26 minute read
Retail and Hospitality Trends and Hot Topics .......... 20,39,41
Focus: Retail and Hospitality
Standing up to the Supply Chain Crisis: Approaching Construction Challenges in Gaming and Entertainment Projects
By Danae Tinsley
Few have emerged untouched from the supply chain and infation issues of the current economic climate. In the hospitality industry, specifcally in gaming and entertainment, owners and developers of casino projects, new construction and renovation alike are grappling with increasing costs and delays. As the architects and designers behind these projects, it is our job to help our clients navigate the challenges facing the industry today, a role that requires a fresh approach and creative solutions.
The Supply Chain and Construction Documents: Two Methods
The supply chain crisis is a much discussed scourge on construction sites globally. Material availability has had a great effect on construction schedules and the way project teams are approaching design and documentation. One of the options designers have to combat delays in construction schedules is to order specialty items such as custom fxtures or long-lead fnishes in advance of construction documents being completed. This shifts the standard workfow to require a bit more effort earlier on but allows designers to prioritize the topquality design items that casino properties are looking for without compromising the project schedule.
Alternately, given the current unpredictability of costs and supply chain delays in the market, some owners may choose to move further along with the design and construction documents before releasing early bid packages and starting construction. This strategy can provide the team with additional time before committing to a GMP (guaranteed maximum price contract), in the hopes that material costs will decrease in the coming months.
The Impact of Partnerships and Collaborations
Another way to approach these issues is through open-book partnerships between construction managers and primary subcontractors that are tied to long-lead items like concrete, steel, and roofng materials. Primary subcontractors can be brought on after the initial Program of Requirement, Concept Design, and Control Budget development tasks are fnished. Candidates are vetted in regards to pricing, availability, and schedule adherence. The primary subcontractor then becomes part of the OAC (Owner-Architect-Contractor) team and participates in all relevant meetings. In this way, they become part of the problem-solving process directly, working alongside the design team, operating staff, and construction manager to make smart and effcient design decisions. This can also help eliminate the amount of change orders, as the subcontractor has been assessing design and construction documents as they are developed.
Alternative Ideas
In gaming projects, where designers might struggle to source prefnished metal products such as bronze and brass, the key to success is thinking creatively and exploring other options. This might mean choosing a different product, a stock fnish, or feld painting materials. In the past, we’ve seen similar efforts involving changing tube steel to more readily available W-sections, and reworking support systems to use less custom steel and more U-Channel style systems. Whatever the options may be, alternative solutions are always available with creative thinking and transparent, collaborative discussions amongst all parties and stakeholders.
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Three Retail Trends to Watch in 2022
By Bill Wright and Brandon Isner
Perhaps no other sector of commercial real estate has endured as much recent disruption as retail. Even before the pandemic, retail real estate was facing questions about its viability as an investment. Some national retail brands had too many physical locations and had to close stores. Growing vacancy within high-street districts refected low foot traffc or asking rents that were too high.
However, retail’s recovery from the pandemic has been a pleasant surprise, with increasing sales even amid diminishing consumer sentiment. According to retail data provider Placer.ai, foot traffc at retail centers has largely recovered to 2019 levels, especially in the open-air segment. U.S. Census data shows robust holiday sales in both brick-and-mortar stores and e-commerce channels. What’s more, U.S. households on average are experiencing record low debt-to-disposable-income levels, according to the Federal Reserve Bank.
In 2022, we expect the retail industry to embrace three growth strategies:
Forge Collaborations between E-commerce and Traditional Retail Brands
Retailers are expanding their offerings by partnering with e-commerce companies, often via branded kiosks or within department stores. Among the benefts of such an arrangement: • The ability for traditional retailers to offer a new product type, potentially attracting foot traffc from a previously untapped customer base. • An opportunity for traditional retailers to upgrade digital resources and customer engagement. • A chance for digital brands to beta test a brick-and-mortar presence without any lease obligations.
