What I Enjoy About Construction

This year marks 10 years in the industry for me, which on one hand feels like 20 years, and on the other, it feels like just yesterday I was graduating college. I was recently asked “What do you enjoy about construction?” so this made me take a minute to reflect on the past 10 years.

Honestly, the day-to-day in construction is grueling. As general contractors, we are focused on keeping the project moving so we are always dealing with resolving issues. Once you solve the problem you are working on, it’s on to the next one. This process repeats really until the project is complete. Sometimes it feels like an uphill battle but that is just the nature of the beast.

So to answer what I enjoy about construction, I was drawn to the process it takes and the impact it has on so many different people. The most enjoyable part of...

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The Movies and Senior Living Development

Twenty years ago everyone would ask me why I didn’t do development on a personal basis. Development is different from construction. I understand the risks of construction, but I don’t understand those of development very well. So I would Forest Gump my way through it, thinking “Stupid is as stupid does,” knowing I am not an expert in development. It was meant to add humility and levity, not to intimate that those who do development are stupid. A better quote would have been from Clint Eastwood, who said “A man’s got to know his limitations.” I did, and I do.

About fifteen years ago a good client and friend asked if I wanted to invest in a project he was developing and we were building, so I did on my own, not as The Douglas Company. I have since invested personally in several projects, always as a relatively small percentage, with...

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Managing Subcontractors Compared to Coaching Basketball

This week basketball practice started for my son’s 1st-grade team, The Clippers, whom I get the opportunity to coach. At first glance, outside of the very dissimilar physical differences, I thought I was in one of our weekly subcontractor progress meetings. Four kids locked in and focused on having a productive practice. One kid did not want to be there, two kids wanted to complain about everything, two showed up for the snack at the end of practice and one kid showed up 10 minutes late.  Yes, this season will be the constant herding of cats but then I laughed, went home, and told my wife I do this every day. Our job as the general contractor is to take the constant chaos and charter a path for everyone to follow. Below are the eight principles The Clippers are focused on this season followed by a description of how each...

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Technology in Construction for 2023

Thanks to the surge in attention to construction technology over the last few years, our once dark and analog industry has benefited from many tools that help produce higher quality projects more efficiently. Here are some of the solutions The Douglas Company is making a focus this year:

  • Scheduling Software - Supply chain issues and workforce shortages are expected to continue in 2023, and without a detailed and outstanding project schedule any project is going to suffer from inefficiency and lost time. As schedules get more complicated, tools that help understand their data and the effects of one task on another. The Douglas Company uses SmartPM, a web-based tool that tracks changes between schedule versions, availability of float, compression, and overall health of a schedule. This gives our project managers more information to help prioritize work on-site and focus on the right work areas.
  • Project Photography - Pictures tell a thousand words,...

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Effective Teamwork Makes the Dream Work

Some of the best teams in sports history had some Hall of Fame individual players on them. But if you don’t have a collaborative group working toward the same goal and carrying their weight, finding success can be elusive.

The same goes for preconstruction planning and execution. Owners/developers first need to align with the best partners/teammates they can regarding design, engineering, construction, operations, etc.  Best practices dictate having as many members of the development team as possible present for O/A/C calls. When this happens everyone is up to speed on what their deliverables are and when they are due; decision-making is more efficient; brainstorming resolutions to hurdles is more productive and it also makes the next call more efficient without backtracking on items that have already been discussed.  Preconstruction coordination should not be done in a vacuum. When we see that not all the key team members are present on...

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Five Charts for Construction in 2023

A recent article shared in Construction Dive contained some great information we wanted to share. Just when it seems like we are all exhausted with pricing news, more comes available that pulls us right back in. The article features five charts that give some indication of the state of construction today, and where it might head. Take the time to read it  ̶  it’s worth it  ̶  then take a look at our commentary below. 

https://www.constructiondive.com/news/5-charts-hint-at-whats-in-store-construction-economy-2023/638059/

From our standpoint, we are seeing the following on these issues:

  1. Architectural Billings - Our design partners are still quite busy in certain areas and sectors, particularly multifamily, yet we do know firms that have already incurred staff reductions. This is an index we watch closely.
  2. Construction Backlog - We have had a record backlog in 2022 like many contractors, and talk of our trade partners becoming more available hasn’t come yet - Especially the specialty trade...

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It’s Not Like It Used to Be

Have you found yourself saying “It’s just not like it used to be”? I hear this a lot lately and if I am being honest, I have said it a couple of times myself. It seems like challenges just keep on coming. First, we had the Covid lockdowns, then the lumber shortage, now inflation, and as I write this we are on the brink of the next crisis…the rail line strikes. One thing is for sure, it’s NOT how it used to be.

