ICI Fall 2021 Newsletter - External

INSIGHTS INTERNATIONAL CONTRACTORS INC.

The latest company happenings.

FALL 2021

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Letter from Leadership Randy Bronge, Executive Vice President

Summer is traditionally a very strenuous time for ICI’s field team. The company’s focus on K-12 Education construction results in a rigorous 10-week period each summer where our team completes extensive life safety upgrades and renovations spread across multiple school districts while students are out on break.

This year, these intensive improvements were coupled with ongoing large-scale additions and the construction of two new schools. Our K-12 Team worked tirelessly and I extend my gratitude to them.

I’d like to specifically highlight ICI’s team working within Elmhurst Community Unit School District 205. I place emphasis on them and the work that they are doing for both professional and personal reasons.

Professionally, I am incredibly proud of our team working within Elmhurst. Their dedication to minimizing disruption within the community during construction, their close coordination among the trade contractors, and their steadfast adherence to the project schedule is exemplary. The team’s foresight and cohesion has allowed them to mitigate inevitable construction issues and avoid challenges that would have overwhelmed a less persistent group of individuals.

On a personal level, I have deep-rooted ties to the community and this is more than the fulfillment of a capital improvement plan. I am a lifelong resident of Elmhurst and ICI has been headquartered within the community for nearly 39 years. My brother Bruce and I attended Bryan Middle School. Bruce, Jeff and I all attended York High School. I went on to send my sons to Lincoln Elementary School and York. Now, my granddaughter is a kindergarten student within the District attending Jackson Elementary School.

As I’m sure you can imagine, after three generations of my family progressing through District 205 schools, it gives me immense pride that ICI is involved in transforming those very buildings into 21st century learning environments. It is an honor to be entrusted with construction that will lead to the enrichment of students’ lives community-wide.

Featured Project

Elmwood Park CUSD 401: John Mills and Elmwood Elementary Schools

ICI was hired as Elmwood Park Community Unit The focus of the renovations at John Mills is School District 401’s construction manager in updating all classrooms and replacing the HVAC 2013 through a competitive selection process. systems. A 7,500 square foot addition will be The District was embarking upon a long-term constructed to house kindergarten, pre-k, and capital improvement plan and needed a schoolbilingual kindergarten. The renovations will also experienced construction manager to act as create focused grade level areas throughout the a trusted partner and advisor throughout the building allowing for future curriculum flexibility. process. ICI’s first undertaking with the District was a high school science wing. Throughout the Elmwood Elementary will be completely preconstruction and construction process, our reconfigured to allow grade level collaboration for K-12 team demonstrated their the first time. The HVAC system commitment to partnering will be replaced, all classrooms with CUSD 401 and the new renovated, and toilet rooms will Our partnership will reach wing has since transformed be upgraded. Two additions will a new pinnacle in 2022 as the science curriculum for the house an elevator, new IT closets, ICI undertakes the largest students. improve egress, and provide a new location for the heating capital improvement Our commitment has and cooling plant. The existing program ever implemented continued since 2013 through courtyard, currently the central by the District at Elmwood several comprehensive heating and cooling plant, will and John Mills Elementary educational improvement be transformed into a place of Schools. The project cost programs at each of the learning for the students. will total nearly $45 million.

District’s facilities. Our partnership will reach a ICI is currently in the bid phase new pinnacle in 2022 as ICI during preconstruction for these undertakes the largest capital major improvements. Interested improvement program ever implemented by the in learning more about how ICI partners with clients District at Elmwood and John Mills Elementary as they embark upon capital improvement plans Schools. The project cost will total nearly $45 like Elmwood Park’s? ICI developed a simple video million. These improvements are based on a recent that provides a general overview of construction referendum that was overwhelmingly approved by management project delivery: the constituents of Elmwood Park 401.

Sixty thousand square feet of John Mills Elementary School and 50,000 square feet of Elmwood Elementary will be renovated during the summers of 2022 and 2023.

VIDEO

Construction Management Project Delivery

Project Updates

Recently Completed Plainfield CCSD 202 Wallin Oaks Elementary School PLAINFIELD, ILLINOIS District 202 hired ICI through a competitive selection process in the summer of 2019. The first major project ICI undertook as the District’s construction manager is a new 81,600 square foot, two-story elementary school. The new facility is the 18th elementary school within the District. Construction began in the spring of 2020 and the new school was completed in time for the start of the 2021-2022 school year.

