Numbers Reveal Construction Industry Trends & Issues

Construction industry statistics from 2017 reveal future issues and trends to watch.

A picture is worth a thousand words, but statistics are also compelling — especially in an industry that’s driven by numbers. The following numerical data, as reported by Construction Dive, are based on a recap of 2017; they are noteworthy in billboarding the near future for construction.

$1.6 trillion — The opportunity cost, according to McKinsey Research, of the construction industry’s hesitation to adopt new technology. While new technologies are making inroads in the construction market – drones, and high-tech, virtual reality  & AR wearable devices – the industry remains somewhat old-school and slow to adapt, thus missing opportunities to grow the market.

$200 billion – According to Moody’s, the estimated damage from Hurricanes Harvey and Irma that ravaged Texas and Florida this year. The stat is a strong argument for resilient design and planning for extreme weather events and rising sea levels.

Key West, Florida, underwater.

$5 billion — The amount of money Amazon is planning to put into its second headquarters (HQ2) building, location TBD.

1,200 — The number of concrete buildings that fall under Los Angeles’ seismic retrofit ordinance, which is the first of its kind in the country. Another tale of governmental policies that are shaping the construction industry and driving resilient design standards to ensure public safety, while protecting property owners’ investments.

76 — The percentage of U.S. construction companies that indicate the tight labor market will stay the same or worsen throughout the year. This statistic, unveiled by the Associated General Contractors of America, bodes well for next-generation practices such as off-site construction, prefabrication and modular assembly, that have proven to help mitigate the industry’s persistent skilled labor shortage.

56 — The average age of the more than 90,000 dams in the U.S. The Association of State Dam Safety Officials estimates the necessary work on the country’s non-federal and federal dams would cost more than $64 billion.  Now there’s a construction market opportunity!

3 — The number of months it took to 3-D print a 26-foot-long concrete bridge in the Netherlands comprised of 800 layers of reinforced, pre-stressed concrete material. 3-D printing and comparable new technologies are changing the building industry.


Construction Trends for 2018

More offsite construction and increased use of modular components are two trends anticipated in 2018.

After a robust 2017, commercial construction companies are anticipating an even stronger 2018. Trends for this year, include a continuing rise in offsite construction as well as increasing reliance on technology. Another emerging phenomenon is the increased focus on resilient design following the most destructive hurricane season on record and devastating fires and mudslides in California.

Other trends that will likely shape construction this year revolve around federal and state policies, the ongoing labor shortage and anticipated mega projects such as Amazon’s much-ballyhooed HQ2. Construction Dive identified what the editors see as the top eight trends for the coming year, and here they are:

Resilient Design

The focus on strengthening structures is driven by the disastrous weather events of the past year. Hurricanes, heat waves, cold waves, flooding, tornadoes and wildfires took their toll, with a nationwide financial hit estimated at $400 billion.

Rather than constructing duplicate replacement structures, more property owners will likely demand resilient site and structure features, heeding the advice and support of organizations such as the U.S. Green Building Council. New projects are likely to mimic resilient construction that is already underway, such as re-evaluating building codes and redefining flood zones in Florida and Texas and fire-resistant construction in California.

Labor Shortages

The construction industry will continue to grapple with a tight supply of skilled craft workers as younger individuals shun construction as a career option, baby boomers retire and the federal government reverses the tide of immigrant labor from Mexico, Central America and the Carribbean. With industry groups continuing to lobby lawmakers for funding for trade education programs to help create a construction industry labor pipeline, these efforts could pay off and help ease the problem.

Meanwhile, the industry is turning to alternative construction methods to compensate for the shortage of skilled labor. Offsite construction and prefabrication, for example, are helping mitigate some labor issues, often reducing labor demands by as much as 50%.  Increased use of modular construction in 2018, could also reduce the need for additional workers.

Offsite Construction

A growing number of U.S. contractors are partnering with prefab companies to incorporate offsite construction into their operations. Suppliers, too, are building up offsite capacity and developing products to help streamline operations. With companies like Google, Autodesk, Marriott and Starbucks embracing offsite construction, so are investors who hope offsite will improve construction industry productivity and returns.

As offsite components increase project speed, they are leading to greater collaboration between general contractors and offsite fabricators. With large companies like Turner Construction and Gilbane adding project manager roles for offsite, this delivery method is projected to gain momentum.

Transportation Investments

Cities are making big investments in transportation, integrating it into other public infrastructure upgrades. Nashville, TN, for example, proposes to spend $5.2 billion on an infrastructure and transit plan. Minneapolis’s $1.9 billion Southwest light-rail and Boston’s $2.2 billion overhaul of the area’s Green Line light rail are two other notable investments in transportation systems. In addition to traditional rail and bus systems and tunnels, high-speed maglev trains and hyperloop systems are also trending.

