Sustainability – one word, many meanings. For some, it refers to whether a business’ Styrofoam coffee cup or coffee pod is recyclable or to a data center’s energy use for computing power and cooling. For others, it refers to material use within the supply chain or to a cumulative assessment of all measures across a corporation’s operations – with full disclosure to shareholders and the public markets.
Within the built environment, sustainability also has many meanings, but is now a mainstream priority, commanding higher prices from buyers and tenants due to the long-term benefits. Beyond building code compliance, owners and tenants alike in all types of buildings – retail, institutional, government, sporting, educational and industrial – are clamoring for sustainable buildings. The reasons for this include wanting to minimize ongoing energy and maintenance costs, improve the health of the occupants, and/or to reduce environmental impact as part of a corporate social responsibility plan.
According to the Lawrence Berkeley National Laboratory, buildings are responsible for 39 percent of total energy consumption for heating, cooling, lighting and plug loads in the United States. This far exceeds the energy used by the transportation or industrial/manufacturing sectors.
For developers and construction managers, this critical need presents a great opportunity to modernize our nation’s buildings and work towards sustainability.
Facing increasing pressure to update aging public infrastructure while delivering more services for less money, government officials are turning to creative methods to develop public infrastructure projects. Public-private partnerships – commonly referred to as P3s – are proving to be a valuable tool for achieving this goal.
When negotiating a construction subcontract between the contractor and a subcontractor, one of the most important provisions is the payment provision. The date when payment is due from the contractor to the subcontractor, and the question of who bears the risk of loss if the owner fails to render payment even if the subcontracted work has been completed, are important concerns for both parties.
As a matter of public policy, in many states, if a subcontractor performs work, they are entitled to payment – and the contractor’s obligation to pay its subcontractors is not generally contingent upon whether the contractor has first received payment from the owner. Because the contractor has negotiated with, and is presumed to be familiar with, the owner and his or her financial wherewithal, the contractor is seen to be in the better position than the subcontractor to assess the risk of the owner’s non-payment.
As the millennial generation – broadly defined as people born in the 1980s to early 2000s – becomes a more dominant group in the workforce, there has been a dramatic shift in the type of physical work space companies are looking for. Gone are the days of traditional office space with cubicles, large private offices and oak doors. Modern offices of the millennial professional set have ushered in open, collaborative workspaces and brainstorming areas. Luckily for landlords and developers, this take on the workplace doesn’t have to be expensive and comes with the payoff of making tenants happy.
In May 2014, the long-awaited revenue recognition standard was issued with the intent of creating consistent revenue reporting across all businesses in varying industries throughout the world. The implementation of the accounting standard means the construction industry-specific guidance currently used in the United States will no longer be applicable, and will require different approaches for recognizing revenue as well as additional disclosures.
The design/build delivery model offers owners and contractors the potential for greater efficiencies in the construction process, but if the parties do not carefully manage the design review process, the project can experience unnecessary delays to procurement and construction that can cascade throughout the project. It is a complex process to track all of the hundreds or thousands of different engineering drawings submitted on a large project to ensure that they are being reviewed and approved according to the contract schedule. The process is further complicated because the owner’s engineers and the contractor’s engineers (and sometimes third-party reviewers) may have conflicting engineering judgments on complex technical issues.
As the construction industry begins the slow crawl out of the recession, many companies and contractors are increasing the number of bids they submit for residential projects. In fact, the competition is as fierce as it has ever been. Obviously, everyone wants to present the winning bid, so what can owners do to increase their bid-to-business-award ratios?