Hard Hat Chat

Observations and Conversations about Commercial Construction, Development and Management

Commercial Construction Trends: More than the Menu—New Restaurant Construction Best Served with an Experience

Chicago Sports Museum

Experience is the order for the day at new restaurants. Last year, Englewood Construction completed the Chicago Sports Museum, an 8,000-square-foot interactive museum at the new Harry Caray’s 7th Inning Stretch in Chicago’s Water Tower Place.

Shopping center owners aren’t the only ones attempting to create a new and exciting experience for consumers with commercial general construction projects, restaurateurs are getting into the game as well.

New restaurant construction projects are booming right now, but just because the market is hot, it does not ensure success. Smart restaurant owners know that attracting a diner’s attention is harder than ever. People can get a burger anywhere, so the goal is to set your burger apart. Sure, luring diners can be done through menu selections and creating a nice ambiance, but more restaurant owners are realizing that creating an experience with a unique commercial construction project can be a winning recipe for success.

This isn’t a completely new concept in restaurant construction, but it’s safe to say it has become a bit more sophisticated. This kind of national restaurant construction has its origins in the sports bar model during the 1990s, where, owners strove to lure clients with the best sports viewing experience and interactive gaming options. The wings and beer were good, but the social atmosphere and interactive entertainment were what really drew patrons. After all, the sports games they show are the same that broadcast to your living room at home. Operations like Buffalo Wild Wings, who Englewood is currently working with on the national restaurant chain’s second Chicago location, perfected this model.

We can also see this kind of experiential restaurant construction in successful theme restaurants like the Hard Rock Café, which Englewood team members have worked on, House of Blues and the Rainforest Café. People rarely talk about the food they have at these establishments, but instead visit because of the dining experience they offer.

Restaurateurs now are taking this new restaurant construction to the next level and developing attractions that are destinations in their own right. Last year Englewood completed the 22,928-square-foot Harry Caray’s 7th Inning Stretch at Water Tower Place on Chicago’s famed Magnificent Mile. The restaurant houses the 8,000-squre-foot Chicago Sports Museum, which features five exhibits, from unraveled sports mysteries to a hall of legends, offering a highly interactive experience for visitors to explore the legends and lore of Chicago sports. Admission is free with a dining receipt, but due to interest and demand, Harry Caray’s also allows visitors to pay separately to tour the museum, view the memorabilia and participate in the interactive displays highlighting Chicago’s sporting past. It’s been a huge success.

Concert venues have become a popular option for new restaurant construction too. These aren’t hastily slapped together stages as an afterthought, but rather restaurant owners consciously deciding to make live music and entertainment a part of their full-service restaurant. Places like Toby Keith’s I Love This Bar and Grill have made live music a part of the experience. As have locations like S.P.A.C.E. in Evanston, Ill., which is attached to Union Pizzeria, and several other hot concert venues in the Chicago area. These Chicago restaurant construction projects have been very successful and often draw big name artists, attracting concert goers, and, diners.

In another twist in the restaurant construction game, some business owners are building out new restaurant locations into their established businesses to help create a more well-rounded experience. This has become very popular with movie theater and bowling chains. One example is Cinebarre. To help increase revenue at many of its locations, Cinebarre converts one of its theaters to a full-service kitchen and removes every other row in the remaining theaters to allow for dining tables. This dining/movie experience has helped keep the theater chain relevant and vital, attracting new customers and opening a new revenue stream with food and beverages.

As we see more restaurant construction in the coming months, expect to see more concepts that offer a unique experience. In many cases, a fresh menu isn’t enough to get diners excited anymore. They want entertainment and an experience they can talk about.

Chuck Taylor
Director of Operations
Tel: 847-233-9200 x712

Questions? Comments?
You can reach me at chuck.taylor@englewoodconstruction.com
www.EnglewoodConstruction.com

How Working with a Design-Build Construction Firm Can Boost the Bottom Line

As we move further into 2015, Englewood Construction has been fortunate to entertain a lot of new business opportunities. All signs have been pointing to a robust commercial construction pipeline, with activity consistently on the rise. In fact, last year, the value of all commercial construction contracts signed in the Chicago area was close to $10.6 billion, an 18 percent jump over 2013, according to Dodge Data & Analytics, a New York research firm. Based on our backlog and client activity, we predict record growth in 2015.

Interestingly enough, we have found owners for many of the commercial construction projects out-to-bid are looking to work with design-build construction firms. As a former architect and member of the AIA, this couldn’t make me happier.

There are so many benefits to using design-build construction firms, it surprises me more owners and investors don’t hire design-build contractors for their new commercial construction projects.

Englewood Construction is currently working on a design-build project for the renovation of Stratford Square mall in Bloomingdale, Ill.

Englewood Construction is currently working on a design-build project for the renovation of Stratford Square mall in Bloomingdale, Ill.

It’s not really a secret, but architects, engineers and commercial general contractors don’t always see eye to eye. An architect may dream up an architecturally significant commercial construction project, but once a commercial general contractor takes a look at the drawings and the proposed site, a different reality may have to be addressed. Likewise, if a contractor gets behind on their construction schedule, the subcontractors might not be able to complete their work on time. In short, while these three entities have to work together, the coordination and camaraderie is often lacking and an adversarial relationship is formed if the owner has bid out the work solely on price in a competitive bid process.

However, a qualified national design-build construction firm can eliminate these problems by quarterbacking a project, working closely with owners and investors and controlling all commercial construction elements from start to finish.

