How is the Supply Chain Affecting Commercial Construction Projects?

The commercial construction business continues to ride the wave of increased demand in 2021. The boom in both residential and commercial projects since the start of the COVID-19 pandemic has led to many supply chain issues. 

The construction industry has been a bright spot in the economy over the past year. However, the market is at a point where manufacturing can’t keep up with demand, driving up costs that can be felt by contractors and consumers. 

Additionally, as society regains a sense of normalcy after the pandemic, labor shortages can be found in every industry and construction is no exception.

To survive, construction firms will need to learn how to adapt to a new way of doing business. 

Let’s look at the trends impacting the commercial construction supply chain and how general contractors can evolve to work around these obstacles. 

Shortages, Costs, and Tariffs Wreak Havoc on the Industry

As of June 2021, material costs have risen by 24%, a steep increase that isn’t allowing contractors to easily pass the excess cost to clients. In some cases, material unit prices have even doubled. 

The pandemic halted production for many global manufacturers that contractors in the U.S. relied on. Even as pandemic restrictions eased, facilities couldn’t operate at their normal capacity, making them unable to keep up with the demand. 

Shortages and Rising Costs

Construction businesses are now looking to the same suppliers for materials and coming up short.

More than 75% of firms have reported commercial construction projects being significantly delayed or canceled due to supply chain issues, including unavailable materials or excessively high costs. 

As a result, firms are now forced to provide bids with higher estimates, much to the dismay of developers, investors, property owners, and brokers. Only one in five contractors reported winning new contracts in the past two months. 

Further price increases are predicted for the summer as more materials, such as PVC piping, steel, and gypsum, become scarce. And though we are just starting to see relief in lumber prices, analysts predict it will take at least a year for things to level out. 

Changes in Trade Tariffs

Supply shortages can also be linked to tariffs put on some of the U.S’s biggest trade  partners. 

The Construction Association of America is now calling on the current administration to end trade tariffs, particularly with Canada and the European Union where aluminum and steel are exported. Though the administration has started negotiations with the EU, tariffs are not expected to be lifted before the end of 2021. 

How can the Industry Adapt to Commercial Construction Supply Chain Issues?

Although these changes cause challenges, they also spark many ways for the industry to adapt and improve. The best option for the industry moving forward is to build a resilient supply chain. 

To prepare for situations like a global pandemic, organizations should reevaluate their business models or perhaps take manufacturing and distribution into their own hands.

Nobody knows for sure if and when this situation will become manageable. To survive in this new economy, firms must learn how to plan and evolve.

Prefabrification

To combat labor shortages, contractors should consider prefabrification, or assembling components off site. Items can then be transported and put together on the job site.  prefabrification methods allow for more productivity in a shorter amount of time, and with fewer labor costs. 

Alternative Materials  

With commonly used construction materials drying up, construction firms can look into alternative materials such as Cross-Laminated Timber. CLT is a prefabricated wood panel that is commonly used for walls, flooring, and roofs. CLT is delivered to the job site, ready for assembly. The material is lightweight yet durable, easy to install, and doesn’t produce waste. 

BamCore, a sustainably harvested wood alternative made up of bamboo, has also emerged as an option. 

Emerging Building Methods

If the old way isn’t working, it might be time for something new. New technologies in the construction industry are emerging and firms should be early adopters.

Insulated Concrete Forms (ICFs), for example, are used to create the form for concrete pours. They are more energy-efficient and cut down on the time required to make steel or plywood forms. 

Construction Software

From Building Information Software to new tools that allow for remote work, firms should be quick to implement new technology. Apps that update in real time can better help with meeting timelines, tracking budgets, and managing projects. Being able to anticipate challenges will help firms identify solutions with speed and accuracy.

Develop New Partnerships: KIRCO and KIRCO MANIX

Companies like KIRCO and KIRCO MANIX offer third-party construction management services to the industrial/advanced manufacturing, distribution, healthcare, retail, and community sectors. From development to construction, KIRCO and  KIRCO MANIX’s  goal is to minimize risk, drive aggressive schedules, achieve budget goals, and protect owners from unwanted “surprises.”

Founded in 1974, KIRCO is a third-generation family-owned and operated, award-winning commercial real estate investment, development, construction (KIRCO MANIX), and facility management organization. 

Having planned and developed over 35 million square feet of real estate and $4 billion of successfully delivered projects across the country, KIRCO is a major developer from coast to coast and focuses on corporate real estate, healthcare, and senior housing. 

KIRCO upholds an all-encompassing culture of safety and is committed to delivering projects within budget and on schedule. If you’re interested in working with us to develop your next project, reach out to learn more today. 

