Construction Trends

You are currently browsing the archive for the Construction Trends category.

What’s Beyond the Horizon?

December 5, 2011 in Construction Trends, Recession | No comments

In the U.S. today, right now, we have more of everything than we need. More housing, more GLA of every type of space, more service providers, more developers and more building contractors.

In order to survive this cycle, we’ve remained nimble, watched expenses and never forgotten what brought us to the party. Our goal is to not lose sight of the future. As Wayne Gretzky said, “I skate where the puck is gonna be, not where it has been.”

To me, being successful long-term will come from helping others achieve success. This means practicing what you do best and at the same time thinking ahead.

These are the best of times and the worst times for all of us. The best of us will be able to look over the horizon. I’ve been trying to anticipate what we will need more of in the next 5 or 10 years. Here are a few things we’re thinking about:

  • Housing for senior living. This is for the 60 and 70-year-old age group, which is the new 40. What will it take to be cool and reach folks who haven’t retired yet?
  • Urban Infill. Is the trend toward repurposing land within a built-up area a fad or a permanent path?
  • Medical sector. Can we put medical where the people are–in neighborhoods–taking advantage of existing GLA?
  • Office Buildings. How can we use the square footage of a space more efficiently?
  • Product distribution. How can we do this more efficiently? We’re looking for lower cost, less carbon and more seamless delivery.

Of course, these are some tricky challenges. But think about the folks who developed the coffee chain with the hard-to-pronounce drink names. Or the person and company who developed that device for us to listen to music downloaded from the Internet. As Steve Jobs once told BusinessWeek, “A lot of times, people don’t know what they want until you show it to them.”

To me, it is important not to forget what brought you to the party, and at the same time not miss the opportunity for what’s on the horizon.

Better yet, what’s over the horizon?…

 

Share

 

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email


Tags: , , , , , , ,

Overcoming a Construction Talent Crunch

November 29, 2011 in Construction Trends, Management | No comments

As an industry, the recent years have taken us  through some lows. As we continue to look ahead and heal, it’s important to consider and overcome what could hold us back.

At a recent breakfast, Brian Moore of FMI presented three challenges ahead of us, and some thoughts on how to keep them at bay.

1. Availability of entry-level employees.

The population of 15 to 24-year-olds is up by a million. This means we have an abundance of college graduates and not enough positions to offer them. In fact, we are having a hard time finding people to mentor them. That’s because our leaders are getting older.

2. Aging U.S. population

As Baby Boomers age and begin to retire, a generation of experienced workers is leaving the field. Project superintendents are particularly endangered. There are not people in the lower level management positions–folks in their 30s and 40s, traditionally thought to be in their working prime–to step up and fill vacancies.

3. Impact of immigration practices on the labor pools.

Hispanics make up 11% of the U.S. workforce and represent 30% of construction’s work pool. This population sector is growing rapidly. We have yet to see what this will mean for the growth and increased impact of Hispanic-owned contracting businesses, but we’d be wise to embrace their expertise.

Solutions to all three of these issues might lie in our industry’s reputation. When jobsrated.com ranked 200 job titles in terms of desirability, not a single construction title placed in the top 100. In fact, 10 industry job ranked lower than “maid” and 5 lower than “nuclear demolition technician.” Wow!

So how do we address these problems? Here is our take:

In the last 12 months, we have hired two new building science graduates. These positions were offered before college graduation. We have assigned sponsors within our company for each to ensure they are integrated into company policies, are well-treated and welcomed. To us, the key is to mentor and acclimate, once you have the good talent.

We are not finding difficulty locating good project superintendents in their 30s. Maybe it’s because we’re hiring younger folks and then making efforts to retain them?

As for immigration, that is a tough one. While we have not seen the impact of the recent state immigration laws, I do believe it will impact us, raising cost. Hopefully, if we can ever get a Congress with any sort of consensus, national policy and laws will come into play. Until then, we are seeking out workers who are in the U.S. legally. Labor cost will rise and fall depending upon the law of supply and demand, but we intend stay aboveboard.

What’s your take? Are there other ideas are out there that might be helpful?

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , ,

BIM: Getting Past the Hype

November 23, 2011 in Construction Trends, Technology | 2 comments

Earlier this week, I met with a national architectural firm with whom we are partnering on a 2012 mixed-use project. I asked the principals what they thought of BIM and their response was, “it will become the norm for architectural and engineering work sooner than later–in less than five years.”

We also believe BIM will become the standard, but not without growing pains and good effort to learn.

