So, not “a dying industry”, but “an industry in transition”!!! Hip, hip, hooray!!!

Last week, we posted, on Reprographics 101, another article from the Daily Journal of Commerce Oregon, and the article below is a “follow-up” article written by the same author who wrote the first article.

So, not “a dying industry”, but “an industry in transition”!!!  Hip, hip, hooray!!!

After re-reading the first article and the follow-up article that appears below, I couldn’t help but think of a project – the “ARTIC” project in Southern California – that’s now out for bidding – and the fact that all bidders ARE REQUIRED to purchase project documents.

Printed Procurement and Contracting Documents: For bidding purposes, each Bidder must obtain an official Bid Set of Contract Documents from C2 Reprographics, 3180 Pullman Street, Costa Mesa, CA 92626. Contact: Andres Valle planwell@c2repro.com, (866) 632-8329.The City of Anaheim will only accept bids for this project from Contractors that have bought the bidding documents from C2 Reprographics. Bidders may obtain either a printed copy or an electronic copy of the documents in order to prepare their proposal.

A set of full size plans and specifications may be obtained for the sum of Five Hundred and Twenty-one Dollars ($521.00) plus the cost of shipping and handling from C2 Reprographics, 3180 Pullman Street, Costa Mesa, CA 92626. Contact: Andres Valle at planwell@c2repro.com, (866) 632-8329. A half-size set of plans is available at a lower cost. 

So, imagine that, a reprographer is – still today - managing and printing construction project documents, in spite of the fact that some are saying that reprographers aren’t printing anymore.

Okay, here’s the follow-up article that appeared in the DJC Oregon:

Reprographers: an dying industry in transition

By Lee Fehrenbacher

May 24th, 2012

Are the days of paper blueprints over?

In 2004 I worked as a project engineer for a commercial construction company in Sacramento. Part of my job was to order 50-pound sets of blueprint drawings and get them to subcontractors. I remember the meticulous task of stamping every page on multiple copies of submittals. As addendums and requests for information came in the door, the paper I sent out piled up, the back seat of my pickup stacked high with 6-inch diameter rolls.

Earlier this week, I had the opportunity to revisit the subject via a feature on the business of local reprographers and how they are responding to the digital systems (online plan rooms, digital files, electronic invitations to bid) that are taking the place of paper. While I think the meat and potatoes of that story were right on the money, the headline I suggested for Wednesday’s feature may have been a bit misleading, “A dying industry fights to survive.”

“That’s why, when I saw the headline on your article, I was surprised,” said Kaye Kloster, vice president of the Oregon division of the American Reprographics Company in Portland. “In the traditional sense, it’s not a dying industry but more an industry in transition.”

Fair enough. ARC is the other big reprographics company in Portland.

“We’re in 35 to 40 different states and Canada and (we) have international affiliates and print partners,” Kloster said. “So we’re really the biggest reprographics company in the world.”

Started in 1988 as Ford Graphics, the company’s founders S. Chandramohan and K. Suriyakumar grew the company from $9 million to roughly $100 million in 10-year’s time by acquiring smaller, mom-and-pop companies around the nation. The company is now publicly traded.

“Wall Street still struggles in some cases to understand what business we’re in,” Kloster said. “We’re not Kinko’s, we’re not Nikon. There wasn’t a pre-described category for us to be put into as far as Wall Street was concerned.”

The same might be said for the reprographic industry.

Kloster joined the company in 1995. She too has seen a huge transition in its business model as architects’ and contractors’ needs for drawings change, but she said things are hardly slowing down. For ARC, the model has transitioned from a scenario where contractors once visited their store for their printing needs, to one where ARC now visits the contractor with their printing equipment.

Because of the company’s size, Kloster said they can rent machines on a lease or cost-per-copy basis, which is often advantageous for temporary jobsite trailers. ARC, along with the other reprographers in town, has also taken up digital services to pick up the slack on dwindling paper revenues.

“The technology has broadened the definition of, ‘What does a reprographics company provide?’” Kloster said.

