Blog

1Call2Build—Our Blog

Here are some thoughts and insight on our business and the construction industry in general. We update our blog regularly to keep you informed and entertained.

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March 1, 2021

Can you describe what goes into creating an initial estimate for a construction project?

Jim Olson, AIA, NCARB
Director of Business Development-Southern Wisconsin

An early stage estimate of the project cost differs from a construction budget, as it relies on the contractor’s past experience, and involves some art and some science. It allows the Owner an opportunity to organize funding sources and plan actual expenditures in advance.

When information and plans may not be complete, the estimator must blend known data, such as a building’s size and scope, with other details based on unit costs, assumptions, historical data, and best judgment. As the design is refined, the final budget is based more on solid information.

When creating a preliminary estimate, the estimator first must assess the level of detail of the plans to determine the best method of approaching the estimate. He’ll then assess the site and existing conditions, considering overhead power lines, presence of hazardous materials, site grades, etc. that will require additional scope and labor.

Estimators next must prepare accurate quantity take-offs based on the plans, determining the materials needed and factoring seasonal effects and price trends. The estimator will then extrapolate the associated labor needs, wage rates, and equipment needed to install. Finally, general project requirements such as permitting, insurance and design fees are also incorporated.

 

August 31, 2020

Avoid Excessive Costs by Planning for “Winter Conditions”

Jim Olson, AIA, NCARB
Director of Business Development-Southern Wisconsin

Snow, blustery conditions, and extreme cold are all harsh realities of living in northern states. When it comes to construction, the term “winter conditions” takes on a whole new meaning.

In construction, “winter conditions” refers to specific budget line items added to accommodate increased fuel, material, and labor expenses related to activities during the coldest months of the year.

The most challenging activities to complete when the weather turns nasty involve site excavation and setting foundations. During winter, ready-mix suppliers typically heat their aggregates and water and deliver these materials to the job site using insulated boom pump trucks. They insulate the forms, then wrap them with insulating blankets, using tents and ground heaters after the pour to avoid thermal cracks. Inclement weather can also make conditions unsafe for workers, cause material and equipment transportation delays, or block access to a project site altogether.

On average, winter conditions appropriations can add five to seven percent to a project’s bottom line. Costs tend to be inversely proportional to the temperatures: the lower the temperatures, the greater the potential costs.

While not every consequence of weather can be prevented, Consolidated Construction works with your project team and can take steps to help avoid costly setbacks, and reduce or even eliminate the budget impact.

We can do ‘look ahead’ advanced planning, which allows us to consider accelerating construction activities or re-arranging them in order to mitigate the impact of winter conditions on your project. In doing so, we weigh scheduling considerations, potential financial impact on project costs, and the influence these adjustments could have on your overall business operations.

Even before budgeting or scheduling begins on a project, our team takes time to assess seasonal weather trends, and adjust your project schedule accordingly. For example, excavating and concrete work is best done in dry, mild weather. Interior work is ideal during the harshest winter months.

Next, we help put a plan in place for your team to respond if an unexpected weather event pops up. You can mitigate costs and get back on track by closing up buildings ahead of storms, ensuring adequate water access is set up, and shifting labor schedules.

With a little planning and good communication with your contractor, weather delays don’t have to put your project in the deep freeze.

August 5, 2020

If Speed to Market Important, Think Design-Build Construction!

Jeremy Walker has more than 23 years of experience in design-build construction with Consolidated Construction, the past 4 years as the strategic account manager for the food/beverage and manufacturing markets.

Are you thinking about a new construction project, but concerned it will take too long to build? If “speed to market” is a primary concern, partnering with the right design-build contractor is the best way to make your project a reality.

Design-build is a construction delivery method in which the Owner, architect, and general contractor work as a consolidated team to design and execute a construction project. This method promotes a collaborative environment, with all parties involved with every critical project decision from start to finish.

Having the contractor involved from the beginning means instant adjustments can be made to budgetary estimates, project schedules can be optimized, and constructability recommendations can be made as design decisions are made. Just as important, potential issues are caught and resolved during the design process, instead of as the building is being constructed.

A unique advantage of the design build approach is it allows the early stages of the project (ex: site work, foundations, structural aspects, etc.) to start before the building design is complete. This can result in significant time and cost savings.

We understand the value of turning your design into a constructible project quickly in order to meet your customers demand or your bottom line. Here are 6 more important benefits that you’ll experience by choosing a design build construction partner:

  1. Total project planning, budgeting, permitting and scheduling is done on a parallel path to construction
  2. Design build creates single-source responsibility and accountability for design, cost analysis, project management, and construction
  3. Early cost analysis to ensure budget expectations are being met; saving time and money by not overdesigning or having to redesign
  4. Gaps and overlaps are eliminated through a disciplined, collaborative process and clear communication
  5. Communications are more frequent across all parties, so information isn’t lost in translation
  6. Expedited scheduling and construction speed results in faster overall project delivery

Correctly executed, the design-build delivery method can result in significant cost savings and faster speed-to-market for your next building project, whether it’s new construction, an addition, or a renovation.

June 26, 2020

Why should I start planning my Spring 2021 building project now, and what goes into creating an initial cost estimate?

Jim Olson, AIA, NCARB
Director of Business Development-Southern Wisconsin

Spring and summer are peak seasons in the construction industry for good reason: The weather is generally nice, so you don’t have to worry about construction delays or added costs due to winter conditions. The same can’t be said for winter projects, especially in the Midwest, where weather can negatively impact construction progress.

