Three Construction Challenges You Should Know About
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So, what causes developers to scratch their heads and turn to their construction and design partners for an answer? Three things lead the way, we learned from the experts at Bisnow's second annual DFW New Construction and Development Summit at the Marriott City Center yesterday.
A crowd of 425 heard that rising construction costs, a shortage of subcontractors, and pre-construction cooperation (or lack thereof) make development projects a little rockier. (It never seemed that difficult when you were playing with Legos.)
Crossland Construction corporate architect Raymond Braswell (right, with Bury EVP Jim Knight) says construction costs could rise more than 4% starting in January. Material costs will likely increase, too, as rumors circulate that wood, especially, is going to cost more. (It was only a matter of time before trees started to unionize.) Another concern: subcontractors. During the recession, contractors didn't have work and were pricing jobs just to cover labor expenses. All of these costs will go up considerably as projects get more competitive in the next few months, he says.
OMNIPLAN principal Tipton Housewright (far left, with colleagues Amanda Buckley, Ashley Perkins, and Michael Hellinghausen) says building collaborative teams from the start can help combat the increasing construction costs. Getting the contractors together with architects early in the design process can result in better planning and creates value. He also thinks office is ripe to be reinvented. The Millennials are looking for a dramatically different type of work environment; one that is more informal and collaborative, and more about the outdoor space and the coffee shop. Not to mention, they want to walk to work. (Also a new Xbox One in the office wouldn't kill you.) That will transform offices over next few years.
UEB Builders principal and design phase manager Kyley Harvey says there's no substitute for getting architects and the general contractors together early to work on projects as a team. (Who knew commercial real estate involved so much diplomacy.) He's excited, too, that investors are realizing the value of creating destinations to projects. For instance, he's working on a 140-acre industrial development in Midlothian that is striving to be more than just a business park; it will be a destination with some mixed-use aspects.
Jim says the trend of mixed-use developments will grow. It's where the capital dollars want to be, whether it is in the downtown core or in the suburbs. He's also seeing compression on staff (and trying to get as much productivity from less people in smaller spaces) will impact office space of the future. Recreating the mixed-use project is evolving, too. The retail portion of these projects may require the most creativity as retailers aren't sure who they are today. (Do they want a 15k SF space or a 49k SF big store? They just need to do some soul searching, maybe skip some rocks on a lake.) More often, retail is becoming boutique and specialized and malls are becoming a little rare.
DIRTT by GL Seaman's Mary Miano-Sleeper (left, with colleague Christine Fleming) moderated the panel of experts. She tells us the firm's pre-fab architectural walls aid rapid construction by creating a custom solution in a shorter time. The accessibility and universal furniture and equipment support of DIRTT walls make them ideal to future-proof office space by making interior changes flexible and agile to grow or contract as business dictates. Check back Monday for more event coverage and look who was in attendance by checking out our photo gallery here.