Bringing a stalled construction project back to life is easier to do if you perform the right due diligence.

It’s not just foreclosed homes that are looking like a bargain to real estate investors in today’s market, but also distressed commercial assets. Most of these REO commercial properties fall under the multi-family construction sector, but there are also abandoned retail and restaurant spaces, not to mention hotel construction projects that have stalled and are now ripe for the picking.

But, before you purchase a distressed commercial asset, you need to do your due diligence and enlist the pre-construction services of a commercial general contractor to ensure that the price for the property makes sense once you factor in the commercial construction costs for bringing a stalled project back to life.

Here are just a couple things that the best commercial contractors will know need to be answered before you consider taking over a distressed construction project.

1. First, the property needs to be assessed and you need to determine what was the original intent and where did the previous developer and general contractor leave off?
2. Is the project so far along in its original intent that you need to complete it that way or is it in a position that you can change direction without losing any previous investment?
3. What construction costs were expended prior to the project stopping and have those costs been satisfied? I.e., are there any subcontractors that have a lien on the project? When we take over stalled construction projects we try and use the same subs from the original project. Not only are the subs already familiar with the work that needs to be done, but it’s fair and good business.
4. Is the building and construction site secure? Specifically, are the utilities secure? Your GC should check for open power panels and if there are any electrical concerns. Is there any wild water? And if you’re tackling a winter construction project, are there any frozen water valves? Is the gas running wild or has it been shut off properly?
5. If the REO commercial project you’re looking at still has the same landlord as before, there is the potential that some of the original paperwork is still intact, so you should ask to see what was paid to date, etc.
6. While you’ll always have access to the original drawings for the project by contacting the municipality, you should also reach out to the architect for additional information. There might also be the chance you need to settle with the architect.
7. The best general construction contractors will also reach out to the municipality just to let them know you are going to be working on this stalled project. As has been the case in some of our takeover construction projects, municipalities are so excited that work is continuing on an abandoned site that they wave certain fees and costs.
8. Of course, you should also check to see how the property sits with the municipality and jurisdiction authorities. Are there outside fees that you need to settle with the municipality?
9. If you are going to follow the original intent of the project, is the permit still in place or do you need to file for a new commercial construction permit?
10. A good GC will also tell you that contingencies will need to be put into place for this type of work. The commercial construction costs for some items will be cut and dry, while other costs will be unknown as abandoned projects have been known to have hidden construction site demons.

It’s not always easy to just pick up where the previous commercial developer or owner left off, but as general contractors, our job is to educate our clients and make sure they have clear expectations on what it is going to cost to complete a distressed project based on all the pieces we have put together.

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

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

Happy Holidays from the Hard Hat Chat team -- Chuck Taylor, Kim Sawyer and Bill Di Santo.

As 2011 comes to a close, it’s time for us to look back on the commercial construction building trends, news and projects of this past year and share our thoughts on the highs and lows in the industry.

HIGH – Everyone was submitting drawings in 2011. We saw drawings for new Chicago restaurant projects, retail construction work, office renovations, school construction and learning center additions – you name it, we saw it. In fact, our commercial construction budget work was back to 2008 levels. It was optimistic and certainly gave us a lot of commercial construction news to talk about around the water cooler.

LOW – Unfortunately, we weren’t the only ones receiving drawings to bid on new commercial construction projects. I didn’t think the number of commercial general contractors bidding on one job could be higher than what we saw in 2010. I was wrong. Developers and retailers that would normally go 2 deep in bidding went 4 deep. And some firms had 11 GCs bid on jobs. To have a successful construction project, you should know who the best general contractors are in your field and not cast such a wide net. The quality and reputation of some general contractors allowed to bid on jobs was questionable at best. If you don’t know who specializes in your line of business then start your search online with a query like “Chicago retail construction experts”.

HIGH and LOW – Speaking of retail, there was an increase in retail construction projects, however most jobs were smaller in square footage than in the past. In fact, in some cases, the job was a retail remodel with a square footage reduction. That was certainly the case with Old Navy, which decreased the size of 300 stores while also completely rebranding the interiors. The positive construction news was this kept GCs busy and landlords retained a healthy tenant. The bad news in this scenario is that landlords are now getting less rent due to a smaller leased space.

The same high/low scorecard goes for many of the new fast-casual restaurant construction projects completed this year. A lot of neat burger and sandwich shop concepts are out there, but is this market segment becoming oversaturated? And even fast-casual restaurants weren’t immune to a restaurant remodel/size reduction this year. Some chains said most of their business was due to take out. Why pay for the space if your customers aren’t using it?

LOW – One thing we saw this year in Chicago as well as other union markets, is that retailers and developers said they didn’t care if their project was built with union labor; they just wanted the best price. This makes it difficult to accurately compare general contract bids and your overall commercial construction costs as some GCs might not call out if they are using union labor, which is usually cheaper.

Due to our 20,000-plus national network of subcontractors, we can build a commercial construction project with union or a non-union labor. This comes in handy and can certainly diffuse conflict when the landlord of a shopping center construction project requires non-union labor, yet certain retailers in the shopping center need to be built with union labor. Regardless, there’s no denying the union construction jobs/markets are taking a big hit.

HIGH – Due to the increase in commercial construction drawings we received this year, we needed to add to our staff. Luckily for us, there was no shortage of resumes and a lot of great talent out there. We all know there have been cutbacks in commercial construction jobs over the past few years, so it was great to get highly skilled people back to work again. We hope this uptick in commercial construction hiring can continue for others, too, in 2012.

As I look back on this year, there are a couple other significant “highs” I would like to acknowledge and people I would like to thank…

• Clients who continue to build and grow
• A construction team that stuck together during the downturn and
  worked efficiently to ensure we didn’t have to make staffing cutbacks
• Our new teammates who offer great talent, new energy and new ideas
• My family, as well as friends, colleagues and vendors
• This crazy, yet great industry that we love so much

Wishing you all the best for the holiday season and
a prosperous New Year!

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

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

www.englewoodconstruction.com

The future home of an hhgregg in Joliet, Ill. Value-based retailers like hhgregg, Ross Dress for Less and Savers should experience construction growth in 2012.

It’s that time of year when our team predicts the 2012 commercial construction trends – from what’s on tap for Chicago retail construction to national restaurant construction and hospitality construction. We’ve compiled the list below based on conversations with clients and fellow commercial construction experts, upcoming bid work, economic projections and observations in the field.

1. We Are the 99 Percent - Following along with Occupy Wall Street, value-based new retail and restaurant construction projects that target 99 percent of the population will continue to be hot in 2012. Watch brands like Ross Dress for Less and Savers continue to gain momentum. Currently Savers has three Chicago-area locations, but we wouldn’t be surprised to see that number increase in 2012.

Growing retail brands likes Advance Auto and Auto Zone that help consumers save money by keeping their cars longer should also continue to do well in 2012. From what we hear on the commercial construction news front, if there will be any new shopping mall construction projects next year, they are likely to be outlet malls – a category that is seeing an uptick after a few quiet years.

New hospitality construction projects in 2012 will also focus on the 99 percent. Most hotel brands are building residence inns and business inns vs. their high-end flagship brands. Expect to see hotel construction in the extended stay market grow next year with an emphasis on highly amenitized rooms.

2. The 1 Percent Still Matters, Too - When it comes to luxury retail construction, look for high-end brands to focus on retail renovations of existing locations. These established high-end retailers are taking advantage of market conditions to build bigger and better stores. There is always at least one big Michigan Avenue retail construction project a year and right now Burberry is expanding its Michigan Avenue space from two stories to five stories, plus one basement level.

3. Creative Deal-Making - As obtaining financing for commercial construction projects continues to be a challenge for some developers, look for creativity behind the scenes. We have been approached a couple of times to become an equity partner in a project in order to win that construction job. We are not developers, so that doesn’t work with our business model. But, that doesn’t mean you won’t see other commercial general contractors cough up cash to win a job. However, we feel the best Chicago contractors, or any commercial contractor, should focus on what they do best, which for us is construction.

We also see no slowing down in providing developers conceptual commercial construction budgets. Deals today are tougher to make and developers want to make sure there aren’t any hidden numbers.

4. Entrepreneurs Are Hungry - Necessity entrepreneurship often emerges during a recession. For those who cash out their 401Ks, many go into business for themselves in the restaurant franchise market. We mentioned this rise in fast-casual franchise restaurants in our 2011 commercial construction trends blog post and we think it will only continue in 2012, particularly in the restaurant construction of sandwich/hamburger shops. The Subways, Quiznos, Five Guys and Smashburgers of the world will continue to dominate the value-add franchise sector. And keep your eye on Capriotti’s Sandwich Shop, which has plans to add 300 new restaurants in the next five years.