We know firsthand. On our first BIM project, our building superintendent was excited about getting into they system. He liked having the flat screen in the trailer and the ability to manipulate the plans. Cool. I recently spoke with him and he hasn’t done a whole lot more with it since then. The hype took over, but substance has not.

I also recently visited a site where everybody was carrying around iPads loaded with BIM software and the talk was about it being the greatest thing since sliced bread. As I read the tea leaves, I fear there is a bit of hype here as well.

So, how do you get past the hype?

For us, it all lies in educating our team.

Realize the initial benefits.

  • Using BIM in presentations can help you win jobs. This works as a commercial developer, a building contractor or as someone trying to sell the construction of a new project within your company.
  • Using BIM is helpful for non-construction types. Most have difficulty visualizing two-dimensional flat plans, but BIM helps them understand what they are seeing.
  • Putting BIM into practice will reduce change orders. The “tool” reduces clashes and delivers the images of the product with more clarity.
  • BIM will eliminate collisions and overlap between trades, saving time and money.

Realized future benefits.

  • BIM will be a great tool for operations and facilities management after construction is complete.
  • BIM will probably lead to better customer long term relationships. Models will help us “own” the project or development.

Realize the obstacles.

  • Right now there are only a small group of BIM-capable personnel in the workforce. With the hype, one would think everyone is using is using BIM, but that’s far from the truth.
  • The software is at times difficult to navigate, even after training. We’re hoping for more use-friendly programs that can be easily used in the field.
  • There are folks in the field who have been reading 2D drawings their entire lives. Widespread acceptance of  the technology will require it to be as easily accessed as a set of paper plans.

Even with these obstacles, to me, BIM is worth the time and cost on the front end. The gains in efficiency and understanding of the project will be of great value to our customer relationships.

Have you been successful putting BIM into practice? What challenges have you overcome?

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , , , , ,

Trends Show Construction Industry Looking Up

November 16, 2011 in Construction Trends, Recession | No comments

Our CFO Del Allen recently attended the Birmingham Aon/Smith Currie breakfast, where they presented a “state of the union” type look at the construction industry.

Later this week, I will share 3 key issues effecting talent in the construction industry, but first I thought you might like to take a look at the stats. Many thanks to Brian Moore of FMI for allowing us to share.

Highest volume segments in 2011:

  • Power–Driven by environmental regulations and transmission/distribution projects.
  • Educational–Due to rapidly increasing student populations, widespread overcrowding and antiquated facilities.
  • Highway and street–Tough climate because state revenues are declining and residential construction is slow.

Strongest gainers in 2011:

  • Power (7%)
  • Commercial (7%)

Weakest segments in 2011

  • Religious (-18%)
  • Lodging (-16%)
  • Manufacturing (-6%)
  • Office (-5%)

Before you start thinking these numbers look dismal, consider the losses in 2010. Lodging and office construction were down 53% and 32%, respectively.

Total “put in place” (construction that has finished and is now being used) lost 10% in 2010, but is expected to grow 2% in 2011. Forecasters say we’ll be up 6% in 2012. From what I can see, we are healing.

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , ,

An Old Salt Problem Surfaces Again

September 23, 2011 in Construction Trends, Tips from the Field | No comments

Recently, a customer came to me with a request I hadn’t heard in a while. They wanted an integrally color-blocked single Wythe incorporated into a new project we will be constructing.

Many of our projects used this means and method a few years back, but we evolved away from that type of concrete masonry unit (CMU). Where applicable, we now use natural CMU and then apply an elastomeric coating, which not only seals and colors the block, but is a much better waterproofed product. That’s important to prevent efflorescence, a problem you see on older generations of construction.

Stephen Shanks addressed the problem in a 1992 talk to the Alabama Masonry Institute. I kept that publication around as a reference, and was glad I could pull it back out. Mr. Shanks says,

“Efflorescence results when soluble salts in masonry or mortar leak to the surface. Later, as the wall dries, the salt solution migrates to the surface and the water evaporates depositing the salt on the surface of the masonry.”

As far as contributing factors, he says salts may be

  1. present in the masonry units
  2. present in the mortar
  3. carried in to the wall by rain or groundwater

Efflorescence can be the bane of my existence or anyone’s for that matter. One can do everything right–being mindful the time of year, keeping the product dry prior to installation and ensuring the site is well drained–and still get these salts leaching out months or years after the work is completed.

While we can control this in a CMU wall using an elastomeric coating, it’s much harder to do with brick. In fact, I was in Tennessee this week checking out one of our projects from about 5 years ago and low and behold there were the salts, not on the CMU, but on the brick.

