AIA construction forecast predicts 5% growth
The non-residential construction sector in the US is expected to see an increase in activity throughout 2013.
The American Institute of Architects’ semi-annual consensus construction forecast found that high demand for hotels and retail projects have boosted the sector to grow by 5%, up from a projected increase of 4.4% in mid-2012.
Kermit Baker, AIA chief economist, said: “After seeing construction activity seesaw for much of last year, there is a much stronger sense that we have entered a recovery phase and the industry is positioned to see continued economic improvement as we move through year and into 2014.
“The resurgent housing market has led to a ripple effect where there is a need for more retail establishments and office buildings across the country.”
The survey also forecasts a 7.2% in construction spending in 2014.
But Baker warns that the design industry can’t expect a certain future until the US’ federal budget and debt issues are resolved.
“This has caused enough anxiety in the real estate marketplace that has resulted in numerous delays and even cancelations of active construction projects,” he added. “More than one quarter of architecture firms are reporting that this tenuous situation is a tremendous concern to clients and may lead to more delays or project terminations.”
The purpose of the consensus construction forecast panel is to project business conditions in the construction industry over the coming 12 to 18 months.
Construction output fell by 3.9% between the first and second quarters of 2012, new figures show today.
The fall is 9.5% when compared with the same period a year ago.
The volume of all new work fell by 4.6% compared with the first quarter of 2012 - and by 12.8% compared with 2011.
A spokesman for the Office of National Statistics, which released the figures, said the poor weather and the extra bank holiday for the Queen’s Diamond Jubilee were likely to have been contributing factors, as well as moving the late May bank holiday to June.
Steve McGuckin, managing director of Turner & Townsend, said: “All the sunshine and Olympic feelgood factor in the world can’t hide the fact that these are black days for the construction sector.
“Stagnation has moved from the stuff of nightmares to the new norm.
“Despite Sir Mervyn King’s assertion this week that the economy is ‘slowly healing’, construction is still walking wounded. Output in the last quarter tumbled to levels not seen since the depths of the 2009 recession. The big drop in infrastructure output is of particular concern for the economy as a whole.”
Optimists who hoped 2013 would see an upturn in work were being forced into a drastic rethink, he added, and small and medium-sized firms were the worst hit.
- UK Second-Quarter Slump May Be Smaller as Building Revised - Bloomberg (bloomberg.com)
- Slower construction fall signals GDP revision (telegraph.co.uk)
- Recession deniers should shut up as down we continue to go (newstatesman.com)
European construction output in May was 6.7% down on previous year and only slightly better than April’s low figures.
Compared with May 2011, production in May 2012 dropped by 8.4% in the Eurozone and by 6.9% across all 27 countries of the EU.
Production in construction rose by 0.1% in Eurozone in May compared with April and by 1.6% across the whole of the EU. But the rise is on figures that had decreased by 3.7% and 6.9% respectively in April. Performance in the UK was up 6.3% on April.
The estimates were released by Eurostat, the statistical office of the European Union.
Among the member states with available for May 2012, production in construction rose in eight, fell in six and remained stable in the Czech Republic. The highest increases were registered in the United Kingdom (+6.3%), Romania (+5.0%) and Portugal (+3.6%), and the largest decreases in Slovenia (-17.5%), Hungary (-4.1%) and Spain (-3.3%).
Building construction dropped by 0.2% in the Euro area, but increased by 1.8% in the EU27, after -3.6% and -7.7% respectively in April 2012. Civil engineering rose by 0.6% in the Eurozone area and by 0.7% across the EU, after -3.9% and -4.8% respectively in the previous month.
In terms of the annual comparison, production in construction fell in 12 and rose in three. The largest decreases were registered in Spain (-24.8%), Slovenia (-23.7%) and Portugal (-16.4%), and the increases in Romania (+21.1%), Poland (+6.5%) and Germany (+2.2%). Building construction declined by 8.6% in the Euro area and by 6.3% across all 27 countries, after -5.9% and -5.1% respectively in April 2012. Civil engineering decreased by 9.3% in the Eurozone and by 10.9% across the EU, after -9.3% and -10.9% respectively in the previous month.