But that is why I love construction. It’s never the same. If I wanted to do the same thing day in and day out I would find another occupation. New challenges are what make us grow and the ones who can adapt are the ones who will succeed.

No two projects are alike. It doesn’t matter if it’s senior living, multifamily, or commercial construction. It doesn’t even matter if...

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Consider The Real Cost Before Delaying Your Project

Developers understand the many reasons construction projects get delayed. Financial challenges can bring a project to a standstill in the face of interest rate increases and material and equipment price volatility. There is also the ongoing challenge of finding sufficient manpower to get the job done and the weather is a factor here in the Midwest.

In the current economic environment, you may consider delaying your construction project. But before you make that decision, consider the compelling reasons to forge ahead. Being a developer is always risky and challenging. With the volatility affecting the industry today, it is important for developers to thoughtfully proceed, as opposed to delaying projects. Some perceived challenges can actually present opportunities.

Longer lead times can provide greater flexibility, which enables you to source building materials at the best possible cost. Lead times for many construction materials remain longer than normal, so think months versus weeks. Lead times...

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The Impact of Hurricane Ian on the Construction Marketplace

It has been 60 days since Hurricane Ian hit Southwest Florida and left its path of destruction across the state. Ongoing surveys estimate that 20,000 homes in Lee County (Fort Myers) have been destroyed with another 2,500 in Collier County (Naples). The City of Fort Myers alone estimates their storm damage to be $600M!  Lee County has reported they have reached the milestone of 1 million cubic yards of debris removed and estimates another 3 million cubic yards of debris remains. The magnitude of these numbers is staggering and doesn’t include any after-effects from elsewhere in the state. 

The observed short-term impacts on the Florida construction market have ranged from labor and materials becoming more readily available as those resources have been diverted from stalled or destroyed construction projects to the exact opposite, a disruption in labor and materials originating from Southwest Florida. 

The question most directed to us is what will be the hurricane's...

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The Future of Senior Living

Two weeks ago, I attended the National Investment Center for Seniors Housing & Care (NIC) in Washington, D.C. As always, it was good to see old friends and clients, and interesting to get a read on the industry. There were really no surprises, but it’s good to get intensive confirmation of what’s going on. 

Senior living development is really a somewhat bifurcated proposition at this point.  Though we are still building and have recently started a number of assisted living/memory care (AL/MC) projects, most of the developers are not bullish on this sector right now. Operating costs are up dramatically, interest rates and construction costs continue to rise, occupancies have not fully recovered, and rents have not yet risen to cover the increased expenses. There are some AL/MC developers that think that they just need to forge through, that it’s just a bump in the road and all will be good,...

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Switchgear Demand Craziness!!!

Behind the critical milestones of building dry-in and completion of drywall hanging, the date of permanent power provides a key indicator of a project’s schedule trajectory towards completion. Unfortunately, the current construction industry is being severely impacted by major challenges within the electrical gear industry driven by demand, labor issues, and electrical component shortages. Critical switchgear components such as switchboards, distribution panels, and heavy-duty circuit breakers have historically taken four to six months to receive. Over the past year, lead times on these items have increased to a minimum of 12 months, and quoted lead times of 14-18 months are becoming the standard.

So how does this impact the construction industry? For comparison, a $25 million senior living project with a construction schedule of 18 months, would typically require permanent power to be in operation by the twelfth month of construction to allow the startup-up of essential HVAC equipment, building systems,...

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Value Engineering or Contingency??

Inflation, fuel prices, material escalation, and material shortages are pushing construction prices to record highs. Already tight project budgets are being value engineered, tabled in hopes that pricing will come back to earth in the future, or just abandoned. Like everything else these days, the typical value engineering process is not as effective as it once was. When project pricing comes in over budget, we have historically provided a list of suggested alternate materials, methods, and/or systems to help bring the cost back closer to budget if needed. 

Currently, inflation is working against project teams trying to value engineer projects. On several recent projects, material escalation has negated any value engineering efforts. Meaning…during the time it takes to price VE alternates, and get the accepted changes into the design documents, the pricing of the other trades and materials has increased an equal or larger amount of the costs saved from the approved value...

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No One Can Whistle a Symphony

“No one can whistle a symphony. It takes an orchestra to play it.”  Famous quote by H.E. Luccock.

Closing a job and seeing it to the finish is not easy. Most in our industry would tell you it can be the least favorite part of the project. Most would also tell you it is impossible to live in fantasy land after working through the challenges of the last two years. There’s no magical bench of labor we can pull from and have crews arrive onsite the next day when needed. There’s no la-la land where the material is in stock and can be pulled off the shelf for overnight delivery. At The Douglas Company (TDC), our core purpose is to contribute to the success of our clients and associates. The industry has changed which has required us to adapt and change with it.

The All American Assisted Living at Enfield...

