Lane awarded $253M design-build contract for Florida highway

Dive Brief:

The Florida DOT has awarded The Lane Construction Corp., a subsidiary of Italian firm Salini Impregilo, a $253 million design-build contract for a 2.63-mile portion of the $1.6 billion 25-mile tolled Wekiva Parkway in Seminole County, Florida, part of the Orlando metro area.
Lane will design and construct a portion of the expressway's limited access toll road as well as an Interstate 4 interchange that will complete a beltway loop north of Orlando. Lane should start construction in 2019 and complete its work in 2022.
Florida transportation officials have split the Wekiva project into 14 sections, four of which are being constructed under design-build contracts. The de Moya Group and C3TS, which Stantec acquired in 2012, took on a three-mile project under a $23.6 million contract, and Superior Construction last year was awarded a $234.5 million design-build contract for a six-mile section. Superior beat out Archer Western Contractors, Kiewit Infrastructure South and Lane to win the latter contract, which includes four wildlife bridges.

Dive Insight:

Florida officials have long embraced the design-build project delivery method, maintaining that it creates value for state residents. In a comparison of design-build versus design-bid-build — both using a $55 million project — FDOT said the design-build method would save $6.5 million and 656 days.

Lane is involved in another project not too far from the Wekiva Parkway, and that is the $2.3 billion Interstate 4 expansion in Orlando. Lane is a part of SGL Constructors, the project's construction arm, which also includes Skanska USA and Granite Construction. I-4 Mobility Partners is the public-private partnership that entered into an agreement with the state to design, build, finance, operate and maintain the project.

This summer, Moody's Investors Service changed its outlook on the 21-mile, toll road project from "stable" to "negative" because of a 245-day delay and extra costs of $100 million. The rating agency said that subsurface geological conditions and certain design elements had resulted in the failure of drilled shafts. I-4 Mobility Partners also had to deal with delay-causing floods in May.

However, despite the downgrade, Moody's affirmed I-4 Mobility Partners' Baa1 moderate-risk rating on $1.4 million of construction loans. The bond credit rating company also made a positive note in its report as to the I-4 group's depth of experience and the financial stability of all its members, who might be able to reduce the schedule by 100 days through the implementation of efficiencies.