Still, in reporting this story, I couldn’t help but feel a bit nostalgic about those old 50-pound rolls of blueprints. When I got to work Wednesday morning, I was glad to see I wasn’t the only one.

“I wish you and the rest of the reporters could have seen the old physical plan center,” wrote Nicole Crawford, one of our project plan center gurus, in an email. “We had cubbies with blueprints similar to Willamette Blue’s. We would have a hard copy of every project … Some of the guys would only work online from the office, others practically had converted spaces and cubbies in the plan center to an office away from the office. A few independent estimators seemed to actually make our office their main office.”

I too remember the days when subcontractors would hang out in the bid room, study plans for hours on end, drink coffee and goof around. And I have to wonder, as we move full steam ahead into the world of the cloud, what will be the value of that face time left behind by a virtual horizon?

Food for thought.

ABC Imaging acquires reprographer in Tampa ??? and to soon open up in Orlando ???

Today, I was informed that ABC has acquired a reprographics company in Tampa.  I don’t know if what I heard is true, or not true, so I have to ask the question, “fact or fiction”, has ABC, in fact, acquired a Tampa reprographer?  And, if so, which one?

I was also informed that ABC will soon be opening a location – a production center location – in Orlando.  I’ve been expecting ABC to open in Orlando for quite some time by now.  I don’t know if ABC is, in fact, soon to open in Orlando; it’s just what I heard.

Service Point’s Washington DC location is closed !!!

Several days ago, I heard from one of my blog visitors that Service Point’s Washington DC location had closed.  I’m speaking about the location at 1300 Connecticut Avenue, N.W., which, to the best of my knowledge was the only SP location in Washington, DC.

After heard that, I contacted, via e-mail, a Service Point facility manager in Boston – to ask where SP’s Washington, DC location had been relocated, but did not receive any reply.

This morning, after hearing from another DC area reprographer that the windows at SP’s location on Connecticut Avenue are all papered over, I sent this e-mail to another SP facility manager:

“Can you tell me where the Service Point Washington DC location has been relocated to?”

“The store at 1300 Connecticut Avenue appears to be closed!”

And, here’s the reply I received from that SP facility manager (located in another city where SP has operations):

“DC is suspended indefinitely and has not been re-located locally.”

“I'm the Facility Manager in ________ and can do printing from here as long as it can be shipped to you.”

- - - - - - - - -

If anyone hears that SP has reopened in Washington, DC (or in the DC suburbs), please kindly let me know.

Summary of Economic Reports by Federal Reserve District Banks

from Bloomberg News

By Vince Golle on June 06, 2012

Summary of Economic Reports by Federal Reserve District Banks

Following is a summary of U.S. economic conditions as reported by the 12 Federal Reserve district banks in the central bank’s latest regional survey, also known as the Beige Book.

The Federal Reserve Bank of Dallas prepared the latest report. Information was collected on or before May 25.

Boston: “Economic activity in the First District continues to expand, with contacts in most sectors citing steady growth. Commercial real estate markets show slight improvement and residential real estate contacts are finally mentioning recovery, albeit fragile. Respondents in this round rarely mention prices or pricing. Except for software and IT services where growth continues to be relatively strong, few firms are doing substantial hiring. The outlook is generally for more of the same, although a couple of manufacturers mention making contingency plans for a potential slowdown.”

New York: “The Second District’s economy has continued to expand at a moderate pace since the last report. Labor market conditions have generally improved, and, on balance, contacts indicate they plan to add workers in the months ahead. Business contacts in a number of industries note a slowing pace of cost increases and mostly stable selling prices. Manufacturers report a pickup in business conditions. Tourism activity has been strong since the last report, while retailers and auto dealers indicate steady sales activity in April and May. Home sales activity has continued to increase gradually.”

Philadelphia: “Overall, business activity in the Third District continues to improve, but the pace has slowed slightly in most sectors since the previous Beige Book. Manufacturing activity has eased slightly, but most major manufacturing sectors continue to grow. After a strong first quarter, partially due to the unseasonably mild weather, retail sales slowed somewhat in April but appear to be gaining strength based on customer traffic in May.