Use Stores to Implement Solutions for Supply Chain Issues
Since the fnal 50 feet remains one of the most expensive legs of the logistics journey, physical stores will take on a greater supply chain role in 2022. Retailers with a physical presence will differentiate from purely e-commerce retailers by expanding their in-store return capabilities,, making it easier for
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consumers to return goods.
CBRE’s Supply Chain Advisory Group reports that transportation costs typically account for 50-70% of a retailer’s total logistics spend, while fxed-facility costs, including real estate, account for only 3-6%. Based on this formula, retailers can hedge against rising transportation costs by assigning a more active supply chain role to their brick-and-mortar stores, where a lease controls fxed-facility real estate costs.
Stores can play an active role in the supply chain in several ways: • Upgrading in-store return capabilities. • Expanding curbside pickup capabilities. • Redesigning stores to optimize the omnichannel experience. • Automating checkout.
Embrace ESG in the Retail Sector
Environmental, social and governance (ESG) concerns are becoming increasingly important for the success of retailers. A growing share of consumers prefer ethically defensible brands, especially those focused on reducing carbon emissions and waste.
There is growing consumer demand in the resale market for products that are in good condition. Retailers can take advantage of this trend by marketing their own secondhand products for sale, promoting a “circular” economy and reducing waste. Overall, Forrester estimates that 41% of U.S. consumers prefer to purchase environmentally sustainable goods.
The retail sector is generally performing well in ESG measurements. The 2021 Global Real Estate Sustainability Benchmark (GRESB) scored ESG implementation by more than 1,200 property companies, REITs, funds and property developers worldwide. Eight of the 11 retail-focused REITs tracked by GRESB increased their scores last year.
Bill Wright is senior managing director, retail advisory services in the Americas, and Brandon Isner is head of retail research for the Americas, at CBRE.
Construction Underway on Lincoln Hotel
Hampton Inn and Suites, Lincoln, N.H.
Lincoln, NH – Allen & Major Associates, Inc. (A&M), in partnership with Opechee Construction, is providing civil engineering, permitting, and landscape architectural services for a new 93-key Hampton Inn and Suites on Main Street in Lincoln.
The new 4-story hotel is under construction with an opening scheduled for fall. A&M provided permitting efforts for Site Plan/Special Permit with the Town of Lincoln, a Lot Merger Application, NHDOT Access Permit, and NHDES Sewer Connection permit.
The parcel has mountain views and overlooks a rail line. It also has a unique visual feature: an abandoned 1950s-era ex MBTA Rail Diesel Car. The car sits behind the lot and sports the famed “T” logo.
A&M’s landscape architecture team has designed hardscape entries, a gazebo shade structure, and patio areas. A seating area will be located along a path in the back of the property, which will feature a native wildfower mix border with lupines and provide hotel guests a view of the railway.
Assembly Row Signs New Tenants
Somerville, MA – Assembly Row, a mixed-use neighborhood in Somerville, announced seven new tenant leases, many of which will open this year.
Restauranteur Frank McClelland is bringing a second FRANK location to Assembly Row, which is expected to open later this fall adjacent to The Row Hotel. Boston-based artist Giovanni DeCunto recently launched a new pop-up gallery showcasing his expressionist works, and Clover Food Lab brings a vegetarian offering to the Row. Seasonal activations include Night Shift Brewing’s Owl’s Nest beer garden and the brand-new Volo Beach from Volo Sports that will offer beach volleyball, pickleball and more.
New retailers also include IT’SUGAR, one of the world’s largest candy “retailtainers;” fashion boutique Style Snoop; collectible jewelry retailer Pandora; and PNC Bank.
“This new crop of tenants brings fresh concepts and diversity to Assembly Row, including our frst vegetarian restaurant and a highly anticipated restaurant from Frank McClelland,” said David Middleton, general manager for Federal Realty at Assembly Row. “Our goal is to surprise and delight our guests with both permanent and pop-up experiences and there are many more in the
Parla XXI
pipeline for this year.”