Working with a design-build firm can include:

  • Subcontractor harmony. A design-build firm will likely work with a trusted set of subcontractors that they know will deliver a successful commercial construction project on time and budget. Relationships on a project count for a lot. Time is money and if a project has a better chance of staying on schedule because of familiarity between the development team members, it will prove valuable to the client.
  • Financial savings. A tenant or developer may be set on using certain materials, but perhaps there is a less expensive alternative that still delivers the same capabilities or appearance. These are the kind of things a good design-build contractor will let a client know. Controlling construction costs is in the design-build  firm’s best interest, as there is typically a profit share system worked out between the client and contractor if the project comes in under budget, with the client receiving the lion’s share of savings.
  • True partnership. The relationship between a design-build firm and a client is much more of a partnership than the traditional competitive bid process allows for. Rather than simply following plans and doing strictly what the documents require, a design-build contractor will work with a client from the very beginning to determine the scope of the project. During the development process, the client and the design-build construction firm will work together to establish a realistic budget and list of wants and needs, and lock in prices on materials and labor for the project.
  • Less responsibility for owners. Owners can also rest easy knowing that any change orders that arise during commercial construction or any extra work that takes place due to unforeseen circumstances are the responsibility of the design-build contractor, not them. Fortunately, these situations rarely arise, as it is in the design-build construction firm’s best interest to complete their due diligence.

Working with a design-build contractor guarantees a much smoother development process, generating savings on materials and labor and delivering a quality product backed by experienced, proven subcontractors.

To me, it’s no secret as to why an owner would want to work with a design-build contractor. In fact, it’s always puzzling to me why they would choose not to.

When the right circumstance arises and we decide to develop retail and entertainment venues, a design-build relationship will be the only option.

Here’s to more design-build construction work in 2015.

Bill Di Santo
President
Tel: 847-233-9200 x710

Questions? Comments?
You can reach me at bill.disanto@englewoodconstruction.com
www.englewoodconstruction.com

3 Solutions to Help Solve the Commercial Construction Labor Shortage

Englewood Commercial Construction Team

Bill Di Santo, president of Englewood Construction (second from right), and the Englewood accounting team receiving recognition from the Chicago Chapter of the Construction Financial Management Association (CFMA) for participating in their 2014 Accounting Intern Program.

Activity is setting up nicely for commercial construction in 2015, but just as the industry seems to be back on its footing, the dreary recession of years past is giving us one last gasp of annoyance and pain. Believe me, no one will be happier than me when we can stop referencing the Great Recession that rocked the general commercial construction industry and the overall economy. Unfortunately, that time has not come yet.

While activity is good, the recession still hangs over us in the form of a commercial construction labor shortage. Between 2007-2009, the construction industry lost 2.3 million jobs. In fact, it’s fair to say that commercial general construction may have been the hardest hit sector of the economy.

Now, as contracts are coming back, skilled workers are in short supply.

In the past five years, commercial construction has lost skilled labors to a wide variety of places. Many immigrant workers have returned to their home countries or taken on work in other parts of the world, experienced commercial construction workers left the industry to pursue other careers, and a lot of accomplished skilled workers just decided to call it a day and retire.

This has had an adverse effect on our industry in two ways—as projects come back, they are on a slower timetable as it is often difficult to locate adequate subcontractors for a project, and, the price for commercial construction labor is often higher as many commercial general contractors are bidding for the services of the same subs.

The commercial construction industry needs workers of all backgrounds to fill in, but most importantly, it needs experienced commercial construction managers and operators. Yes, we need skilled electricians and plumbers, but what’s lacking the most seems to be the management positions. I’ve been in the commercial construction industry for 24 years and I still have no idea how to bend a conduit…it’s magic to me. However, I know how to manage an electrical team on site, while simultaneously managing foundation and drywall contractors. The managerial element of the industry is sorely lacking.

How do we fix this? Happily, as opportunities arise, the problem is beginning to sort itself out, but we are still a ways from being healthy. Here are three things that the commercial construction industry needs to do to fix the current construction labor shortage and get back to a balanced market.

  1. Apprenticeships need to increase. According to a recent Crain’s article, this is already happening. It couldn’t come at a better time. The industry needs a new batch of young, skilled commercial construction workers who know their way around a job site. With the proper training in an apprenticeship program, hopefully subcontractors will be able to staff up at a better rate.
  2. Veterans need to come back. The industry lost a lot of talent, especially on the management side, to premature retirement. Commercial construction was in a prolonged slump and many successful professionals thought it would be better to hang it up, rather than wait for the commercial construction industry to come back. With big new retail construction and restaurant construction projects in the pipeline, it would behoove commercial general contractors to approach some of these newly retired individuals and try to lure them back with high-paying opportunities.
  3. Align with education. Commercial general contractors in the Chicago area would be smart to partner with some of the great universities and colleges in the Midwest to offer internships to construction management students. Last year alone, Englewood had four interns—two in estimating, one in operations and one in accounting—from major Midwestern colleges. We feel it’s great to help mentor these young students, but also it gives us a chance to possibly help mold and shape future talent for our team. In baseball terms, we use it as our farm system.

Whether it is at the apprenticeship, management or internship level, mentoring is really the key to bolstering the commercial construction workforce. Learning is a process that should never stop and all commercial construction professionals should stay up-to-date with trends and code changes.

I remember back to my days as a young laborer and one of my mentors, Leopold Hanke. He came up through the ranks and went from apprentice to journeyman to foreman to superintendent. In his time, he had built nearly everything imaginable. I asked him once how he accumulated so much knowledge of the commercial construction industry and he said “Kid, I wake up every day with the goal of learning something new.”

I took that to heart and I approach my job the same way. If I’m lucky enough to pass that along to several young commercial construction workers in our industry, I’ll have done my part.

Chuck Taylor
Director of Operations
Tel: 847-233-9200 x712

Questions? Comments?
You can reach me at chuck.taylor@englewoodconstruction.com
www.EnglewoodConstruction.com