Technology and Automation Advances

Automation and related technologies such as 3-D printing are changing construction practices dramatically. Consider Europe’s first 3-D printed building in Denmark, a 3-D printed concrete bridge in the Netherlands, and the 3-D print concrete turbine towers planned in California.

According to Construction Dive, construction technology was the “Trend of the Year” in 2017. It’s not going away; in fact it looks to be ramping with factory-based construction automation and standardizing design and construction, creating a continuum of services.

New Policy Regulations

New policies at the federal and state level will continue to shape the industry. New York City now requires construction workers to undergo at least 40 hours of safety training. Los Angeles instituted a new seismic retrofit ordinance that will impact an estimated 1,200 older concrete buildings. As always, policies and politics will impact the construction business.

Large Companies with Large Construction Projects

While last year saw the addition of new, high-tech campus facilities at Google and Apple, a second new North American Amazon headquarters complex will likely fuel increased momentum for similar expansions in 2018.

Microsoft is slated to begin a multi-billion-dollar redevelopment of its existing Redmond, WA, campus later this year; Marriott and General Electric are also expected to break ground on new headquarters developments.

As more firms continue to expand their facilities, many are also likely to add infrastructure needed to support their operations. Data center construction is an especially fast-growing sector, as companies amass unprecedented amounts of information. By the first half of 2017, data center investments had already doubled those made in 2016, coming in at $18.2 billion.

Augmented & Virtual Reality — Wearables and Drones

With mixed-reality headsets, such as Microsoft’s HoloLens, and wearable devices, such as Triax’s  Internet of Things-enabled sensors, high-tech wearables and both augmented and virtual reality will continue to make inroads, transforming job sites. Two of the greatest benefits these technologies offer are safety and efficiency — areas where the construction industry has struggled in the past.

Beyond the innovations and investment in con-tech, it’s also possible that technology will help attract younger workers who are captivated by the technology in-roads impacting construction, such as the increasing use of drones on survey sites. One thing is certain: the industry buzz can’t hurt.


Real Estate Trends to Watch for in 2017

PricewaterhouseCoopers and Urban Land Institute just released their annual Emerging Trends in Real Estate report for 2017. The report, based on interviews and surveys with industry experts, focused on three game-changers:

1). Limited housing inventory and the lack of affordable middle-class housing are top concerns for real estate professionals.

2) Labor shortages are inflating construction costs. The problem isn’t going away,  but vocational training and apprenticeships, as well as potential immigration reform may help ease the problem.

3) New technologies are having favorable effects, including innovations that make buildings smarter and more efficient, and augmented reality (AR) technologies that improve collaboration between builders, architects and developers during the construction process.


Trending Now: Architectural Tourism

Architectural Tourism could take you to Nanjing, China, where you can savor large scale architecture forms with tranquil and contemplative gardens.

Culinary tourism (delicious); historical tourism (educational); medical tourism (not so fun); tourism for singles (mega-fun for some); art museum tourism (a visual treat); TV tourism (see the “real” Downton Abbey.)

Why not architectural tourism? For devotees of innovative, cutting edge architectural design, the world is your oyster.

The following is a mere snapshot of the architectural tourism opportunities worldwide.

In Copenhagen, Denmark, ski slope meets waste disposal at Amager Bakke​.

The The Amager Resource Centre, Photo: Bjarke Ingels Group

The Amager Resource Centre. Photo: Bjarke Ingels Group

The Amager Resource Centre has been converting waste to energy since the 1970s, and next year will give residents a place to burn their energy – on its roof, which is being converted into a ski slope and green space for mountaineering and walking. The project is the brainchild of Bjarke Ingels Group (BIG) (stateofgreen.com) who also brought the world LEGO House  (legohouse.com)….another stop on the architectural appreciation tour.

A view of the riverside facade of MAAT Photo Credit: HUFTON + CROW

A view of the riverside facade of MAAT. Photo: HUFTON + CROW

In Lisbon, Portugal the brand new Museum of Art Architecture & Technology opens October 5th. Designed by Amanda Levete of AL_A in London, a light-infused, undulating low-lying structure on the Tagus River.

In Nanjing, China the Nanjing Zendai Himalayas Center is a metropolis-scale urban development that will be complete in 2017, but there is already a lot to see.  An ongoing project for the Chinese architecture firm MAD, it will have a central valley, a lake, an elevated plaza, and other features that cultivate the traditional Chinese ethos of feng shui — a spiritual harmony between nature and humanity. It will span 6.5 million square feet.

