Four Growing Commercial Construction Trends To Watch in 2017

Four Growing Commercial Construction Trends To Watch in 2017

Mar 29, 2017 | Construction Industry

With 2017 well on its way, construction professionals are identifying new and growing industry trends that will shape the remaining year and set the stage for 2018. Despite an overall underwhelming growth in 2016, the Dodge Data & Analytics team has projected an optimistic 5% growth for the upcoming year.

What will this growth look like in the commercial construction industry?

 

Increase in Warehouse and Distribution Centers

  • While the robust growth in online sales has been detrimental to larger retail centers, like Macy’s and JC Penny, it continues to build demand for regional distribution centers. Retail construction as whole is not projected to decline, it is only predicted to experience a sharp shift from walk-in glass-glass front stores to warehouse and manufacturing centers.
  • The retail sector has also experienced an overall positive-growth, meaning that commercial construction still retains a positive outlook for cutting-edge retail and restaurant concepts. One of the more innovative developments is fulfilling grocery or food orders. Need some examples? Check out AmazonFresh, Instacart, and Grocery Gateway – all companies who will need massive warehouse space to accommodate a larger variety of products and produce.

Energy Efficiency and Green Building

  • The rise in eco-friendly and health-conscious trends is now beginning to take shape in the commercial construction industry.A new study completed by Dodge Data and Analytics points out that green building is expected to double by 2018. The demands for recycled materials and energy efficient solutions are spurring new developments in various trades, specifically in the window/glass, doors, and plumbing trades.Customers are learning that while LEED-certified buildings involve a costlier design, they use less water and energy overtime, reducing expenses in the long-run.
  • What does this mean for general contractors?There is a growing expectation for contractors to provide clean and resource-efficient alternatives for all phases of development. Might be time to consider that LEED-certification.

Technological Efficiencies

  • The integration of technology and construction has rapidly reduced and streamlined previously arduous processes. Project management software systemizes the pipeline of communication between contractors, subcontractors, and clients. Real-time video feeds capture and report jobsite data with speed and accuracy. As far as customers are concerned, technology has significantly raised the bar for both jobsite accountability and visibility.
  • Wearable technology is also transforming the building and construction industry, specifically for tradesmen and superintendents. The building pressure behind jobsite safety and quality assurance has instigated a wearable technology industry that is expected to hit and $4 billion by the end of 2017.[1] Some of the most innovative wearable devices include safety vests with GPS, hard hats with virtual display visors and augmented reality devices to experience virtual design elements.[2]

Collaborative and Integrated Approaches

  • The collaborative approach is becoming more popular as it continues to prove its time-efficiency and cost-effectiveness. While the public sector primarily retains its design-bid-build segregation, construction professionals are seeing an increase in design-build projects in the private sector. According to Dodge Data & Analytics, the design-build, public-private partnerships and integrated project delivery are three of the most often-cited methods that are altering the industry and are likely to gain ground in 2017.

 

[1] https://www.buildsoft.com.au/blog/construction-tech-and-trends-for-2017

[2] https://equipmentshare.com

Three Common Myths About Construction

Three Common Myths About Construction

Mar 22, 2017 | Construction Myths, Starting a Construction Project

Myth #1: I can do my own general contracting.

Navigating the commercial construction industry requires years of involvement and significant technical understanding.

Does this mean that general contractors have an exhaustive understanding of every trade? No, definitely not to the same degree that subcontractors do. However, there is a reason general contractors are required to be licensed in Oklahoma.

Operational general contractors must demonstrate a basic proficiency in the construction process so they know how to build your project safely and effectively. They must know how and when to obtain the necessary permits, schedule material and long lead items, and – most importantly – manage the pipeline of communication between project managers, subcontractors, architects, and the client. This maze of project management requires an entire team of full-time, dedicated construction professionals.

Not convinced? That’s okay. We wrote down a few more reasons to consider a General Contractor here and here. 

 

Myth #2: You can pick any general contractor.

Your project is unique, so the company that builds it should be, too.

Is it a design-build project? Some commercial construction companies have developed years of synergy with architectural firms. They know how and when to implement value engineering.

Are you constructing a multi-phase, 100,000 sqft building? Other firms have developed their portfolio in construction management and know how to execute complex phases using cost-effective and time-sensitive methods.

A firm that specializes in office renovations and repairs may not be the most qualified to handle your ground-up restaurant. That’s why it’s important to vet the experience and expertise of any general contractor.

Ask for referrals. Most general contractors who perform quality work are well-known by repeat-clients and subcontractors.

Conversely, contractors who promise low prices and perform low-quality work also develop a reputation for hemorrhaging client’s budgets with hefty change orders.

The commercial construction industry is a resourceful community. Ask for recommendations and find out what contractors deliver quality services.

Analyze their resources. The individuals who comprise the general contracting team determine the overall capability of the firm. That’s why it’s important to ask: What are the qualifications of the project managers and superintendents? How many can they dedicate onsite to your project?

For example, DBG Construction uses Procore Construction Management software to effectively record and track onsite supervision, safety, and progress. We dedicate a superintendent to a single project, and provide a comprehensive support system for processing contracts and documentation. Make sure your construction project is going to receive the detailed attention it deserves.

 

Myth #3: The hard cost is negotiable.

An experienced contractor is familiar enough with the trades to ensure that each piece of the project is priced properly. In fact, a quality contractor will put together a team of knowledgeable subcontractors with a record of excellent performance. This means that a general contractor has diligently estimated the hard cost of your construction project, and then added the necessary percentage to cover their overhead costs. These hard costs are the result of existing market dynamics – labor, material, or the availability of both – not the contractor’s desire for profit.

(Fun fact: Overhead costs are how we take care of our people – including providing water and accommodations for onsite workers. You can read more about overhead costs here: “Contractor Markup – What are you really paying?” SucceedWithContractors.com.)

What is left to negotiate? A successful general contractor in the commercial construction industry knows that they can only afford to drop the price if they can adjust the scope of work.

They often provide value engineering services to analyze the specifications and replace various materials and finishes with cost-effective alternatives. Without examining other options for material or labor, the hard cost of your project remains the same, but an experienced general contractor has the resources and the network to help keep your project in budget without sacrificing quality.

Looking for a general contractor for your next commercial construction project? We’d love to hear about it. Contact the DBG team!