There are many i’s to dot and t’s to cross before a commercial construction project can get off the ground. Generally speaking, it can take 3-6 months (or more) until your project is shovel ready. There are the obvious decisions to make: building function, size, design, location. Then there are factors to consider, like zoning approvals, permits, financing, and other items from outside agencies.

If you are considering constructing a new facility, adding to an existing building, or renovating an existing space next spring to take advantage of prime building conditions, now is a great time to get the ball rolling on those plans.

Pre-Construction Planning is Key
The pre-construction phase is perhaps the most important stage in any building process. That’s because 90% of a project’s success is determined in the first 10% of its timeline.

The key elements to the pre-construction phase include:
• Defining the objectives of the project
• Detailing the scope of the project (describing the work to be done)
• Setting the budget to allow for cost estimating and value optimization
• Setting the schedule
• Initial schematic design
• Construction site analysis
• Materials procurement management
• Acquiring proper approvals (zoning, building permits, etc.)

Clear and collaborative communications is essential during this phase. Setting clear expectations through schedules, responsibility matrices, and cost control measures provide you with the cost, time, and quality information needed to make the best decisions for your project.

Elements of an Initial Cost Estimate
It’s important to understand that an early-stage cost estimate differs from a final construction budget. An early-stage estimate relies on the contractor’s past experience, and involves a combination of art and science. This estimate allows the Owner an opportunity to organize funding sources and plan actual expenditures in advance.

For the initial cost estimate, the estimator relies on information and plans that are termed conceptually complete, but not to the level of actual construction documentation. They must blend known data (such as a building’s size and scope) with other details based on unit costs, assumptions, historical data, and best judgment based on experience and existing market conditions. Often, they will consult with our listing of trusted subcontractors to get a snapshot of current pricing. As the design is refined, the final budget is based on more solid information.

When creating a preliminary estimate, the estimator first assesses the level of detail in the plans. He’ll then consider the site and existing conditions, allowing for variables like overhead power lines, presence of hazardous materials, site grades, etc. that will require additional scope and labor.

At that point, accurate quantity take-offs can be prepared based on the plans, determining the materials needed, and factoring seasonal effects and price trends. The estimator will then extrapolate the associated labor needs, wage rates, and equipment needs to install. Finally, general project requirements such as permitting, insurance and design fees are also incorporated into the initial estimate.

Plan Now, Reap the Rewards!
As project Owner, you can take steps now to set yourself—and your building contractor partner—up for success on your next construction project. It’s important that Owners and contractors view each other as partners in this process. Neither can be successful without the other.

Plan now for Spring 2021, and you’ll be rewarded with a smooth-running, low-stress, cost-effective, and safe construction project.

April 28, 2020

Why Should Contractor Safety be Important to a Project Owner?

Jim Olson, AIA, NCARB
Director of Business Development-Southern Wisconsin

Starting a new construction project is an exciting time! Whether you are launching a new venture, adding on to a site because your company is growing, or renovating an existing structure to better serve your needs, a solid safety plan needs to be an integral part of your efforts.

Job site safety is paramount to ensuring every individual in and around the project returns home safely to his or her family each night. Contractors and project owners who insist on a comprehensive safety program see safety not only as a way to provide a safe work environment, but also as a cost control tool, and a critical element for budget success.

How Owners Can Work with a Contractor to Help Ensure Safety on Their Job Site
Owners sometimes feel they are interfering with the contractor’s way of doing business if they express concerns over safety at a jobsite.

As an owner, you have the right to have a quality safety program be an important part of the selected contractor’s approach to your project. You also need to think beyond the job site and consider safety measures adjacent to the site as part of the planning.

In addition, if you have any safety requirements for your own employees, your selected contractor should take those requirements into consideration when putting together the site-specific safety plan for your project.

Owners should provide the direction and information necessary for a contractor to produce and enforce an effective safety plan that meets your needs as well as the needs of the contractor, subcontractors, and visitors.

How to Assess a Contractor’s Commitment to Safety?
Contractors with excellent workers compensation safety records are more efficient at reducing risks, driving project profitability, and completing jobs on time.

Your contractor pre-qualification process should include an assessment of their workers’ compensation history, and three years of historical safety data. The contractor should provide you with their Experience Modification Rate (EMR) going back at least three years. EMR is a calculation used by insurance companies to gauge both past cost of injuries, and future chances of risk. An EMR of 1.0 or less is considered exemplary.

It’s also a good idea to obtain references from past clients and subcontractors, and gauge their assessment of the contractor’s safety program. A quick look at the contractor’s organizational chart will demonstrate if the leadership structure is in place to support a proactive safety culture.

Check to see if they have a dedicated Safety Manager on staff. These trained professionals monitor construction sites, enforce compliance with government regulations and standards, and provide training opportunities for staff. They also help identify safety-related issues on project sites, and work with project leadership to design solutions to mitigate exposure to those risks.

We’re All In This Together!
As project owner, you should be able to count on a properly licensed and insured contractor to shoulder the bulk of responsibility for construction jobsite safety. However, you must collaboratively plan for project safety by providing the contractor with the information necessary to set up a safe worksite. You should also feel comfortable performing inspections to ensure safe practices are being followed.

It’s important that Owners and contractors view each other as partners in this process. Neither can be successful without the other. Ensuring safety for everyone in and around your job site is a shared responsibility.

Your involvement will be rewarded with a smooth-running, low-stress, cost-effective, and SAFE project.