Construction 2023

Challenges and Opportunities

Since 1969, Rogers-O’Brien Construction has firmly established itself as Texas’ Premier Builder by delivering excellence and expertise to our valued customers through all aspects of our business. We consistently deliver high quality buildings and exceed the most demanding expectations. Rogers-O’Brien’s unique approach consistently delivers high quality buildings in a variety of market sectors, exceeding the most demanding expectations.

Lorraine Francis: Starting our project during the tail-end of the pandemic has had some challenges. How do you see the current impact, and what changes have you had to make to adapt?

Mike Dempsey: Starting our project during the tail-end of the pandemic presented some major challenges across our entire business. Chief among the challenges has been the safeguarding of our onsite workforce. We’ve implemented strict health and safety protocols to minimize the risk of exposure by including additional sanitization, social distancing, and additional personal protective equipment, as needed, on our job sites. By keeping a watchful eye on the directives issued by local health authorities, we’ve swiftly refined our practices, ensuring an ever-secure working environment.

Additionally, the supply chain disruption fallout from the pandemic has led to extraordinary (truly unprecedented) lead times for most of the materials used in every facility we build. We have adapted by pre-purchasing materials prior to commencement, finding alternative suppliers, and working with our partners to develop creative solutions to keep the projects moving forward.

LF: How are you dealing with supply chain issues and delays caused by shortages of materials, components, particularly electric components?

MD: To deal with supply chain issues and delays caused by material and component shortages, we’ve implemented a very proactive approach to procurement, sourced alternate materials, and offered alternate solutions to our design partners.

Throughout our 50 years serving Texas, we’ve fostered many trusted subcontractor relationships which have proved to be absolutely critical during these times. We maintain close relationships with our suppliers and constantly monitor lead times for all the major materials so we can share real-time updates with our internal teams and customers.

Perhaps the most disrupted portion of the supply chain has been related to electric components, and in particular switchgear. Depending on the specific type of switchgear, we have seen lead times extend out to eighteen months! We have utilized several different strategies to address this particular concern including preordering materials, expediting purchase orders, redesigning the electrical service for more readily available materials, and utilizing creative temporary construction power solutions.

LF: With interest rates uncertain, how are you managing the financial risk of construction in the hospitality sector?

MD: The uncertainty of interest rates, availability of capital, and current construction costs has dramatically increased the financial risk particularly during the planning phase but also continues during construction with the interest carry fluctuations. During the planning phase we provide our customers with a wide menu of pricing options to create a financial buffer prior to closing the construction loan. Working closely with our clients to establish contingency plans and maintaining open lines of communication to ensure all parties can pivot is essential.

LF: How are you using technology , or innovative construction methods to improve efficiency, reduce cost or meet sustainable goals in the hospitality industry?

MD: Across the construction industry, 96% of data goes unused (2018 FMI Report). Having disparate processes that are not aligned across an organization does not enable a successful datadriven decision-making culture. We’re trying to change that. In 2021, we made some key new hires including our Director of IT who brings extensive Data Warehouse experience and a BI Analyst/ Developer to improve existing dashboards. We started building out new dashboards (multisystem data) and working on streamlining common systems and processes to align key data objectives. With these changes, our data is now stored in a common system. The benefits are exponential. Common ways to collect and use data are standardized across project teams. The data is liquid, and easily accessible for quick decisions. Field teams can view data quickly to help inform decisions. And then our corporate goals and benchmarks are used to measure progress and outcomes. Data is used to proactively manage risk and provide better visibility into issues earlier. We can more quickly analyze RFIs across all completed projects, learn from historical RFI trends, and understand what RFIs are most likely to occur on future projects based on past performance. We can see the risk of overspending based on historical project trends and then act as soon as risk emerges.

LF: Labor shortage has been a continued challenge in the hospitality industry, how are you dealing with labor shortage or backlogs amount trade partners, and what impact is that having on your projects?

MD: Labor shortages have been a major challenge for us, particularly with certain trades like electrical and plumbing. To address labor shortages and backlogs among trade partners, we are actively recruiting skilled workers and investing in workforce development initiatives. We also collaborate with local trade schools and community organizations to attract and retain talent.

One proactive step we recently took to address the labor shortages and skill gaps in the construction industry was by founding the ACE mentorship program here in Austin. This program connects high school students interested in architecture, construction, and engineering to industry professionals who mentor them and provide valuable insights and guidance. We also sponsor various other initiatives and partnerships that support the next generation of builders, such as scholarships and sponsorships for students pursuing degrees or certifications in constructionrelated fields. In fact, we just wrapped up a threeday competition with a group called SkillsUSA that promotes leadership, STEM, and occupational skills among CTE high-school students. Through these efforts, we aim to inspire and empower young people to consider careers in construction and support their development into skilled professionals.

LF: Finally, How do you see the hospitality construction industry evolving in the next few years and what opportunity or challenges do you anticipate?

MD: Looking ahead, we anticipate continued growth in the hospitality construction industry and greater focus on sustainability, technology integration, and modular construction methods. Opportunities lie in adopting energy-efficient systems, smart technologies, and prefabricated components, while challenges may include staying up to date with new regulations, managing labor shortages, supply chain, and construction pricing.