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Fire, water recovery work remains stable despite economy

Cleaning up after fires, floods and other disasters may not be the most
glamorous work in the world, but it is steady, even in a recession.

Cleaning up after fires, floods and other disasters may not be the most glamorous work in the world, but it is steady, even in a recession.

Midstate restoration contractors said they were glad for that steadiness last year. Business was down a little as clients strove to keep discretionary costs to a minimum, but even so, volume was about normal.

“Our business isn’t really affected by the economy as far as the amount of volume that comes in,” said Greg Hess, president of Keystone Restorations & Builders Inc. in York County.

Keystone serves a six-county area in the midstate from its offices in Manchester Township. Like many companies in the industry, it offers 24/7 emergency response service and a full range of remediation and repair services to clients hit by fire, water, wind and other types of property damage.

Business likewise was stable for Mellon Certified Restoration, a regional firm with an office in Lower Paxton Township, Dauphin County, said Mellon’s business development manager, Matt Dishner.

The biggest change in 2009, both men said, was in residential clients’ decisions after the companies completed the initial disaster mitigation work.

In past years, their clients would usually stick with them for any subsequent repairs. Due to the recession, however, more homeowners chose to cash out their insurance settlements, Dishner and Hess said.

People would then do the repair work themselves or find acquaintances willing to do it as a side job, the two men said.

“Somebody always seems to have a painter that’s laid off or a drywaller that’s laid off,” Hess said.

Cash-outs occurred about 20 percent to 30 percent more frequently than in previous years, he said.

“We experienced that on some of the smaller claims,” Dishner concurred.

Cash-outs are not a factor on larger-scale commercial jobs because of the scope and complexity of the work, he said.

People hit with small claims such as a kitchen fire naturally think, “‘I can do it cheaper myself,'” said Anthony Worrall, president of Reynolds Restoration Services Inc. in Harrisburg.

Reynolds saw cash-outs rise from a normal level of about 5 percent to about 20 percent in 2009, Worrall said.

Another difference compared with past years, said Dishner: Residential clients are much less likely to use a loss as an opportunity to remodel. In the past, people would supplement insurance settlements with their own money to upgrade to the “dream kitchen” or den they always wanted. By and large, that is no longer happening, he said.

Winter is traditionally a busy time for restoration contractors, and there is a predictable pattern of mishaps stretching from November to February, Worrall said. It begins with a spate of “puff-back” malfunctions when people light their oil furnaces for the first time. A bad puff-back can eject enough sticky soot to blanket an entire house.

Kitchen fires are big around Thanksgiving and Christmas, as are garage fires caused by turkey fryer accidents, Worrall said. Christmas lights cause their share of problems. After that, it’s frozen-pipes season, he said.

Generalizing about the restoration industry is difficult because the term “restoration contractor” encompasses a wide range of companies, practices and business models, said Patricia Harman, spokeswoman for the Restoration Industry Association, a national trade group based in Columbia, Md. Some specialize in niche areas, such as textile restoration or duct cleaning, while others are subsidiaries of general contracting firms.

“A lot of companies have seen a slowdown in their business, but by the same token, there are some companies that are having very strong years,” Harman said.

Some companies are dealing with slowdowns by increasing their advertising. Others are seeking new markets or collaborating with other firms. Contractor-subcontractor relationships are common, and something the industry association encourages, Harman said.

Reynolds and Mellon recently partnered to clean Founder’s Hall at Milton Hershey School after the 30-foot-tall Christmas tree on display there caught fire Dec. 21 due to an electrical malfunction.

The collaboration is the first of its kind for the two companies, Worrall said.

“It is an extremely large loss,” he said.

Soot and smoke settled throughout the nearly 300,000-square-foot building, which includes an auditorium, a rotunda and dozens of offices, Worrall and Dishner said. Every duct and surface is being scrubbed by hand, they said.

Dishner said the companies were able to meet their initial deadline: reopening the kitchen in time for students’ return to the school Jan. 4. Cleaning in other areas was ongoing in early January, and the hall remained closed indefinitely, according to the school.

The willingness of Mellon and Reynolds to partner meant Milton Hershey could rely on local firms rather than seeking a larger firm from elsewhere, Dishner said. The school had existing business relationships with both companies, he said.

Restoring the landmark structure is hard work, but also a “wonderful opportunity,” he said.

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