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With More Work In Region, Firm Goes on the Move

Construction project and cost management firm Cumming Corp. has moved its national headquarters from Orange County to San Diego, citing a steady influx of work in the industries where it has managed to carve out a niche in a still challenging climate.

Peter Heald, the company’s chief operating officer, said Cumming in recent months has added about six new staffers to its existing San Diego operations and relocated to bigger quarters in Carmel Mountain. As of Aug. 1, the Carmel Corporate Plaza office was officially designated its headquarters, where it now employs 27 of its global workforce of about 250 spread across 19 offices in the U.S. and Abu Dhabi.

The headquarters was shifted from Orange County, where Cumming started operations in 1996 and retains an office in Aliso Viejo, though it closed a smaller office in San Juan Capistrano. Heald said Cumming has been in San Diego more than 10 years, but decided to make the headquarters change because the local region has recently been a consistent generator of projects in areas where it has come to specialize, including health care, public and higher education, hospitality and gaming.

Rising demand for health care has spawned a continued wave of hospital building locally and nationally, and schools are looking to carefully manage limited construction funding.

“If a school district has a $600 million bond issue they’re working with, they need to have an accurate view of what they’re going to be able to build with that money, for instance, in the next six years,” Heald said.

Numerous Local Clients

Its local clients have included Grossmont Union High School District, San Diego Community College District and Doubletree by Hilton Hotel San Diego in Mission Valley, and it has worked on hospital projects for the UC San Diego Health System, Sharp HealthCare and Scripps Health systems.

As new office, industrial and retail construction remain at virtual standstills, Heald said Cumming in recent years also has done cost and project management for several local projects at tribal-owned casinos and hotels, and its gaming industry specialist who handles Las Vegas clients is based in San Diego.

The company has 18 offices across the U.S., and serves growing demand in international markets through its operations in Abu Dhabi. While the privately held, Cumming does not release earnings data, representatives said annual revenue in recent years has ranged from $50 million to $60 million.

Like other construction industry segments, cost managers and estimators have had to adjust to a steep downturn in new projects, including competing for fewer jobs. Associated General Contractors, an industry trade group, recently reported that local construction employment in June dropped 5 percent from a year ago — to 53,400 — and jobs in that sector continue to hover around 10-year lows.

Mixed Results

According to the Construction Industry Research Board, builders in the first half of 2011 took out permits for new residential and commercial construction projects in San Diego County valued at $1.3 billion. While that was up nearly 50 percent from the same period of 2010, it represented just over half what was seen in the same six months of 2006.

Also, the majority of commercial permits in the first half — 56 percent — were for renovations and expansions, with the remainder for new projects.

Frank Young, owner of CSOS Consulting in San Diego and a certified professional estimator for more than 40 years, said that while some commercial renovations provide work for cost managers and estimators, the amount is not nearly what is generated by new construction.

Young said cost estimators and related managers continue to focus on arenas including education, health care, civic projects and military base improvements to find work. The local military has been a boon for the past five years, but the recent stream of projects will likely trail off in the next two years.

Health care will likely provide long-term work related to mandated earthquake-readiness upgrades at California hospitals, but school districts will be stretching out the timelines for improvement projects amid tight funding, he said.

Heald said Cumming has generally been careful with new hiring in recent years, focusing on choosing workers with specific industry experience who can “add value” — for instance, a track record in building schools that helps guide education-related customers.

“It comes down to understanding the client’s business,” Heald said.

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