Recent openings include Parla XXI, a speakeasy-inspired eatery offering Italian small plates and custom cocktails; French patisserie Le Macaron; and soon-to-come services from veterinary clinic Bond Vet. Anticipated openings include varied dining experiences from Civility Social House, An Nam, Tatte Bakery & Café, and Tribos Peri Peri.
Miscela, Assembly Row’s new 500unit luxury apartment community, is currently leasing and just unveiled its new poolside and roof deck experience for the summer.
NAIOP: Retail, Industrial Sectors Converge
Washington – A recent report published by the NAIOP Research Foundation fnds that the pandemic and the e-commerce trends that preexisted it have led to a dramatic confuence of the industrial and retail real estate sectors.
“The COVID-19 pandemic dramatically accelerated demand for e-commerce. Correspondingly, it accelerated demand for distribution space from which to fulfll purchases made online. These conditions have led developers in land-constrained markets to consider new formats for distribution buildings and pursue redevelopment projects that would not have been feasible before 2020,” according to New Places and New Spaces for E-commerce Distribution: Three Strategies Bringing Industrial and Retail Real Estate Closer Together.
“At the same time, brick-and-mortar retailers have responded to customer preferences by expanding online order pickup services and shipping orders from retail stores. Together, these trends are contributing to the convergence of industrial and retail real estate, with implications for developers, investors and building owners,” according to the report.
The report examines the risks and opportunities associated with three related strategies: • Functionally obsolete shopping centers can be attractive targets for conversion to distribution space given their size and location. • Retailers are adding distribution capacity and online order pickup and return services to existing retail stores to enhance their customers’ shopping experience. • Some developers are pioneering mixeduse developments that collocate retail and industrial space.
“No one is certain how quickly brightline distinctions between industrial and retail space will disappear, how market participants will react or how ESG initiatives will shape corporate real estate portfolios. However, it stands to reason that all these factors may infuence the prospects of retail-to-industrial conversions, micro fulfllment from operational retail outlets, and mixed-use development that includes industrial and retail components. Real estate developers who are mindful of them may therefore succeed in such projects when others fail,” the report said.
The report was written by Dustin C. Read, PhD/JD, who has two decades of experience conducting real estate research.
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Jones Architecture Supports MiniLuxe Expansion
Boston – Jones Architecture has designed a new prototype store for Boston-based nail care brand, MiniLuxe.
With a mission to change the way customers view the beauty industry and create new standards for the salon environment, MiniLuxe is embarking on a national expansion. “We are excited to be able to partner with such a forwardlooking personal care company as they look to expand across the country,” said Rick Jones, founder and director of Jones Architecture.
With cleanliness at the core of their mission, MiniLuxe aims to build confdence and self-respect through selfcare, for both their employees and their clients. A “kit of parts” package including guidelines, layout confgurations and equipment standards is designed to help achieve these goals in a distinctive expression of the brand that emphasizes effciency and comfort.
Jones, along with with Commodore Builders, began working with MiniLuxe right before the pandemic. Since then, renovations to the brand’s Boston area locations include the Prudential and Coolidge Corner locations. Upcoming plans include stores in the Tampa/St. Petersburg, Fla. area.
Prototype MiniLuxe branded environment
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Acher Hotel
3rd Ave. Redevelopment Acher Hotel
MJ Daly Celebrates 140 Years in Business
Longevity in business is rare. According to Harvard Business Review, the average lifespan of businesses has fallen by 80% in the last 80 years (from 67 to 15 years). With this in mind, the staying power of MJ Daly is that much more impressive. This year, MJ Daly, LLC of Waterbury, Conn. is celebrating 140 years of providing mechanical contracting services to commercial and industrial buildings across New England.
