Dodge Momentum Index Remains Strong in November

NEW YORK – December 7, 2017 – The Dodge Momentum Index surged again in November, climbing 13.9% to 149.5 (2000=100) from the revised October reading of 131.3. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The November increase was the second month of strong gains after a four-month period of softness. November’s advance was the result of healthy gains in both the commercial and institutional sectors. From October to November, the commercial portion of the Momentum Index advanced 19.6%, while the institutional portion grew 5.5%. On a year-over-year basis, the Momentum Index is now nearly 21% higher, with the commercial portion up 24% and the institutional side up 17%. The turnaround in October and November suggest that building activity should continue to expand in 2018.

In November, 21 projects each with a value of $100 million or more entered planning. For the commercial building sector, the largest projects include a $300 million mixed use facility containing two hotels at Atlanta’s Hartsfield-Jackson Airport and a $230 million Hayden Ave Life Sciences office campus in Lexington MA. The leading institutional projects were a $200 million UPMC Vision and Rehabilitation Hospital in Pittsburgh PA and a $200 million project that will provide additions and alterations for several schools within the Uniondale (NY) School District.

 

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About Dodge Data & Analytics: Dodge Data & Analytics is North America’s leading provider of analytics and software-based workflow integration solutions for the construction industry. Building product manufacturers, architects, engineers, contractors, and service providers leverage Dodge to identify and pursue unseen growth opportunities and execute on those opportunities for enhanced business performance. Whether it’s on a local, regional or national level, Dodge makes the hidden obvious, empowering its clients to better understand their markets, uncover key relationships, size growth opportunities, and pursue those opportunities with success. The company’s construction project information is the most comprehensive and verified in the industry. Dodge is leveraging its 100-year-old legacy of continuous innovation to help the industry meet the building challenges of the future.  To learn more, visit www.construction.com.

MIA + BSI Vote “Yes” to Merger

 

Image result for mia + bsi logoWith a vote of 565 to 25, the memberships of Marble Institute of America and Building Stone Institute have overwhelmingly decided to authorize a historic merger of North America’s two most prominent stone associations. Effective January 1, 2018, the combined association will formally be known as the Natural Stone Institute, a name widely used during the associations’ two year joint venture.

Jim Hieb, CAE, CEO Natural Stone Institute and Jane Bennett, EVP Natural Stone Institute, thanked members who voted and everyone who has participated in the dialogue about the merger.  “Your trust, support and guidance has helped make this possible,” they said. “Together, we will continue our resolve to provide the best technical, educational, and promotional support for our growing membership and the natural stone industry, as well as expand our outreach to the design community. We now have the combined assets to become the largest and most influential natural stone association in the world!”

The combined staff share members’ passion to advance the industry.  Natural Stone Institute has a dynamic team of dedicated people who have come together over the past two years to prove this union can work, and that merging is the best move for the natural stone industry.

In 2018, David Carnevale (Carnevale & Lohr) will serve as the first president of this merged organization. Greg Osterhout (Northern Stone Supply) will serve as vice president, Robert Zavagno (Cleveland Marble Mosaic Co) will serve as secretary, and Kathy Spanier (Coldspring) will serve as treasurer.

Carnevale commented, “I look forward to serving as first president of the Natural Stone Institute. I want to thank the many current and past industry leaders from BSI and MIA who had the foresight to see what was possible with a merger. The Natural Stone Institute is well positioned to further advance the combined association’s role as a technical and educational leader. We will continue to offer a wide array of opportunities for networking with both industry and design professionals.”

The membership of the combined association will exceed 2,000 members. The leadership will focus on technical and education initiatives intended to further advance the use of natural stone. A new association logo will officially debut at TISE 2018 in January.

 

Stimac is New CEO at Braxton-Bragg

KNOXVILLE, TN –Braxton-Bragg, a leading distributor of tools, materials and supplies to granite countertop fabricators, marble stone masons, tile contractors and concrete polishing contractors, has named Rick Stimac CEO, following Rich Hassert’s retirement.