Lakeside Bank OAKBROOK TERRACE, ILLINOIS Lakeside Bank operates branches throughout Chicago and in several of the surrounding suburbs.

ICI is serving as the bank’s construction manager as they undergo a regional expansion. The Lakeside Oakbrook Terrace branch began construction in the fall of 2020 and was completed in early summer 2021. In addition to standard banking center components, the two-story, ground-up 8,491 square foot facility houses offices and meeting space for the bank’s leadership team.

Links lead to additional photos and videos.

Napleton Porsche Chicago CHICAGO, ILLINOIS Napleton Porsche is located within the Presidential Towers development in the heart of the city. ICI was hired as the dealer’s construction manager for the 27,000 square foot build-out and related façade work. The new dealership contains 10,000 square feet of sales space and a 17,000 square foot service department. This is the third dealership ICI has completed for the Napleton Automotive Group.

Cooper’s Hawk Winery & Restaurants SARASOTA, FLORIDA At present, Cooper’s Hawk has nearly 50 locations spread across 10 states. The Sarasota store is the restaurant group’s twelfth in Florida. The ground up, 12,000 square foot location has space for approximately 200 diners and also includes an additional 1,000 square foot covered patio.

Project Updates

Recently Completed Cooper’s Hawk Winery & Restaurants CHANDLER, ARIZONA As Cooper’s Hawk Winery & Restaurants begins their western-most expansion to date, ICI has been entrusted with completing back-to-back Arizona locations. In 2020, ICI completed a store in Scottsdale and then moved directly on to the Chandler store.

Chandler is a freestanding, new construction 11,536 sf store with an 1,196 sf exterior patio.

Lakeside Bank CHICAGO, ILLINOIS (BRIDGEPORT) The ground up, 6,344 square foot branch is located on the northwest corner of Pershing and Halsted on Chicago’s south side. The two-story Halsted branch includes drive-through lanes and an adjacent parking lot. Prior to construction commencing, ICI partnered with bank stakeholders to lead them through a comprehensive preconstruction process tailored to their specific needs.

Links lead to additional photos and videos.

Elmhurst CUSD 205 Edison Elementary School ELMHURST, ILLINOIS Edison was originally built in 1956 and houses grades K-5. ICI constructed an expansion that houses four (4) kindergarten classrooms and provides the space needed to offer full-day kindergarten. A major reconfiguration of the existing school updated and arranged classrooms in a pinwheel fashion, revolving around a new focal-point media center. The media center serves as a hub of collaboration, technology and self-directed learning.

The Audi Exchange ST. CHARLES, ILLINOIS In continuation of an existing working relationship with The Exchange Automotive Group, ICI completed the St. Charles Audi Exchange in August 2021. The project marks ICI’s fourth with the dealer. The ground up, 26,000 square foot dealership was constructed on a redeveloped 3.5-acre parcel. Sitework included fully developed wet and dry utility services, lighting, landscaping, and a 500 foot-long decorative concrete retaining wall.

Project Updates

Under Construction Elmhurst CUSD 205 Lincoln Elementary School ELMHURST, ILLINOIS ICI is serving as construction manager for the 79,380 square foot, two-level 21st century learning environment.

Demolition of the existing school took place June and the new school is being constructed on the same site. LEED Silver is being pursued for the new building and completion is targeted for the start of the 2022 school year.

Confidential Grocer ARLINGTON HEIGHTS, ILLINOIS In May 2021, ICI was hired to transform an existing 50,000 square foot retail space for an incoming grocery tenant. The scope of work includes HVAC, electrical, plumbing system, and food preparation equipment upgrades. ICI is also modifying the building’s existing glass storefront system and adding a new loading dock area. Completion is targeted for November.

Indicates construction is viewable via live stream webcam on ICI’s website

Fields Auto Group Mercedes-Benz ASHEVILLE, NORTH CAROLINA ICI is currently underway on a new construction 30,000 square foot Mercedes-Benz dealership. The prior Mercedes-Benz was operating out of a shared facility with Mazda and Chrysler Jeep Dodge Ram brands and the format no longer met the Fields Auto Group’s needs. The multi-brand dealership will remain in operation throughout construction and then Mercedes-Benz will move into its own freestanding facility upon construction completion which is anticipated for early 2022.