Source: The Construction Index
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BIM overlay added to architects’ management document.
The RIBA Plan of Work is set to be overhauled for the first time in 50 years to include bim processes. The RIBA’s new Plan of Work, which organises the process of managing and designing buildings, is due to be issued in early 2013 and will also include a green overlay, as well as changes in procurement. “It’s a different way of doing things,” said Richard Brindley, executive director for membership and professional support at the RIBA. “The actual processes are still there, but how they fit together is very different.” Though still in its infancy, it is known that the new Plan of Work will identify stages by numbers rather than letters. “The bim overlay is just highlighting key aspects through the different stages that we should be looking for,” said John Orrell, member of the core review group, which is led by Dale Sinclair. So far the group has produced a draft bim-overlay document and will meet this week to finalise the changes, which will eventually feed into the new Plan of Work.
- CPD 2012 Module 3: Introduction to BIM (yechteconsulting.com)
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March saw the strongest upturn in new construction orders since September 2007, four and a half years ago.
The monthly survey of construction industry purchasing managers reports a marked expansion of UK construction sector output, with the rate of growth accelerating for a second successive survey period and confidence strengthening.
The seasonally adjusted Markit/CIPS Construction Purchasing Managers’ Index (PMI) posted 56.7 in March. Up from 54.3 in February, the index has now posted above the 50.0 no-change level that separates growth from contraction in each month since January 2011. Moreover, the latest reading pointed to the sharpest expansion of output in 21 months.
Growth was registered across all three of the broad construction categories monitored – housing, commercial and civil engineering. Commercial was again the strongest performing of the sub-sectors, in line with the recent trend. However, the increase in civil engineering activity strengthened and was the fastest since March 2011. Only a slight increase in residential construction was indicated.
A substantial rise in new business received by UK construction companies was seen in March. Growth has now been sustained for six consecutive months, and the latest rise was the sharpest since September 2007. Panellists commented that a general improvement in market activity, increased tender opportunities and long-running negotiations coming to completion had boosted new work intakes in the latest survey period.
March data signalled a rise of employment in the UK construction sector, reflective of growth of both output and new orders. However, the rate of job creation was only modest. Increased usage of sub-contractors was also indicated.
Purchasing activity rose at the fastest pace for more than four years in March, in line with a faster expansion of output requirements. Subsequently, suppliers’ delivery times lengthened again. Anecdotal evidence suggested that vendors continued to hold low inventories.
Input prices faced by UK construction companies rose sharply in March. Higher raw material costs, particularly for oil, were cited as the main driver of inflation. Nonetheless, the latest increase was below the long-run trend.
UK construction companies were optimistic in March that activity would rise over the next year. Positive sentiment strengthened to a 22-month high, indicating that confidence continued to improve. Expectations for new marketing initiatives, a more buoyant outlook among clients, rising tender opportunities and company expansions are all anticipated to support growth. Nonetheless, optimism remained below the historical average.
Markit chief economist Chris Williamson said: “The good weather appears to have led to a surge in demand for construction projects in March, adding to the recent flow of good news which suggests the economy will have skirted a recession.
“Construction companies reported the largest monthly rise in new orders for four-and-a-half years, driving building activity higher at the fastest rate since mid-2010. Coupled with increasing activity recorded in the first two months of the year, this bodes well for the sector’s contribution to overall growth of the economy in the first quarter and will raise hopes that the country has avoided a slide back into recession.
“Looking ahead, the lack of big new projects such as Crossrail and the Olympics means expectations about the year ahead continued to run well below the pre-crisis peaks, but business confidence nevertheless reached the highest for nearly two years, driven up by expectations of increases in new order intakes and improving client optimism.
“The particularly encouraging news is that the improvement in confidence is generating more jobs, with employment rising modestly.”