KIRCO MANIX to Construct the First BJ’s Wholesale Clubs in Southeast Michigan

Troy, Mich., March 11, 2019 –KIRCO MANIX announced today that it has been selected by BJ’s Wholesale Club Holdings, Inc., an East Coast based wholesale club operating 216 clubs and 138 gas stations in 16 states – to construct 100,000-square-foot clubs and gas stations in Madison Heights and Taylor, as the company expands into Eastern Michigan this year.

“We are thrilled that BJ’s Wholesale Club selected our company to bring its first two locations to the Metro Detroit area,” said Adam D. Manix, director of Business Development for KIRCO MANIX. “We look forward to tapping our local resources and teaming up with the company as it brings its stellar wholesale shopping experience and new jobs to our area.”

The new clubs and gas stations will feature unbeatable values on a wide assortment of produce, meat, dairy and bakery items; everyday household essentials like paper goods, cleaning supplies and items for your pet; and exciting items with the latest in technology, TVs and apparel. Plus, BJ’s Members can shop faster and save easier with digital coupons, same-day grocery delivery and buy online, pick up in club. The expansion is expected to bring 300 new jobs to the area.

BJ’s two Michigan clubs are expected to open in the fall of 2019.

About KIRCO MANIX

KIRCO MANIX provides construction management services in office, light and heavy manufacturing, distribution, retail, healthcare and community market sectors. The company has operated throughout the region since 1929 and combines the experience of two well-established construction firms, Campbell / Manix and KIRCO Construction. With total construction volume exceeding $3 billion, KIRCO MANIX offers customers a unique, full-service approach by managing the design, engineering and construction phase through the eyes of an owner. For more information, please visit www.kircomanix.com or call 248.354.5100.

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Editor’s Note:   Images and interviews are available by contacting Jessica Muzik. 

CONTACTS:      

Katie Moore / KIRCO

248.680.7180 / katiemoore@KIRCO.com

Jessica Muzik / Bianchi PR

248.269.1122 / jmuzik@bianchipr.com

Global Dow Center Project honored by the Construction Association of Michigan (CAM)

The Global Dow Center Project was selected by the Construction Association of Michigan (CAM) as one of the twelve most outstanding construction projects of 2018 and was honored at CAM’s 133rd Annual Meeting. The project team enjoyed a reception and lunch, followed by a keynote address from Sergeant, U.S. Army, Ret. Sammy L. Davis, a Vietnam War hero, awarded the nation’s highest military medal for valor, the Medal of Honor.

KIRCO and KIRCO MANIX were also recognized in CAM Magazine’s  2018 Special Issue. The article highlights the development and construction of the Dow Global Center in Midland, MI. 

“In 320,000 man hours, KIRCO brought to life the prestigious and aesthetically appealing Dow Chemical Company World Headquarters building – a modern and dreamy empire of concrete, brick, aluminum, glass and steel structure – complete with an executive basement parking garage; mechanical penthouse; majestic, double-height lobby; conference rooms; state-of-the-art, 400-seat cafeteria, four floors of open-office work space with ergonomically enhanced furniture; huddle and break rooms; fitness center; mother’s room for nursing moms; outdoor patio; two sustainable, vegetative green roofs designed to reduce storm water; and a one-acre, decorative pond underneath an enclosed pedestrian connector leading to the Dow Visitors and Heritage Center.

Read the Full Article Here

View the Project Video

About KIRCO

KIRCO is an award-winning commercial real estate development, construction (KIRCO MANIX) and property management organization.  Having planned and developed over 30 million square feet, KIRCO is a major developer of build-to-suit own or lease properties coast to coast.  Because of KIRCO’s vertical integration, with development, construction, and property management under one roof, all facets work seamlessly as one extraordinary unit to bring out the best in every project.  Founded in 1974, KIRCO is third-generation family owned and operated, and has expertise in the corporate services (office, industrial, R&D), retail, senior living and healthcare sectors. KIRCO is headquartered in Troy, Mich. with a presence in Ohio, North Carolina, South Carolina, Alabama and Florida. For more information, please visit www.kirco.com.

KIRCO Named One of the Best and Brightest Companies to Work For in the Nation For 2018®

Troy, Mich., Jan. 29, 2019 – KIRCO – a full-service commercial development, construction (Kirco Manix) and property management organization – has been named one of the Best and Brightest Companies to Work For in the Nation For 2018® by the National Association for Business Resources (NABR).

“We are proud to again be recognized as one of the Best and Brightest Companies to Work For in the Nation®,” said Therese Peace Agboh, vice president, talent and culture for KIRCO.  “The exceptional performance of our company is a result of our engaged and committed associates. We have a mutual commitment to each other through our Founding Principles – to grow our business, treat each other with respect and continue to learn. Receiving this award is an honor and demonstrates that we are living up to our commitment.”

