Daily Business Report-April 14, 2020
San Diego International Airport. (Photo courtesy of the San Diego Convention Center Corp.)
Airport says coronavirus could have
‘six times the impact of Sept. 11’
San Diego airport officials are grappling with the immediate financial impacts of the coronavirus and it’s not looking good. The airport’s CEO projected that the lost revenue will be “six times the impact of Sept. 11.”
Ashly McGlone reports that the airport has amassed a healthy $853 million-plus reserve over the years, but the loss of flights, passengers and related consumer activities amid shelter-at-home orders could take a toll long term.
The airport’s CEO has created a financial resilience plan that calls for a hiring freeze, delayed and reduced non-essential spending and a stop to non-critical capital projects. The hard-fought $3 billion plan to rebuild Terminal 1 is still on the list, but it’s an open question whether the airport will still issue bonds on time.
Officials plan to award the construction contract for the $2.2 billion Terminal 1 rebuild in May and break ground in November 2021.
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Gafcon workers put down hard hats and
hammers to refurbish district computers
so they can be used in distance learning
San Diego Unified School District students receiving laptops for distance learning have Gafcon Inc. construction project managers to thank for playing a role in making these critical virtual learning tools.
The San Diego-based international program, project and construction management firm has several ongoing construction projects at SDUSD campuses. Deemed essential workers in California, they were on site when they learned of the need to help refurbish laptops for students and staff to use remotely when “distance learning” begins on April 27. They put down their hard hats and hammers and jumped in.
Working with the District’s IT staff, the Gafcon team visited multiple closed campuses to update older computers with new software. Although they are not IT workers by trade, the construction team was nonetheless enthusiastic to help the gistrict and the students and teachers who would otherwise not have computers to continue the school year.
Sixteen of Gafcon’s employees are helping, with four leading the seven teams that are working on the project. The teams perform a multi-step process that includes locating the computers on the school campus. They test, scan, disinfect and package each computer before loading them into the trucks to be distributed to students and teachers.
In one day alone, one of the Gafcon-led teams processed 2,100 computers.
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As Californians stay home,
air quality improves — for now
by Julie Cart | CALmatters
The global coronavirus pandemic has inadvertently achieved what state officials have sought to do for decades: Californians have parked their cars. Freeways and highways are clear. And the constant burn of fossil fuels has been markedly diminished.
The statewide stay-at-home order has brought about drastic reductions in air pollution and planet-warming emissions, experts say. The Los Angeles basin, where the term smog was invented, has enjoyed the longest period of good air quality days since 1995, according to a UCLA researcher.
Highway traffic is down by more than half since the start of the pandemic, according to official tallies, and emissions that form smog and soot have been reduced by about the same amount in parts of the state.
For Californians with chronic health conditions, such as asthma and heart disease, the unexpected breath of fresh air is welcome.
But to be clear, no one is celebrating. The boon to public health, coming in the midst of a public health crisis, is difficult to measure against the widespread illness and loss of life wrought by the coronavirus.
Significant drops in air pollution have been measured across the globe since the start of the pandemic last month, particularly in China, which toggles massive production facilities off and on, impacting worldwide emissions.
But officials caution that any environmental benefit is likely to be temporary. They expect pollution levels to ratchet back up to normal levels once isolation orders are lifted and customary economic activity resumes.
Translation: Once this is over, Californians will get back into their cars.
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Jennifer Barnes sells shares
of PBO Advisory Group
Jennifer Barnes has sold her shares of PBO Advisory Group. Michael Ford, who owns 45 percent of PBO, and Scott Palka, who owns 10 percent, bought out Barnes’ 45 percent interest in the company for an undisclosed amount.
Barnes co-founded PBO Advisory Group (then named Pro Back Office) in 2012 with Ford and grew the company to become one of the most successful outsourced accounting firms in San Diego, earning it a spot on the Inc. 5000 list in 2017 and 2018.
