ThinkstockPhotos 513792676By Michael J. Vardaro

As we embark on 2017, three trends in the construction industry will undoubtedly shape the industry. All eyes are turned to the impact of the President-elect’s infrastructure mandate and to what extent it will dominate the early part of his administration. This country’s infrastructure inventory is in dire need of work; how and when that work gets done remains to be seen. In addition, offsite construction technology and the design/build project delivery method will continue to transform projects.

Sutherland MIT Sloan graphic 2

Figure 1: Acquisition, Development, and Construction Loan Growth, Bank Failures, and Deposit Insurance Fund Losses by Region. (Source: United States Office of Inspector General 2012, pg. 6).

By Andrew Sutherland

Lax mortgage lending by banks has long been recognized as a major cause of the financial crisis. But banks played another, lesser-known role in the crisis. In much the same way that banks failed to verify the creditworthiness of people buying homes, banks also neglected to verify financial qualifications of those building homes — developers, contractors and other firms in the construction industry.

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By Elan Parra

Managing potential fraud is a fact of life in many industries, but it’s especially true in construction. While the good guys far outnumber the bad, if you own or manage a construction business, it’s likely that you will encounter fraud at some point eventually. When it happens, having a few simple measures in place can save your company from irreparable damage.

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By T. Michael Toole

For the first time, the United States has a President-Elect who has not only pledged to invest substantially in infrastructure, but also has a professional background that includes overseeing the financing, design and construction of large building projects. Also noteworthy is the fact that Mr. Trump was elected in part by working class people who feel their needs have not been fully considered in recent years.  

There is now a unique opportunity for our new Developer-in-Chief to ensure that the greatly needed renovation and enhancement of our nation’s infrastructure does not occur at the expense of the safety and health of our nation’s six million construction workers. To do this, the President-Elect can promote Design for Construction Safety.

2By Roy Rasmussen

The construction industry is poised to rebound and grow in 2017 after a temporary slowdown this year. Construction starts will grow 5 percent next year to reach $713 billion, according to Dodge Data & Analytics. As the construction industry recovers from this year’s slump, competition will be fierce for new business emerging from a growing market, as companies coming out of today’s saturated market strive to win over new customers.

One of the keys to winning over customers against your competition is to deliver superior customer service. Here are four ways to build your customer base and expand your construction business.

Crane 1By Jake Morin

A commercial general liability (CGL) policy is a standard insurance policy issued to protect business organizations from certain liability claims. This type of policy is intended to protect businesses from certain financial losses that may arise from construction-related claim, such as personal injury or property damage. However, recent court rulings in several states have resulted in a broader interpretation of what should be covered by CGL policies. Such rulings effectively turn the CGL policy into a warranty, which it is not intended to be. The intention of the CGL policy is to cover property damage and bodily injury that occurs as a result of the work being done, not to provide a warranty against any potential subpar work.

At first glance these recent rulings might sound beneficial to clients and construction companies with the onus falling on insurance companies to cover the costs of these claims. However, these kinds of unprecedented payouts could have long-term consequences. The additional costs insurance companies will accrue as a result of covering this extra layer of claims may result in insurance companies significantly increasing their insurance rates in impacted states, or pulling out of specific states altogether.

ThinkstockPhotos 155673118By David Finkelstein

Construction companies are safety-conscious for good reason. Fewer accidents mean fewer delays, higher worker morale, lower insurance costs and avoidance of OSHA fines. Ensuring that workers do only jobs they’re trained for is one of the most critical steps in a safety program. An untrained worker who botches a job may injure himself and others, damage expensive equipment, cause fires and release hazardous materials. But in the rush to get things done, proper vetting can get overlooked.

ThinkstockPhotos 483808004By Tony Sinisi 

Even today, in the age of connectivity and a technology solution for everything, many building owners still rely on manual e-mails, spreadsheets and PDFs to manage construction projects. This isn’t all that surprising: historically, the construction industry has been slow to adopt new technology. In fact, according to a recent KPMG survey, two-thirds of the 200-plus construction executives surveyed said they do not use advanced data analytics to monitor project-related estimation and performance.  However, as many are discovering, this obsolete method isn’t working.

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