It’s Sept. 12, the day Hurricane Ike began wreaking havoc along the Gulf Coast, and Wes Wyman has evacuated his home in Plaquemines Parish, La. He is setting up a generator that will run his office in Belle Chasse in the event the storm knocks out the electricity.
Wyman, who owns Wyman Construction, has been down this road before—when Hurricane Katrina hurtled through the Gulf in August 2005, leaving in its wake 220,000 homes damaged or destroyed in greater New Orleans. Since then, Wyman’s company has rebuilt about 50 homes, ranging in price from $85,000 to $2 million, and could have built many more if he’d had a lot more manpower: An oil refiner approached him after Katrina about rebuilding homes for 150 of his employees. Even so, half of Wyman Construction’s current construction activity is rebuilding storm-damaged property. “There’s always going to be work,” he says.
But most builders here and in other markets clobbered by natural disasters say the process of rebuilding can be as slow as molasses. “It’s been like walking through quicksand,” says Marianne Cusato, a designer whose “Katrina Cottages” received considerable fanfare as viable emergency housing after Katrina hit but are only now coming to fruition in Louisiana.
All kinds of factors—government inertia, insurance payment snafus, and assorted other red tape—limit disaster-related reconstruction. Consequently, rebuilding after disasters isn’t the economic bonanza for builders that some might expect. “One of the biggest misconceptions is that everyone who comes to a storm becomes a millionaire,” says Anthony Johnson, owner of 1st Restoration Group in New Orleans, which has been doing insurance reconstruction for 13 years. “We have one job we did a year ago we’re still waiting to be paid for.”
Michael Fearn, president of Champagne & Fearn, a builder in Biloxi, Miss., where very little post-storm reconstruction was happening this summer, adds that recent hurricanes have been followed by “a lot of hype,” with investors buying and flipping real estate but not much else. He points to a huge master planned community in Stone County, Miss., called Horizon, which broke ground on its 8,000-unit first phase in January 2007. As of mid-September, nothing had been built.
Almost entirely absent from these efforts are production builders; rebuilding on owners’ lots is contrary to their usual business model. Builders in California, Florida, Texas, Oklahoma, Louisiana, and Mississippi mostly have stayed on the sidelines when disasters strike, leaving repair and rebuilding work to local contractors and nonprofits. “It’s more of a custom environment,” observes Steve Doyle, president of the San Diego division of large production builder Brookfield Homes, which did not actively pursue rebuilding projects after wildfires swept through Southern California in October 2007 (see “False Start,” page 103).
But smaller builders can be just as ambivalent about diving deeply into the disaster rebuilding swamp. David Dale, whose construction company builds between 12 and 14 vacation homes annually in the Galveston market, remembers when Hurricane Alicia blew through Galveston 25 years ago and took out nearly 6,000 homes. His company had rebuilding work for more than six years after. But Dale told Builder a few days before Ike hit that he probably wouldn’t alter his immediate construction schedule regardless of how much residential wreckage that storm left behind.
Builders that have embarked on disaster rebuilding are profiles in perseverance. Their experiences are testaments to the haphazard and uncoordinated ways that government and the private sector respond to help people left suddenly homeless by storms, floods, and fires.
Learn more about markets featured in this article: New Orleans, LA, Cedar Rapids, IA, Los Angeles, CA.