MJ Daly’s history starts with Michael Joseph Daly in 1882. It was then that he moved to Waterbury to make pipe and supply deliveries using horse-drawn trailers. The firm grew rapidly to eventually serve all of Connecticut and parts of New York, Massachusetts, and Rhode Island. Robert M. Bolton, CEO of Arden Building Companies, LLC, acquired MJ Daly in 2006. Today, MJ Daly is helmed by President Edward Carvalho.
What do leaders of the organization attribute to their longevity? One of their key values is the importance of looking ahead and adjusting to changing requirements. According to a Harvard Business Review study, adjusting to the needs of the future is a key to establishing staying power in business.
MJ Daly’s Bank Street, Waterbury, CT original location
Another key to the organization’s longevity is its ability to provide services across the range of needs. MJ Daly is a true one stop shop. It provides construction, service and maintenance for HVAC, plumbing, and fire protection systems, and is on the forefront of building automation control (BAC) technology. The company offers advanced engineering, 3D modeling, and design build capabilities.
Facility managers will be the first to tell you that having a reliable service and maintenance provider is critical. MJ Daly’s comprehensive approach to service and maintenance often leads to lower operating costs, increased energy efficiency, extended equipment life and less planned downtime. MJ Daly’s building automation technology capabilities deliver on the efficiency demands of today’s most forward-thinking building operators and owners. They employ a team of engineers and certified technicians to implement and manage BAC systems for new construction or retrofits.
MJ Daly’s engineering capabilities are also impressive. They include system design, construction administration, and sprinkler system inspections and testing, among others. Their state-of-the-art 3D modeling and BIM capabilities provide a clash-free design model along with bid documents that address specific project needs. And their design-build capabilities help maximize productivity and remove the uncertainties that can be prevalent in traditional build environments.
All of these capabilities would not be possible without the right workers and resources. MJ Daly is focused on delivering the highest quality workmanship and materials, and implementing strategic planning and processes into every job. MJ Daly serves a full range of markets that include biotech, commercial, education, and healthcare, among others. The company has developed processes and approaches designed to address the specific needs of each market.
As they look to the future, management is constantly taking steps to invest in, embrace, and implement new technologies, equipment, processes and techniques. With this approach, MJ Daly is assured to be around for another 140 years.
Left: Paul Evon, VP Fire Protection Center: Edward Carvalho, President Right: Dan Nelson, VP Mechanical
Millbury Cannabis Facility Completed
Millbury, MA – Vantage Builders, Inc. announced it completed the build-out of a 100,000sf cannabis cultivation, product manufacturing and dispensary facility for GreenCare Collective (GCC), located at 12 Latti Farm Road in Millbury.
Vantage Builders completely transformed the building, which formerly housed two manufacturing tenants, into a state-of-the-art grow facility featuring clone, mother, and vegetation rooms; six 9,500sf grow rooms; cultivation process rooms for drying, trimming, curing and packaging; secure vault storage; and a commercial kitchen for the creation of cannabis edibles. The second foor has corporate offce space for GCC staff. A 2,000sf dispensary is located in the front of the building and is scheduled to open this summer.
The facility includes a perpetual harvest system, which enables GCC to have plants continuously in both the fowering and vegetation stages. The perpetual harvest features GCC’s custom rolling tray system from EnviroTech Cultivation Solutions. Plants are seated in large, 15.5 foot long by 4 foot wide trays and are effciently moved by GCC growers along wheeled conveyor racks through each stage in growth, from mother to vegetation and growth, right to processing. The process allows
GreenCare Collective’s new cannabis cultivation and dispensary facility in Millbury, Mass
growers to carefully tailor the light and fertigation that plants receive at each stage, which greatly increases crop yield, product quality and the effciency of the cultivation process.
The six grow rooms have walls and ceilings consisting of Norbec insulated metal panels and epoxy fooring, which help maintain the clean environment. Each grow room has 24 separate fertigation zones and four different lighting zones to maximize growth and healthy plants. Vantage Builders installed 2,200 LED lights from Revolution Microelectronics to create the proper grow conditions.