Rick Stimac, new Braxton Bragg CEO

Newly appointed Stimac was most recently Vice President/Chief Sales and Marketing Officer of Gustave A. Larson Co., the midwest, plains and mountain states’ leading wholesale distributor of heating, ventilation, air conditioning, and refrigeration (HVACR) equipment, parts and supplies.

Stimac comes to Braxton-Bragg with extensive P&L management experience and a history of successfully growing profitable revenue. He is a strategic and performance focused executive with more than 25 years of innovative passionate leadership in various markets; a motivational leader known for clearly defining mission and goals, aligning people and resources and consistently delivering results that exceed expectations in diverse distribution channels.

“Rick is an outward-looking CEO that possesses a strong market-driven strategic mindset, the demonstrable ability to develop and execute growth initiatives and a measured approach to excellence in operations,” says Frederick A. Eck, president and co-founder of The Randolph Group, holding company for Braxton-Bragg.

Stimac’s background includes successful leadership assignments in sales, brand management, general management and as President and CEO. Formerly, Stimac had stints at Allen Co./Play Sports Co., Sportcraft LTD, Classic Sport Companies & Huffy Sports Corporation.

 

 

 

AGC: Construction spending hits record in October; public, private segments vary widely

(DECEMBER 1, 2017) — The weekly AGC Data DIGest reported:

  • Construction spending totaled $1.241 trillion at a seasonally adjusted annual rate in October, a record level before adjusting for inflation, 1.4% higher than in September, and 2.9% higher than the October 2016 rate, the Census Bureau reported today. Year-to-date (YTD) spending for the first 10 months of 2017 combined was 4.1% higher than in January-October 2016.
  • Public construction jumped 3.9% for the month but declined 3.4% YTD. Of the three largest public segments, highway and street construction increased 1.1% for the month but slid 4.3% YTD; educational construction soared 11% in October and rose 2.2% YTD; and transportation (transit, passenger rail, ports and airports) rose 2.0% for the month but slipped 1.6% YTD.
  • Private residential spending gained 0.4% in October and 11% YTD. New multifamily construction sank 1.6% for the month but rose 3.9% YTD; new single-family construction rose 0.3% and 9.0%, respectively; and residential improvements gained 1.4% and 17%.
  • Private nonresidential spending climbed 0.9% from September and 1.5% YTD. Of the four largest components, power (electric power plus oil and gas pipelines and field structures) dipped 0.3% for the month and 2.5% YTD; commercial (retail, warehouse and farm) fell 1.9% in October but jumped 15% YTD; manufacturing added 1.3% in October but tumbled 13% YTD; and office rose 4.4% and 4.1%, respectively.

 Detailed figures on Census’s construction spending website show that commercial spending segments exhibit a wide range of growth patterns.

  • Warehouse construction leaped 37% YTD as the mini-storage component has roughly doubled for four years in a row.
  • Shopping mall construction increased 29% YTD and shopping center construction grew 20%. These gains may reflect renovations rather than new construction; Census does not break out improvements for nonresidential categories.
  • Construction of general merchandise stores (including department and variety stores) plummeted 22% and other multi-retail (warehouse-type retail stores) spending dropped 10%. There was a similar range within food and beverage segments.
  • Construction of dining/drinking establishments climbed 15% YTD, while food-store construction increased 3% and fast-food restaurant construction plunged 29%.

 Construction of natural-gas fired power plants appears to be on the upswing. On Thursday, the e-newsletter BreakingNews reported the following projects underway or under development in western Pennsylvania and eastern Ohio, where the Utica and Marcellus shale formations are providing abundant feedstock: “Work is underway at the new $893 million Hickory Run Energy Center outside New Castle, a combined-cycle power plant…Located outside Johnstown [is] a $700 million gas-fired plant that should be under construction for the next two years. Work should wrap up in 2018 on two other plants, the $780 million Tenaska Energy project in Westmoreland County and the $900 million Lordstown plant in Ohio. The Lordstown project is phase one of two. Not far from Lordstown, near Wellsville, a $1.1 billion combined-cycle plant is going through the final planning stages.” Numerous plants are under construction or design in other regions.

