Construction Cost

The economy started out the first quarter of 2016 in good shape, as energy and commodity prices stabilized at reduced levels. This led to more construction activity nationwide, with average prices coming in at an annual escalation rate of around 6 percent, depending on location. Construction job growth and dollar volume both continued upward trends as non-residential construction spending rebounded 48 percent from its most recent bottom in 2011. On balance, current indicators support stable construction growth over the short-term.

Dubai Electricity and Water Authority is planning to construct the $136 million Research & Development Center at the Mohammed Bin Rashid Al Maktoum Solar Park in Dubai. The four-building facility will be constructed using 3D printing and will support the creation of drones and 3D printing technologies for applications including solar power, energy efficiency, smart grids, and photovoltaic desalination.

JHL Biotech opened a biopharmaceutical manufacturing facility in May of 2016 in Wuhan, China. Featuring single-use bioprocessing technologies, the cGMP facility utilizes GE Healthcare's prefabricated KUBio system to produce biosimilars and monoclonal antibodies for late–stage clinical trials and commercial supply. The project was completed in just 18 months.

Embry-Riddle Aeronautical University has awarded Sundt Construction the design-bid-build contract for a new teaching and research facility in Prescott, Ariz. The 52,570-sf addition will provide classrooms, an auditorium, and labs for robotics testing, optics research, and high-speed computation and simulation. Featuring advanced building systems and exterior finishes, the project will support programs in applied science, aviation, business, engineering, space, computing, cybersecurity, and defense. Completion is expected in just 13 months.

STEM facilities built in the 1960s and 1970s aren’t up to hosting today’s science, and universities across the nation are wrestling with the question of how best to move forward. Building a new science facility isn’t always an option, due to funding limitations, insufficient swing space, or lack of administrative or political support. Fortunately, in-place transformation projects can often deliver a revitalized STEM environment for a significantly lower cost, if you begin with a solid roadmap, evaluate the building’s “bones,” and don’t underestimate your power to transform a building.

Beijing Construction Engineering Group and the University of Huddersfield in the United Kingdom have signed a five-year agreement to collaboratively develop Building Information Modelling (BIM) technologies. The partnership will leverage BCEG's expertise in lean construction practices with the University of Huddersfield's new degree program in Design Integration and Building Information Modeling. The Memorandum of Understanding (MOU) will also create employment opportunities at BCEG for both undergraduate and postgraduate students.

The U.S. economy continued growing at a healthy rate in 2015, adding approximately 221,000 jobs per month over the year. Wage and profit increases in the construction sector are expected to pull new entrants into the labor force with some restructuring from other sectors of the economy, for example energy and exports. Construction prices increased nationally, trending toward 8 percent, depending on location.

Construction Costs

The University of Cambridge is planning to build a $125 million biomedical research facility in the United Kingdom. The six-story, 190,000-sf Project Capella will house the Cambridge Stem Cell Institute, the Milner Therapeutics Institute, the Cambridge Institute of Therapeutic Immunology & Infectious Disease, and the Cambridge Centre for Haematopoiesis and Haematological Malignancies. Lean construction methodology will be implemented in the delivery of the facility, which is slated for completion in the second quarter of 2018.

Complex technology, expanding program, and increasingly specialized and segmented roles and responsibilities often create a disconnect in the process of designing and building sophisticated facilities. The result can be a research or diagnostic lab or high-containment animal building that becomes a burden to the owner, whether because it hasn’t been right-sized, is not energy efficient, or operates with sub-par reliability. The solution is to assign someone the task of aligning design decisions with the building’s ultimate scientific mission.

The Pennsylvania State University's Health and Human Development Building was awarded the 2015 Gold Project Leadership Award in November of 2015 by the Construction Owners Association of America (COAA). Completed in summer of 2015, the structure was the second building of a two-phase expansion of the College of Health and Human Development, collocating several research centers near the main academic departments.

Decreases in energy and commodity prices have driven growth and pricing increases in the non-residential construction market and other sectors of the economy. Year-over-year non-residential construction growth is currently at 25 percent. Combined with a total volume growth of 17 percent in 2014, the sector is approaching a 52 percent rebound in spending from its most recent bottom. Price increases for 2015 are trending toward 8 percent, depending on location.

The siting of sensitive instruments in a research facility requires awareness of the electromagnetic field (EMF) environment and the various types and locations of emission sources. Some of the most difficult electromagnetic interference (EMI) challenges include DC and geomagnetic sources such as cars, trucks, subways, and trains, as well as facility elevators. The EMI footprint from the movement of an elevator through the earth’s magnetic field can exclude large areas of a facility from housing sensitive tools and instruments.

Baylor Scott & White opened its Marble Falls Medical Center in August of 2015. The 188,000-sf acute care hospital will provide primary care, general surgery, and a comprehensive array of medical specialties. The 46-bed medical center houses an eight-bed intensive care unit, two operating suites, and a birthing center. The project was designed for ease of expansion to enable the build-out of two additional operating suites, four ICU beds, and 30 medical-surgical beds at a later date.

Major economic indicators point to healthy growth for the remainder of 2015. Non-residential construction spending has rebounded nearly 50 percent from its most recent bottom in 2011, with a total volume growth of 17 percent in 2014. Year-over-year growth is currently 21 percent. Though commodity and energy prices were lower in the first quarter of 2015, the construction sector is nearing full employment, which will drive significant wage increases regionally.

Using a phased, core-and-shell strategy to construct the 310,000-gsf Life Science Laboratories (LSL) building allowed the University of Massachusetts Amherst to obtain high-level research space and take advantage of the competitive bid market and economic incentives available in 2010. The approach also provided economies of scale and the advantage of postponing programming and occupancy decisions with subsequent fit-outs.