Tariffs, Interest Rates Create Uncertainty for Birmingham, Ala., Contractors


Todd Jackson

Todd Jackson

President

Brasfield & Gorrie

While Birmingham contractors always keep a close eye on the local market, many are focused on the impact of new national policy on area projects, says Jackson. “Right now, the local industry is focused on the implications of tariffs and interest rate uncertainty,” he says.

Such uncertainty makes it hard to predict where the market is headed in the coming years, Jackson notes. “Market volatility that is beyond our control is the biggest uncertainty and challenge,” he says. “Everyone is waiting to see which deals will come to fruition. Usually, you see a bit of a pause before an election, and activity resumes afterward. But today’s market conditions have extended the uncertainty.”

While the future may be cloudy, Brasfield & Gorrie is currently focused on its multiple large projects in Birmingham. Construction is underway on the Coca-Cola Bottling Co. United headquarters, a $330-million investment in the city’s Kingston community set to create up to 50 new jobs and more than 750 spots for current employees. Located off Interstate 20 near the city airport, the headquarters is designed as an attraction for travelers. “It’s an important project for both Brasfield & Gorrie and Birmingham,” Jackson says.

The project, which broke ground in 2024, is scheduled to complete in 2027.

This year, Brasfield & Gorrie expects to complete renovations to the Southern Research biotech center and campus. Located near downtown and the University of Alabama-Birmingham, the project includes 200,000 sq ft of new and renovated wet lab space for life sciences.

City Scoop Birmingham

Market Opportunities

The firm is also active in several public sector projects. In the greater metro area, it is working on the Cahaba River and Trussville water reclamation facilities and the Mitchell Dam near Clanton. It is also working on the Chilton County Courthouse, a $32-million, 72,000-sq-ft project that includes courtrooms, support areas and licensing and administrative offices. It will occupy 6 acres of a 13-acre county-owned plot, with the remaining acreage reserved for future expansion.

Jackson notes that institutional clients “are doing well—specifically education and health care clients and other owners that do not need a conventional bank loan to underwrite a project. Clients with capital are proceeding with projects.”

Last year, Brasfield & Gorrie finished UAB Medical West, a replacement University of Alabama-Birmingham hospital in McCalla, a suburb. It includes a nine-story, 412,000-sq-ft hospital; 20,000-sq-ft central energy plant; 127,000-sq-ft medical office building; and 621-space parking deck.

“We have active work on several health care campuses, including UAB St. Vincent’s and Grandview Medical Center,” Jackson says. “At UAB, we’ve recently completed Frances and Miller Gorrie Hall, the School of Engineering’s new home. We’re also building the UAB Biomedical Research and Psychology Building.”

Chilton County Courthouse

Brasfield & Gorrie is building the $32-million, 72,000-sq-ft Chilton County Courthouse on part of a 13-acre county-owned plot.
Rendering courtesy of Brasfield & Gorrie

Looking ahead, Jackson says many regional design and construction firms are keeping an eye on recent major acquisitions in the local health care market. Orlando Health recently purchased Tenet Healthcare’s majority interest in Baptist Health. The UAB Health System Authority also purchased Ascension St. Vincent’s Health System in central Alabama.

“That’s a pretty big shift in our local medical community,” he says. “I think there’s uncertainty and optimism at the same time.”

Jackson says area AEC firms also are watching several potential redevelopment projects. “Brookwood Mall has been a hot topic of discussion, as has the future of the campus of now-closed Birmingham-Southern College,” he says. “Work has started on new projects at Edgehill, the site of Southtown Court, which was an affordable housing community near downtown.” A senior residence is under construction and commercial projects are planned as well, according to Jackson.

Looking ahead, he expects national trends to potentially have an impact on the local construction market. He says many firms are evaluating the growth of artificial intelligence and its possible effects on AEC work, especially for design.



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