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Wolgast Blog - Construction Trends, Tips and Information

Get commercial construction questions answered by a professional contractor sharing building trends, tips and information

Posts about the Wolgast Way (5)

Educational Enhancement the Wolgast Way

As we hear more and more about STEM education and how important it is to expose your students to Science, Technology, Engineering and Math as fields of study, Wolgast offers programs to introduce construction practices to your students during our construction projects at your school.  We call it Educational Enhancement and it has the flexibility to be tailored to your students in many different scenarios.

Why Winter Is the Best Time to Plan Your Construction Project

Other than taking time to prepare a plan when the weather is poor for construction (so you can be ready when the weather is conducive for construction) there are additional benefits to contact your design/builder or general contractor in the winter.  Let me clarify that the following explanation works best when applied in Michigan and other cold winter states.  

Why Design Build Works Well for Healthcare Practices

 
In this blog, I’ll explore how the Design-Build method of construction is well suited to medical doctors, more so than general construction.  To start, the D-B method was really created to suit the needs of busy business owners, which includes doctors, because it requires less attention from an owner and that owner can set their involvement as much or little as they see fit.  Some customers like to be more engaged in the process than others and we are happy to accommodate each client’s unique desires.

 

The basic difference of D/B over general construction, is the relationship between the architect and builder.  In this project delivery, they are on the same team.  A doctor only needs to work with one entity to design and then build his or her office.  Also in this scenario, the doctor is protected from any discrepancies from the architect’s drawings to contractor’s application.  With D/B, the contractor and architect are consulting on budget, application and material quality throughout design, so when construction starts there are very little interruptions or change orders.  Should there be a discrepancy, the design-builder will work it out without involving the owner unnecessarily.  This protection is valued by doctors who oftentimes aren’t as familiar with construction, nor have the time to deal with these issues on site.  All of these reasons are exactly why Design-Build was created as an alternative to general construction.

Popularity Increasing for Design Build Construction

As an update to this blog originally posted a few years ago, we have new information to add  from the June 2018 Design-Build Utilization Report funded by Design-Build Institute of America. Findings in this report determined that popularity continues to grow for this delivery method. The results showed, "Design-Build Construction spending in the assessed segments is anticipated to increase 18% from 2018 - 2021", and will likely represent 44% of construction spending by 2021. Researchers determined that the education of building owners on Design-Build benefits is gaining traction, and more owners are experiencing enjoying the benefits first hand.  Additionally, FMI Corporation, a management consulting and investment company, had released a report in March 2019 titled 2019 AGC/FMI Risk Management Survey, whereby they found that "38% of contractors were <planning> to increase their in-house design capabilities last year and 43% this year".  So there will be more collaboration, less risk, and more competition among design and construction moving forward.

Original blog article:

According to the May 2013, “Design-Build Project Delivery Market Share and Market Size Report” by Reed Construction Data and RS Means Intelligence, Design-Build construction delivery method has taken an additional 9% of the construction market since 2005 and General Construction has lost 10% of the market share in that same time.

Three Common Misconceptions about Design Build Construction

Companies that regularly open new locations probably have a lot of experience with construction.  They benefit from having established drawings to help design the next store and a familiarity with contractors, and, therefore, are a good fit for General Construction services to complete their buildings.  On the other hand, business owners who are unfamiliar with construction and don’t have relationships with professional contractors would benefit more from having a Design-Builder on their team.  This is because Design-Build perks include faster completion, a single-source to contact for all project needs, and the ability to judge which subcontractors offer the best value for their project.

Guess: Which Profession Has no Room for Errors?

I caught a rerun of Family Feud on GSN recently and the question was posed, “What profession has no room for errors?”  They featured seven possible answers.  I automatically thought of physicians, which was the top answer.  After that, it became a little tougher.  Police officer was up there, but neither pilot nor bus driver were.  So what else could it be that 100 American people thought?  I was on the edge of my seat to find out.  Then they said it, "Construction"!  Of course, being in the industry I know this, but I didn’t know that the majority of people on Family Feud would have thought of it.

Get Ready to Talk to Your Lender about a Construction Loan

Commercial Property Financing

As I found out recently by talking to Steve Canole, Vice President and Business Loan Officer  at 1st State Bank, there aren’t as explicit criteria for securing a commercial construction loan as there are  for residential mortgage financing.  According to Steve, there are many more variables that lenders need to consider when reviewing a commercial property mortgage compared to a residential loan which is more stream lined.  Primarily, these variables include whether it’s an investment property versus owner-occupied, the size of the project, the varied ways commercial real estate can be purchased and held, the various types of operating entities and how the owner chooses to operate and file taxes, and finally the loan/cost ratio of the project.

Ample Estimating Time Can Lower Price of Construction

Obviously, planning a construction project doesn’t happen overnight.  In most cases, the client has a set occupancy date when construction has to be completed either to satisfy a contract they have acquired or to meet their seasonal market (to name two).  During that construction project time frame, planning through completed project, there are five main activities that need to take place, which include design, cost estimating, obtaining regulatory approval, acquiring materials and construction. 

Construction Scheduling for Dental Offices

Continually meet with patients throughout construction

Dentists sometimes put off improvements to their building space due to the anticipated disruption of their business.  Determining how to remodel their office or relocate to a new space when a practice can’t survive without an active patient load can feel like a big risk.  However, I’m here to tell you that it's possible to remodel, renovate or relocate with minimal impact to your practice when you use a professional contractor.

The Good and the Bad of How Contractors Lower Their Bids

 

In a competitive bid situation, contractors can go to the extremes to lower their bids, especially when work opportunities are scarce.  In the end, a business owner may like the price, but may not like the final results.

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