 Construction employment, not seasonally adjusted, rose from October 2016 to October 2017 in 243 (68%) of the 358 metro areas (including divisions of larger metros) for which BLS provides construction employment data, fell in 59 (16%) and was unchanged in 56, according to an AGC release and map on Wednesday. (BLS combines mining and logging with construction in most metros to avoid disclosing data about industries with few employers.) The largest gains again occurred in Riverside-San Bernardino-Ontario, Calif. (14,700 construction jobs, 15%) and Las Vegas-Henderson-Paradise (10,500 construction jobs, 18%) followed by New York City (10,100 construction jobs, 7%). The largest percentage gains occurred in Cheyenne, Wyo. (24%, 800 combined jobs), followed by Las Vegas-Henderson-Paradise; Lake Charles, La. (16%, 3,600 construction jobs) and Killeen-Temple, Texas (16%, 1,600 combined jobs). The largest job losses again were in Houston-The Woodlands-Sugar Land (-7,900 construction jobs, -4%); Columbia, S.C. (-3,100 combined jobs, -18%) and the Kansas City, Mo. division (-3,000 combined jobs, -11%). The largest percentage losses again occurred in Grand Forks, N.D.-Minn. (-25%, -1,200 combined jobs); Columbia S.C. and Kansas City, Mo., along with Eau Claire, Wisc.. (-11%, -400 combined jobs). October employment was a record high for the month in 45 metros (dating back in most areas to October 1990); none set a new October low.

Economic activity continued to increase at a modest to moderate pace in October and mid-November, according to anecdotal reports from contacts across the 12 Federal Reserve districts,” the Fed reported on Wednesday in the latest Beige Book. The Beige Book is a compilation of informal soundings of business conditions in each of the districts, which are referenced by the name of their headquarters cities. “Residential real estate activity remained constrained, with most districts reporting little growth in sales or construction. By contrast, nonresidential activity was consistent with previous reports of slight growth….construction-material costs rose in most regions, with many districts citing increased lumber costs and/or increases in demand for materials due to hurricane rebuilding efforts.”

Revenues of architectural, engineering and related services firms increased 3.1% in the third quarter (Q3) of 2017 from 2017Q2 and 1.7% from 2016Q3, Census reported on November 17. This “advance” estimate did not break out architectural and engineering firms.

AGC on Senate tax bill: temporary tax cuts and lack of infrastructure support create concerns

DECEMBER 1, 2017 — The chief executive officer of the Associated General Contractors of America, Stephen E. Sandherr, issued the following statement today in connection with the proposed Senate tax reform measure:

“The association has long advocated for comprehensive tax reform, especially considering that construction employers pay the highest effective rate of any industry at 30.3 percent. The Senate tax reform bill has been substantially improved over the course of the past few days and we support its passage.

“It is important to note that most construction firms are organized as pass-through entities, such as S corporations and partnerships that are taxed at personal rather than corporate tax rates. While the Senate proposal has wisely increased the pass-through deduction from 17.4 percent to 23 percent, the fact that the cut is temporary is concerning. We also remain disappointed that infrastructure was largely overlooked in the tax reform process. This is a missed opportunity.

“Assuming the tax reform legislation moves to a House-Senate conference committee, the association and its 26,000 member firms will continue to advocate for permanent changes to the tax code that benefit the majority of small and medium-sized construction firms that pay taxes as pass-through entities. And we will continue to push Congress and the administration to work together to swiftly enact measures to increase investments needed to improve our aging and over-burdened infrastructure.”

CONSTRUCTION EMPLOYMENT INCREASES IN 243 METRO AREAS BETWEEN OCTOBER 2016 & 2017

Construction employment increased in 243 out of 358 metro areas between October 2016 and October 2017, declined in 59 and stagnated in 56, according to a new analysis of federal employment data released today by the Associated General Contractors of America. Association officials said the best way to ensure metro areas continue to add construction jobs is to treat small and medium-sized employers more fairly and include new infrastructure funding as part of federal tax reform.

“Growing demand, especially from the private sector, is continuing to drive construction employment gains in many parts of the country,” said Ken Simonson, the association’s chief economist. “The tax reform proposals now being debated in Washington can do even more to help ensure that metro areas will continue to add new construction jobs.”

