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October 2012 - as seen in our digital magazine

The Demolition Men

By Jason Soeda

Is Hawaii's construction industry finally bouncing back? We ask a few companies that deal in demolition and metals recycling. After all, they are often the first people on the scene of a new job site. Let's examine the situation from their point of view.

Sometimes, in order to build something new and exciting in Hawaii, another thing needs to be torn down and taken apart. That's where demolition contractors step into the picture. For this report, let's reach out to Northwest Demolition & Dismantling, a leading firm that specializes in all aspects of the demolition work, including: industrial and commercial; bridge and infrastructure; marine; and military housing. How does Northwest feel about Hawaii's demo industry right now?

"The current state of demolition in Hawaii seems to be leaning toward the private sector as of late, maybe due to the further decline in interest rates and increase in tourism that is unique to the Hawaii market," says Darin Leibelt, Hawaii division manager of Northwest Demolition & Dismantling. "There are always some federal and state jobs bidding, but some federal budgets seem to be stagnant with less activity occurring than in the past." Having said that, Leibelt says, "We have a healthy backlog of work, with some long-term contracts going into 2013."

All things considered, Leibelt feels that the construction industry in general seems to be improving.

"The private commercial real estate investment market continues to post improvement, which is usually a good indicator for properties that need to be renovated or improved through demolition activities, he says. "We are doing more and more budgeting work for upcoming large projects, thus, our perception is that the major redevelopment projects are warming up."

This year, Northwest Demolition completed several high-profile projects in the islands. Leibelt describes their key projects: "Our sustenance in Hawaii for the past 10 years has been military housing, for which we just completed another phase at Kaneohe Marine Corps Base in August. We also specialize in large steel fuel tanks, utilizing a hydraulic shear attachment on an excavator. Several of these tanks have been completed this year. Other small projects included various warehouses, community centers and concrete recycling activities."

Leibelt describes one project that will keep the firm busy for the foreseeable future: "Northwest Demolition & Dismantling is currently involved in a six-year project located in the Northwestern Hawaiian Islands. In general, the scope of work involves a combination of: lead-based paint removal from existing structures and repainting using encapsulation paint; asbestos removal; excavation and on-site treatment and consolidation of lead-contaminated soil; demolition of several buildings and two above-ground oil storage tanks; and retrofit of an existing lagoon into a secure disposal site for stabilized soil and contaminated building debris."

He continues: "There are some unique challenges when working in such remote locations, dealing with logistics, equipment maintenance, supplies, etc. We have found that it pays to be flexible in today's market, going to the work and embracing projects with a broad scope of environmental services and demolition and dismantling."

Leibelt says the company's success in Hawaii is tied to its commitment to sustainable practices. "It is Northwest Demolition's philosophy to be environmentally responsible – this goes hand-in-hand with the material handling and disposal aspect of the demolition procedure," says Leibelt. "We try to recycle whatever we can in order to keep materials out of Hawaii's landfills. Concrete can be crushed on site with the intention of being able to be reused as structural fill. Northwest has demolished over 3,000 housing units over the past 10 years, crushing over 300,000 tons of concrete and asphalt that has been reused on site. Almost all steel and nonferrous metals are recycled. Green waste will typically be mulched and reused on site to control dust and run-off."

He concludes: "Some of these practices are not only good for the environment, but also reduce the overall cost of the project. To offer this range of services we own our own recycling equipment and have several strategic relationships with other local service provides."

Now let's check in with Alan Hornstein, president of Lenox Metals, LLC, a metals recycling company that has served the state of Hawaii for 23 years. What does he think about the state of Hawaii's construction industry? Is he pessimistic or cautiously optimistic?

"I'm not cautious at all!" Hornstein says. "I'm feeling very positive. Lenox Metals is very excited about the prospects of the future."

Hornstein says he is definitely seeing glimmers of light at the end of this long dark tunnel of low construction activity. As a matter of fact, he says some sectors of our industry are looking downright bright. For example, Hornstein points to the numerous construction projects taking place in Waikiki right now.

Hornstein says: "There are a large amount of hotel renovations going on right now in Waikiki, some of which we have been involved in, specifically major hotels where they are actually tearing out the buildings, from top to bottom. Complete rooms and towers are being upgraded because a lot of the major hotels have not upgraded for well over 20 years."

One particular hotel, the luxurious Halekulani, recently completed a massive, property-wide revitalization, which includes its guest rooms, suites and restaurants. Hawaiian Dredging, acting as both general contractor and demolition contractor for the project, contracted Lenox Metals to perform metals recycling during the project.

"We were intricately involved in the
recycling of all the metal in that renova- tion," says Hornstein, who is gearing up
to do more work in Waikiki in 2013.

"That's one aspect of construction that's going to be ongoing," he says.

Hawaii's economy in general is coming back, says Hornstein, however, "because it is an election year, a lot of money is still tied up."

"A lot of money still needs to be spent, but I think the people that are holding on to this budgeted money are waiting to see who our next president will be," he says. "Regardless of who wins, I think the economy is slowly coming back."

Having said that, the president of Lenox Metals says Hawaii's building industry is still on the back end of its recession timeline. Fortunately, Hornstein says, Lenox Metals seems to be thriving despite the recession. While certain construction projects have been stifled in recent years, Lenox kept busy with a variety of high-profile projects. For example, two years ago, while kamaaina companies struggled to survive, Lenox Metals won bids that gave them opportunities to work with the largest construction firms in the state, including Healy Tibbitts, Watts Constructors and Hawaiian Dredging.

"We've done some pretty incredible projects with them," says Hornstein, who cites one key example: Lenox Metals' work at Joint Base Pearl Harbor-Hickam's Beckoning Point.

"We do most of the recoveries of undersea cable (in Hawaii)," he says. "For Beckoning Point, we handled the recovery of undersea cable that was pulled out of the harbor," he says. "We did all of the recycling."

Apart from having established a niche market in Hawaii, Hornstein says he credits the company's success to its intense focus on customer satisfaction and the pursuit of Leadership in Energy and Environmental Design projects.

Hornstein says Lenox Metals is privileged to be involved in an industry that is so rooted in environmental awareness.

"Our business tends to be influenced by people who want to recycle, and also the laws that govern recycling here in the state," he says. "We are not at all stifled by the economy and where it is. There is always something in our mill."


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