the newsletter of tbd consultants - 1st qtr 2018

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In this Edition

Data Centers
Pricing International Projects
Construction Prospects in the US & Europe

Construction Management Specialists

111 Pine Street, Suite 1315
San Francisco, CA 94111
(415) 981-9430 (San Francisco office)
6518 Lonetree Blvd., Suite 164
Rocklin, CA 95765
(916) 742-1770 (Sacramento office)
9449 Balboa Avenue, Suite 270
San Diego, CA 92123
(619) 518-5648 (San Diego office)
8538 173rd Avenue NE
Redmond, WA 98052
(206) 571-0128 (Seattle office)

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Los Altos, CA 94024
(650) 386-1728 (South Bay office)

7083 Hollywood Blvd., 4th Floor
Los Angeles, CA 90028
(424) 343-2652 (Los Angeles, CA office)
78 Heathervue, Greystones
Wicklow, A63Y997, Ireland
+353 86-600-1352 (Europe office)


Data Centers

Data is the hot commodity these days, and in this article we look at the design of data centers, and how that design is changing.


Pricing International Projects

Here we look at the resources and techniques for estimating construction costs in 'far away places with strange sounding names'.


Construction Prospects in the US & Europe

The US construction market continues to follow the economy, which, in general, is prospering very nicely. Some regions are prospering more than others, of course, but the differences between regions of Europe are even more profound.

The recovery from the Great Recession has proved to be a bit slower in Europe, although things are moving in the right direction. Growth has been seen in nearly all EU countries since 2014, although it has tended to be slower in southern Europe, in countries such as Portugal, Spain, and Italy.

The European construction market has seen substantial growth in many areas. For instance, in Ireland the construction industry has seen output expanding over 10% in recent years. However, Ireland was one of the hardest-hit nations during the recession, with construction volume reducing to about a third of what it had been, i.e. a 66% drop. The average drop in construction levels across Europe was more like 25%. Despite rapid growth in recent years, construction levels in Ireland are still well below the highs of the 'Celtic Tiger' era, and are expected to remain so for a few years to come.

On the above chart we have plotted our San Francisco Bay Area bid index against the Irish construction cost index (prepared by the SCSI) and the labor and material increases (which are virtually the same for both areas). For comparison purposes, the starting point of all three indices has been adjusted to 100 for the start of 2003.

The EU is actively promoting the adoption of new technology in construction, and is promoting green buildings, especially with regard to energy efficiency. With the construction industry contribution almost 10% of the EU GDP, promoting growth in this sector helps the regions economy overall.

As with the US, the European construction market is suffering from a lack of skilled personnel. The recession saw many people leaving the industry, and it has been hard to attract them back to a notoriously cyclical workplace. Couple that with the fact that the younger generations are tending to avoid an industry that they view as largely technically outdated, and it becomes obvious that innovation in how construction is carried out is becoming essential, if the construction needs are to be met. Such innovations are likely to include prefabrication of large portions of a building offsite, and autonomous, or robotic, site equipment drawing information from the GPS network and directly from the BIM files.

One concern in the US is that the rising cost of construction will be starting to deter investors. However, the latest CONFINDEX report shows that the construction industry in the US is expressing optimism for at least the next year, and the prospects for Europe appear to be at least as healthy.

Happy New Year to all!

Geoff Canham, Editor, TBD San Francisco
Colin Fulham, TBD Europe office, Ireland



Design consultant: Katie Levine of Vallance, Inc.