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Don’t Get Soft on Wood Buildings

Wood structures seem to have gotten a bad rap the last few years. It’s not entirely their fault. The skyrocketing land costs have pushed projects to go to more stories than a conventional wood frame building allows to get the number of units needed. Massive price hikes and volatility of material costs have also made it a less desirable building material to use.

Throughout the years The Douglas Company has proudly worked hard to build as much of our work out of wood as possible. We thought we should revisit the good reasons and tactics for doing so that still exist today.

Wood framing is simply faster than other methods. Modular and panelized systems abound in our industry now, but none of them from our experience go up faster than a wood-framed structure. Despite some of the scary lead times we’ve seen over the last two years, wood framing materials involve many...

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As Boring as Dirt – Understanding Your Site Construction Options

It is easy to focus on the building cost per square foot in the preconstruction process, but the site costs can make or break a project. Too often we see scope creep on the project site after the initial site plan, and it takes asking the right questions and getting creative to bring these costs back in line.

As your civil plans develop and soils reports become available, make sure you’re asking the design team these questions:

  • Grading - Are the buildings at the right elevation? The finished floor level is usually set early in the design process, but as more requirements become known it may not be the right height anymore. Raising/lowering a finished floor level can help reduce soil import/export, and can have positive impacts on your storm sewer layout as well. 
  • Deep Foundations/Undercuts - It seems that poor soils are an issue on most projects we are looking at...

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Technology Advances in Construction

As the world continues to evolve with technology, so too does the construction industry, albeit at a much slower rate. Looking back over the last 15 years, it is incredible to think about how much technology has changed in our daily lives. Smartphones weren’t very prevalent and the first generation of the iPhone had just been released. Businesses used fax machines instead of email to transmit information, very few people knew what the cloud was, and drones, as we know them today, didn’t exist.

As it relates to the construction industry, 15 years ago I can remember physically mailing sets of drawings out to people for them to bid jobs and waiting for their faxed bid to come through. People used an actual camera to take pictures, and submittals were wet stamped and mailed to the design team for their review.

All of the efficiencies gained through technology really are fascinating. To...

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How The Douglas Company’s proactive approach keeps projects on schedule

In today's construction world, more and more time and resources are spent on scheduling, and with good reason, too. With the high cost of construction loans and general conditions, contractors and developers alike can agree that the sooner we hand over a building the better for all those involved. Project milestones, proper sequencing, and task and crew logic are all scheduling terms that are thrown around on a weekly basis when discussing how we get the job done as soon as possible.

But what if I told you there was something else besides scheduling that can hold up progress on your project just as much as a missing drywall crew or bad schedule logic? Wouldn’t that be something we need to be cognizant of?

I am talking about inspections, of course. Inspections are a necessary step in the construction process to provide a third-party audit that the work meets all code requirements...

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Capital Investment Remains Strong in the Active Adult Space

Some developers and investors are unsure about committing to new senior living developments amid rising construction costs and interest rates, while others remain bullish on building new communities figuring that demand will be outpacing supply for the foreseeable future. I have even heard from some clients that they really push to get new developments going in this environment when other potential new projects may be holding off which gives them a leg up in a given market. 

One segment that continues to gain steam is active adult according to a recent article in Seniors Housing Business’ April Edition. Active adult communities target those 55 years old and older that are ready to rid themselves of all things associated with home ownership, but are young and healthy enough that they don’t require assistance with daily living activities. These communities are not as labor- or service-based as an assisted living community because they...

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Protecting wood framing during construction provides peace of mind

As we move into the rainy season, it’s important to revisit best practices of protecting wood from the elements during construction. Previously, we used to rely on just-in-time deliveries which would limit the amount of time our framing materials were subject to the weather prior to being covered up. With today’s market environment, we find ourselves ordering materials early and storing them on site so that we can be productive as we start building and not run out of material along the way. This has led to lumber being stored for longer periods than we are used to.  It’s important that this is taken into consideration as we construct our projects and that we don’t allow deterioration of our building products to occur. 

First, develop a plan early to deal with these issues in order to reduce the risk of mold and product deterioration. Ensure that your storage area is well...

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Good News!

I thought I’d write a blog about some good news, at least for multi-family developers.  No, costs aren’t coming down, nor are interest rates.  But rents for multifamily are going up!  According to rent.com through April 2022 apartment rents nationwide for two bedroom apartments are up 22.8% in a twelve month period.  In some areas that are close to us they are up even more.  Orlando rents are up 38.2%.  Cincinnati is 37.8%.

So while costs are up and interest rates are threatening to rise, rents in many areas more than make up for this, creating opportunity.  Rent.com goes on to say that the shortage of supply coupled with increasing demand and increasing inability of people to purchase homes is causing this phenomenon.

Good news for multifamily developers.  

Peter Douglas

President

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