Also look for fast-casual restaurant construction jobs to go smaller – in terms of square footage. Reports from some restaurateurs say the majority of their sales are from take-out, so they are moving to building smaller spaces.

5. Anything Goes – The old rule of successful shopping center development was not to mix retail tenants with medical tenants. Having a restaurant next to a dentist office was suicide for the center. But now, shopping mall landlords need to fill the space so anything goes, even if the stores may not be the best fit for mall. A lot of these random tenants are independent retailers, which unfortunately do not place the highest standards on shopping center construction, but they pay their rent and fill vacancies, so that’s what matters at the moment.

What commercial construction trends do you think we’ll see in 2012?

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

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

www.englewoodconstruction.com

• Everyone wants to network, so don’t forget your business cards and don’t feel bad about giving them out like candy. We all want to meet people who will help us grow our business – whether that’s learning about new construction projects, successful commercial construction blogs or ways to reduce restaurant construction costs. At CWA, I learned about a great association called the Society for Marketing Professional Services that I think would be good for Englewood Construction.
• Small talk can turn into big talk. When I was breaking the ice by asking people where they were from, I couldn’t believe how many people were from the Chicago area. I now have a rolodex full of new contacts from Chicago that I can easily meet in person for lunch, or have them tour our office as we discuss new projects or the latest Chicago construction news. And they now have me on their short list of Chicago commercial construction firms.
• Look for an educational take-a-way. Surrounded by the best construction writers in the business, I knew I would get great ideas for an upcoming commercial construction blog or hear interesting commercial construction tips. I wasn’t wrong. The winning video from Bill Wilson at Roads & Bridges for the “Construction of the New San Francisco Bay Bridge” was inspiring. Why aren’t there more commercial construction blog videos discussing commercial building trends, answering commercial construction questions on green building retrofits or even showing the time lapse of a construction project from start to finish? All I can say is look for more Englewood Construction videos in 2012.
• Go to the after-hours party. After the awards dinner, most of the CWA attendees decided to move the celebration from our conference room at the hotel to Howl at The Moon. It was a great opportunity for me to meet the other attendees that I wasn’t able to talk to at the dinner and congratulate fellow winners, such as Tudor Van Hampton, Chicago Bureau Chief of Engineering News Record. Tudor and I talked about 2012 commercial construction trends and I also found out about an upcoming story in ENR that would be perfect for Englewood Construction.
• Don’t book the earliest flight the next day. That 5:30 a.m. wake up call was too early after Howl at the Moon.

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

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

Chuck Taylor (center) accepts the 2011 Construction Writers Association award for best blog from CWA president Bill Wilson (left) and Patti Flesher (right) chairwoman of the Website and Electronic Communications Awards committee.

Chuck Taylor and Kim Sawyer show off their new hardware from the 2011 CWA awards dinner in San Antonio.

Chuck Taylor and Tudor Van Hampton, Chicago Bureau Chief of Engineering News Record, get into the western theme at the CWA after party at Howl at the Moon.

I’ll admit, when we heard we won we were pleasantly surprised. In 2009 we launched this commercial construction blog as a platform to share ideas, best practices and observations about commercial construction, development and management. I’ve always felt that having an open dialogue with clients, peers, architects, subcontractors or anyone with an interest in the commercial construction industry was the best way to improve my knowledge base and in turn be a successful commercial construction contractor.

We weren’t sure how many of you would find Hard Hat Chat, or keep reading after our first blog post, Retail Development and Construction: Getting Started. But two years, 51 blog posts and more than 22,000 page views later, it seems we’re doing something right.

If you happen to be attending the CWA conference and awards dinner in San Antonio on Oct. 25, make sure you look for Chuck Taylor, who co-writes this blog with me and will be accepting the award. Without Chuck, our marketing director Kim Sawyer and the rest of the Englewood team, we would not have won this award.

And of course a special (hard) hats off to all the readers of this blog, our clients (who let us share their stories), vendors and subcontractors who continue to support our efforts with Hard Hat Chat and suggest timely topics and thought-provoking questions so we can all be a little better at our jobs.

Thanks again and please keep your suggestions coming.

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

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

www.englewoodconstruction.com

What was once an Ethan Allen store in Wheaton…

As a shopping center landlord or retail developer, you might find yourself with a big empty retail space you need fill – especially if you had Borders or Circuit City as a tenant. Finding a single tenant to occupy all that space in today’s economy can be challenging, so the smarter and more feasible move is to hire a retail construction contractor that can provide you with the various pre-bid commercial construction budgets needed for subdividing that big box into a multi-tenant space.

We frequently get asked the question, “How many tenants do we need before a general contractor can give us commercial construction budgets for a shopping center construction job?” The answer is none. Because Englewood Construction has been in the retail construction and shopping center construction field for so long, we have pricing models based on square footage, level of finish and geographic area for virtually every retail and restaurant construction concept.

…became a multi-tenant commercial construction job…

As long as you know what type of tenants you might want, the best commercial construction firms should be able to give you a pre-construction services construction budget. Case in point – cellular phone places always look for 1,500 square feet, sandwich shops are typically 2,000, fast-casual restaurants want 3,500 and outlet stores are 6,000 to 8,000 square feet.

What typically happens is the first tenant dictates how the rest of the space is divided. Say a big tenant signs a lease that leaves you with 7,500 square feet. You should then ask for construction pricing models for the different ways the remaining space can be used, whether it’s a fine dining restaurant, a mix of middle and high-end retail or even simple office space.

As long as you are working with a general contractor who has shopping center construction experience, your GC will know its construction pricing models should include vanilla box budgeting as well as tenant budgeting, based on the type of tenants you are pursuing. Of course the best Chicago commercial contractors will also factor due diligence with municipalities into their budgets. And if it’s a Chicago commercial construction project, the Mayor Daley black iron fence rule should also be noted by your GC. If your GC doesn’t know that rule, don’t work with them.

…that leased attractive tenants such as Koenig & Strey Real Living

Another benefit to working with a GC early on for construction budgeting is that most architectural fees are based off of square footage or the cost of construction. So not only can the right construction firm help determine your square footage rental rates with its construction pricing models, but it can also help figure out your soft costs, too.

When it comes to the physical construction of subdividing your retail space, it’s always smart to “dance with the one you brought.” Use a GC that provided you with pricing models because the firm is already familiar with your project so there isn’t the additional cost and time of getting another commercial construction firm up to speed.

Also, it’s quite possible the shopping center landlord will need to build the tenant’s space, so landlords should align themselves with a shopping center general contractor who is not only experienced in base building construction, but also retail reconstruction. This is especially critical if your retailers have a payment penalty in place if they don’t meet their open date.

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

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

www.englewoodconstruction.com

Nothing says you completed a successful education construction job more than thank-you cards from these Bright Horizons kids…

Cupcake restaurants are hot right now in restaurant construction trends. In fact, Chicago cupcake restaurants and food trucks are popping up all over the place. However, the best Chicago cupcakes Englewood Construction ever had were the ones from our latest Chicago education construction job.

After we completed a school construction project for a Bright Horizons pre-school, the teachers and students threw our construction team a thank-you party with decorated cupcakes and hand-made cards. Cute, right? Well, it’s more than that.

I don’t know if the cupcakes were made from scratch or out of a box, but they were the best damn cupcakes for one simple reason – they reminded us how important our jobs are and that commercial construction projects touch the lives of everyone big and small.

There we were, face-to-face with our client’s end-users. If we had skimped on commercial construction costs and used cheap construction materials, or decided to cut corners to speed up the construction schedule, these were the people who would have suffered due to faulty construction.

Don’t worry, I won’t get sappy on you. But commercial construction developers, owners and landlords should never lose sight of how a commercial construction general contractor’s work affects the public and their safety.

…unless it's awesome cupcakes from the teacher. Check out the construction tools on top!

The commercial construction industry is a business and whether you’re a commercial property manager, shopping center landlord or restaurant owner, it’s about the bottom line. Trust me, we provide the best retail/restaurant/office construction budgets we can, but there are additional factors to consider when reviewing your commercial construction bid. Does your GC provide you with an industrial construction preventive-maintenance checklist? What about satisfied commercial construction client testimonials? Also keep in mind that there’s no line item for honesty, work ethic and construction site safety.

All I’m saying, is do the right thing. Whether you’re budgeting a new restaurant construction job, or hiring the best Chicago retail construction firm you can, always keep safety and integrity top of mind because you never know who might be making you cupcakes.

For the record, the Bright Horizons cupcakes were awesome.

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

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

If the right team and plan are in place, there are a number of outdated malls that could turn into successful shopping center retrofits.

