Construction Cost

Capital construction costs for institutional projects will continue rising across much of the nation due to growing market strength, regional labor shortages, rising commodity prices, and an increase in mark-ups. Construction volume, the industry’s biggest cost driver, continued its steady increase—up more than 18 percent in the third quarter of 2013 from the bottom in March 2011. At the current rate of growth, construction prices will surpass the industry trend line in 2014, repeating long-term cyclical patterns.

Eastern Kentucky University's utility costs have remained stable over the last two years due to the implementation five years ago of an Energy Savings Performance Contract (ESPC) with Siemens Building Technologies. Aiming to generate savings and address deferred maintenance needs, the $27 million contract included extensive infrastructure upgrades to HVAC, lighting, and water systems, as well as the integration of building automation technologies.

The American Institute of Architects (AIA) today announced the release in November of 2013 of seven new Sustainable Projects (SP) contract documents. The release includes SP versions of the AIA’s two families of Construction Management documents, Construction Manager as Adviser (CMa) and Construction Manager as Constructor (CMc), as well as B103–2007 SP, Standard Form of Agreement Between Owner and Architect for a Large or Complex Sustainable Project.

Offsite prefabrication of building modules can potentially transform the construction process in the United States, according to two engineers who have implemented the technique on multiple project sites. The experience of Ed Szwarc and Dean Poillucci of Skanska USA Building, Inc., indicates that assembly of such units at offsite construction facilities (OSCFs) radically compresses schedules and improves safety while also providing cost savings.

Blindly trying to incorporate all the cutting-edge technologies and processes in the delivery of a new facility can lead to more waste than value. It’s important that building owners understand which Lean design principles, innovative technologies, and sustainability strategies meet their needs and add value to their specific project in a way that maximizes lifecycle performance, says Andreas Phelps, integrated projects executive at Balfour Beatty Construction.

The following is a condensed transcript of a panel discussion from Tradeline’s 2013 International Conference on Research Facilities. The panelists are William Gustafson, principal at Ballinger; Steven Frei, principal at Affiliated Engineers, and Michael Reagan, vice president of Stantec. The moderator is Steve Westfall, founder and CEO of Tradeline.

UMass Memorial Health Care opened its 14,000-sf Cancer Center at Marlborough Hospital in September of 2013. Designed by The S/L/A/M Collaborative, the $12.8 million facility features an illuminated entrance pavilion, an infusion therapy space with abundant natural light, and a healing garden with a reflecting pool.

Fairfax Hospital is implementing Integrated Project Delivery (IPD) in the $20 million expansion of its Kirkland facility. The 68-bed addition was designed by Boulder Associates and is being constructed by BNBuilders. The project team includes 12 firms participating in the IPD process, all working in close collaboration to deliver an advanced facility at a lower cost as compared with traditional construction methodologies.

The Sandler Neurosciences Center at the University of California, San Francisco (UCSF), is a developer-built facility created through innovative planning, development, design, and research. A public-private partnership—an alternative to the traditional design-bid-build model—applies private-sector efficiencies to an institutional project. Benefits include faster delivery, lower costs to build and operate, and reducing institutional risk by shifting responsibility for construction and ongoing maintenance to the developer.

North Middlesex University Hospital (NMUH) will open the two-story, 84,000-sf Women & Children’s Centre in London in November of 2013. The project is being delivered using the ProCure 21+ framework, with the building components being prefabricated in York by modular construction specialist Yorkon working in collaboration with main contractor Kier Construction. The facility will include 152 steel-framed modules with pre-installed utilities, doors, windows, and floors. The architect and project manager is AHP.

The University of North Carolina Hospital is using Building Information Modeling (BIM) to manage construction of its $156 million campus in Hillsborough. Designed by ZGF Architects, the project includes a 240,000-sf patient tower, a 14,000-sf central plant, and a three-story medical office building. Partnering with construction manager Skanska USA, UNC Hospital used BIM to plan the location of underground utilities, including integrating multiple building systems with existing rock formations.

Suffolk University is planning to build a $49 million academic building in Boston. The 10-story, 110,000-sf facility will provide classrooms, teaching labs, faculty offices, an art gallery, and a cafeteria. The project team includes architect NBBJ and general contractor Suffolk Construction. Lean construction methodology will be employed in the delivery of the project, as well as Virtual Design and Construction (VDC) technologies. Occupancy is expected in July of 2015.

Lacking space for its health science programs but faced with a limited budget, the University of Georgia is repurposing a former Navy Supply Corps School as a new Health Sciences campus, salvaging a property slated for closure and creating a more modern, collaborative learning environment. Throughout the renovation process, the challenges have been managing end-user expectations, balancing practicality with functionality—including reusing some materials—and dealing with diverse properties in this compatible but not perfectly matched space.

The California Institute of Technology uses facility condition assessment and data-driven analysis to determine the best investment strategy for limited recapitalization funds. Combined with the institutional discipline to demolish or mothball buildings, Caltech minimizes costs and maximizes immediate functionality, while making funding decisions that support the institutional mission.