The Market: A Fresh Perspective in the New World Presented by:
The Market: A Fresh Perspective in the New World
Presented by:
The Construction Market and Key Indicators
Evolving Design
Evolving Construction
Introductions01.
Questions + Answers
02.
03.
04.
05.
AGENDA
OBJECTIVES
• Understand and identify the key market indicators for the construction
industry and how they interplay
• Understand how we can learn from previous market conditions along with
identifying the differences those conditions make on future planning.
• Understand and develop approaches for differing scenarios across the
markets and how to incorporate those within future plans
YOUR PRESENTERS
Daniel Pomfrett, FRICSVice President
Cumming Group
Randy KeiserVice President & National Healthcare Director
Turner Construction
Gary Hamilton, PE, PMP, LEED AP, FASHE, CxASenior Vice President & Healthcare Practice Lead
WSP
“Building cost escalation” as the anticipated increase, over a defined period of time, in the cost of constructing a building
Building cost increases usually occur as a result of market forces and reflect increases in the cost of labor and materials. In general, escalation is indicative of higher levels of construction activity driving up prices.
THE CONSTRUCTION MARKET: ESCALATION
Region Annual Escalation 2021 Healthcare Escalation 2021
Illinois 4.909% 5.607%
Indiana 4.519% 4.991%
Iowa 5.313% 5.469%
Kansas 3.415% 3.231%
Michigan 4.778% 3.660%
Minnesota 4.505% 3.684%
Missouri 3.595% 3.456%
Nebraska 4.542% 5.316%
North Dakota 5.260% 5.024%
Ohio 4.494% 4.966%
South Dakota 4.086% 5.304%
Wisconsin 4.563% 3.880%
28
30
32
34
36
38
40
42
44
46
48
50
52
54
56
58
60
62
Jan
-16
Ap
r-1
6
Jul-
16
Oct
-16
Jan
-17
Ap
r-1
7
Jul-
17
Oct
-17
Jan
-18
Ap
r-1
8
Jul-
18
Oct
-18
Jan
-19
Ap
r-1
9
Jul-
19
Oct
-19
Jan
-20
Ap
r-2
0
Jul-
20
Oct
-20
Jan
-21
Ap
r-2
1
Jul-
21
AIA Architectural Billing Index-National (2016-Current)
THE CONSTRUCTION MARKET: KEY INDICATORS
22
26
30
34
38
42
46
50
54
58
62
66N
ov-
18
Dec
-18
Jan
-19
Feb
-19
Mar
-19
Ap
r-1
9
May
-19
Jun
-19
Jul-
19
Au
g-1
9
Sep
-19
Oct
-19
No
v-1
9
Dec
-19
Jan
-20
Feb
-20
Mar
-20
Ap
r-2
0
May
-20
Jun
-20
Jul-
20
Au
g-2
0
Sep
-20
Oct
-20
No
v-2
0
Dec
-20
Jan
-21
Feb
-21
Mar
-21
Ap
r-2
1
May
-21
Jun
-21
Jul-
21
AIA Architectural Billing Index-Regional (12 Months)
West South Northeast Midwest
THE CONSTRUCTION MARKET: KEY INDICATORS
0%
2%
4%
6%
8%
10%
12%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
THE CONSTRUCTION MARKET: LABOR
The U.S. economy managed to recover faster than many experts predicted. Unemployment was expected to average 15% in 2020, but the actual figure was closer to 8%. It is to be 3.6% in 2022 – slightly below 2019 levels
Construction has proven to be one of the most resilient industries, with employment making an almost full recovery. The labor market remains tight, however, and projects may face difficulty filling key positions and finding materials
Non-agricultural private wage and salary workers 5.2%