It’s a mixed bag of commercial construction news for shopping center developement. On one hand, retail sales continue to show improvement from last year, yet the suburban shopping mall – or at least the traditional enclosed shopping mall – seems to be on the way out. So what’s a successful shopping center developer to do with his or her empty mall?

According to the New York Times, there can be new life for a ‘Dead’ Suburban Mall’. We agree with the article that failed, outdated malls can present a great opportunity for building a new shopping mall, or retrofitting a shopping center. Just look at the transformation of Randhurst Village. If you’re interested in turning your shopping center mess into a success, review our checklist below.

Qualify your team. Make sure the commercial construction team you hire not only has shopping center construction experience, but also retail and restaurant construction experience. You want a general commercial contractor who understands all parties’ needs.

Plus, if you didn’t have a restaurant in a space before, chances are you will now. Working with a commercial general contractor who can build in any of these disciplines will help you determine what can be saved, repaired, moved or redistributed from the existing infrastructure.

Also, heed my warning on hiring low-bidding pick-up truck contractors. I’ve run out of fingers and toes to count the number of commercial construction projects where we’ve rescued the job because of shoddy work by a GC who was in over his head. In the end, your lowest bidder may actually cost you more time and money if a job has to be done twice.

Save. Save. Save. Most retailers today want less space. Depending on your tenant mix, a shopping center contractor could be reconfiguring your space significantly. To do this effectively and efficiently, we need to review as-built drawings to see what big tickets items can be re-used and what existing infrastructure we can integrate into the re-design of the space to save on retrofitting a mall construction costs.

Structural steel, slab, the roof, HVAC systems, mechanicals, electrical systems – these are all up for re-use. Keep in mind, it becomes more important to re-use features when you’re working with temporary or pop-up retail tenants than with long-term leases.

Being fuzzy on tenant mix is okay. The more information you provide, the more accurate the shopping center construction budget – especially if you plan to work with retailers who have proprietary facades. But due to our vast experience, we have construction pricing models in place for all restaurant and retail construction (high-end, low-end, big, small, etc.) work. We can even provide construction budgets based on square footage for typical-sized retail space even before you hire an architect.

Spend. Spend. Spend. Speaking of the architect, the more money you invest upfront to get the construction documents as accurate as possible, the more money you’ll save on the back-end. You’ll receive the most accurate subcontractor pricing and the fewest amount of construction change orders with highly detailed architectural drawings. And I know people don’t believe this, but the best Chicago contractors hate change orders. It’s just more paperwork and time on a job. Trust me, screwing in a light bulb is going to cost more as a change order than if it was in the original plan.

What malls do you think are in need of a re-boot?

www.englewoodconstruction.com

The pending downtown Chicago casino will involve a different set of construction challenges than the Rivers Casino in Des Plaines (shown here).

In Chicago commercial construction news, everyone knows the big buzz right now is on the pending Chicago casino. Although many sites have been mentioned, the Chicago casino location is still undetermined, and for the purpose of this blog post, that’s okay. Because regardless of where the downtown casino is located, there is a commercial construction checklist of best practices that a successful casino developer needs to keep in mind.

1. The most important aspect to any casino construction job is the electrical work. It has to be perfect, so the electrical commercial construction subcontractors need to be the best in their field. There could be a power outage outside the casino, but no disruptions can take place within the infrastructure of a casino’s electrical system.
2. A casino is an entertainment-based themed experience, which means there can be no room for error in commercial construction work that affects the clientele’s comfort level, such as the HVAC system.
3. You can never have too many bathrooms.
4. Whether you’re building a casino in a city or the suburbs, labor rates are going to be similar. However, you will likely see an increase in Casino constructions costs when it comes to the logistics of getting materials into the city, and ultimately, moved into the project. Whether the casino location ends up being a site like Navy Pier, the old Chicago Main Post Office or Block 37, there will be more commercial construction challenges and coordination of delivering materials than with the new Rivers Casino in Des Plaines. More challenges = higher commercial construction costs.
5. Bigger isn’t always better. The size of the new downtown Chicago casino hasn’t been determined, but it won’t be as big as the other Chicago-area casinos. With enough hotels and restaurants in downtown Chicago, this new casino likely won’t require new hotel construction and will have limited casino restaurant construction. That said, the casino developer would do a disservice to the project by hiring a big general commercial construction contractor. Why? Because most general contractors put their best people on their “biggest” projects (think square feet and revenue). In terms of size, this casino won’t be that big of a project for a large commercial general contractor. Instead, it’s likely to fall to their special project team – i.e., not the A team. The best Chicago commercial contractor for this casino is likely to be a smaller firm.
6. Get the GC on board as early as possible to work alongside, not behind, the architect. As most every potential site mentioned for the casino will mean a retrofit construction job, the general commercial contractor needs to get in early to perform commercial construction CSI and remove the construction demons from the site. This is especially true for neglected commercial properties, such as the Post Office that have been vacated for awhile.

And despite the headline for this post, we think a downtown casino is a guaranteed bet for the house (developer), the city and Chicago’s commercial construction industry. I’ll admit, a casino wasn’t on our radar for commercial construction trends 2011, but it’s a happy surprise. No matter where the casino ends up, it’s going to bring jobs to the city – both in building the casino and operating it. Plus, all the trickle-down new construction work, in the form of new storefronts that are likely to pop up around the casino, will create even more jobs and spur the economy.

Deal Englewood Construction in!

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

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

www.EnglewoodConstruction.com

Do you know what construction responsibilities fall to a tenant and landlord in a build-to-suit space?

While I think everyone in the retail industry likes to hear news that 2011 retail sales are up – as it usually means new retail construction projects are in the pipeline – it’s still tough for shopping center landlords to make deals work with retail tenants. Why? Because it can become a bad game of “who’s on first?” as mall owners and retail tenants figure out who will be responsible for commercial construction services in a “build to suit” shopping center construction space.

First, let’s have a refresher on the most common types of available retail space in Chicago shopping centers — actually, the terms below work for all new commercial construction projects. Keep in mind, the rent is reflected with increases for each of these levels.

• Cold dark shell. This space has virtually been untouched by a landlord’s commercial construction general contractor. There is nothing on the perimeter studs or deck (underside of roof), no HVAC or ductwork, sprinklers are basic and the flooring is probably concrete.
• Vanilla box. This is a very generic retail space with cheap commercial construction finishes. The drywall is primed and may have one coat of white paint, the ceiling is basic at best and the flooring is probably covered in vinyl tile.
• Turnkey from spec. This is most popular with big retail leases in 2011. The retailer (or office tenant) brings in its drawings and asks the landlord for costs from commercial construction contractors to build out the entire space.

Regarding a turkey space, after the landlord pulls together the best commercial construction bids from its general commercial contractors and presents its retail construction costs to finish the space to spec, one of two things happen.

Scenario A – The tenant agrees with the landlord’s bids, so the landlord pays for and manages the construction process. This scenario works well for retailers who prefer to dedicate personnel to managing their business rather than managing the commercial construction process.

Scenario B – After reviewing the landlord’s construction bids, the tenant opts for a concession check and hires its own retail construction firm to oversee the build-out. This is popular with large national brands that have in-house teams who know their way around a construction site.

Regardless of which scenario happens, make sure you are working with a good retail contractor that has experience in tenant and landlord shopping center construction and knows the different needs and responsibilities between the two parties. For example:

• The tenant almost always is responsible for millwork and cash wrap, trade fixtures, any signage (directional or façade) and tenant specific equipment. In restaurant construction checklists, this means tenants are responsible for putting in their own ovens, prep stations and sinks.
• Infrastructure work, such as sprinkler service, water service, sanitation, fire alarm service where applicable and mechanical infrastructure, typically falls to the landlord.
• Landlords don’t want to lease space to tenants who aren’t financially secure, so they won’t accept just any deal. Landlords are pairing with the best retail contractors to make sure construction budgets work with proposed rents.

Does this mean that general commercial contractors like Englewood Construction can spend hours working with landlords in reviewing drawings and putting together the best commercial subcontractors and costs for a potential job only to see that it doesn’t make sense for the landlord? Or that tenants may decide to take a concession check from a landlord and do the construction work themselves? Sure, but it’s still nice to be asked to the prom.

Plus, we can hold our head high that in looking out for our client, we gave our best pre-construction services (for free!) without compromising our quality of work.

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

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

www.EnglewoodConstruction.com

If your shopping center general contractor can read this sign from his truck, he's guilty of being a parking poacher.

In this dog-eat-dog retail world of shopping center operators and mall developers working every angle and concession to bring in new retail tenants, the last thing mall landlords need is a commercial construction general contractor who doesn’t know the rules causing headaches for everybody.