Source: The Construction Network
- UK construction PMI reaches 56.7 in March 2012 (newstatesman.com)
- UK construction growth bolsters economic recovery hopes (guardian.co.uk)
- Hewlett continues to weather the recession as it heads into its 25th year (theconstructionindex.co.uk)
- UK Construction Sector Sees Unexpected Boost (news.sky.com)
- Construction firms optimistic despite January slowdown (guardian.co.uk)
- Construction growth slows in January (telegraph.co.uk)
- US factory output rises, but construction falls (newsok.com)
BIM enables the design team to work together to model every detail of a building.
Up until the 1980s, the main purpose of architectural models was as a presentational material, to show clients and stakeholders how a concept would look as a finished building. They were often made to a very high standard, but could be expensive, fragile and cumbersome. Drawing and modelling were also often laborious processes.
If major amendments were needed after technical information and costs had been fed into the detailed specification and tender package, you would literally have to “go back to the drawing board” and start again.
Advances in technology have allowed designers to cut the time they spend on models and drawings, and have also enabled greater accuracy of design. The introduction of more advanced computing into mainstream business during the 1980s saw computer aided design take off across a number of industries. CAD is used extensively to design everything from shampoo bottles to cars, trains and buildings. This has automated much of the redrawing and remodelling process.
Using bim allows all interfaces between the specified flooring and other parts of the building to be reconciled before installation. Here Karndean Design-flooring was installed in London’s Push Studios.
The introduction of 3D CAD, which was developed in the 1980s but became more mainstream in the 1990s and 2000s, further increased the quality of design. With 3D CAD there is no need for the designer to imagine how 2D objects fit together, therefore reducing errors.
Advantages of BIM
BIM offers benefits for everyone involved in construction projects, including clients, designers, contractors, suppliers and facilities managers.
The government has recognised this, and adopted a strategy that all projects worth more than £5 million will be managed using BIM by 2016. This is another good reason for companies to adopt BIM.
Early design clarity
Late design changes can result in extra cost and delays to a project. With BIM, architectural models, structural models and MEP models can be brought together to carry out virtual testing and highlight conflicting design decisions.
These errors can then be rectified very early in the process. For example, if an architect specifies a window and a structural engineer specifies a beam that conflict, this will be picked up immediately.
Likewise, if a specification does change, BIM can be used to ensure that no new clashes are introduced. To give an example, if a 20mm hardwood floor covering is specified and the client demands a re-specification to 3mm LVT Designflooring, the BIM software will alert the specifier to the conflict with door frame heights and door sizes.
BIM allows the creation of a building virtually before it is built, so virtual testing can be done early on in the design process to ensure that standards are met.
Aspects of the design that can be tested include:
- Consumption of energy
- Carbon emission rates
By visualising daylighting, for example, the project team can ensure that skylights are installed at the correct angle and the right size to let in sufficient light. This avoids the need to replace a non-conforming skylight at the end of a build, saving money and time.
Architectural models have come a long way since the pre-CAD era of wood, cardboard and glue.
By using 3D studio maps, details can be highlighted and highly detailed planning undertaken, not just by the project team but by the client and end user. BIM visualisations can be used in a number of ways:
- Simulating pedestrian use
Pedestrian simulations can be included to view the density of use and identify bottlenecks, flow rates, queue sizes, journey times and so on. Such information has been used to alter timetables for schools and determine optimum numbers of students.
- Close design analysis
3D parametric models can be used to identify the specifics of products used, for example, in walls and floors, as BIM objects can include a variety of details.
- Fit-out design
Room loading can also be completed early on to ensure accessibility standards are met with the introduction of furniture, for example under the Disability Discrimination Act.
- Managing time & budget
Time and cost are often referred to as the fourth and fifth dimensions of BIM.
By incorporating all of the elements of a construction project, including the time scale, BIM can establish sequencing early on in a project and flag up whether there are any potential clashes in the programme. This can avert delays and, by consequence, save additional costs. For example, when time is added to the model, detailed visualisations of the following can take place:
- What is being done at any given moment
- Activities on a certain date
- What plant is needed
- What hoardings are needed
- Impact on the local area
At present, the major software packages do not automate this process and major revisions still need reworking, but it is a good start.