“Although sales remain strong overall, motor vehicle dealers also reported softer sales in April. Third District banks report steadier growth in lending and continued strong credit quality since the last Beige Book. Demand for new home construction has eased off a bit, but brokers report stronger sales of existing homes. Several signs of improvement were cited by commercial real estate contacts. The outlook remains optimistic, but more firms readily noted the slow pace of the recovery relative to the sunnier views expressed in the last Beige Book.”

Cleveland: “Business activity in the Fourth District has grown at a moderate pace since the beginning of April. Manufacturers reported stable production, while residential and nonresidential construction showed moderate growth. Retail sales held steady, and auto dealers described April sales as generally good. Exploration and production in shale gas expanded, even as the demand for coal has slowed. Freight transport volume moved higher. And the market for business credit has strengthened.

“Hiring continued at a modest pace across most industry sectors, although staffing-firm representatives reported that the number of job openings had increased for information technology and healthcare workers. Wage pressures are contained. Input prices were stable, apart from increases in building materials.”

Richmond: “Economic activity in the Fifth District improved modestly since our last assessment. Retail sales were sluggish, held back in part by weak big-ticket sales. Growth at services firms slowed, although tourism businesses reported strong demand. Bankers said that lending grew slowly, and much of the activity was refinancing. Residential real estate agents noted encouraging signs of improvement in housing sales, while commercial Realtors described leasing and construction activity as mostly flat to moderately up. Manufacturing reports were mixed, with auto and other transportation equipment-related producers continuing to do well, while other producers faced unchanged or weakening demand. District hiring activity varied, with some businesses reluctant to hire or unable to find qualified workers. Recent rainfall aided newly planted fields, but excess moisture in some areas delayed planting.”

Atlanta: “Reports from Sixth District business contacts indicated that economic activity continued to expand at a moderate pace in April and May. Reports were somewhat more positive than the previous report, and expectations remained generally optimistic across most sectors. However, uncertainties surrounding the potential impact of developments in Europe weighed on the outlook. Most retailers noted a modest increase in sales activity, and auto sales remained strong. Manufacturers cited modest growth in new orders and production. Bankers asserted that the demand for refinancing mortgages continued to increase slowly. Hiring activity was positive, but muted. Firms continued to note difficulty filling specialized positions. Most businesses indicated having little pricing power.”

Chicago: “Economic activity in the Seventh District continued to expand at a moderate pace in April and May, although at a touch slower rate than during the prior reporting period. Many contacts remained cautiously optimistic in their outlook for the U.S. economy. Several, however, also noted an increase in economic uncertainty, pointing to weaker business conditions in Europe and Asia and the upcoming elections in the U.S. Growth in consumer spending slowed, while business spending continued to increase at a steady pace. Manufacturing production also rose at a steady pace, and construction activity increased as well. Credit conditions were little changed on balance. Commodity prices moved lower, and wage increases remained moderate. Planting of corn and soybeans was well ahead of the normal pace and that of a year ago.”

St. Louis: “The economy of the Eighth District has continued to grow at a modest pace since our previous survey. Residential real estate market conditions have improved moderately. Similarly, commercial real estate market conditions have also improved. Retail and auto sales in April and early May increased over year-earlier levels. In contrast, recent reports of plans from firms in the manufacturing and services sectors were mixed. Reports of lending activity at a sample of large District banks during the first quarter of 2012 were somewhat mixed.”

Minneapolis: “The Ninth District economy grew at a modest to firm pace since the last report. Strength was noted in consumer spending, tourism, professional services, real estate, construction, manufacturing, energy and mining, and agriculture. Firms reported difficulties hiring qualified candidates, although wage increases remained modest. Price increases were generally subdued.”

Kansas City: “The Tenth District economy improved moderately in late April and May. Retailers and restaurant contacts reported stronger sales, while auto sales declined. Both retailers and auto contacts expected increased activity in the months ahead. Manufacturing activity rose, and the high-tech services industry experienced modest growth. Transportation activity was flat and was expected to remain unchanged in the months ahead. Residential and commercial real estate activity increased solidly with higher sales and lower vacancy rates. Banking contacts reported slightly higher loan demand, improved loan quality and increased deposits. Agricultural growing conditions improved, and farmland values continued to climb. The energy sector expanded further, but the oversupply of natural gas was leading to a slower pace of expansion. Wage pressures increased, and firms reported some difficulty in filling positions.”