The project included the installation of all new mechanical, electrical, plumbing and fre protection (MEP/FP) and HVAC infrastructure to meet the heavy systems demands of the cultivation facility. The building required a new electrical service power upgrade, including new outdoor switchgear with a CAT diesel backup generator. The main chiller plant features three Tecogen chillers, boilers and two large cooling towers that supply hot and cold-water loops for the building’s HVAC needs. The chiller plant consists of four modular sections that were assembled in Arizona, shipped to Millbury and carefully installed on a new, custom-built structural equipment pad.
All aspects of the grow process – fertigation, lighting, temperature, and CO2 levels – are controlled by an intelligent Priva building management system (BMS), while a second BMS provides control for the offce and dispensary areas. Any odors created during the cannabis processing are eliminated by a Benzaco Scientifc odor neutralization system.
The build represents the largest cannabis project for Vantage Builders and is one of the largest cultivation facilities in Massachusetts. The project team included BKA Architects; BLW Engineers, MEP engineering; McClure Engineering, civil engineering; and Trinity Engineering, structural engineering.
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Dacon Completes Facility for Crate&Barrel, Sterling Movers
36 Executive Drive, Hudson, N.H.
Hudson, NH – Dacon has completed a 95,000sf expansion of 36 Executive Drive in Hudson, in response to market demand for warehouse and distribution space along the Massachusetts/New Hampshire border.
The property is centrally located to Routes 3 and 495 in Sagamore Industrial Park. This expansion is now fully leased to Crate&Barrel which has earmarked this site as a customer pick-up center for northeast New England, and Sterling Movers which will utilize the space for transitional warehousing of client goods.
With a concerted focus on sustainability across its 100 locations, home decor store Crate&Barrel employs responsibly sourced packaging, sustainable forestry practices and is 100% LED lit. Sterling Movers provides end-to-end residential and commercial services for the healthcare, life science, technology, academic and manufacturing sectors. While it serves the New England region, its reach is national with services entailing moving, storage, specialty freight transportation, furniture installation and building decommissioning.
The merits of this project rested on fexibility and feasibility: crafting a space to be responsive to a variety of tenant needs, increasing leasing capacity by 50%, rapid timing, and realistic cost. Design elements include a high bay, 32 foot clearheight conventional structure with tilt-up concrete wall facade, high-performance storefront glazing systems, two entrances, 11 egresses, a truck court accommodating 21 simultaneously loading vehicles, and dock levelers.
Wychmere Beach Club Completes Construction
Harwich Port, MA – Construction was recently completed at the Wychmere Beach Club on Cape Cod. The club held its frst wedding reception at the newly constructed “Dune” event space in May.
Wychmere Beach Club spans 20 oceanfront acres on Nantucket Sound and features event space, a private beach, sparkling pools, poolside bars and restaurants, and a tennis club. ReyCon feld teams, led by Project Manager Greg Ginsburg, worked in collaboration with property owner Atlas Investment Group, the architecture and design team at GS Design Group Inc., and a team of subcontractors.
ReyCon’s work at Wychmere consisted of ground up construction on the 35,000sf oceanfront wedding venue as well as adjacent pools, pool deck and bar/restaurant. “Dune” features panoramic ocean views accessible through expansive windows, balconies and a rooftop terrace with frameless glass walls. Outside, the beach club features two brand new grand pools, a kids pool and an extra-large hot tub.
TrimBoard, Inc. partnered with the team on interior and exterior millwork including attached and freestanding pergolas. TrimBoard manufactured custom interior and exterior shiplap paneling to create the space. The landscaping is anchored by two 50 foot TrimBoard manufactured structural fberglass custom pergolas designed to withstand the unpredictable wind and weather in this waterfront location.