Mining, quarrying, and oil and gas extraction 10.2%
Construction 4.6%
Manufacturing 3.6%
Wholesale and Retail Trade 6.1%
Transportation and utilities 5.9%
Information 4.4%
Financial Activities 3.2%
Professional and business services 4.6%
Education and health services 4.3%
Leisure and hospitality 9.1%
Other services 5.0%
Agricultural and related private wage and salary workers 5.7%
Government workers 3.6%
Self-employed workers, unincorporated, and unpaid family workers 4.9%
THE CONSTRUCTION MARKET: LABOR
56.8%
49.0%
48.8%
38.2%
33.2%
32.5%
26.7%
23.2%
21.6%
11.8%
10.9%
9.9%
9.3%
9.2%
7.3%
5.9%
4.5%
4.3%
4.0%
2.8%
2.7%
-15% -5% 5% 15% 25% 35% 45% 55% 65%
Lumber and plywood
Copper and brass mill shapes
Steel pipe and tube
Metal bar joists & rebar
Aluminum mill shapes
Fabricated structural steel
Plastic construction products
Sheet metal products
Gypsum products
Insulation materials
Asphalt roofing & siding
Architectural coatings
Prestressed concrete products
Precast concrete products
Flat glass
AC paving mixtures and blocks
Construction machinery & eqpmt
Brick and structural clay tile
Concrete block and brick
Ready-mixed concrete
Concrete pipe
Construction Materials Price Movement - Last 12 Months
THE CONSTRUCTION MARKET: MATERIALS
Delivery times have increased after receiving a double hit of demand and supply issues
Item Pre-COVID Delivery Time Current Delivery Time Future Delivery Time
Prestressed concrete products 3-4 months 6-7 months 6-7 months
Asphalt roofing & siding 2-4 weeks 2-3 months 2-3 months
Concrete block and brick 2-4 weeks plus 1-2 weeks plus 1-2 weeks
Ready-mixed concrete 1-2 days 1-2 weeks 1-2 weeks
Precast concrete products 2-4 weeks 4-6 weeks 4-6 weeks
Brick and structural clay tile 3-4 weeks 16-20 weeks 16-20 weeks
Flat glass 3-4 weeks 8-16 weeks 8-16 weeks
Gypsum products 3-4 weeks 5-6 weeks 5-6 weeks
Insulation materials 2-4 weeks 4-5 months 4-5 months
Steel pipe and tube 4-8 weeks 4-5 months 4-5 months
Aluminum mill shapes 4-8 weeks 4-5 months 4-5 months
Sheet metal products 2-4 weeks 4-6 weeks 4-6 weeks
Fabricated structural steel 6-8 weeks 5-6 months 5-6 months
Metal bar joists & rebar 2-3 months 6+ months 6+ months
Construction machinery & equipment
12 months for AHUs18 weeks for generators
8 weeks for lighting22 week for switchgear
25 weeks for environmental cold rooms
18-20 weeks for lab casework
12 months for AHUs18 weeks for generators
8 weeks for lighting22 week for switchgear
25 weeks for environmental cold rooms
18-20 weeks for lab casework
THE CONSTRUCTION MARKET: LOGISTICS
Evolving Design
• Touchless technology an integral part of most healthcare design
• More negative isolation rooms are included patient tower design
• Design now focus on how we can quickly they can modify existing patient rooms
• How can we design spaces to quickly convert newly design patients' rooms to negative pressure rooms
• Telemedicine has become an important mode of healthcare delivery
• New hospital are designing more robust IT infrastructure to meet IOT & AI requirements