And by causing headaches, I mean a GC that annoys your existing retail tenants and chases away shoppers with their inexperience in shopping center and retail construction projects. So heed my advice and follow these shopping center construction tips:

1. The successful retail construction firms are the ones your shoppers can’t see or hear – it’s like they don’t exist. After all, commercial construction is noisy work. The best shopping center contractors and retail construction firms know demolition and construction work needs to happen at least four hours before normal business hours to reduce disruptions to shoppers.
2. Commercial construction is a dirty business. The best time to haul debris to a dumpster is when shoppers aren’t around. But, you also need to be mindful of a shopping center’s neighbors. We’ve done a lot of work at Westfield Old Orchard, which is close to a residential area, so you also can’t be kicking up dirt and dust in people’s yards either.
3. If you’re opening new retail in a mix-used development, your GC needs to understand the unique commercial construction challenges this type or project entails. For example, we’re currently doing Chicago retail construction prep work for General Growth for the new Water Tower Place Armani store. Water Tower Place includes a shopping center, hotel and residential tower, so the noise level needs to be minimized for everyone. Extra measures need to be taken, such as adding extra insulation barricades to adjacent tenant walls for sound deafening.
4. It’s imperative that a GC knows how to communicate with all parties in a shopping center retail build out, or what I refer to as the shopping center holy trinity – security personnel, dock managers and mall management. A smart commercial general contractor knows how to get out of the way and let the office of the building QB the process, because the biggest challenge of any new shopping center construction project is the coordination of materials.
5. If your GC schedules Monday a.m. deliveries, they’re a novice to new restaurant construction. We stay away from Monday a.m. deliveries because that’s when restaurants receive their food. In fact, each mall will have a rhythm of deliveries that a GC needs to learn and coordinate around. Merchandise and food deliveries will always take precedence so you don’t want a GC with down time waiting for construction deliveries. All that does is delay the job.
6. Protect the merchandise! Certain materials have to come in a certain way through the general mall – like the cash wrap, a large piece of millwork, etc. Successful retail contractors know how to protect a mall’s common areas from bulky materials and not interfere with customers walking through the mall.
7. It’s tough enough getting shoppers to come to your mall, so look for a GC that wants to give customers a great shopping experience during construction. Use their construction barricade to your advantage by putting out signs and directions that tell shoppers where to go and what new and exciting experience they’ll soon have at your shopping center.
8. Beware of parking poachers. Customers always get the closest spots, so make sure construction teams are parking in the proper areas.

Even though shopping center construction can happen 24 hours a day – and it usually does – the most successful projects are when nobody else knows we’re there. The barricade comes down and people ask “where in the world did this store come from?”

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

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

www.EnglewoodConstruction.com

Many shopping center landlords are no longer assuming responsibility for store construction costs, but instead offering higher tenant concessions.

Now that spring is officially here, I wanted to reflect on the Chicago retail construction trends and news we’ve seen so far in 2011. From the new commercial construction projects we know are in the pipeline, to what I heard at the recent Bisnow Chicago Retail Summit, I am cautiously optimistic.

Good News/Bad News.

The good news is the volume of new commercial construction projects we’re bidding on is on track with 2008, which means the market is moving in the right direction. The bad news is the number of Chicago general contractors bidding on jobs has increased.

The first round of hhgregg stores in Chicago had eight commercial contractor bids per job, while the second wave of stores is averaging 11 bids per site. The fact is, there are too many GCs bidding on new retail construction jobs and commercial developers and shopping center landlords are the ones paying the price.

We still see retailers/landlords/owners take bids from the best Chicago contractors as well as pick-up truck GCs. The latter are often awarded jobs due to low commercial construction costs. But as the saying goes, you get what you pay for, so it’s not surprising when we’re brought in to re-do or un-do the work of the pick-up truck GCs.

But I cannot underscore how great it is for Chicago’s retail market to see a brand like hhgregg come into town and burn up square footage. This is especially positive commercial construction news given the first quarter announcements of Borders, Blockbuster and Barnes & Noble closing all, many or some of their stores.

The Loop.

There have been other promising retail construction trends in 2011. It looks like we’ll finally see new Walmart stores in Chicago, including a Neighborhood Market at Prudential Towers. State Street got a shot in the arm from CityTarget. And while we’ve seen the ownership of Block 37 change hands, the bottom line is Larry Freed got the project done. Eventually the entire shopping mall will be leased and State Street will once again become a retail mecca.

Michigan Avenue. While there weren’t a lot of new Michigan Avenue construction projects announced this first quarter, work is underway at AllSaints, TopShop and Rolex. And pre-construction commercial services are probably in play for Uniclo as we’ve heard it is shopping the Magnificent Mile, as is a national maternity chain.

Chicago Suburban Shopping Centers. At the Bisnow Retail Summit, there was a lot of emphasis on city projects, but we’ve been just as busy on new suburban Chicago retail projects. One shopping center construction trend we’ve noticed is a shift in responsibility for shopping center construction services. Last year, landlords wooed tenants by assuming responsibility and mall construction costs to build out a retailer’s space. Now, owners/landlords are scaling back on their burdens by giving higher tenant concessions so retailers are responsible for their store’s construction.

It will be interesting to see how Chicago’s retail market progresses in 2011. But one thing I am certain about is that retail construction is constantly re-inventing itself because retailers need to stay current with new store concepts, brands, services and designs. And speaking of new retail concepts to hit Chicago, we’ve got a doozey to announce this second quarter. Stay tuned.

www.englewoodconstruction.com

Englewood Construction has worked on a number of Chicago retail construction projects in high-traffic urban areas, such as American Girl Place on Michigan Avenue.

With the recent Chicago commercial construction news of Target moving to State Street and Wal-Mart opening its Neighborhood Market store at Presidential Towers, it begs the question of what other big box retailers might take advantage of current commercial construction costs and available space to introduce a smaller concept store to downtown Chicago. Is this a new retail construction trend? Probably so.

hhgregg is certainly creating buzz in Chicago retail construction with a number of retail retrofit construction projects in Chicago’s suburbs, so perhaps they are a likely candidate to penetrate the city’s urban retail market.

But regardless of which national big box retailer enters downtown Chicago (or any city’s urban core for that matter), it needs to make sure its commercial general contractor has experience not only in stores with smaller footprints, but also in multi-story, mixed-used urban developments with existing commercial tenants or residents. Why? Because while most people think commercial construction contractors simply build projects, what we really do is manage a process and the logistics of a commercial construction project. So if your general contractor doesn’t tell you the same thing, then you’re not working with one of the best Chicago contractors.

Unlike a suburban retail project in a new-construction shopping center development, the CityTarget and the Neighborhood Market jobs will involve working within a tight city block foot print that likely has only one opening where all goods, materials and debris can enter and exit. Coordinating traffic and usage between other tenants, building operators and construction personnel is like conducting an orchestra.

After working on the retail build-outs of Zara in the former Chicago Place Mall and American Girl at Water Tower Place, both of which were Michigan Avenue retail construction projects, we know a little something about working in high-traffic, urban areas. (As a bonus, click here if you want to know the three secrets to a successful retail store build out in an existing vertical mall or shopping center.)

Wal-mart’s Neighborhood Market store at Presidential Towers poses an even greater coordination challenge for a commercial general contractor. With an office building that’s occupied during the daytime, you can leave all the loud work noise and smelly chemicals to nighttime work. But, in a residential building like Presidential Towers, you can’t do that. The time frame for working is a lot shorter, so your GC has to work smarter.

And if you’re opening a new retail space in a historic building, like the CityTarget on State Street, well that’s a whole other animal. The number of building permits we needed for 520 N. Michigan Ave., a landmark building, would blow your mind. The city is full of orange tag buildings, so align yourself with a Chicago commercial contractor experienced with landmark buildings and historic facades or your construction schedule could go out the window waiting for your GC to pull permits and navigate the appropriate jurisdictional authorities.

Who do you think will be the next big box retailer to offer a small store concept?

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

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

www.EnglewoodConstruction.com

Step 1: We pulled out the cable to find it completely destroyed.
Step 2: We rented a sewer camera and discovered a metal object stuck to the existing pipe, which scraped the cable and caused the explosion.
Step 3: We fixed the problem. Case closed.

At one point or another, even the best Chicago commercial construction contractors are susceptible to a construction site demon. In some situations, like the exploding cable above, the job was delayed by just 1.5 days. But in a retrofit construction job or an REO commercial property where the distressed asset has been neglected for awhile, there could be significant delays to your commercial construction timeline and an increase in commercial construction costs depending on the scope of the problem.

Englewood Construction's team is always ready to solve the latest construction CSI case.

