Massachusetts Claims 65% Share of $2.5 Billion of Third-Quarter Project Starts in New England

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Reported by Annette Kreuger for Industrial Info Resources (Sugar Land, Texas)--The New England region, which includes the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont, is currently forecast to have $2.5 billion in industrial capital and maintenance, repair and overhaul projects during the third quarter of this year. A recent analysis of Industrial Info's North American Plant Database revealed that the region is currently forecasting 55 projects to begin construction through the end of September. The projects have an average total investment value (TIV) of $44 million. Massachusetts, with 20 planned projects, claims more planned projects than other states in the region. The state's projects total $1.5 billion in planned spending, allowing the state to also claim the title of "top spender" for the region.

Click on the image at right to view a chart showing the breakdown of project spending by industry.

Connecticut placed a respectable second with 15 projects valued at $349 million that are scheduled for a third-quarter start. The remainder of the projects are scattered throughout New Hampshire (9 projects - $229 million TIV), Maine (8 projects - $188 million TIV), Vermont (2 projects-$75 million TIV) and Rhode Island (2 projects - $10 million TIV). This project activity includes everything from grassroot plants and capacity expansions to routine maintenance programs. Except for grassroot construction, the remainder of the projects are located on-site at the region's 2,000 existing operational plants as found in Industrial Info Resources' New England Online Plant Directory, with new plants added once they become operational. Of course, all project start dates are fluid and subject to change. Financing, permitting and a host of other issues all impact when a project actually begins.

Another analysis of project data for the quarter in the New England region reveals that the Pharmaceutical-Biotech sector far outpaces all market sectors with a cumulative TIV of $1.5 billion. That amount is divided among only 15 projects, resulting in an impressive project average of $100 million. The largest of the pharma-biotech projects currently scheduled for a third-quarter kickoff is Shire Limited's (NASDAQ:SHPGY) (Wayne, Pennsylvania) $394 million biomanufacturing plant in Lexington, Massachusetts (source: Pharmaceutical Tracker - Online Database).

Holding a very distant second place in regional spending is the Industrial Manufacturing sector. With 12 projects valued at $278 million, the average project TIV is $23 million. The largest of the group's projects for the quarter is Evergreen Solar's (NASDAQ:ESLR) (Marlboro, Massachusetts) $170 million solar panel manufacturing plant in Devens, Massachusetts.

The remaining project activity for the third quarter is distributed over the remaining major industry groups, including Power (13 projects at $259 million, $20 million average TIV), Alternative Fuels (3 projects at $190 million, $63 million average TIV) and Oil & Gas Transmission (3 projects at $136 million, $45 million average TIV).

As evidenced by the figures, there is a wide disparity among the industries in average project TIV, although it is doubtful that any of the locales hosting one of the smaller projects is complaining. The 3Q08 project TIV for New England has jumped an astounding 280% over the same quarter in 2007, when the region had 44 projects valued at $890 million begin construction.

The region currently boasts nearly 2,000 operational plants as found in Industrial Info Resources' New England Online Plant Directory. The existing plants provide employment for almost 400,000 people in the region. With all of the major industrial groups represented in the region, the majority of existing operational plants are claimed by the Industrial Manufacturing sector, followed by the Food and Beverage industry. The remaining sites are sourced out to other industry groups, including the Pharmaceutical-Biotech Industry and the Pulp & Paper Industry.

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