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CONSTRUCTION KNOWLEDGE BLOG

May 18, 2012

Chicago Infrastructure Trust: You Heard It Here First
Filed under: Industry outlook — Tags: — nedpelger

Remember that scene in The Graduate when Dustin Hoffman, as a recent college graduate, gets some sage advice? Take 22 seconds to watch it:

Well I’m going to give you the word for our times. Actually,  let me give you the phrase: Chicago Infrastructure Trust. Imagine Rahm Emanuel whispering it to you at a party.

As most folks in America know, we haven’t been spending enough to repair our infrastructure. Inefficient transportation systems and buildings cost our society $130 billion in 2010, mostly because of higher running costs and travel delays, according to The Economist. The American Society of Civil Engineers calculates (which is something they’re good at) that this under-investment will cost each American family over $10,000 US between 2010 and 2020.

We all also understand that no political will exists to get this money raised through traditional public sources: raising taxes, selling municipal bonds, etc. So, the Chicago Infrastructure Trust (CIT) shows a new way. It’s not an infrastructure bank so much as a project facilitator, matching public infrastructure needs and private investor wants.

The Economist article says it well:

The CIT allows Mr Emanuel to tap the private sector for money, rather than just raising taxes and borrowing. The private sector will invest money in projects and get it back in the shape of tolls, user fees, premium pricing or even tax breaks.

The first project is an investment of $225m to make city buildings more energy-efficient. This is expected to reduce annual energy costs by $20m, and the savings will then be used to pay back the investors. The CIT will provide some capital, bond financing and grants. It will also offer tax-exempt debt to entice investors. Returns on investment could vary from 3% on tax-exempt bonds to 8% for equity partners.

The beauty of the CIT system, to me, is the private investor direction and oversight. Goofy projects that don’t make sense (which so often proceed in the public process), simply won’t find traction among private investors. Also, the private investors will tend to demand better selection, design and construction management. The private investors (think smart financing executives) will push for efficient pricing of public resources like parking and busy roads, allowing the free market to improve our public works.

Certainly many details need to be resolved and safeties need to be in place, but the CIT will be the future model for public investment. If you agree, you may want to think about how you could productively align yourself with the trend. Knowing an important trend early can be a huge advantage.

Now, if you have a few more minutes, why not treat yourself to the amazing conclusion of The Graduate? You know you want to.

CONSTRUCTION KNOWLEDGE BLOG

May 15, 2012

Building Inspector Rag
Filed under: People Skills — Tags: — nedpelger

A building inspector on a large project we completed was complimenting the way our team worked. He mentioned how we strive to get all the info a tradesperson really needs on the drawings and how we make quick decisions to resolve potential problems. He especially liked how pleasant we were with him in resolving difficult issues.

Then he told a story about another project. A commercial building was being built without a building permit. When the Authority Having Jurisdiction found out, they assigned this Building Inspector to go an ascertain the status. He requested they dig up the foundation at one location so he could evaluate the footing and that he look above the finished ceiling at one location.

The Building Owner fussed and cussed. The Building Inspector simply walked away, thinking, “Let the Township handle this.” It took a few weeks, but the Building Owner called the Building Inspector, just as nice as cherry pie, and asked, “Which spot do you want the footing exposed and to look above the ceiling?”

The Building Inspector replied, “I want every single inch of the footings exposed and the entire ceiling taken down.” And that’s the way it went.

Moral? Consider consequences…and learn to keep your pie hole shut.

CONSTRUCTION KNOWLEDGE BLOG

May 14, 2012

A Game of Chicken on the High Speed Rail
Filed under: Industry outlook — Tags: — nedpelger

ENR reports that Transportation Secretary Ray LaHood, acting on behalf of the Obama Administration, has given an ultimatum to California: either vote in June to provide the matching state funding for the high speed rail from Bakersfield to Fresno or lose the $3.3B US federal grant. I struggle when I think of 3,300 million dollars. That’s a lot of scratch…to continue the chicken analogy.