While you can’t ward off all commercial construction site problems, follow these commercial construction tips below and your chances of running into an unforeseen condition should decrease significantly.

1. In a restaurant or retail retrofit job, you really are going in blind to the property, which is why you need to enlist a commercial general contractor early on. (See below)
2. Typically, the architect is hired first and completes a very general site survey before submitting drawings. Then, the GC is hired and performs an exploratory search. If the GC uncovers any real problem on the site, you now have delays and need to pay for a second round of drawings. To avoid this, have your commercial construction contractor on hand during the architect’s commercial site survey so the GC can verify the safety and viability of the construction site.
3. If your project is a retrofit and you want to save on construction costs by re-using existing infrastructure or construction materials, an experienced GC will examine areas that often fall short of code due to poor maintenance, such as electrical work (lights), bathrooms and HVAC units, just to name a few.
4. Take the temperature of your building into account. For a hospitality construction job involving an REO chain of hotels, we knew the buildings were abandoned and cold, so we assumed there would be water leaks in the pipes and factored detailed exploratory work and pressure tests into our construction budget that saved the client money in the long run.
5. Find the original general commercial contractor of your project site. At one of our current Chicago restaurant construction projects, it’s a good case of déjà vu because we were the original GC for the retail space back in 2002. We already know any potential construction site demons so our construction timeline is much shorter than a firm’s not familiar with the site.
6. And one time, a member of our team tapped his experience with a retail retrofit project that went back 20 years to the first time he worked on the complicated site. Granted this doesn’t usually happen, but it’s a win-win for everyone when it does.

What was your worst construction site horror story and how did you fix it?

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

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

www.EnglewoodConstruction.com

Englewood Construction is an expert in winter condition commercial construction practices.

The Chicago blizzard of 2011 is a story we’ll be talking about for generations. While most businesses, including commercial construction projects, were closed on Wednesday, Feb. 3, 2011, that didn’t mean the best Chicago contractors weren’t working. After all, shopping center landlords, restaurants and retailers couldn’t afford to be closed two days in a row.

Our commercial maintenance hotline was on high alert. Was a business or shopping mall roof going to collapse under the weight of too much snow like in New England? Were pipes going to burst or freeze in a restaurant? Would office or shopping center parking lots be cleared in time so delivery trucks, customers and employees could use them the next day?

While we, and our clients, were prepared and made it through the recent blizzard unscathed, not everyone was so lucky. If you’re involved in Chicago retail construction, or any type of commercial construction in a cold weather climate, take note of the checklist below.

1. Any commercial project started after Dec. 1 will run into some type of delay due to winter conditions, so successful general commercial contractors will plan accordingly. It’s a red flag if winter conditions aren’t factored into their schedule or bid.
2. If your project isn’t at a certain point in construction by Dec. 1, then it might need to shut down temporarily. An experienced GC can help you weigh the construction costs of fighting winter conditions versus lost revenue if your project doesn’t open on time.
3. Certain construction materials are in short supply in winter. The rule of thumb is you won’t get asphalt until tax day since the plants shut down in December. If you need asphalt in the winter, expect premium commercial construction costs to re-open a plant.
4. You can still get concrete, but your commercial general contractor should factor in the cost of concrete warming blankets so it doesn’t freeze.
5. Forget exterior painting and plastering if the weather is below 45 degrees. Same with brick and mortar.
6. Expect increased commercial project costs if you need to rent equipment, such as temporary propane tanks if there is no gas to the building; temporary heaters if the HVAGC hasn’t been installed; temporary enclosures for the face of a building; and ground thawing blankets if you have to dig into frozen ground.
7. If your project requires a construction crane to swing cables for pre-poured concrete panels, be prepared for additional crane rental days/fees as fierce blowing snow + swinging cables = safety hazard.

For those working on a retail construction build-out, don’t think you’ve escaped winter conditions just because you’re renovating an interior. At our Trader Joe’s retrofit on Diversey, our superintendents cleared snow for hours to ensure we could move materials around the site and get to the dumpsters.

Speaking of snow removal, we worked on one project where the shopping center landlord and retail tenant were still coming to terms with who was responsible for snow removal when we showed up to work. These matters should be finalized before a project even begins to avoid construction delays. And for tenants, make sure your maintenance budget allows for increased CAM (common area maintenance) charges due to high snow removal.

Folks, it’s only February, so were not out of the woods yet. Stay safe and warm.

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

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

www.englewoodconstruction.com

Franchise restaurants are the rise, like this new Mrs. Fields that Englewood Construction built in Orland Park Mall.

As suggested in my 2011 commercial construction trends blog post, there seems to be a rise in new restaurant construction, particularly among franchise restaurants. In fact, Crain’s Chicago Business just reported that Moe’s Southwest Grill has sold restaurant franchise agreements to open 10 new units in the Chicago market.

So I thought I’d devote a blog to franchise restaurant construction. Whether you’re planning on buying a franchise agreement or you’re a shopping center landlord negotiating construction concessions with a franchise operator, you should know what is ahead of you.

Each franchise is different. Some give more guidance to operators than others, but typically a franchise gives a binder to an operator that instructs how to operate the store, but not how to build it. More often than not, a first-time franchise operator is given no design specifics on how to build a franchise store. All he knows is that it should look like the other one down the street.

For franchise operators new to the restaurant construction bid process, there is a definite learning curve with construction costs. First-timers tend to go with a low-bidding pick-up truck contractor only to realize you get what you pay for. I understand the concept of wanting to save money, but at what cost?

A franchisee needs to partner itself with a restaurant contractor that understands the brand standard, has experience in restaurant construction, knows what the county health inspector wants and expects, and is well versed in working with the municipality. Even better is to work with a national general contractor who has worked with your brand before and knows exactly what the franchise wants.

To really save yourself time and money, hire a general commercial contractor with restaurant design build experience. This way you won’t have to manage the architect and general contractor separately. A restaurant contractor with design build experience should be able to look at a photo of your store and build it. No hand holding involved.
Tying back to my first point, franchise operators should not expect a lot of support from the corporate office during construction. So in addition to hiring a contractor with restaurant construction experience, your GC should also care about the end product and fostering a healthy relationship between you and your landlord. You shouldn’t have an adversarial relationship with your landlord. Picking a general contractor who has the time and knowledge of working in shopping center construction can also make or break your project.

Finally, once you do open your franchise, make sure you protect your investment by scheduling restaurant preventive maintenance visits.

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

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

www.englewoodconstruction.com

Bill Di Santo (right) overseeing a design-build project for Englewood Construction. Working with design-build GCs is a good resolution for 2011.

January is a great time to create a commercial construction checklist of resolutions to help improve your commercial real estate business in the coming year. I’m sure some of you don’t have the time to draft a list of resolutions, so I’ve done it for you – you can thank me later. Whether you’re looking to save on commercial construction costs, strengthen your subcontractor relationship, decrease your commercial construction timeline or just stay ahead of commercial construction trends, here are some resolutions to consider in 2011.

Don’t always take the lowest bid. I know this is a tough one to follow as we all need to keep commercial construction budgets in check, but we saw too many companies go with pick-up truck contractors in 2010 only to be burned later. The low-bidding general contractor was often in over its head, which meant deadlines were missed or work was shoddy and another, more experienced GC was brought in to finish the job—at an additional cost.

Schedule a commercial construction preventive maintenance visit. If you never bother to have your HVAC cleaned or don’t think your restaurant construction budget allows for an annual jetting of the pipes then you could be in for a world of hurt and lost revenue. On average, preventive maintenance costs are far lower than the cost to replace major equipment. Also, by using poorly maintained equipment, you carry a higher risk of equipment malfunction, which could jeopardize your safety plan.

Get online. If you’ve read HardHatChat before then I’m preaching to the choir. But if this is your first time reading this blog or you don’t spend much time on the internet researching best commercial construction practices, researching general commercial contractors and vendors or catching up  on commercial construction news, then you are missing out. Like HardHatChat, most of the information out there is free, so sign up now!

Qualify general contractors that build in your wheelhouse. While bidding on the commercial construction remodel of a 500+ sq. ft. national chain on State Street we were surprised to see two of Chicago’s largest GCs also bidding the job. I won’t name names, but call me and WE can discuss it over a Dr. PEPPER. I’m sure the retailer was also surprised. If the client needed a hospital or condo building on top of the retail it would make sense, but 500 sq. ft. Really? Bottom line, use a commercial general contractor who specializes in what you need, whether its retail construction, restaurant construction, etc. The absence of super-sized commercial projects has forced a lot of large firms to go after jobs they normally wouldn’t consider or aren’t even their specialty. Do you really want to be somebody’s sloppy seconds?