Perry’s Steakhouse & Grille 5 LOCATIONS IN ILLINOIS, TEXAS, COLORADO ICI has been hired as Perry’s Steakhouse & Grille’s construction manager for concurrent renovations to five of their locations. The scope of work varies by location but largely includes transforming each of the restaurants into Perry’s newest scheme: a vibrant color palette with modern touches punctuated by details that celebrate the local community. A noteworthy enhancement within each location is a completely revamped bar. Each restaurant is open throughout construction.

Cost Escalation Predictions for 2022 Marc Poskin, CPE, LEED AP BD+C, VP of Estimating

Predicting cost escalation is difficult enough but especially now. As the pandemic lingers on, its effects on the economy and markets throughout the world make it nearly impossible to predict cost increases on future construction projects. But … having a construction manager on your team boosts confidence when sharing cost information with stakeholders.

A construction manager has the resources and experience to prepare accurate cost estimates on future projects. How? Construction Managers (CMs) have cost data, industry resources, connections to the subcontractor market, and bids from similar projects to help them more accurately assess the cost of your project. This information, in addition to an escalation factor, provides a comprehensive estimate for any project that your building team can rely on.

One especially important number is the escalation percentage (EP), usually applied to the direct construction costs (trade costs) within a construction cost estimate. This number inflates the direct cost total to account for labor and material increases to a future time – either when the project breaks ground or goes out for public bid. For those planning a year or more in advance for a project, this factor is significant.

Below is a summary of the industry’s most widely used construction cost indices averaged over a (3) year period looking at second quarter (Q2) 2017 thru (Q2) 2020. The chart below suggests an annual escalation factor of 3.5 - 4.0 % when averaged across all (5) organizations.

2017-2020 3-Yr. Average

2nd Quarter

Annual %

2017

2018

2019

2020

Turner Index

4.52%

1031

1089

1149

1177

Mortenson Index

3.59%

126

134

137

140

R.S. Means

3.96%

251.7

261.1

266.1

282.7

ENR Index

2.35%

5826

6005

6118

6247

AVERAGE

3.61%

[cont.’d]

Cost Escalation Predictions for 2022 (Cont.’d) But look at the same data from (Q2) 2020 to (Q2) 2021.

2020-2021 1-Year

2nd Quarter

Annual % Turner Index

0.85%

Mortenson Index

2.86%

R.S. Means

1.91%

ENR Index

10.07%

AVERAGE

3.92%

3 3 3 3

4 4 4 4

2020

2021

1177

1187

140

1144

282.7

288.1

6247

6876

Indices during this period are inconsistent when compared to each other as pandemic period cost reporting appears unreliable – revealing some confusion amongst the experts. Construction starts in 2020 came to a crashing halt as the pandemic settled in, then rebounded quickly in early 2021. As the industry tried to play catch-up, demand for construction labor and materials compounded. Demand for steel, insulation, lumber, and building equipment rose quickly, driving up prices through mid-2021.

Supply-chain bottlenecks caused an increase in prices as multiple sectors competed for construction industry services. The current upward cost pressure is somewhat tempered by subcontractors trying to fill their backlog for 2022.

My opinion for any work starting in Q2-2022 or

In summary, it’s difficult to use current cost indices to predict

later: Follow the (3) year

future escalation factors (especially now, working through a

pre-pandemic escalation

pandemic). My opinion for any work starting in Q2-2022 or later –

factor level of 3.0 - 4.0%

follow the (3) year pre-pandemic escalation factor level of 3.0-

from today’s adjusted

4.0% from today’s adjusted market pricing. Most experts agree

market pricing.

that costs will begin to moderate over the next 12-18 months as the industry supply-chain catches up and production levels return to normal pre-pandemic levels.

g

A graduate of the University of Illinois at Champaign-Urbana, Marc holds masters degrees in both architecture and civil engineering. He holds the accreditation of Certified Professional Estimator (CPE); an extensive cost estimating certification process achieved by only 26 people in Illinois. Additionally, Marc is a LEED Accredited Professional.

For more than 15 years Marc has led ICI’s estimating team in the successful pursuit of a multitude of construction management and hard bid opportunities across all markets. His dedicated expertise, however, is in cost estimating and value analysis within the Illinois K-12 Education public school market. Throughout his career, Marc has worked with nearly 40 Illinois school districts on their short- and long-term preconstruction needs.

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