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7 Reasons the Benefit of BIM Is Now

Posted on 06/01/2017 in Construction, Homebuilding - 0
BMI-Proposition

Building information modeling – or BIM – is a powerful business platform that uses 3D visualization to convey a building’s materials, construction, and architecture. Its complexity and power have made it ideal for large-scale commercial projects…but the time is coming for its use in single family and multifamily residential applications.

In a new piece for Multifamily Executive, Continuum Advisory Group’s Clark Ellis argues that time is now:

“The benefits of BIM greatly outweigh the risks. In fact, a deeply ingrained human flaw may be at the root of the reluctance of many to get started: Most of us tend to underestimate the risk of not changing our habits, behaviors, processes, strategies, and the like. At the same time, we overestimate the risk of change.”

By examining a mixture of technological advances, consumer demands and operational efficiencies, Clark outlines seven reasons your multifamily residential company could benefit from BIM.

Read the full article HERE.

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CURT 2017 Keynote: Excellence in Total Project Performance

Posted on 03/02/2017 in Construction - 0
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At the 2017 CURT National Conference in Chandler Arizona, Gretchen Gagel, President and COO of Continuum Advisory Group, presented the preliminary findings of the CURT and Continuum Advisory Group annual Owner Trends Study. Through this year’s study we explored:

• What sets above average project teams apart
• The cultural factors that differentiate above average organizations from average and below average organizations
• Best practices utilized in achieving excellence in total project performance
• What more owners and their A/E/C partners need from each other to achieve excellence

As one of our study participants said, “At the end of the day, we only achieve true
excellence if all stakeholders feel that it was a successful project for them. That includes our most important customers – the business units we serve.”  –Michael Mayra, Construction Group Manager, General Motors

For more, download the full keynote presentation below.

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Viewpoint: Accelerate the Changes As published by ENR

Posted on 01/28/2015 in Construction, Engineering - 0

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Ten years ago, I left the construction industry because I needed a change. I wanted a break from the constant travel, and I wanted to get to know my home town of Denver again. So I took an opportunity to run a foundation and, later, became assistant dean at the University of Denver’s business school. Last year, I was coaxed back to the construction industry to become president of Continuum Advisory Group, a management consulting firm focused on our industry. After a decade away, I decided to catch up on what I had missed by interviewing 40 owners of the industry’s largest firms, many of them past clients.



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PRESS RELEASE: Continuum Advisory Group Releases Trends Study in Engineering and Construction

Posted on 12/18/2014 in Construction, Economic Overview, Engineering - 0

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Denver (Dec. 18, 2014) – Continuum Advisory Group, a management consulting firm with a vision to transform the worldwide building and construction industry through revolutionary innovation, has just released a qualitative study on the economic cycles and key trends in capital asset construction for the next decade.



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Key Owner Trends: Gone Are The Days… Challenges of the Next Decade of Capital Construction and Facilities Maintenance

Posted on 12/10/2014 in Construction, Economic Overview, Engineering - 0

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THERE IS NO “NEW NORMAL,” SOME FUTURE STATE WHERE CHANGE WILL CEASE.

We know for certain that change is the constant of our future, driven by factors such as global political unrest and swinging economic cycles, and that the world is continuing to change at an ever-increasing pace.

For the second part of this qualitative study, we interviewed 40 of the largest organizations in the world, both private and public, including oil & gas, healthcare, hi-tech, transportation, education, commercial, power generation and distribution, and pipeline construction. With the theme of ever-increasing change in mind, we asked them a simple set of questions. What keeps you lying awake at night? What challenges do you foresee in the next decade relative to capital construction and facilities maintenance that your organization absolutely MUST address in order to remain competitive? How will you effectively address the need to change and continually improve?



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Nimble By Nature as Published by Utility Contractor

Posted on 11/14/2014 in Construction, Utility - 0

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Success in 2015 Depends on Being Flexible in the Utility Market.
In an environment that will exhibit disruption and change, being nimble is a necessity. The concept of being flexible rather than ridged in the face of change is one that for many industry participants is counter intuitive. Bruce Lee might have said it best when he suggested the following: “Empty your mind, be formless. Shapeless, like water. If you put water into a cup, it becomes the cup. You put water into a bottle and it becomes the bottle. You put it in a teapot, it becomes the teapot. Now, water can flow or it can crash. Be water, my friend.” Those leaders who adapt, change and are nimble in the coming decade will thrive while those who remain ridged will be ground down the way water cuts a canyon.