Bring your GC in early. Everyone who brings their general contractor into a project after their architect, raise your hands. Now, how many of you have had to pay for a second set of drawings because your GC found something that would alter the architect’s original plans? Try switching it up in 2011 and bring in your GC first. Or better yet, hire a design-build general contractor. With your commercial general contractor on the front lines of all design plans and in charge of selecting the engineer and architect, you greatly reduce the risk for unnecessary change orders. Design-build general contractor should also perform exploratory work up front, before you pay for architectural plans.

Take a leap of faith. Most of our work comes through the competitive bid process, but we welcome negotiating with clients and so should you. It may not be what you’re used to, but from a construction cost perspective, it pays to negotiate with a designated general contractor versus requesting multiple bids. When you negotiate, any cost savings your contractor may uncover are split between the two of you. When you competitively bid a project, the GC pockets the savings. Also, negotiated projects foster more team spirit, which is a great way to begin any collaboration. So check your gut and go with a firm you feel comfortable with – you could be pleasantly surprised.

Now that I’ve shared what your resolutions should be for 2011, it’s only fair that I share mine. I have learned that I cannot be everything to everyone, so I resolve to be the very best person I can be to those most important in my life and to continue to grow by surrounding myself with the very best friends, clients, colleagues and vendors that life has to offer. Oh, and for 2011 to be Englewood Construction’s best year yet!

What are your resolutions for 2011?

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

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

www.EnglewoodConstruction.com

It was a busy year for shopping center renovations, like the new food court construction at Westfield's Old Orchard shopping center in Skokie, Ill.

High – Shopping Centers. We saw much-improved activity in shopping center construction – not necessarily the building of new malls, but in general commercial contractors working with landlords and developers on pre-construction services, such as commercial construction budgeting to help them propose attractive lease deals for new tenants. With so much desirable retail space available, many brands were taking advantage of desirable shopping center rents and tenant allowances to add a new store location and increase market share. And of course the industry did see some notable shopping center renovations in 2010, such as Randhurst Mall in Chicago and Hamilton Plaza Shopping Center in New Jersey.

Low – Green building. While sustainable construction was a hot button in 2010 office construction, green retail and restaurant construction did not gain as much traction. While some retailers may be looking at using low VOC paint or furniture made out of re-manufactured materials, the certification for LEED retail and restaurant construction just isn’t there. Now, as new shopping center developments are launched or landlords look to refresh their portfolio with a shopping center renovation, they could stand to gain long-term benefits from having a green shopping mall in the mix and will eventually recoup the sustainable construction costs that go into a project like this. But in the meantime it seems like the line on sustainable retail and restaurant construction isn’t “no” but “not now.”

High – Institutional Construction. Thanks to the stimulus plan and federal funding, institutional work in the education sector was a bright spot in commercial construction news this year and should continue to be strong in 2011. Health care construction also gave our industry a much-needed shot in the arm, including hospital remodels and additions as well as the construction of stand-alone doc-in-a-box locations and rehabilitation centers.

Low – Pop-up Shops. Usually limited to the holidays, pop-up shops went mainstream in 2010 with Pop-Tart World in Times Square. Sure, pop-up stores provide a short-term fix to vacant retail space, but in the big picture most pop-ups are not good news for the retail construction industry or shopping centers. Unless they become full-time tenants, like many Toys R Us pop-ups did the other year, pop-up shops are not a landlord’s long-term solution to vacated space. Plus, in some cases pop-ups can actually de-value a property. We’ve seen too many pop-up shops that do slim to none construction improvements to their space. Or worse, the work they did, which is usually done in-house, actually highlights flaws in their temporary space or creates a safety hazard.

High – Franchises. The downturn in the economy prompted many people to embrace their entrepreneurial spirit and buy into a franchise. The restaurant sector in particular saw strong franchise growth, which in turn created a nice stream of new restaurant construction work for general commercial contractors. Sandwich and burger restaurants were particularly hot, including 5 Guys, Fatburger and Elevation Burger, but so were other chains like Noodles & Company and Mrs. Fields.

Low and High – Distressed properties. There are still far too many distressed commercial properties on the market. However, the good news is that toward the end of 2010 we started to see commercial developers and investors pick up those properties and decide to do something with them via a retrofit construction job, like the Waterview Tower and Shangri-La Hotel in Chicago – or at least work with contractors on determining the commercial construction costs to transform the property and turn it around.

High – Decreased construction costs. Commercial construction costs were at all-time lows in 2010, allowing many projects to get the green light. Except for commodity-based materials like copper, steel and petroleum, construction material costs were down for most items. Labor rates were also down, which of course made many commercial construction budgets look very attractive compared to two years ago. In turn, we saw a rise in bid activity.

Also, because commercial construction costs were down in 2010, the mentality of the lowest bid gets the job did not reign supreme as it did in 2009. As I’ve often said, do you want the cheapest doctor saving your life, or the best doctor? With so many firms watching their bottom line in 2009, they often hired pick-up truck contractors to keep costs down. Unfortunately this move proved costly to their projects as many of those commercial contractors did not have the experience needed for the job or the depth of quality sub-contractors that a national general commercial construction firm can provide. So it was refreshing to see 2010 bids awarded on merit, not price.

Let’s hope the same holds true for 2011.

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

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

www.englewoodconstruction.com

Fast-casual restaurants like Noodles & Company should be a bright spot for commercial construction in 2011.

It’s that time of year again, when I dust off the crystal ball to predict commercial construction trends for the following year. If you didn’t read last year’s post on “Commercial Construction Trends 2010,” you should know these predictions are based on the new commercial construction projects Englewood Construction has heard are in the pipeline for 2011 across the country, as well as my 30+ years of combined experience as an architect and national general commercial contractor.

1. Wet, but not Wild. Around Labor Day 2008, the faucet shut off for commercial construction projects. By Thanksgiving of 2009, there was a trickle of new drawings coming in, which increased to a steady flow throughout 2010. In fact, by August of this year, we had billed as much work as all of 2009. And from what we hear and see, 2011 should be even better than 2010. There are some great opportunities, especially in retail construction, as highly motivated landlords are offering prime locations with attractive rents. Read more on this commercial construction news below in trends three and four.
2. Apple Magic. You can bet smart retailers will continue to mimic the magic shopping experience Apple has created with their retail stores. This may entice some brands to undertake retail construction renovations of their stores to offer a more engaging venue and keep customers in their space longer. It might also mean brands need to get creative in using store space. For example, lululemon builds yoga class space in its stores. The brand also frequently repaints their locations to keep them fresh and looking like new retail construction. And Target became even more of a one-stop destination by renovating limited locations with full-on grocery stores.
3. International Invasion. The influx of available and attractive retail space is also appealing to foreign retailers looking to grow their brand stateside. This is especially good news for Chicago commercial construction, as exciting foreign brands are drawn to our city. AllSaints and Topshop from England; Australian jewelry brands Diva and Michael Hill; Italian glove maker Seminetta; Spanish retailer Desigual; and Japan clothing store UNIQLO have all announced (or be rumored) to be setting up shop here.
   And while most foreign retailers prefer their own store, don’t be surprised if more of them opt to introduce their brand through department stores. Spanish retailer Mango is a prime example as it created the MNG store-within-a-store at JCPenny to complement its line of Mango stores.
4. Off the Shelf, Into the Box. While international retailers may partner with department stores to enhance their brand, we could also see an increase in new retail construction from popular domestic brands leaving large retailers to build their own store due to attractive leasing options. Both Vera Bradley and more-recently LittleMissMatched have ventured out with their own line of stand-a-lone stores, while still maintaining a strong presence with independent retailers.
5. Fast-Casual. This phrase was a saving grace for many in the restaurant construction industry and we’ll continue to see more of these stores in 2011. Whether it’s a familiar brand like Noodles & Company, or new concepts like Pei Wei and Boloco, these fast-casual restaurants are striking a chord with the public. Expect to see more new restaurant construction in the fast-casual sector than other restaurant arenas in 2011.
   Whether you agree or disagree with my predictions, I’d enjoy hearing your thoughts on restaurant construction trends or retail construction trends for 2011. But this year isn’t over yet, so stay tuned for an upcoming blog on the best and worst of commercial construction 2010.

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

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

www.englewoodconstruction.com

After renting the same space in Schiller Park for 12 years, we decided to buy a vacated grocery store in downtown Lemont, Ill. for what we considered the ultimate office tenant renovation project. Our new office is bigger, brighter, more energy efficient and centrally located to our staff and Chicago commercial construction projects. And because we were our own client, we were only limited in our design build capabilities by our imagination and a little thing called a commercial construction budget.