Cost information can then be added to form the 5D model, including:
Rates can then be added, to better understand the cost of the build at a micro scale.
BIM Academy case study
The BIM Academy cites a real-life example from the US.
The use of BIM on a recent project highlighted a structural beam conflict with a sprinkler pipe, enabling it to be immediately rectified.
If it had not been dealt with at an early stage, the conflict would have become apparent during construction, after all the structural supports had been set. In other words, it would have cost $4,664 per clash, which, as there would have been 10 instances per storey, would have risen to $46,640. And as it was a 15-storey building, the total cost would have been $699,600.
It would have incurred the following costs per clash:
- $3,800 for replacing materials
- $205 for removing the beam with a crane
- $195 for installing the new beam with a crane
- $464 for cutting the hole for the pipe in the beam
What is BIM?
BIM is the next stage in developing architectural models and integrating them with the whole construction process. It is not a single piece of software, but an integrated digital process providing coordinated, reliable information about any given project. In effect, it gives meaning to what are, within CAD, just shapes.
Source: © 2011 Tekla Corporation
A whole model view of a project using BIMsight software by Tekla.
Though the most visible face may be the geometric model, BIM is essentially a database of information from many different compatible sources, including 3D CAD, which can be drawn on by all those involved in the construction, maintenance and eventual demolition of a building. This information may come from many sources, including:
- Revit AutoCAD
- National Building Specification’s (NBS) free online National Bim Library, which includes generic bim objects for systems and products such as walls, windows, doors, founda-tions, cladding and roofs. This will be launched at Ecobuild. BIM objects can include installation instructions and guidance on maintenance.
- Plug-ins for factors such as environmental conditions, people flow, project management and life-cycle assessment.
- The BIM Academy, a partnership between Ryder Architecture and Northum-bria University, describes the process as the “digital representation of physical and functional characteristics of a facility, creating a shared knowledge resource for information about it, [and] forming a reliable basis for decisions during its life cycle”.
- How to Implement BIM into the Practice of Architecture is New Training Program on LearnVirtual (seattlepi.com)
- Open BIM Program (archicadsa.wordpress.com)
- A More or Less Optimistic Update on BIM: older article featured on Isicad.net (bausk.wordpress.com)
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- Welcome toThe BIM Advocate! (thebimadvocate.wordpress.com)
The George Osborne has delivered his to the , which includes the Government’s Growth Review Phase II and the National Infrastructure Plan.
The statement confirmed the plan to unlock up to £20 billion of private investment through signing a Memorandum of Understanding with two groups of UK pension funds, an additional £5 billion of infrastructure spending in this Spending Review period, and commitments to £5 billion of capital projects in the next Spending Review period. In addition, the Government is supporting around a further £1 billion of investment by Network Rail.
To make the UK’s infrastructure fit for the 21st century, the Government has published its National Infrastructure Plan 2011. The plan sets out a critical analysis of the state of the UK’s infrastructure and sets out a pipeline of over 500 infrastructure projects.
The key measures in the National Infrastructure Plan include:
- introducing a new approach to financing infrastructure, by leveraging £20 billion of private investment from pension funds;
- giving local authorities more flexibility to support major infrastructure by considering local borrowing to fund the Northern Line extension to Battersea, and exploring new sources of revenue, such as options for tolling on the A14.
- investing over £1 billion to tackle areas of congestion and improve the national road network, including £270 million for two new managed motorway schemes at congested times on the M3 and M6.
- investing more than £1.4 billion in railway infrastructure and commuter links, including £270 million for a rail link between Oxford and Bedford and £390 million on enhancement and renewal works to improve stations and infrastructure.
- investing £100 million to create up to ten ‘super-connected cities’ across the UK, with 80-100 megabits per second broadband and city-wide high-speed mobile coverage.
The Chief Secretary to the Treasury, Danny Alexander, will chair a new cabinet committee on infrastructure, to push through the delivery of the top 40 priority projects and programmes that are critical for growth.