Dallas: “The Eleventh District economy expanded at a moderate pace over the past six weeks. Manufacturing activity was flat to up, demand for business services rose and transportation services activity was mixed. Energy activity remained strong, and the housing sector continued to improve. Retail sales rose moderately, and auto sales were strong. Loan demand picked up since the last report. Drought conditions improved. Most firms reported no change in selling prices. Employment levels were steady to slightly higher, and wage pressures remained minimal. Most firms’ outlooks are optimistic, although many respondents expressed concern about U.S. political uncertainty and the European debt situation.”

San Francisco: “Economic activity in the Twelfth District continued to grow at a moderate pace during the reporting period of April through late May. Price increases for final goods and services were very modest, and upward wage pressures were quite limited overall. Sales of retail items rose, as did demand for consumer and business services. District manufacturing activity picked up further. Sales remained robust for agricultural producers, while conditions were mixed for providers of energy resources. Demand rose modestly for residential real estate and also improved a bit for commercial real estate. District banking contacts reported that overall loan demand edged up, and they noted further slight improvements in credit quality.”

To contact the reporter on this story: Vince Golle in Washington at vgolle@bloomberg.net

Iron Mountain Rips Higher On REIT Conversion Plan

Article from Forbes by Steve Schaefer, Forbes Staff

MARKETS | 6/06/2012 @ 11:43AM

Iron Mountain Rips Higher On REIT Conversion Plan

It is no secret that in a world with 10-year U.S. Treasury rates well below 2%, investors are desperate for yield. But it isn’t only money managers and everyday investors who are aware of this fact. Companies are too and the latest example comes from Iron Mountain.

The document storage firm said Tuesday that its board has approved a plan to convert into a real estate investment trust. Such a conversion would result in the distribution of up to $1.5 billion in accumulated profits to shareholders and REIT status would mean 90% of taxable income moving forward would be delivered to shareholders.

Chairman and Chief Executive Richard Reese said converting to a REIT will have little to no impact on customers, while enhancing capital return to shareholders. “The REIT structure provides stockholders with dividends from U.S. tax savings and other increases in distributable income that will enhance stockholder returns,” he said. The company estimates the cost of converting at between $325 million and $425 million. (Read: Iron Mountain’s investor presentation on the plan.)

Since the largest portion of Iron Mountain’s income stems from renting storage space to customers around the world for storing and protecting everything from historical artifacts to business documents to medical records, the transition seems like a home run at a time when investors are starved for yield.

The company is no stranger to sharing its spoils with shareholders previous to the REIT decision. It upped its dividend 8% Tuesday and already yields 3.2%, hardly a frontrunner but above the 2.7% average among S&P 500 dividend payers.

REITs, like master limited partnerships in the energy space, can be a rich income-producing portion of a portfolio, but must be carefully monitored for valuation purposes. While all REITs have certain essential characteristics in common – they must pass muster with SEC regulations on distributions of capital, maintain at least 75% of assets in real estate and derive at least 75% of gross income from real property rents, among other requirements – they fall into a number of different sub-categories.

Some of those categories carry far higher dividend yields. Mortgage firms, or mREITs, like Annaly Capital Management, can yield in the teens but also be more volatile, while apartment REITs that rent residential space like AvalonBay Communities have been in favor as total return plays. Still others are involved in the retail space, like mall owners Simon Property Group and General Growth Properties, or technology plays like Digital Realty Trust.

Because REITs are required to pay out so much of their income to shareholders, a disappointing quarter can be doubly painful, hitting both share price and dividends, the two components of the total return story.

Iron Mountain, which stressed that its plan to become a REIT by Jan. 1, 2014 is not assured of regulatory approval, was the best performer in the S&P 500 Wednesday, gaining $2.92, or 10.3%, to $31.32.