The CA Legislature had planned to vote to authorize the funding, but moved toward more hearings in the summer and delay the decision till August.

“We need the Legislature to make the strongest commitment possible,” LaHood said in an interview. “The way to do that is to include the money for high-speed rail in the budget that is passed in June. August is too late for us.”

Of course the CA legislators respond that they want to follow their plan and not be pushed around. So it will be interesting to see who jumps aside in this game of chicken.

As I understand it, the first high speed rail section from Bakersfield to Fresno will cost about $6B, but the entire project cost from LA to San Francisco will run $68B.

While the construction industry certainly could use some stimulus, it’s amazing to me to see projects like this under consideration. Adding flights seems so much more efficient.

When President Eisenhower dreamed and financed the interstate highway system, that government investment made USA more efficient to do business than anywhere in the world. Why are we now jerking around with high speed rail to make for comfortable commuting (which already has several viable alternatives) and not high speed internet access for the entire country? Or a more bulletproof electrical grid?  Who is driving the dream?

CONSTRUCTION KNOWLEDGE BLOG

May 11, 2012

Friday Fun: Push to Add Drama
Filed under: Ned Weirdness — Tags: — nedpelger

You are walking through a charming square in Belguim and you see a big red button with a sign hanging above that says, “Push to Add Drama.”

What do you do? If you work in construction, my guess is that you push the button. Click on the link and you’ll see what happens:

httpv://www.youtube.com/watch?feature=player_embedded&v=9OIJRMqYAA0

Hope you had a good week that didn’t have too much drama. As for me, I had more than my share this week. Oh well, I’ll just work harder next week.

CONSTRUCTION KNOWLEDGE BLOG

May 9, 2012

Bird Brain
Filed under: Industry outlook — Tags: — nedpelger

I read an article in ENR that opened with:

As California Department of Transportation Construction Manager Douglas Coe tells it, the key to success on a very complicated seismic retrofit of the Antioch Toll Bridge is the mastering of the three B’s – birds, bearings and bracing.

Now I understand that a seismic retrofit for a bridge would involve some work on the bridge bearings and the bracing structure, but why did birds top the challenge list?

Turns out that Caltrans knew that Barn Owls, House Finches, Cliff Swallows, Barn Swallows and Northern Mockingbirds all build nests on the bridge between February and September. If a nest is built and eggs laid, then all work has to stop for the 6 to 12 weeks till the eggs hatch and birdies fly away.

So a $35M US project halts, costing tens or hundreds of thousands of dollars for a barn swallow egg? I’m wondering who has the bird brain in this scenario. How have we gotten to the place where this behavior makes sense?

I’m in the process of awarding a large site package and talking to several older estimators (my age) about the project details. We easily track onto how things were in construction and how they are now. The increase in silly rules and paperwork dominates those conversations. Can our society ever move away from special interest initiatives and back toward common sense?

CONSTRUCTION KNOWLEDGE BLOG

May 7, 2012

Construction Unemployment Rate Falls, But 2,000 Jobs Lost
Filed under: Industry outlook — Tags: — nedpelger

So how can the Construction unemployment rate for April 2012 fall to 14.5% (from 17.2% in March) but the industry lose 2,000 jobs? As ENR reported, the laid off construction workers find jobs outside the construction industry. In fact, though the unemployment rate has steadily dropped, the construction industry employs less workers than in April 2010.

According to the Bureau of Labor Statistics’ latest monthly report, though, the architectural and engineering services have added 7,400 jobs in the last month. That’s normally a harbinger of good news for construction.

As I’ve been writing for over a year, if Europe doesn’t melt down, we should be on our way to a reasonable recovery in construction. We certainly see it here.

CONSTRUCTION KNOWLEDGE BLOG

May 4, 2012

How to Use an Extra Elevator Shaft
Filed under: Cool Projects — Tags: — nedpelger

If you find yourself renovating a building with an extra elevator shaft, what are your options? Some quirky spiral stairs? Lots of floors with small rooms with off-set firemen’s poles? How about a toilet?