Nanjing Zendai Himalayas Center Photo Courtesy of MAD Architects

Nanjing Zendai Himalayas Center. Photo: MAD Architects

Costa Rica Congress Hall Photo: Courtesy of Caza

Costa Rica Congress Hall. Photo: Courtesy of Caza

In San Jose, Costa Rica, the Costa Rica Congress Hall designed by Caza – a Brooklyn-based firm — connected a series of hypercubes to create a modular government building, which features a platform for public demonstrations.

 

 

 

The Abu Dhabi Louvre. Photo: Ateliers Jean Nouvel

The Abu Dhabi Louvre. Photo: Ateliers Jean Nouvel

In Abu Dhabi, the Louvre Abu Dhabi will open in 2017. Brought to you by the architecture firm Ateliers Jean Nouvel, the museum will be one of five on Saadiyat Island designed by other giants of architecture — Hadid,Ando, Gehry and Foster.

In New York, ultra-skinny residential towers are reaching for the stars, transforming the city’s skyline. The following architects, each name as big and tall as their creations, are causing a sensation: Zaha Hadid (520 West 28th St) Isay Weinfeld (527 West 27th St); David Chipperfield (16 West 40th St); BIG (625 West 57th St); Herzog & de Meuron (57 Leonard St); Foster + Partners (100 East 53rd St) You can easily map a city tour to admire all these new properties.

Zaha Hadid's residential skyscraper in New York 

Zaha Hadid’s residential skyscraper in New York

And this is just the new, latest, greatest architecture. If you want a memorable tour of American iconic architecture consider Chicago, long a laboratory of innovation and a showcase for great architecture. October 15-16 in Chicago you can tour “200 cool places in 48 hours” – over 200 buildings, hidden gems and architectural treasures will be open to the public for a behind the scenes tour; the free event is hosted by the Chicago Architectural Foundation. And while you’re in Chicago, if you haven’t done the architectural river tour, it’s a must.

Another rich landscape for architectural tourism is Los Angeles — from the Hollywood Bowl to the Walt Disney Concert Hall. Los Angeles’s skyline might not be as famous as Chicago’s or New York’s, but there are some seriously iconic buildings.


Passive Design Projects Worldwide Drive Global Energy Savings

Heidelberg Village in Germany will be the largest residential Passive Design project in the world.

Touted as “the world’s largest passive housing” project, a 162 unit residential complex is currently under construction in Heidelberg, Germany. The solar-powered Heidelberg Village designed by the Frey Architekten firm will feature a wide range of sustainable features, as well as rooftop and vertical gardens. The complex is expected to use 75% less energy than a similar project using conventional building design.

The Passive design concept originated in Germany in the 1990’s, and has now been embraced worldwide as an effective and economic way to cut carbon emissions and reduce energy demand in buildings while still providing high-caliber living comfort, superior indoor air quality and structural resilience. While the movement began with a residential focus, passive “house” building principles have been adopted in major commercial building projects as well, setting new standards for heating and cooling efficiency, total energy consumption and air leakage.

The Herman Teirlinch building is the largest Passive Design commercial project in Belgium. Photo: inhabitat

The Herman Teirlinch building is the largest Passive Design commercial project in Belgium.
Photo: inhabitat

One of the most ambitious “passive design” commercial projects currently underway is in Belgium where Europe’s largest passive office complex is under construction. The Herman Teirlinch government office will be a 66,500 square meter mixed use, low-rise, sustainable building designed by Neutelings Riedijk.

While entire passive home neighborhoods have yet to be created in the United States, passive design residential and commercial buildings are cropping up nationwide. The key components are 1) high-quality insulation and thermal-bridge-free construction 2) airtight construction 3) energy efficient windows and doors 4) mechanical ventilation for air quality.

Sto Corp has been a leader in providing passive design projects with energy efficient exterior insulation and finish systems. StoTherm ® ci continuous insulation, air moisture barriers, and advanced wall cavity systems have been used to meet and even exceed passive design energy efficiency standards in various climate zones across the country.

For more information on the Herman Teirlinch office building: http://inhabitat.com/belgiums-largest-passive-office-building-breaks-ground-in-brussels/

For more information on passive design: http://www.phius.org/home-page

For more passive design case studies: http://nypassivehouse.org/new-york-passive-house-2015-the-nyph-flip-book/)


Can Green Buildings Make Us Smarter?

Green is good -- outside or inside an occupied building.

A recent study published by Environmental Health Perspectives (EHP) suggests that Green Buildings create optimized conditions for health and productivity. In a series of experiments, indoor environmental quality (IEQ) factors for both “green” and “conventional” buildings were simulated in a controlled environment that included office workers, and the researchers measured variables such as carbon dioxide variation, ventilation and exposure to volatile organic compounds in the building atmosphere.

The results? On average, cognitive scores for the two groups of workers were 61% higher for those working in a building with green features than with conventional construction.  In other words, green building can potentially deliver a smarter workforce.