Each project we take on presents an opportunity to share commercial construction news with you. This project was no different. Here are just a couple commercial construction tips and insights we learned along the way:

1. There are great deals on leasing office space, but even better deals on buying vacated grocery stores. The property we picked was such a great value that even after factoring in the commercial construction costs of the office renovation, our new mortgage was still less than our old rent.
2. When it comes to a commercial construction retrofit, let the design work with, not against, the existing structure. The building we bought had a low roof height, so we knew an office design based in Prairie-style architecture would work well with the building’s long horizontal lines.
3. Don’t design in a silo. As both the architect and client for this office renovation, I could have designed the space as I saw fit. Instead, I asked all employees for their input so the office could be functional as well as fun. It was important to meet their needs to ensure the new environment would be conducive to maximum productivity.
4. As mentioned in an earlier blog post about commercial construction retrofits, re-use as many materials as possible to not only keep construction costs down, but also have a more sustainable construction project. The work stations from our old office were fine, so we re-used those. We also kept the HVAC units and the exterior brick of the building, but we did stain the bricks to work with our Prairie-style color palette. We also retained most of the concrete flooring, but gave it a face lift with a new stain.
5. Even the smallest green construction building practices can make a difference in creating a smaller carbon footprint. We used low VOC paints, local materials to save on transportation costs and created a rain-water recapturing system. Also, our lighting system is based on light sensors that not only monitor the brightness of a lighting fixture, but also harvest natural light, allowing us to reduce the use of artificial light.

While it was exciting to be the client for once in an office retrofit construction project, it wasn’t without its challenges. You’ve heard the saying “the cobbler’s children have no shoes.” Well, you’re talking to the cobbler.

Just as we scrutinize every detail in our client’s projects, we examined and then re-examined every beam, angle and pipe in our new office. It was a state of constant tweaking. But there comes a point when you have to trust your construction team and let the project move forward. Lucky for me, I had the best general commercial construction contractor on this project – us.

Stay tuned as we plan to share more photos, videos and insights about the office construction of our new headquarters. And if you’re interested in taking a tour, you know where to find me: 80 Main Street in downtown Lemont.

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

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

www.englewoodconstruction.com

The editorial team behind commercial construction blog Hard Hat Chat -- Chuck Taylor, Kim Sawyer and Bill Di Santo.

But, everyone assured me a commercial construction blog would be an affective way to engage with our peers, clients, the media and anyone else who had a shared interest in everything from retail construction trends to restaurant construction costs. So I took a leap of faith and HardHatChat.com was born. As usual, my team was right.

Twelve months and just 34 blog posts later, I find myself very proud of our little blog. More than 5,600 people visited HardHatChat.com in its first year. And from the emails and calls we’ve received, you find it as worthwhile as we do.

One thing that strikes a chord with most of you is information on trends in the industry, whether it’s insights on general commercial construction trends, or more concentrated areas like retail construction trends, restaurant construction trends and industrial construction trends. So stay tuned, as we’ll soon be predicting 2011 construction trends.

Commercial construction checklists have also ranked high with you, so we’ll continue to write more of those in 2011, as well as other popular commercial construction blogs on topics like construction costs, commercial construction tips and commercial construction best practices.

Of course if you ever have a particular construction question you would like us to address or you want more information on a topic, just let us know. We’re honored that you have found HardHatChat to be a great resource for your needs.

I also want to acknowledge some great supporters of our blog who have helped broaden our readership. Hat’s off to Procore Technologies, The Blue Book, Retail Traffic, BidClerk, Realcorner.com and the U.S. Green Building Council.

But most importantly, thanks to our readers, my team at Englewood, our clients and vendors. Your continued help, suggestions and new projects provide us with much of the valuable content for this blog. I appreciate each and every one of you.

And if you think writing a blog was a new and exciting venture for Englewood Construction, wait until you read what we’re up to in my next post.

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

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

www.englewoodconstruction.com

Commercial construction contractors can save clients thousands of dollars by knowing the right time to buy certain materials.

I heard a Home Depot ad on the radio recently targeted to commercial general contractors that made me pause. The spot is about the costs of commercial construction and how buying building materials in bulk can help GCs save money and bring down a construction project bid so they win the contract.

On the surface, the ad is true – buying building materials in bulk is cheaper. It’s the Costco principle. But the ad doesn’t begin to scratch the surface of a general commercial contractor’s duty to analyze construction cost projections to see if certain commodity or building material prices are expected to rise or fall during the life of a construction project.

Buying construction materials in bulk today won’t help your construction budget if prices for those materials are expected to drop tomorrow. More importantly, are you even ordering the right or best materials for your new retail construction or restaurant renovation job?

A commercial developer or shopping center owner who doesn’t bring a commercial construction contractor into the design build process early could unknowingly be sabotaging his own project’s timeline and costs. How?

As a national general contractor, it’s our job, not an architect’s job or even the client’s job, to know the jurisdictional authorities, inspectors and code compliances for all cities and states. It’s also our job to be abreast of commercial construction trends and to find the best construction material costs, and even alternatives to those materials.

Too often, general contractors are not asked to weigh in with their design build experience, just provide the lowest competitive bid they can for construction costs and materials. What unfortunately happens next is that once the project is awarded, the GC may alert the client that part of the design or some of the materials they were supposed to use don’t comply with city or state codes, so new materials are requested, change orders are made, costs run up and timelines are pushed back.

If only the client had negotiated with the commercial contractor and was brought in during the design phase he could have saved himself time and money. Speaking of money, make sure your general contractor is up on the following construction material prices:

• Lumber costs are down slightly compared to last year at this time.
• Wood and gypsum products are at a 10-year low.
• Marble and granite prices have come down.
• Metal, cement, drywall and paint have all gone up.
• The down economy has closed a number of steel mills, which is one reason steel
  is in short supply and has increased in price from last year.
• Any petroleum-based product is up like PVC foam insulation,
  rubber roofing, mats, flooring, etc.

But going back to my first point, the costs of these materials won’t mean a thing unless you hire the right commercial construction general contractor. After all, the building you want to build today, but won’t for six months, will cost something different in six months because material costs will change. You need an experienced general contractor to walk you through the process and help determine what makes the most sense to buy and when.

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

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

www.englewoodconstruction.com

Marcello’s Market and Deli from Canada is the latest international retailer to work with Englewood Construction.

Lately, we seem to be working on more and more new retail construction projects from international retailers. And with each one, we’ve learned some valuable commercial construction tips.

Whether it’s a chain of jewelry stores from Michael Hill (New Zealand), yoga apparel retailer Lululemon Athletica (Canada), fashion forward Zara (Spain) or restaurants like Marcello’s Market and Deli (Canada), they all want the same thing: a successful retail construction project that’s built on time and for a fair price. Not surprisingly, that’s the same thing U.S. retailers want. But getting from point A to point B with foreign retailers takes a certain savoir faire.

1. Time zones. With the five new retail stores we recently completed for Michael Hill, there was an 18-hour time difference between us and the retailer, which meant the end of our day, was the start of their tomorrow. So we engaged one of our favorite technologies for working in different time zones – Skype.
If you haven’t used Skype before, check it out. The service is free, but you have to pay for the equipment. Just keep in mind, you can send all the emails you want, or Skype every day, but there’s no time like face time.

2. Language barrier. Luckily this hasn’t been an issue with our international retailers, but as some of you may know, there is a difference between speaking Spanish with people from Spain and speaking Spanish with people from Mexico. If you’re an international retail developer, make sure you ask about your retail contractor’s capabilities to communicate effectively with you or if translators are needed (and who will pay for that expense).

3. Logistics. Some international retailers prefer to ship materials from their country, while others let us fabricate millwork locally. If items are being received internationally, it’s a bonus if your general construction firm is experienced in receiving materials from customs.

For retailers interested in green building practices, suggest locally manufactured items as those certainly count in their favor toward commercial LEED building certification.

Although I will say, we’ve used some very innovative construction materials from our international retail clients. They tend to set commercial construction trends by using interesting finishes and details that aren’t always common stateside.

4. Measurements. I love my country, but if I could, I would use the metric system for all new commercial construction projects, not just for our international clients. The metric system is so accurate, it’s perfect for construction. Make sure everyone on the team can instantly convert from the industry standard to the metric system. Clients should not have to deal with a metric system learning curve from their general contractor.

5. Municipality/U.S. code compliance. When working with international retailers, it’s often the middle processes that can cause a stumbling block, like making sure their materials are UL approved, or that a design is meeting a municipality’s requirements. That’s why it’s important to bring a general commercial contractor into the process as early as possible, so they can let clients know during the design build process what needs to be changed to comply with U.S. codes.