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August 2014 Economic Overview

Posted on 08/15/2014 in Construction, Economic Overview, Engineering - 0
Summary

While 2013 closed well, the ’14 winter punished the economy, construction markets, and design & construction service providers. The bounce back continues despite lingering unemployment and a volatile global economy. Fed tax receipts YTD are up 3.3% (individuals) and 15.6% (corporations), reducing the deficit. Mid-term elections halted all but the most critical legislation. Single-family housing is improving in the face of moderate headwinds. Domestic oil & gas continues big growth and the energy/utility construction market is feeling the pressure through additional projects, faster schedules, and labor shortages. The Fed’s bond buying fell to $35B per month from $75B yielding inflation trending toward the 2.0% target. Continuum’s forecast of a short and shallow recession during early 2015 persists, although it is less likely. All in all, risks are modest and economic progress is positive, slow and steady.


General Economy

  • 1Q’14 GDP growth revised down to dismal -2.9% due to hard winter; Economists expect 2Q’14 improvement and strong finish to 2014
  • Consumer confidence at highest level since ’08-’09 recession; Auto sales at eight-year peak; Employment trending upward
  • Continued Fed tapering may lead to rise in interest rates during 3Q/4Q’14; Unexpectedly rates fell during 2014 YTD

Unemployment

  • 288,000 new jobs in June; Unemployment to 6.1%, a new low since ’08; Labor participation rate is falling, low, and problematic
  • 3.1 million long-term unemployed (> 27 weeks) is highest rate of long-term joblessness since World War II
  • June construction unemployment is down to 8.2% from a high of 27% in February ’10
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Political Environment

  • $130B deficit for May ’14 is 9% improvement from May ’13; Spending cuts and increased tax revenues expected to push deficit projections lower to close out 2014… deficit spending to continue based on President’s 2015 budget
  • High-stakes midterm elections loom; Look for executive action (minimum wage increase, etc.) to be a top issue

Finance & Banking

  • Continued tapering of Fed bond buying to $35B per month (vs. $75B in Jan 2014); End to bond buying by 2015
  • Liquidity extremely high driving high equity returns on top of a fantastic 2013; Equity gains YTD: DJI +2.7%; S&P 500 +7%; NASDAQ +6.6%; 10-year UST yield (2.6%) trending down YTD and was unplanned and unexpected
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Surety

  • 2014 YTD losses flat; Overall, multi-year results are unprecedented and highly positive attracting new surety companies to market
  • Soft market, loosening underwriting, higher capacity, and competition on indemnity are accelerating for surety providers and making it easier for contractors to obtain bonding support
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State & Municipal
Agencies

  • Balanced budgets, spending constraints, and tax revenue growth are placing many states and cities on more solid financial footing
  • Municipal bonds returned 3.2% in ’14 (vs. 2.6% in ’13) attracting wary investors given high-profile trouble in Detroit and Puerto Rico

Global Competition

  • China – 7.5% 1Q’14 GDP growth is 18-month low; Industrial and mfg’ing growth offset by intentionally slowed residential market
  • Brazil – World Cup was a great success despite all of the issues leading up to it… now on to preparation for 2016 Olympics; Central bank benchmark interest rate remains at hefty 11%; economists expect GDP growth of 1.3% in ’14 and 1.5% in ’15
  • Brazil – World Cup was a great success despite all of the issues leading up to it… now on to preparation for 2016 Olympics; Central bank benchmark interest rate remains at hefty 11%; economists expect GDP growth of 1.3% in ’14 and 1.5% in ’15
  • India – New government in May focused on kick-starting Indian economy reeling from recession
  • Russia – Ukraine sanctions are more targeted and severe with less negative bleed over on European Union
  • Russia – Ukraine sanctions are more targeted and severe with less negative bleed over on European Union
  • European Central Bank offers 0.25% loans to commercial banks to spur lending in Eurozone nations and hope to accelerate growth
  • Syria/Iraq debacle & Hamas/Gaza/Israel conflict raises fears and long-term diplomatic risks but short-term US impacts are minimal

Residential
Building

  • Mixed signals for single-family construction: starts dropped 6.5% in May, while single-family permits jumped 3.7%
  • 30-yr fixed mortgage remains in low 4% range; mortgage rates flat through 2014
  • Mixed signals for single-family construction: starts dropped 6.5% in May, while single-family permits jumped 3.7%
  • NAHB Multifamily Production Index suggests positive market conditions for ninth consecutive quarter… supported by rising cost rental market and very low interest rates; constrained by labor, resource, and land availability
  • Growing interest by institutional investors in residential rental property-backed bonds; Blackstone, KKR, Cerebus already in market
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Construction Economy