• Designing universal patients' rooms that can be easily switch to ICU rooms
• Engineering design is now focus on enhance filtration and enhanced ventilation HVAC systems
• Enhancing Medical Gas design
HOW HAS DESIGN BEEN EVOLVING SINCE THE PANDEMIC
Adopt Destination Control system(DCS) for staff/bed Lifts
Adopt Automatic sensors for touchless control
TOUCHLESS TECHNOLOGIES
Ward
Ward Floors
Program Floors
Ward
A&E
OT
Radiology
Before SARS(prior 2003)
Isolation Beds(total 90 beds in HK)
Iso. Ward
A&E / Iso. Zone
OT / Iso. OT
After SARS(2004 - 2019)Isolation Beds
(total 1,000+ beds in HK)
Ward
Ward
Ward
Ward
Ward
Ward
Ward
Ward
Ward
Ward
Ward
Ward
Ward
ICU
Radiology / Iso. Rad
ICU / Iso. ICU
OT OT
Iso. Ward
A&E / Iso. Zone
OT / Iso. OT
Ward
convertible Iso. Ward
Ward
Ward
Ward
Radiology / Iso. Rad
ICU / Iso. ICU
OT
Iso. Ward
convertible Iso. Ward
AII
AII
AII
AII
AII
AII
AII
+AII
+AII
AII
AII
AII
AII
AII = Airborne Infection
Isolation Room
Future (post COVID-19)(2020 & beyond)
Isolation Beds (may be 2,000+ beds in HK)
HISTORICAL CHANGES IN HONG KONG PUBLIC HOSPITALS
Mount Sinai Hospital – Guggenheim Pavilion – 6th Floor
SWITCHABLE ISOLATION ROOMS
Normal ModeDucted to R/F for
discharge
(CLOSE)
(OPEN)
(Remove Filter)
2ND TIER ISOLATION FACILITIES – EXAMPLE
Pandemic Mode
Preferable ducted to
R/F for discharge
(OPEN)
(CLOSE)
(Insert Filter)
HOSPITAL DESIGN
Evolving Construction
AVERAGE COST/SP FOR HOSPITALS, THROUGH 2021
$60/SF
$120/SF
$200/SF
$350/SF
$550/SF
$600/SF
$100/SF $130/SF
$175/SF
$260/SF$285/SF
$0/SF
$100/SF
$200/SF
$300/SF
$400/SF
$500/SF
$600/SF
$700/SF
1980 1990 2000 2010 2020 2021
($)C
ost
/SF
Year
Cost/SF
EscalationAdjusted
Why the Variance?
- Codes
- Wants vs. Needs
- Technology
INFLATION VS. RECESSION (1965-2021)
3.3
%3
.2%
3.1
%6
.0%
10
.4%
10
.3%
11
.6%
6.3
%6
.5%
16
.6%
4.2
%2
.0%
3.5
%6
.2%
10
.8%
11
.0%
10
.3%
8.0
%5
.2%
5.3
% 3.9
% 2.7
%3
.4%
3.8
%3
.4%
3.5
%1
.6% 0
.4%
2.2
%3
.0%
3.8
% 2.6
%4
.0%
4.6
% 3.8
%4
.4% 3
.0%
1.0
%0
.3%
5.5
%9
.5%
10
.6%
7.7
%6
.3%
-8.4
%-4
.0%
1.6
%2
.2%
4.1
%4
.4%
4.5
%4
.9%
5.0
%5
.6%
5.5
%1
.3%
9.0
%
1970, 129
1974, 190
1980, 273
1981, 301
1990, 441
2001, 613
2008, 908
0
200
400
600
800
1000
1200
1400
1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020-12.0%
-9.0%
-6.0%
-3.0%
0.0%
3.0%
6.0%
9.0%
12.0%
15.0%
18.0%
TUR
NER
CO
ST IN
DEX
ESC
ALA
TIO
N
Turner Cost Index vs Recession
Escalation Turner Cost Index
CONSTRUCTION INFLATION BY CITY (3.9% - 16%)
PREFABRICATION
PREFABRICATION
Cincinnati – Mercy Health, West | MEP Racks
New York – NYU Kimmel | Bathroom PODs
Tampa – James A Haley VA Hospital | OH Racks, Risers & Electrical Pods
University of Kentucky | Exterior Panels
Children’s MOB | Stairwells Owensboro | Headwalls
Electrical | Prefab Components
Interiors | Preassemble Door Hardware
Interiors | Soffits & Ceilings
Citizen M
461 Dean Street
THINKING BIG – MODULAR / VOLUMETRIC
Questions + Answers
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