The second phase of the Government’s Growth Review includes the following 'reforms':
- creating a £20 billion National Loan Guarantee Scheme, to lower the cost of loans to small businesses, and a £1 billion Business Finance Partnership, which will lend to mid-sized businesses and small and medium sized businesses in the UK through non-bank channels.
- increasing the Regional Growth Fund by £1 billion to provide ongoing support to grow the private sector in areas currently dependent on the public sector.
- an extra £600 million to fund 100 additional Free Schools, and an additional £600 million to deliver an additional 40,000 school places.
- introducing a new build mortgage indemnity scheme which will help up to 100,000 families to buy their own home, and launching a new £400 million Get Britain Building investment fund to progress stalled developments.
- providing £45 million of support to UK firms wishing to export, doubling from 25,000 to 50,000 the number of SMEs supported, and making similar support available to 500 mid-sized businesses.
- making 100 per cent capital allowances available in six Enterprise Zones (Black Country, Humber, Liverpool, North Eastern, Sheffield, and Tees Valley).
- making available around £250 million from 2013 to support energy intensive industries manage the costs of electricity, including increasing the relief from the climate change levy on electricity for Climate Change Agreement participants to 90 per cent.
- an additional £200 million for science capital investment.
- investing £55m into the Strategic Rail Freight Network to help deliver schemes that remove bottlenecks and improve capability and longer term connectivity to the UK’s major ports.
- giving a bigger role to businesses in purchasing vocational training programmes. In the New Year employers will be invited to bid for a share of a new £250 million government fund. This will route public investment directly to employers.
- taking decisive action to remove barriers to hiring by making reforms to streamline employment law.
- investing £10 million over five years from 2013-14 in Project Enthuse, matched by investment from the Wellcome Trust, to improve the quality of science teaching in schools
- announcing how the Government will maximise the value of public sector data.
- Osborne's Autumn Statement - what it means for your business (simplybusiness.co.uk)
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US billings bounce back but market remains unstable.
The American Institute of Architects monthly billings index, created by surveying AIA member practices, jumped up three points in October following a sharp dip in September.
Over the past three months billing levels have jumped up and down creating a confusing picture for financial analysts, who view the index as an economic indicator of future construction activity, with spending on architectural services taking place between nine and twelve months before further construction spending.
The index, which records positive growth as any score over 50, reported its first positive results in four months in August, before dropping from 51.4 to 46.9 in September. In October the score was 49.4.
New project inquiries also jumped up, from a reading of 54.3 in September to 57.3 in October.
“An increase in the billings index is always an encouraging sign,” said AIA chief economist, Kermit Baker.
“We’re seeing some regions and some construction sectors move into positive territory. But there continues to be a high level of volatility in the marketplace, with architecture firms reporting a wide range of conditions from improving to uncertain to poor. It’s likely we will see a similar state of affairs in the coming months.”
Latest figures from Office of National Statistics see output down 0.2%.
The construction industry is continuing to feel the squeeze after posting disappointing figures for Q3 output, according to the latest report from the Office of National Statistics (ONS).
Total volume of construction output was 0.2% lower than Q2, with all new work falling by 0.6% in Q3 compared to a 1.1% rise in the previous quarter.
The total volume of construction output in Q3 fell by 1% year-on-year with new work falling by 1.8% and maintenance rising by 0.9%.
Housing suffered the most dramatic falls, with new public housing dropping 8.2% compared to Q2 and a year-on-year fall of 8.9%.
The volume of new private housing work in the third quarter of 2011 fell by 2.5% compared to the previous quarter but was still 0.7% year-on-year.
New infrastructure output was 0.3% lower compared than the previous quarter but still 13.4% higher year-on-year.
Andrew Duncan, managing director of property at Turner & Townsend, said: “These figures are further evidence of the strength of the bad economic headwinds buffeting the construction sector.
“As the Eurozone debt crisis goes from bad to worse, a tidal wave of uncertainty is washing across the Channel, swamping any green shoots that may have sprouted in the second quarter.
“The omens for next year are not good, as the Eurozone saga shows little sign of abating, and the doubt it is sowing risks undermining the fragile progress made by the industry in 2011.”