Riverside-San Bernardino-Ontario, Calif. added the most construction jobs during the past year (14,700 jobs, 15 percent), followed by Las Vegas-Henderson-Paradise, Nev. (10,500 jobs, 18 percent); New York City, N.Y. (10,100 jobs, 7 percent); Portland-Vancouver-Hillsboro, Ore.-Wash. (8,000 jobs, 12 percent) and Los Angeles-Long Beach-Glendale, Calif. (7,500 jobs, 6 percent). The largest percentage gains occurred in the Cheyenne, Wyo. metro area (24 percent, 800 jobs) followed by Las Vegas; Las Vegas; Killeen-Temple, Texas (16 percent, 1,600 jobs); and Lake Charles, La. (16 percent, 3,600 jobs).

The largest job losses from October 2016 to October 2017 were in Houston-The Woodlands-Sugar Land, Texas (-7,900 jobs, -4 percent), followed by Columbia, S.C. (-3,100 jobs, -18 percent); Kansas City, Mo. (-3,000 jobs, -11 percent); Middlesex-Monmouth-Ocean, N.J. (-2,300 jobs, -6 percent) and San Jose-Sunnyvale-Santa Clara, Calif. (-2,100 jobs, -4 percent). The largest percentage decreases for the year were in Grand Forks, N.D.-Minn. (-25 percent, -1,200 jobs) followed by Columbia, S.C.; Eau Claire, Wis. (-11 percent, -400 jobs) and Kansas City, Mo. (-11 percent, -3,000 jobs).

Association officials said there was still time to improve the tax reform measure, noting that Senators have an opportunity to make improvements to the proposal. In particular, they urged Senators to set final the final tax rate for pass-through businesses at a comparable level to the rate for corporations. And they urged Senators to boost infrastructure funding.

“Lowering the tax burden on many small and medium-sized employers and including new infrastructure funding will bring immediate and widespread benefits to local economies across the country,” said Stephen E. Sandherr, the association’s chief executive officer. “That is why the construction employers and workers our association represents are committed to helping ensure any final tax reform measure actually helps support continued construction job growth.”

View the metro employment data by rank and state. View metro employment map.

BELKNAP WHITE GROUP HOSTS ANNUAL FLOORINGPLUS CONVENTION

MANSFIELD, MASSACHUSETTS – The Belknap White Group (BWG), one of America’s leading full-service flooring distributors, hosted its 17th Annual FlooringPlus Convention held in upstate New York at Bolton Landing’s Premier Luxury Resort, The Sagamore.

Scores of retailers, vendors, exhibitors and sponsors turned out for the 17th Annual FlooringPlus Convention, October 22nd and 23rd, which is open to FlooringPlus Members only.

This year’s convention focused on BWG’s tradition of empowering its FlooringPlus Members. This two-day event featured keynote speaker Jay Rifenbary, whose presentation “No Excuse!” discussed incorporating core values, accountability and bringing balance into one’s life and career.

Additional breakout sessions focused on marketing and the importance of consistent advertising, effective website marketing, promoting consumer financing options and the often forgotten importance of “making customers feel appreciated.”

Other sessions included important technical issues such as “Focusing on Moisture Control.” Attendees learned about new products and services during the events’ two-day “Product Showcase.”

The main event featured was BWG’s awards presentation luncheon and ceremony. This year, BWG recognized the following award recipients:

  • BWG Highest Percentage Increase – Floor and Home Inc. Westwood NJ -Tony and Kathy Sicilla
  • BWG Cross Corporate Account of the Year – Lee Appliance Plattsburgh, NY – Gary and Shelly Bertrain
  • BWG Dealer of the Year – Elite Flooring Specialist – Hartford,  CT

“Our 17th Annual Convention was a resounding success,” said BWG President, Paul Castagliuolo.  “Thank you to all suppliers, service providers, employees and participants who joined us to renew friendships, forge new relationships and help plan for our shared future,” Castagliuolo added.

