Archinect - News

Leveling construction material costs and supply chain relief may signal inflation cooling, new report finds

2023-08-14T16:55:00-04:00

The latest Associated Builders and Contractors (ABC) analysis of U.S. Bureau of Labor Statistics Producer Price Index data indicates that increasingly stable construction materials prices and recent supply chain improvements over the past few months may signal "positive economic outcomes" within the United States, Construction Dive reports.

"Goods prices continue to stagnate in the context of improved supply chains and a sluggish global economy," ABC Chief Economist Anirban Basu explained in the analysis. "It has been the improvement of supply chains that best explains recent positive economic outcomes in the U.S. economy. As supply chains have normalized, unmet demand has been more readily satisfied. That has propelled transactional volume and economic growth."

Image source: U.S. Bureau of Labor Statistics via the ABC (Aug 2023).

"At the same time," Basu continued, "the improved supply chain has helped push prices lower, contributing to the disinflation observable both in yesterday’...

Amid contractor competition and COVID-19, construction costs fall for the first time since 2010

2020-07-22T16:09:00-04:00

A new report from Turner Construction Company highlights an unexpected trend that has taken shape in recent months: lower construction costs for non-residential projects.

According to Turner's quarterly Building Cost Index, construction costs decreased during the second quarter of 2020 by 1.01%, reversing a nearly equal increase seen during the first quarter of 2020.

Describing the contents of the report, Attilio Rivetti, the Turner vice president responsible for compiling the Cost Index, explains, “Trade contractor competition has increased in many areas as they work to secure backlog due to uncertainty they have about future opportunities. We expect the third quarter will serve to more clearly define the fluctuation of escalation of cost in the construction industry."

Hawaii issues RFQ for new Aloha Stadium

2020-04-02T12:13:00-04:00

The state of Hawaii's Department of Accounting and General Services (DAGS) has issued a Request for Qualifications for contractors interested in bidding on the first phase of the New Aloha Stadium Entertainment District in Honolulu. The first five years of work will include a replacement stadium and ancillary commercial mixed-use development and will be delivered through a public-private partnership (P3).

According to Construction Dive, Phase 1A of the project will include the demolition of the current 50,000-seat stadium; design, construction, financing and maintenance of a new 35,000-seat stadium, due to open August 2023. The work will also include necessary infrastructure, including roads, parking, public spaces and utilities; and connections to the Honolulu Authority for Rapid Transportation (HART) system.

Phase 1B will include 20,000 square feet of retail and entertainment space; up to 700 residences; 75,000 square feet of office space; and 240 hotel rooms, Construction Dive reports.

Construction Labor Shortage Macroeconomics

2019-08-21T09:48:00-04:00

The No. 1 business issue for home builders, remodelers, and land developers continues to be access to skilled labor. According to NAHB analysis of Bureau of Labor Statistics (BLS) data, as of April of this year there were 404,000 open construction sector positions. Not only is this level of unfilled jobs in the construction industry at a post–Great Recession high, the current estimate is the highest ever reading for this data series, which runs back two decades.

According to Builder, "the intensity of the labor shortage among builders grew more intense during 2018 and 2019." The challenges of this shortage on the construction industry bring higher costs, delays, and lower output on projects. Economist, Robert Dietz, Ph.D. suggests that, "Wage growth in a sector is ultimately limited by productivity gains. If, to attract new workers, wages are required by supply and demand to rise faster than productivity growth, such hiring does not take place." He says this in turn creates a reduction in output within the industry.

Dietz's contention is that a macroeconomic/historical look at the situation provides reasonable answers. He believes that "lower tax rates and lower interest rates will spark additional business investment, which will in turn attract workers and raise productivity."

Funding flows to construction technology start-ups

2019-07-24T09:36:00-04:00

Funding in US-based construction tech startups totals just $196.5 million across 44 deals halfway through 2019. Still, $192.6 million across 44 deals is still significantly lower than the $1.274 billion raised by US-based construction startups in the first half of 2018.

The bustling world of construction technology start-ups is off to a slow start in 2019, as mid-year funding statistics point to a marked drop in investment for these insurgent companies over 2018's blockbuster year, Crunchbase reports.

Whether or not 2018's record investment, including Katerra's $865 million haul, was a one-time fluke remains to be seen. Either way, that's not stopping funders from supporting companies like Rhumbix, a San Francisco-based field data-capturing platform that helps builders go paperless on the job site, which recently received a $14.3 million in new investment.

Trevor Zimmerman, managing partner at investment firm Blackthorn Ventures, told Crunchbase, “Today, foreman and laborers have supercomputers in the form of smartphones in their pockets,” adding, “That’s enabling companies like Rhumbix to bring efficiency gains to construction that other sectors, like manufacturing, were able to access over a decade ago with desktop computers.”

New York City-base...

Perfectionists versus contractors: the details of building the Apple Campus

2017-02-09T13:45:00-05:00

One of the most vexing features was the doorways, which Apple wanted to be perfectly flat, with no threshold. The construction team pushed back, but Apple held firm. The rationale? If engineers had to adjust their gait while entering the building, they risked distraction from their work, according to a former construction manager. “We spent months trying not to do that because that’s time, money and stuff that’s never been done before,” the former construction manager said.

Although detail-obsessed architects can often find working with broad-strokes contractors to be challenging, there's one group of designers with perhaps even more rigorous attention to detail: the team at Apple. According to this article in Reuters, the actual building of the "spaceship" Apple Campus in Cupertino has been an unusually precise experience for those working in construction. According to the article, among many other requirements, "Apple's in-house construction team enforced many rules: No vents or pipes could be reflected in the glass. Guidelines for the special wood used frequently throughout the building ran to some 30 pages." Think perfect?