I still consider efflorescence one of the most common and unpredictable problems in construction today, where masonry is concerned. To me, the best remedy is to let it “run its course” so to speak. When it has dried on the masonry, then clean and keep this cycle going until all the salt has leached. Trust me, it will stop, but for a period will look unsightly.

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , , ,

Advances in “Green-er” Drywall

September 16, 2011 in Construction Trends, Green Building | 2 comments

 

 

 

 

 

 

 

 

 

 

A while back, I wrote a post titled, “Can Drywall Be Green?” which discussed the aftereffects of the Chinese Drywall crisis that plagued our country earlier this decade.

When it comes down to it, drywall is a convenience product. It is efficient, replacing lath and plaster and therefore saving time and money. However the emissions drywall produces–both in its creation and in shipping–are not exactly environmentally friendly. Until recently, the best way you could make drywall more green was by buying local, or looking into EcoRock (the usability and quality of which could provide another post entirely).

I’m pleased to say I recently read about a new development in “green-er” lightweight drywall in Environmental Building News. They report that multiple companies are producing a product that weighs 25-30% less the standard. While we are commercial builders, I did the math on what this means for the typical home which has an average of about 8 tons of drywall. By reducing the weight, it means  that in a typical residential building year (not like the last 4) the US would save about 400,000 gallons of oil in transportation alone.

The benefits I see include:

  • Easier installation with less fatigue.
  • Lower weight, meaning less energy to ship.
  • Increased sag resistance, allowing the same product to be used in ceilings and walls.
  • Scores and snaps more easily than standard drywall.
  • Less waste and reduced dust.

At this point, the only downsides I see are:

  • Costs slightly more, by about 5-10%, but I believe this will moderate.
  • Some reduction in sound dampening qualities.

Since the developments on this product change are so new, I don’t have any results to report…yet. I can promise that we will be investigating lightweight drywall as we bid future projects. If you have experience with these products, it would be great if you would share in the comments section.

In the meantime, it’s nice to know that more environmentally friendly products are being researched and entering the market.

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , , , ,

Lean Part 1: The System In Action

August 23, 2011 in Construction Trends, Customer Relationships | No comments

Recently, our friends at Superior Mechanical were kind enough to give me a tour the new half-billion dollar Children’s Hospital expansion here Birmingham. I was interested to see how they are integrating Lean construction initiatives with their BIM work to be more efficient, and save their ultimate customer time and money.

As background, Lean is a system that seeks to streamline practices and eliminate wasted effort. The idea is to create more value with fewer resources. The system is process-oriented, with the goal of entirely eliminating excess—be it physical or in the form of time.

While Lean technology has been applied to manufacturing for several decades, Superior is using it to make them be more efficient in construction. Rodney King, their Lean Coordinator, explained the efforts.

Superior has made perfecting processes their goal. Errors are identified and the procedure is refined until mistakes evolve out. The emphasis is on the series of tasks rather than the individuals performing them, systematizing delivery.

No more creating a new mold with every project. The system becomes the skill.

Rodney gave me the example of their pre-fab shop. It was created so that many standard assemblies–like plumbing systems–can be put together in a warehouse before installing on site. The benefits are multiple:

Speed. All the tools needed are at arm’s reach. Also, with repetition, the labor becomes more time and cost efficient.

Safety. While plumbers onsite might have to work on a ladder, the tasks are at chest-level in the prefab shop.

Lower waste. Excess product that might get thrown out on the job site is set aside for another use. This is better for landfills and the bottom line.

We are evaluating lean ourselves. In fact, we’re planning a post later this week about our CFO’s visit to Basic Lean. For us, I can see the potential. While it’s not always easy to change mindsets and habits, I believe there are some wins out there in the construction industry. As Rodney said, it’s about small incremental successes over time. I agree.

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email


Tags: , , , , , ,

Is Now the Time to Renegotiate Or Right-Size?

August 4, 2011 in Construction Trends, Management, Recession | No comments

Recessions don’t have many redeeming qualities, but they do create opportunities that wouldn’t exist otherwise.

Let me explain myself with an example. During our current economic downturn, commercial and retail spaces have often been leasing at reduced rates. Many of the prime locations already have been scooped up by opportunistic businesses.

There still are good options. According to a recent article in The Wall Street Journal titled, “Time is Ripe for Negotiation,” annual leases for U.S. office properties averaged $23.20 a square foot during the fourth quarter of 2010, down from $25.02 in 2008. Meanwhile, despite the discounts, office vacancies have increased to 13.4 percent from 11.8 percent.