The Best and Brightest Companies to Work For® competition identifies and honors organizations that display a commitment to excellence in operations and employee enrichment that lead to increased productivity and financial performance. The competition scores potential winners based on regional data of company performance and a set standard across the nation. This national program celebrates those companies that are making better business, creating richer lives and building a stronger community as a whole.

As an award recipient, KIRCO will be recognized by NABR at the National Best and Brightest Summit – Illuminate 2019 symposium and awards gala taking place September 15-17 at the Renaissance Chicago Downtown Hotel.

Previously, KIRCO was named a national award winner in 2016 and 2017 by NABR, as well as one of Metropolitan Detroit’s in Best and Brightest Companies to Work For® in 2017.

About KIRCO

KIRCO is an award-winning commercial real estate development, construction (KIRCO MANIX) and property management organization.  Having planned and developed over 30 million square feet, KIRCO is a major developer of build-to-suit own or lease properties coast to coast.  Because of KIRCO’s vertical integration, with development, construction, and property management under one roof, all facets work seamlessly as one extraordinary unit to bring out the best in every project.  Founded in 1974, KIRCO is third-generation family owned and operated, and has expertise in the corporate services (office, industrial, R&D), retail, senior living and healthcare sectors. KIRCO is headquartered in Troy, Mich. with a presence in Ohio, North Carolina, South Carolina, Alabama and Florida. For more information, please visit www.kirco.com.

New Building in Dow’s Corporate Headquarters Replacing the Willard H. Dow Center 2020 Building

New Building in Dow’s Corporate Headquarters Replacing the Willard H. Dow Center 2020 Building

July 17th, 2015

Overview

Dow is focused on driving a strategy that will deliver sustainable, long-term earnings growth through investment in a market-driven portfolio of advantaged and technology-enabled businesses. Delivering this strategy requires a commitment to staying on the forefront of innovation by enabling growth and productivity in the workplace. Aligned to this commitment – and the Company’s long-term commitment to Midland and the Great Lakes Bay Region –Dow will construct a new building in its global headquarters campus in Midland, Michigan, to replace the current 2020 Willard H. Dow Center (WHDC 2020) which is being demolished.

This development is part of a broad, ongoing Company initiative to drive increased collaboration, growth, and innovation-aligned business practices. The open-plan design of the building and technology upgrades reflect Dow’s focus on engagement and streamlined communication to propel the Company’s culture forward. The building’s sustainable and adaptable design is further expected to advance employee productivity that will benefit customers and the markets Dow serves.

The new building will include a visitor reception area, customer conference rooms, and a cafeteria with an outdoor patio space overlooking a pond feature and natural area. Construction will begin in third quarter 2015 and the building is expected to be occupied and operational by the end of 2017. 

Construction Advantages

Over the last decade, Dow has made several major upgrades to aging facilities in Midland, and constructed new buildings including the Business Service Center and Michigan Division Headquarters.

Demolishing the obsolete WHDC 2020 Building and constructing a new facility has multiple advantages, offering greater efficiencies in energy, land and water use, and will improve operational costs over the long-term including:

  • 20% lower construction costs compared to revitalizing the WHDC 2020 building
  • 63% reduction in energy consumption compared to the WHDC 2020 Building
  • 43% reduction in greenhouse gas emissions compared to the WHDC 2020 Building
  • 38% utilization improvement (square foot per workplace capacity)
  • 46% less gross building square footage

Building Profile

The six-story, open-plan building will include space for approximately 600 employees and contractors, and will be developed using both Dow materials and recycled resources from the WHDC 2020 structure. The building is targeting LEED certification when complete.

Sustainability and technology features include:

  • The latest in audio visual and internet technologies to enhance productivity and innovation
  • Flexible office space, meeting rooms, media centers, huddle rooms and break rooms to foster greater collaboration and efficiency
  • Open work environments designed to embrace collaboration and enhance the well-being of employees in the workplace
  • Industry-leading office design standards will be implemented to ensure the most efficient, productive, and cost-effective use of space
  • Green (vegetative) roofs will provide energy savings, mitigate heat island effects, and dramatically reduce storm water runoff
  • 20,000 tons of material from the demolition of WHDC 2020 will be designated for recycling
  • More than 10,000 tons of concrete from the WHDC 2020 building will be recycled and used for various substructure elements and temporary roads
  • 20% of building products will be from recycled materials

 Project Partners

The new facility will be developed by KIRCO, a company based in Troy, Michigan, with more than 40 years of experience in energy efficient construction and corporate project management. Kirksey Architecture of Houston, Texas, will act as architect on record for the facility, bringing their experience in sustainability that has led to more than 27 million square feet of LEED certified projects.

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