  • Construction spending growth continues versus ’13 figures with fastest growth in Power, Office, and Lodging, slowest in Healthcare, Sewage & Waste Disposal, and Communication
  • 1Q’14 GDP slump linked to harsh winter yields continued and tempered growth in construction markets for remainder of the year
  • Skilled trades in Energy, Power, Industrial and Residential construction sectors are driving higher labor costs and slowing pace

Construction M&A

  • 1Q’14 construction M&A activity driven by smaller number of large deals; AMEC acquired Foster Wheeler for $3.3B
  • Parsons Brinckerhoff, currently owned by Balfour Beatty, is in play and will likely close in late 2014
  • Toll Brothers’ completes acquisition of Shapell Industries in 1Q’14
  • Continued merger activity in the energy and utility sector (Wis. Energy Corp. and Integrys Energy Group announced merger) serves as a driver for design and construction firms serving these markets to seek growth through acquisition
  • High public equity values and cheap debt yield strong acquisition currency; Expect active M&A market through 2014; Eventually, Fed tapering, monetary policy, and rising interest rates will increase borrowing costs, reduce valuations, and lower deal multiples

Power
Construction

  • Power construction market is the best performing market and the long-term prospects remain fantastic; Domestic natural gas output hit alltime high in June 2014, expect another high in July – is a driver of pipeline, gas processing, LNG, and power gen construction activity
  • MA is first state to issue grid modernization orders; Will drive electric T&D overhead and underground markets

Telecom
Construction

  • Global IT spending revised downward for second half of 2014, still expected to grow by 2.1% year-over-year
  • 2014 state/municipal IT spending focused on data center consolidation, cloud services, and enterprise information security
  • Google’s push & other provider’s response to develop higher speed infrastructure will drive boom in telecom construction in 2015/2016

Utility Contractor Financial Performance

  • Energy and utility contractors continue to thrive with growing markets driving growth and reasonable margin achievement…as an example, many of our clients in this space are 50-100% larger vs. 2010 and achieving equal or higher margins
  • Resurgence of local electric T&D markets will boost small to medium sized firms vs. the largest publicly traded utility contractors

Construction Raw Materials

  • Overall construction materials prices are up ~1.6% over the last 12 months, while crude oil is up more than 3% in the same period
  • Lumber prices continue their volatile rise through mid-2014, driven primarily by short supply, higher demand in residential construction

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Construction Raw Materials

  • Overall construction materials prices are up ~1.6% over the last 12 months, while crude oil is up more than 3% in the same period
  • Lumber prices continue their volatile rise through mid-2014, driven primarily by short supply, higher demand in residential construction



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Good Times, Bad Times, You Know I’ve Had My Share…

Posted on 05/22/2014 in Construction, Utility - 0

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In the immortal words of Led Zeppelin, the overall utility construction market has seen both good and bad times. The current market is perhaps the best in 60 years, and many utility contractors are expressing their optimism that this market will continue for some time. The optimism is particularly strong in the distribution and transmission pipeline construction markets, which are exceptionally healthy, while electric distribution is also expected to yield growth. Water and sewer are least attractive, and telecom, while positive, is not as robust as other markets. As a side note, Continuum is more bullish in the 2- to 4-year prospects of the telecom market.



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Key Owner Trends: Riding The Wave of Capital Construction Delivery Through The Turbulent Past Decade

Posted on 02/27/2014 in Construction, Economic Overview, Engineering - 0

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“Study the past if you would define the future.” – Confucius

These are sage words of wisdom, especially when one considers this advice within the context of the U.S. construction industry. Capital asset owners — large American corporations and government agencies who spend roughly one trillion per year to construct pipelines, schools, retail stores, data centers and any other imaginable structure — have endured several economic cycles over the last decade and are preparing for more volatility, uncertainty, complexity and ambiguity in the business environment over the next decade.



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January 2014 Economic Overview

Posted on 01/28/2014 in Construction, Economic Overview, Engineering - 0

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2013 closed with lots of good news – a budget through 2015; stock market highs; falling unemployment; low inflation; 3Q GDP of 4.1%, etc. The stage is set for a positive 2014. We will see GDP of 3.2% max; unemployment at 6.5%; continuation of a QE program at a reduced pace but still supporting a high liquidity, low interest rate, and positive stock market result enviornment; improving global economies in Asia and South America; improving state and municipal finances; and an improving residential and construction market. The world is watching the Federal Reserve as it tapers its monthly bond buying programs and weans financial markets off manufactured liquidity. Risks for 2014 are modest, but performance wanes in 2015/2016 where we expect a 2-3 quarter shallow recession. Beyond 2016, we are very bullish and expect faster economic growth and solid construction markets.



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