Trends are similar in the retail and industrial sectors.

  • Retail property leases averaged $15.56 per square foot during the fourth quarter of 2010, down from $17.51 in 2008.
  • Retail vacancies rose to 7.3 percent from 6.6 percent.
  • Industrial property leases dropped from $6.28 a square foot in 2008 to $5.47 last year.
  • Industrial vacancies bumped up to 10.2 percent from 8.8.

Having more available space on the market combined with lower rates means this is an excellent time to negotiate with landlords. They would prefer to lease part of the space rather than let the entire building sit empty.

This is also a good opportunity to right-size. We’re increasingly seeing retail boxes get smaller in an attempt to be more effective and profitable.

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , , , ,

In Construction, Are Bells and Whistles Worth Added Costs?

August 2, 2011 in Commodities Pricing, Construction Trends | No comments

In short, sometimes.

Last week, I was reading an article in Engineering News Record titled, “When Does It Pay to Use Innovative Concrete Construction Products?” The piece details a study by the Construction Industry Institute where three recent innovations in concrete were investigated, comparing them to traditional counterparts. The article explains the “why” behind their conclusions, but here’s the executive summary:

Modular formwork involves substantially more labor, which is usually cost prohibitive.

Self-consolidating concrete is a toss up. Labor costs are lower, but they might not offset the signifcantly higher material price.

High-strength rebar is a win over traditional steel enforcement.

I’ve been through several decades of innovations and can tell you that some have proven their worth and others are show.

For example, one of the challenges we have experienced in formed concrete work–especially the more complicated pieces–is the quantity of rebar in the design and getting concrete properly placed among this amount of rebar. Having less rebar makes this an easier task to accomplish properly.

As for high strength rebar, reducing the quantity of steel  involves less production and freight, leaving a smaller carbon footprint.

To me, there is never a large win in cost, sustainability or reduced carbon. The key is small wins multiplied many times over.

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , ,

Hot Gas Reheat: Worth the Extra Cost?

July 12, 2011 in Commodities Pricing, Construction Trends, Project Estimates | 1 comment

Last week, I was having a conversation about pricing on an HVAC system with Heath Cather in our office. Why had the mechanical engineer chosen hot gas reheat? It’s more expensive and sometimes unnecessary, I offered.

He mentioned a trend he’s noticed. With all the mold law suits lately, we are seeing recommendations for a sure bet against moisture: hot gas reheat.

What is hot gas re-heat?

With this system, you have two coils in the air handling unit. The air first travels across a cooling coil which de- humidifies, then it crosses the hot gas coil that raises the air temp back up 15-20 degrees to further dehumidify and render the air neutral, eliminating over-cooling.  Once the thermostat calls for cooling, the hot gas drops out in order to lower the space temp.

Why are we seeing more use of hot gas reheat?

I talked with a mechanical contractor relationship of ours for details. This is what he told me:

Recent requirements to introduce large amounts of outside air into the workplace can result in the rise of the  indoor humidity level in the space. People want to combat this by purchasing a unit with excessive cooling tonnage, a “bigger is better” mentality. The over-powered unit causes the system to short cycle, not running long enough to de-humidify. We’re left with excess moisture, which can lead to mold.

Thoughts on combating the moisture with hot gas reheat:

  • Energy code limits the use of electric re-heat to 42,000 btu and below.
  • With hot gas reheat, the average 5-ton unit sees a price increase between $2,800 and 3,000, rising significantly as the tonnage increases.
  • If the space is cooling, it is de-humidifying, whether humidistat is calling or not.
  • Humidity control from a properly sized unit can lead to energy savings. Lower humidity in summer will make you feel more comfortable at 75-77 degrees, while if the humidity is high , 70-71 degrees may not seem comfortable. The opposite is true for winter operation.

Takeaways:

Hot gas is more expensive. A standard  and properly sized system has been proven to be just as effective in humidity removal and comfort control.
Know what you’re building and communicate it. What will the building be used for, and are there special climate issues involved? This is another reason design build works for many clients.
Application is key. HVAC is not a one size fits all discipline.From a contractors stand point, we see the addition of hot gas reheat on the increase and the majority of the time justified.  However one should stop and evaluate: do we really need this, or is it just insurance for a 3rd party?

Share

Merrill Stewart is Founder and President of the Stewart Perry Company, a commercial building contractor based in Birmingham, Ala. Contact him via email

Tags: , , , , , , ,

« Older entries § Newer entries »