Having survived nearly two centuries in the construction industry, Alvin H. Butz has found itself at the center of an economic revitalization, and Allentown, the company’s corporate headquarters, is a key component.
The company hosted a celebration Oct 25 at PPL Center to mark its 175th anniversary and thank employees, clients, community leaders and others.
The PPL Center arena has been a pivotal project in the economic resurgence of Allentown, serving as a catalyst for redevelopment efforts and signaling a new era of growth for the city.
The project, completed in 2014, was one of many that Alvin H. Butz has undertaken over the years for a variety of clients in a range of industries.
Over the years, there’s been many changes in the construction industry and the family-owned business, now in its sixth generation, has seen many of them.
Before the days of email, workers completed everything for a project on paper, said Greg Butz, the company’s president and CEO. Since that time, the speed of getting information to customers has accelerated.
The use of sustainable products in construction has grown, too, he added.
Virtual reality, meanwhile, has changed the way clients can view their construction projects, making plans more tangible.
Butz said he can bring clients into a room at his company’s corporate office, where they can don a headset and see what their project space is going to look like. That type of technology has taken off in the last three years, Butz said.
Superintendents and project managers can draw plans on iPads and immediately send them to architects. Overall, technology helps construction companies complete large projects faster, he added.
WORKFORCE AN ISSUE
But while technology has helped, construction is not without its challenges.
“The biggest challenge is staffing issues,” Butz said. “We are pretty much at full employment now. It’s getting tough to find people. Everybody is pushing kids to go to college.”
Other challenges are national, such as inflation and the uncertainty surrounding tariffs, which increase costs for construction materials.
“The threat of tariffs has people uncertain where that’s all headed,” Butz said. “We have to price a project, the material comes and there’s uncertainty surrounding pricing.”
Another challenge involves changes in employee loyalty. People used to go work for the same company for 30 years, but not anymore.
Over the years, the company has worked on many memorable projects, according to Butz.
They include various hospital projects as well as some that helped nonprofits, such as the Miracle Network and Community Services for Children. The company also recently finished the first two phases of a renovation and restoration project for the Civic Theatre of Allentown.
The arena at PPL Center was special because it played a role in Allentown’s revitalization, he added.
“It’s rewarding to be involved in projects that help the community,” Butz said. “You are never doing the same thing over and over again.”
A MOVE DOWNTOWN
In 2006, years before tax incentives took effect under the Neighborhood Improvement Zone, Butz built its corporate headquarters on the 800 block of Hamilton Street. The company had been based in South Whitehall Township.
“We did this before the NIZ was in place to help start the revitalization process,” Butz said.
Some projects have been more challenging than others. One example is the Sands Casino Bethlehem, which opened in 2009. It involved a lot of work in a short timeframe. But as the arena at PPL Center did for Allentown, many view the massive Sands project as a major catalyst in Bethlehem’s resurgence after Bethlehem Steel closed.
Now, Butz is working on a number of local projects. They include: the B. Braun manufacturing expansion in Hanover Township, Lehigh County; two elementary schools in Allentown, and a new lobby entrance at Lehigh Valley Health Network’s Children’s Hospital in Salisbury Township, as well as the creation of a pediatric medical surgical unit on the fifth floor of Jaindl Tower on the hospital’s campus.
Health care is one of Butz’s biggest markets and probably the fastest growing, he added.
With a lot of recent hospital consolidation, new ones under construction and many services moving out of hospitals into smaller outpatient facilities, there’s a lot of work to be done.
Overall, the company has about $1.2 billion worth of work under contract for projects that are in place over the next two to three years, Butz said. Annual revenues are in the $400 million to $500 million range.
In 2016, Butz and business partner Andy Baldo formed Forge Development, an affiliate company that offers real estate investment and development services.
Alvin H. Butz was starting to do some development projects and found a need to offer investment and development services under a separate entity.
“More owners would rather lease space from someone else than put the capital into their own building,” Butz said. “I think the development company is going to grow and be another important part of our future.”
The company also has been working on a succession plan, Butz said. His sons Mike and Steve are both working for the company now, Mike for seven years and Steve for about two. Steve is a project engineer and Mike is a project manager.
Butz said he will turn over more responsibility as time goes on. Lee Butz, Greg’s father, still serves as chairman of the board. There are no plans for Lee to step down as chairman.