The Belknap White Group created the FlooringPlus Loyalty Program to provide their customers with ongoing cogent information on merchandising, marketing, technology, education and business resources. Members enjoy the benefits of a group program… while maintaining its independence and identity with great flexibility. For more information on BWG’s FlooringPlus Program, visit the website at www.belknapwhite.com/flooring-plus

 

 

 

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‘Go Build’ Campaign to Launch National Website

Competitors participate in the National Craft Championships at the Associated Builders and Contractors’ Conference in Ft. Lauderdale, Fla., in 2015.
PHOTO BY KEVIN DIETSCH, COURTESY OF ABC

By most measures, this is an ideal time to be a construction tradesperson. An analysis of government job data by the Associated General Contractors of America reveals that the industry’s unemployment rate of 4.5% is the lowest in 11 years. Conversely, the average hourly wage for construction—$29.06—is up 2.3% from last year and nearly 10% more than the average non-farm, private-sector job.

Nevertheless, the long-simmering shortage of skilled trade labor continues to plague contractors of all sizes, specialties and locations. The third-quarter Commercial Construction Index, produced by USG Corp. and the U.S. Chamber of Commerce, found that 60% of contractors are having difficulty finding skilled workers. The current pinch, exacerbated in part by hurricane-driven demand in Texas and the Southeast, will only tighten as projected upward trends in commercial and infrastructure construction clash with a rising tide of baby-boomer retirements.

Although construction professionals, educators and associations have warily eyed these trends for some time, many well-intentioned efforts to recruit young people to replenish the job pool have yielded mixed results.

Now, Go Build America, an industry-driven, image-building program set to launch nationally in December, aims to succeed where those other initiatives have fallen short. Based on state-level programs that have helped to boost enrollment in local technical education programs, Go Build hopes to rebrand and promote the entire construction industry via a multiplatform public-relations campaign. It will maximize the use of video-enhanced social media, a lively and information-packed website, ads, grassroots outreach and other carefully crafted elements. The aim is to convey a clear message to targeted audiences.

“We created our own playbook—an aggressive, comprehensive and sustained effort with a look and feel that engages young people and inspires them to explore careers in the construction trades,” says Ryan Dwyer, Go Build America executive director.

And unlike previous programs, extensive data analytics and metrics will play a key role in helping Go Build’s leadership to gauge the effectiveness of the program’s digital tools and messages. Analytics will allow the program to enhance content or placement as needed, quickly and easily.

Dwyer says the fundamental message about construction careers is “all inclusive.” Because the message is not limited to a specific industry segment, “we’re able to present every type of career path, including how easy it is to get training—from colleges, high schools, contractors and associations—then get a job and advance,” he says.

Go Build America has been endorsed by the U.S. Dept. of Labor and the Ironworker Management Progressive Action Cooperative Trust (IMPACT), a labor-management partnership affiliated with the Iron Workers Union. The industry’s leading associations also are on board, with AGC and Associated Builders and Contractors represented on the program’s board of directors.

AGC spokesman Brian Turmail says Go Build’s “many unique and incredibly helpful features” will complement existing efforts “to reverse decades of disinvestments in career and technical education and a cultural mind-set that no longer places much value in high-paying craft careers like construction.”

ABC President and CEO Mike Bellaman adds, “The more stories, the more content [and] the more social media we can get out about our great industry, the better. Go Build will be a great way to make that message more relevant to high school students.”

An Original Approach

While such plaudits have heralded other industry-wide awareness programs, Go Build boasts something that most of those initiatives lacked: a track record.

The Go Build model got its start in 2010 as a construction workforce development program in Alabama. It was led by Bob Woods, a 40-year veteran of construction services for regional energy provider Southern Co. The effort drew on a broad-based collaboration of trade associations, educators and state government to craft a long-term campaign tailored around Alabama’s specific industry needs and demographics.

Using strategic placement of mass media and social media advertisements, complemented by support from local educators and associations, Go Build Alabama continually conveyed positive messages about construction careers while keeping students and others abreast of training and employment opportunities.

Woods, who now serves as Go Build America’s president and CEO, notes that, while the messages had a significant impact, a shortage of technical education programs in Alabama’s two-year colleges posed an early obstacle to turning students’ interest into action.

“We were missing the education components,” Woods says. “We had to convince the colleges that there was a demand for this kind of training.”

