6 minute read
Market voices: Design and
Sherif Ayad
President & CEO ID & Design International
It is a highly competitive business. Five years ago, we were all designing multifamily projects for millennials. We find ourselves today designing the same multifamily projects, but for mixed, diversified age groups and ethnic backgrounds. We can develop projects today that cater to both millennials and empty nesters within the same communities. Being as competitive as it is, the multifamily niche has really become an amenity war, more than anything. It’s about all the bells and whistles you could imagine, from bowling alleys to full-fledged gyms, boxing rings and everything else. With the impact of COVID specifically, the biggest change we’ve seen is how developers have taken coworking environments very seriously. It’s no longer putting a Mac and a PC in a corner facing the wall. Our two biggest competitive amenities right now in any multifamily job are fitness centers and our coworking environments.
We have several, in-house teams using drones for aerial surveys on our projects. That’s becoming increasingly commonplace in the engineering industry, because it’s an e cient way to collect data ahead of executing a project. We are also starting to incorporate augmented and virtual reality into our design process. That helps to visualize what the project is going to look like, and it is great for public stakeholders to visualize future projects within their communities. From a design perspective, you get to see things in 3D, which helps with clash detection and to eliminate human error. We can also use these tools to do 4D, to visualize construction sequencing to see what di erent parts of the project will be accomplished and when. We can also use this tool in a fifth dimension for cost estimating.
Daniel Suarez
Office Principal HDR
Vince Yarina
Principal & Vice President Langan Engineering & Environmental Services, Inc.
Broward’s talent pool is limited and hiring is definitely a challenge. For example, we have an entry-level opening in our Fort Lauderdale o ce and the bulk of the resumes we receive are from out of the area and lack the specific skills we require for the job.
For senior level positions, there are not a lot of these folks in the market so the pool is limited and we need to be cautious of having key talent stolen by our competitors. Professionals with a diverse range of skills are most prized in the current market, including skilled engineers, geologists and scientists with good interpersonal skills. Dealing with clients and having the ability to manage time, projects and budgets are the primary skills most in demand and the hardest to find.
( ) 2020, according to the MIAMI Association of Realtors®.
Increased housing starts and more sellers listing properties in 2021 should help alleviate the lack of supply. A healthy Q1 in terms of new construction starts points to builders doing their part in helping alleviate pressure in the housing market. As of March, residential starts were north of 40% across the tri-county area, accounting for $461 million, The Real Deal reported sourcing data from construction data analytics firm, Dodge Data & Analytics. Buyers are increasingly turning to new construction to avoid the extremely competitive housing market. Throughout South Florida, there are nearly 29,000 homes in various stages of construction, the Sun Sentinel reported sourcing data from Zonda Home, a housing market research and real estate analytics firm. Broward County accounts for more than 5,300 of the new housing inventory currently being constructed in South Florida, according to the newspaper.
Challenging the homebuilders are ongoing supply chain disruptions and the sharp rise in construction costs, mainly seen in lumber and steel commodities, costs which in turn are passed onto buyers. “The limiting factor for builders has been the roller-coaster ride for lumber prices,” National Association of Home Builders Chief Economist Robert Dietz said during the Florida Realtors® 2021 Florida Real Estate Trends Summit. “In talking to builders, rising lumber costs for a newly built home could be pushing prices up $15,000 or more. And, about 24% of the cost of a new home comes from the cost of regulatory requirements, during both the development and construction. We need to see what can be done in regulatory costs to keep down
Orlando Sharpe
Founder & Principal – Sharpe Project Developments
We’re very excited about the numerous projects we have in the works for our clients in secondary and higher education. For example, we’re developing a new four-story building for Christopher Columbus High School, containing structured parking, athletic facilities, and classrooms on the third and fourth floors. We’re also assisting the University of Miami in their multi-year plan to modernize campus housing. Right now, we’re working on the Centennial Village project, which, when complete, will house over 2,100 live-in faculty and staff. Nova Southeastern University has also been a fantastic organization with which to work. We’re in the final stages of their innovation center, The Alan B. Levan | NSU Broward Center of Innovation.
what we call ‘death by a thousand cuts’ in the newhome market,” he said. Despite these challenges, Dietz pointed out that Florida saw strong growth in the new construction market in 2020, with building permits up 30% year-over-year.
Challenges From supply chain disruptions and sharp cost increases to a heightened focus on health and wellness to investor indecision, the pandemic forced industry leaders to stay nimble and contend with the challenges head on. Demand and supply chain issues have directly impacted the cost of materials, most notably lumber, copper and steel. Over the last 12 months, the cost of lumber has increased more than 56%, according to Cumming’s Domestic Material Price Trends analysis. In similar fashion, copper and brass mill shapes prices have increased more than 30% and steel pipe and tube prices are up more than 10%, the consulting firm reported. “The challenges are ever-changing. You think you know what to expect but COVID comes and attacks you in the most obscure places,” Current Builders CEO Michael Taylor told Invest:. “You don’t always know, day to day, how COVID is going to affect you. It hit the lumber market, midyear, really hard. We weren’t expecting that. It basically doubled lumber prices in about a month. So, there were challenges with how we recover those costs with the owner,” he said.
The sharp rise in prices is mostly connected to shortages of factory workers in conjunction with supply chain disruptions from national and international shutdowns and unexpected events such as the twoweek blockage of the Suez Canal in March and the Colonial Pipeline ransomware attack that left a great swath of Southeastern states scrambling for gas for a few days in May. However, the industry expectation is that material prices will level out during the second half of 2021, yet closely monitoring the supply chain will be crucial as the industry recovers. “As we hit midyear, we do expect a normalization of material price increases and those that have plateaued at the beginning of the year will close the gap over the next three to six months. Moving forward, the key will be the supply chains and in particular their capacity and ability to deliver materials across state and international lines, as even now with a slowdown in construction we are seeing pressure with both costs and delivery schedules starting to increase. As the construction sectors start to regain traction that pressure will increase,” Cumming wrote in its material price trends analysis. ( )