A serial entrepreneur, Barnes is growing her second company, Optima Office. Optima offers outsourced/fractional accounting, human resources, and consulting services on an hourly basis. Optima has grown to 67 employees in 14 months and brought in $3.3 million in revenue in the company’s first year in business. The company anticipates revenues of between $5-6 million in their second year in business and has plans to reach $10 million in revenue by year five.
Barnes plans to use the funds from selling her first company to further invest in building her second company.
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SANDAG forecasts potential COVID-19
pandemic impacts on regional economy
To help plan for the potential impact of the COVID-19 pandemic on the San Diego regional economy, the SANDAG Data Science and Analytics team has developed a new report, COVID-19 Impact on the San Diego Regional Economy: Retail Sales and TransNet Revenue Forecasts, that will be updated regularly as new information becomes available.
The SANDAG forecast is a dynamic model that produces 40 potential scenarios based on an array of assumptions, estimates, and factors, such as the length of the pandemic and the severity on the economy. Assumptions are based on the most recent statements and information provided by Federal, State, and local authorities. The forecast also considers changes in legislation to support people and the economy, business decisions, and behavior changes in response to the pandemic.
“Hundreds of millions of Americans will be adversely affected by this pandemic,” said SANDAG Chief Economist Ray Major. “For the San Diego region, we modeled three scenarios: mild, moderate, and severe. Obviously, a mild scenario is the most desirable outcome, with no recession; a moderate outcome would compare to the early 1990s recession and recovery; and a severe scenario could mimic the 2008 Great Recession.”
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Navy exercises $117 million ship
maintenance contracts with 7 contractors
GovCon
The U.S. Navy has awarded seven companies $116.6 million in contract modifications to help maintain the branch’s surface combatant and amphibious ships that are visiting or stationed in San Diego.
Contractors will continue to perform non-complex emergent and continuous maintenance services under option period three of a multiple-award indefinite-delivery/indefinite-quantity contract, the Department of Defense said.
DoD expects work to be complete in May 2021.
Awardees are:
Colonna’s Shipyard West
East Coast Repair and Fabrication
Epsilon Systems Solutions
Marine Group Boat Works
Pacific Ship Repair and Fabrication
Propulsion Controls Engineering
South Coast Welding and Manufacturin
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General Atomics opens new spacecraft
development and test facility in Colorado
General Atomics Electromagnetic Systems (GA-EMS) has opened a new, modern spacecraft development, integration and test factory with state-of-the-art laboratories and secure facilities in Centennial, Colo. The 33,514-square-foot facility triples GA-EMS’ capacity for satellite production, integration and testing for single to constellation-sized orders, and also houses an expanded mission operations center to support on-orbit satellite and customer payload commissioning and operations.
“Colorado is home to the nation’s second largest space economy, and we are excited to continue to expand our development, production and mission capabilities in the region to meet the growing needs of the military, intelligence community, civil and commercial satellite communities,” said Scott Forney, president of GA-EMS.
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How Realtors group keeps its members
informed during the coronavirus crisis
The Pacific Southwest Association of Realtors (PSAR), one of San Diego’s largest real estate trade associations, is making efforts to keep its members informed during the coronavirus crisis.
In addition to posts on the website’s blog and social media, the 3,100-member organization has been hosting twice-a-week virtual town hall meetings over Zoom, the online video conferencing platform. The meetings began in late March.
The meetings start at 12:30 p.m. every Tuesday and Thursday and are hosted by PSAR chief executive officer Rich D’Ascoli. All San Diego County real estate professionals are invited to join. Zoom membership is not required to participate. Registration for future PSAR Virtual Town Hall meetings is available on the PSAR website, https://blog.psar.org/info/townhall.
“We’re concerned about how COVID-19 will impact our members personally, including the health of their businesses,” D’Ascoli said. “We know the coronavirus pandemic is leaving people feeling fragmented and disconnected. Nobody wants to spend their days in isolation. But, social distancing does not mean social isolation. We all still want to connect with each other, and we’re learning how to do that in different ways.”