The promised demand has since materialized, leading to the addition of more than 120 credentialed training programs and a 24% increase in course enrollments across Alabama. In addition, more than half of those students credit Go Build Alabama for influencing their pursuit of a career in construction, providing what Woods says is “evidence that the strategy is working.”

As support for Go Build Alabama grew, Woods and his team began planting the seeds of the model in other states. “Alabama was a pilot program that we wanted to expand as far as we could to help the industry,” he explains. Go Build Tennessee, established in 2016 and funded via a portion of state contractor licensing fees, garnered 70 million advertising, website and social media impressions in its first year. A Go Build program for California debuted in May.

Although it’s too soon for Tennessee’s Go Build program to make a big impact in the hiring pool, Tommy Burleson, chairman and CEO of Burleson Construction Co., Johnson City, Tenn., says the program contributed to a strong turnout at a construction job fair this year.

“We had more about 5,000 high school students—many of them women—who wanted to learn more about trade careers,” he says. “It’s allowed us to show schools just how much demand there is for this kind of training and what contractors can do to help.”

“You need constant evolution because the internet moves at the speed of light.”

– Ryan Dwyer, Executive Director, Go Build America

Along with carrying the Go Build message to other states, the program’s leadership has streamlined operations, reduced costs and become more vertically oriented ahead of the national rollout. Dwyer says keeping pace with technology has posed the biggest challenge.

“When we started in 2010, there was no Instagram  and Facebook ads were in their infancy,” Dwyer says. Along with tapping into those outlets, Go Build is refreshing a two-year-old website with components and enhancements that will keep it relevant to the coveted millennial workforce.

Adds Dwyer, “You need constant evolution because the internet moves at the speed of light.”

Adding Tools

Besides addressing the construction industry’s long-term workforce outlook, Go Build America hopes to help contractors with their immediate skilled-labor needs via a database for incumbent workers in search of jobs. Similarly, Go Build member organizations can post immediate job openings and regularly receive résumés from people seeking work across the country.

Dwyer says the feature enhances existing online job boards because, like Go Build America’s messaging strategy, users can narrow their interests and searches to specific skill requirements or geographic areas. “It’s not as cumbersome to use as other job-posting sites, making it the shortest path to securing work,” he adds.

What may ultimately make the difference in Go Build America’s efforts to secure a labor pool for the future is sustained support from its partners at the national, state and local levels. Dwyer says he and Woods have been traveling frequently over the past year to build deeper support for the initiative.

Simply highlighting Go Build’s images and high-tech features is not enough. “We are showing these groups that we’re using money in more effective ways,” Dwyer says. “We’re not spending it on something that may or may not be effective, doesn’t evolve and might not last.”

Woods agrees, adding that, in order for Go Build America to redefine the industry, it must first combat negative perceptions that created the current labor crisis. “The problem didn’t develop over a short time,” Woods says, “and it won’t be solved in a short time.”

Builder confidence hits high in November

Builder confidence in the market for newly-built single-family homes rose two points to a level of 70 in Nov. on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). This was the highest report since March, and the second highest on record since July 2005, the company said.

“November’s builder confidence reading is close to a post-recession high — a strong indicator that the housing market continues to grow steadily,” said NAHB chairman Granger MacDonald, a home builder and developer from Kerrville, Texas. “However, our members still face supply-side constraints, such as lot and labor shortages and ongoing building material price increases.”

“Demand for housing is increasing at a consistent pace, driven by job and economic growth, rising homeownership rates and limited housing inventory,” said NAHB chief economist Robert Dietz. “With these economic fundamentals in place, we should see continued upward movement of the single-family housing market as we close out 2017.”

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” According to he company, scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

Two out of the three HMI components registered gains in November. The component gauging current sales conditions rose two points to 77 and the index measuring buyer traffic increased two points to 50. Meanwhile, the index charting sales expectations in the next six months dropped a single point to 77.

Looking at the three-month moving averages for regional HMI scores, the Northeast jumped five points to 54 and the South rose one point to 69. Both the West and Midwest remained unchanged at 77 and 63, respectively.

Editor’s Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public.

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