Found on Interior Design and Inspirational Homes, this toilet room located in an old elevator shaft would encourage bowel looseness. That is to say, a sit down would likely scare the crap right out of you.

Designed by Hernandez Silva Arquitectos and located in Guadalajara, Jalisco, México, this penthouse on a 1970s 15 story building inspires.

The living room looks fantastic

and the balcony view works.

Oddly enough, we have some weirdly similar design challenges coming up in the next few months, so I’m motivated to see this design done so well. I love to see really good work.

CONSTRUCTION KNOWLEDGE BLOG

May 1, 2012

ShopBot: A Tool Looking for Opportunities
Filed under: Carpentry — Tags: — nedpelger

For $5,000 US, you can purchase a small CNC machine. This small Computer Numerically Controlled milling machine can do amazing work. The ShopBot cuts aluminum, plywood, plastic and lots of other materials. Google SketchUp can direct the cutter to make almost anything you can dream.

Here’s an excerpt from the Boing Boing article:

I work at Stanford’s design school — called the d.school. We designed and made much of the furniture we used in our new building space in Google’s Sketchup and machined the material using a 4′ x 8′ ShopBot owned and operated by Rob Bell. The process was very fast, and relatively cheap. ShopBot + Sketchup allowed us to do many cycles of design/build/test, which ultimately yielded some very refined artifacts.

This tool will create some great opportunities for some creative construction folks. If you think about the projects you do, then how a tool like this could change things. Then think about a way you could get paid to be the person that makes those changes happen. For someone, this will be a wonderful opportunity.

Do you have any ideas how this could be used in construction?

CONSTRUCTION KNOWLEDGE BLOG

April 30, 2012

Amazing Longhouse Volunteer Day
Filed under: Cool Projects — Tags: — nedpelger

We hoped for 100 volunteers to strip the bark off saplings for the Eastern Woodlands Longhouse we’re building. We got over 250 folks that came and worked.

I worried that volunteers would get frustrated with getting the bark off the hickory trees, particularly the many shagbark hickories. We were told every bit of bark would need to be cut off with a drawknife. We found a stripping secret that allowed the workers to peel the bark off in large sections. In fact, some of the folks managed to peel an entire tree and deliver only big piece of bark. These folks (see the man below in a blue hat) got inducted into the “Strippers Hall of Fame”.

We had a great time. Native Americas walked the site with a smudge pot burning cedar and sage, cleansing our spirits and bringing us peace. Dereck Hench and the Bottomline Contracting crew did a great job showing the volunteers how to get started stripping the various species of trees. Their expertise kept the volunteers from getting frustrated. In fact, most of the volunteers seemed to love the feeling of successfully peeling the bark off a sapling and going for another.

By the end of the day, we got all the main saplings stripped. We didn’t expect to get half of them done.

Tomorrow we start putting the steel pipes in the ground, concreted to prevent uplift and stoned to aid in drainage. It’s such a fun project.

CONSTRUCTION KNOWLEDGE BLOG

April 26, 2012

Construction Presentation Tips
Filed under: Construction — Tags: — nedpelger

Do you ever need to convince someone that your firm is the one to hire? Here’s a great video that will make you laugh and give you an example to avoid.

Think hard about the work you do, who your best customers are and why they choose to work with you. Know where you add the most value and stick to that.

I got offered the chance to manage a $20M construction project today by one of my favorite customers. As soon as he told me about the project, though, I told him I wasn’t the guy to do it. It was a few hours further away then I normally work and was a type project I don’t typically do.

He’s worked with me on many projects and believes in my capabilities. He was amazed that I immediately told him I wasn’t a fit for the project and told him a good way to proceed. To be successful, we need to focus on what we do best and not be greedy. When we grab for work out of greed, nobody wins.

The video above reminded me of one that a cycling buddy sent me. If you happen to like riding a bicycle, take a few minutes and watch this video. I laugh out loud when I watch it. Cyclists truly are knuckleheads.

By the way, if you watched both videos, you noticed that they were produced on the XtraNormal.com site. That seems like a reasonable way to create some fun content.

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