city in Colorado when it comes to licensing. In addition to the normal ICC contractor licensing and examination, Denver requires contractors to first obtain a Denver supervisor’s certificate issued by the city’s Community Planning and Development division, which certifies that the applicant has experience in the relevant trade.
Journeyman electricians are the only type of contractor able to take advantage of Colorado’s license reciprocity, and only from certain states. All other types of contractors will have to go through the licensing process in each Colorado municipality they wish to do business in.
“Regardless of the licensing statutes and rules where you work, there’s one thing for sure state-wide: Colorado contractors have to focus on managing positive cash flow to grow their businesses,” says construction writer Tom Scalisi. “Negative cash flow is the shovel that digs a hole from which you can’t get out.”