Construction Costs

The cost of construction has gone up in the past 5 years. I could have stopped with that statement alone and you would have thought “he does a good job of stating the obvious!” In all seriousness, we have all seen the cost of everything from gas to groceries to building material costs rise over the past 5 years. I could point to many different factors that have caused these increases, but we can all agree that everything is more expensive these days for lots of different reasons.

Speaking of things being more expensive, we have been working with a client for the past 3 years that is looking to build a new manufacturing facility here in Fort Wayne. The project has been on and off about 4 times over those years, but is now back to being “on”. In the initial planning meeting we had with the client this week, they started to ask about budgets for their new building. We had talked budget 3 years ago and they are still somewhat basing todays building on those old numbers. The reality for them is that the budget from 3 years ago will not allow for the same facility today. As Dan Gagen in our office often says, “compromise is not a bad word”. It is very likely that the client will need to compromise on scope, quality or budget. We’ve done many e-bits in the past on Scope x Quality = Budget. You can control two of those variables, but someone else will control the third. This client does not have a lot of flexibility on the quality, so they will need to either increase their budget or decrease the scope (in this specific case, size of the building).

We know that building projects can be daunting, especially in this environment of increasing construction costs. One of the many things that PDMi offers is detailed upfront planning to help our clients filter the “wants” from the “needs” which can help solidify the scope of the project early on for budgeting purposes. Give us a call, we’d love to help solidify your project scope early in the process.

A Big House – What’s the Use?

We met with a potential client earlier this week who is looking to purchase a large single family home on about 20 acres of land in east central Indiana. (The picture here is not of the actual house, but it sure does look grand). The home was custom built in 1993 by a wealthy business owner in the area. The vision of the potential new owner is to convert the home, with its large indoor pool, tennis court, massive garage and beautiful outdoor gardens into an event space for weddings and corporate retreats. The plan is to advertise on “Airbnb” and “VRBO” to rent it out and cash flow the property. The plan sounds great on paper as the size of the property and amenities lends itself to this type of use. I can only imagine the amazing backdrop this would provide for one of those magical summer outdoor weddings.

The reason they called us was to talk about the code related items that they will face in converting this single family home to commercial use. There are several things that need to be done in order to properly convert the structure such as fire protection systems, ADA accessibility and the liability insurance costs associated with having large events at the site. We are not insurance experts, but we know that insuring a business like this will come with a significant price tag.

PDMi has the knowledge and expertise to work through the state and local building codes to help our potential client identify all of the items they will need to address with this project. Some may be costly and others rather affordable, but in the end they will have a fairly long list of changes in order to convert this single family home to a commercial space.

If you think your next project might have some building code issues, give us a call as we’d love to share our wealth of knowledge and help you through the process.

Batman & Robin

Batman & Robin – Night & Day – Salt & Pepper, these are all things that go together. They fit. One complements the other. It is the same with Design & Build, one completes the other. Too often today design and build are regarded as adversaries. They separately compete for the approval of the owner and/or the success of the project. This should not be! Just like Batman was not complete without Robin, the design of a project is not complete until it is built.

There are many benefits to the Owner when Design and Build are combined on a project. They include:

• A Team Relationship is established between the Design Professional and the Contractor which is built on trust and confidence.

• The Scope of the project is identified through the contract documents so that Cost and Schedule can be identified/verified/modified early in the process.

• The Design Professional becomes a Valuable Resource to the Builder during the construction process.

The Old Days of adversarial relationships which were formed by Architects/Engineers drawing blueprints for the Contractor to competitively bid must be reevaluated. If we, as Professionals and Contractors, desire to bring the best product to our clients then we must learn that Design and Build fit together.