For the Beach Grille, a private restaurant on the property, TrimBoard partnered with StruXure, a provider of commercial smart pergolas with operable louvres that are adjustable for wind, sun protection and rain protection, to build a space to protect diners from the elements and extend usability of the space. TrimBoard custom-manufactured
rafter tails and columns for the StruXure system, which is designed to match the other large scale pergolas on the property, as well as the custom rafter tails on the architecture. The StruXure installation was completed just before the season’s onset by M Duffany Builders of Falmouth. “We were thrilled to partner with Atlas Investment Group on a hospitality project of this magnitude and prestige,” said Mike Reynolds, president of ReyCon. “The Wychmere Beach Club is an absolute jewel and one of the truly special beach clubs and event venues not only on Cape Cod, but all of New England. I’m particularly proud of the fact that this project was initiated and developed during the challenging pandemic. Success on the project required creative problem solving and a tremendous team effort; everyone involved deserves credit for driving the program forward during uniquely diffcult times.”
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Trends and Hot Topics Performance/Payment Bonds: Owner’s Concerns
By Girard R. Visconti
On public works projects, many states, including Rhode Island and Massachusetts, require performance and payment bonds. A “statutory bond” should be pursuant to the state statute, i.e. citation and its general laws which mandates that a surety will be responsible for the performance of a construction contract as well as claims for labor and materials.
Previously, the American Institute of Architects (AIA) utilized Form A311, which was a basic form and acceptable to many owners. The AIA developed Form A312, which is rather complicated, burdensome and has notice provisions as a prerequisite to recovering under the bond, and the failure to follow the strict notice provisions will result in the surety being absolved of all liability under the bond. (See Seaboard Surety Company v. Town of Greenfeld, 370 F.3d 215 (1st Cir. 2004)).
On public works projects, the statutory bond form required should closely resemble the prior AIA A311 type bond, which is without many conditions to recovering against the bond.
AIA A312 is not a statutory bond but is a common law bond that contains onerous and burdensome notice requirements that must be satisfed as a precondition to the surety’s liability under the bond. If the condition precedents are not satisfed, then the obligee/claimant cannot resort to the bond for recovery.
The AIA A312 contains the following conditions:
Section 3: If there is no owner default under the construction contract, the surety’s obligation under this bond shall arise after: • The owner frst provides notice to the contractor and the surety that the owner is considering declaring a contractor default. Such notice shall indicate whether the owner is requesting a conference among the owner, contractor and surety to discuss the contractor’s performance. If the owner does not request a conference, the surety may, within fve business days after receipt of the owner’s notice, request such a conference. If the surety timely requests a conference, the owner shall attend.
Unless the owner agrees otherwise, any conference requested under this Section 3.1 shall be held within 10 business days of the surety’s receipt of the owner’s notice. If the owner, the contractor and the surety agree, the contractor shall be allowed a reasonable time to perform the construction contract, but such an agreement shall not waive the owner’s right, if any, subsequently to declare a contractor default; • The owner declares a contractor default, terminates the construction contract and notifes the surety; and • The owner has agreed to pay the balance of the contract price in accordance with the terms of the construction contract to the surety or to a contractor selected to perform the construction contract.
The bond between the contractor and subcontractor contains similar conditions.
For an owner to recover against a general contractor pursuant to the performance bond (or for a general contractor or CM to recover against a subcontractor’s performance bond using A312) the aforesaid conditions apply under Section 3 of AIA A312.
Pursuing the surety under the A312 bond requires notifcation to the surety that the owner or contractor is considering declaring a default and requesting a conference and thereafter, the owner or contractor declares the contractor or subcontractor in default and terminates the agreement and notifes the surety and the owner or contractor has agreed to pay the balance of the contract price.
If the owner or contractor does not comply with the strict requirements, the surety bond may be voided.
Such is the matter of Seaboard Surety as noted, plus the First Circuit’s recent opinion of Arch Insurance Company v. The Graphic Builders LLC. (Case No. 21-1126), whereby the court noted that the claimant declared the subcontractor in default but did not terminate the subcontractor and never agreed to pay Arch, the surety, any portion of the contract price. Further, in this case, the contractor failed to terminate the
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destinations and inspire that engage
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