6. Expectations. Last, but not least, it’s important to discover and manage the expectations of an international retail client. Not only may we be living in different time zones and speaking different languages, but we also differ in our social customs and national holidays. Case in point, Thanksgiving is a U.S.-only holiday, so don’t be surprised if some international clients expect you to work that day.

Keep the channels of communication open, and communicate in a way that works for both of you. This can be a real test of your client and commercial construction services.

Bottom line, they are the client. Follow their lead. And if you’re not willing to make the effort, then I’m sure there is a long line of other commercial general contractors who will.

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

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

www.EnglewoodConstruction.com

Now is a good time to study up on sustainable construction, like this wind turbine install at Sloan Valve.

As I recently watched my kids head back in school, it got me thinking that if I could do it all over again, I would have applied myself a little bit more in school—as I think most of would. Luckily, there are all kinds of opportunities for us in the commercial construction industry to go back to “school” and beef up on the latest commercial construction trends and design build best practices to enhance our expertise and construction services.

Commercial real estate developers, shopping center landlords and restaurant owners should also take advantage of this slow time in the market to attend the various commercial real estate networking events and shopping center conferences to gain new business insights on the industry or better yet, to sit on a panel to showcase their expertise and highlight their projects.

I, for one, try to go to as many industry seminars as I can, whether they focus on retail construction, restaurant renovations, commercial real estate market conditions, etc. I soak it up like a sponge. But the thing I most dig about these events is the opportunity to connect with customers. Sometimes, simply listening to a client can give you better insights into providing them with the best service possible, which is arguably more valuable than any advanced degree you can hang on a wall.

There’s no denying that for your company to stay relevant in today’s commercial construction industry you need to be up to speed on sustainable construction and green building practices. It’s a big hot button and one Englewood Construction is dedicated to as more and more of our staff becomes accredited in LEED construction.

Whether you’re planning a green commercial construction project for LEED certification or maintaining your professional LEED accreditation, there are a number of educational resources for you, such as green construction education programs though the AGC of America (The Associated General Contractors of America) or the U.S. Green Building Council.

And with modern technology, some coursework can be completed online, so you don’t have to leave your office to brush up on new construction procedures or study successful general contracting case studies.

Take this blog for example. One of the reasons we started www.HardHatChat was because we wanted to create an online dialogue with others in the industry to improve our knowledge base. We also thought we could share some interesting case studies and tips that would benefit others.

So let’s get this discussion going. Whether you are a client, peer, subcontractor or anyone who has an interest in commercial construction projects, raise your hand and ask us a question or suggest a topic for discussion.

And unlike in math class, I promise, no spitballs…maybe.

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

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

www.EnglewoodConstruction.com

As for grading myself on that commercial construction trend, I would like to borrow a page from President Obama and say “incomplete.”

Chicago Place shopping mall retrofit

The big shopping center landlords and office building owners aren’t going to release any funds until a deal is signed. Meanwhile, tenants are asking for more concessions, such as co-tenancy clauses and included commercial construction work like full store fronts, bathrooms and full HVAC systems. Bottom line, landlords are forced to realize their threshold for pain, which means all deals are taking longer to get done.

But that doesn’t mean we aren’t seeing interesting retail construction projects or innovative commercial construction retrofits, like the 23 up-and-coming new-store concepts as noted by Retail Traffic. Some are big and ambitious, while others are more subtle.

On the home front, our client New Zealand jewelry retailer Michael Hill is giving shopping center construction a shot in the arm by acquiring a handful of shuttered Whitehall Jewelers. The end result is new, renovated retail space that is clean and modern with dark millwork and flooring accented by horizontal lines of jewelry cases that pop with strategic lighting. It’s taking the mall jewelry store concept to a sophisticated new level.

And edgy clothing retailer AllSaints is taking advantage of vacated vertical shopping centers to transform common shopping center space into usable retail space. At 700 N. Michigan Ave., aka the once-bustling eight-story Chicago Place shopping mall, we’re transforming what was the Michigan Avenue entrance of the mall into the formal entrance of AllSaints. Chicago Place also had an eight-story atrium as the core of this vertical shopping mall, which we are now filling in on the second floor to give AllSaints more ground floor ceiling space.

There also is definitely something in the water with baby/children-focused retailers. First, there is WONDER!, the new children’s retail concept store opening in Deerfield, Ill. Second, we’ve seen a tremendous increase in retail construction bid work for Buy Buy Baby and Babies R Us. And third, we hear there is a major baby/maternity retailer looking to launch a new concept store on Michigan Avenue.

And while I haven’t heard anything…yet, it certainly would make sense for Ultimate Electronics, a Denver-based electronics retailer, and HH Gregg, an Indianapolis-based appliance and electronics retailer, to take advantage of prime available retail space at great pricing (courtesy of the vacated Circuit City and Linens ‘n Things stores) to expand their presence by entering new markets.

So far, I’ve given myself a B and an “incomplete” in revisiting two of my five commercial construction trends for 2010. This is looking eerily similar to my grade school report card.

What new innovative retail concepts or creative re-use of commercial space have you seen recently?

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

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

www.englewoodconstruction.com

For example, we’ve been able to enhance our general construction services and stay ahead of commercial construction trends by doing the following for our clients:

1. Listen. Not too long ago, a major retail construction client of ours asked if we had the ability to manage our work with them in an online file-sharing system. While we didn’t offer an online construction management file sharing system at the time, we quickly launched one because it was important to our client and helped us increase our construction services with them.

We then rolled out our paperless project management system to all of our clients, which in turn helped us save more than $150,000 in printing costs alone in its first 18 months of operation – savings we’ve been able to pass along to clients in their overall construction costs.

2. Observe. For our restaurant construction and retail clients, we typically do a walk-through 11 months after the project is complete to make sure everything is as it should be. During these check-ups, we noticed the stores were outsourcing maintenance needs to other firms. So, we created a construction maintenance program.

Who better than the general contractor who built the store to service its maintenance needs? We were even able to offer construction maintenance services they weren’t receiving from other companies, such as an online management tool that allows clients immediate access to their request and service schedule, plus a 24-hour service hotline.

Observing our client’s day-to-day routine helped us find a way to offer them better customer service. Plus, it generated more work for us in our area of expertise.

3. Remind. As you get older, you start to forget things – I know this from experience. So you need to consistently remind people of your capabilities. For example, I’m sure some of you don’t know, or have forgotten, that I’m an architect.

This means not only can Englewood Construction oversee everything from the construction permitting process and managing the subcontractor relationship to physically building a project like a new shopping center development, but we can also be brought in on pre-construction services and managing design build projects.

If fact, one of our upcoming projects for this fall is a design build project that should feature sustainable construction. See, maybe you forgot we have experience in green commercial buildings. Good thing I’m reminding you.

What does this mean for you?

• Listen to your clients and tenants. Have they had to cut back on internal services that you can offer them instead?
• Observe your customers to see if you can offer them procedures or services that will make their business run more efficiently or meet their construction project deadline ahead of time.
• Remind everyone you know of your capabilities and background. Maybe they forgot or maybe they have a new need that your “new found” capabilities can fill.

What are some of your tips to not leaving money on the table
in today’s commercial construction market?  Leave a comment.

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

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

www.englewoodconstruction.com

Bill Di Santo on Champlain Ave. in Pullman, circa 1950s

But more than anything else, a new Wal-Mart in Chicago’s south side Pullman neighborhood is good for its residents. It’s also very personal to me.

Why Wal-Mart is “pulling” at my heart
There is a lot of Pullman pride in my family. My grandparents moved to the Pullman area in the early 20th Century. They were hardworking, blue collar and very proud of their heritage and neighborhood. I, too, grew up in Pullman and spent much of my youth at my grandparents for dinners and holidays.

My grandparents and mother are gone now. And while I no longer live in Pullman, my memories of these communities are frozen in time.

Why a new-construction Wal-Mart in Pullman is needed
The Pullman community has been adversely affected by high unemployment, increased crime and is lacking an overall retail environment. Forget about a large shopping center development, Pullman residents don’t even have a local grocery store. They have to travel miles to the inner city or the south suburbs to shop or buy groceries.

What a new Wal-Mart really means to Pullman residents

1. It will give them a sense of community.
2. With Wal-Mart paying employees 50 cents above minimum wage, it will provide numerous jobs, including construction jobs in Pullman.
3. It will increase the tax base of the community.
4. It will be the engine that drives the train to a community revival by drawing interest for new commercial construction projects from national chains, both corporate-owned and franchises.
5. Wal-Mart has agreed to donate $20 million to neighborhood charities.

Will there be more new-construction Wal-Marts in Chicago?
Unions, politics, retail construction. They don’t always mix – especially in Chicago. So let’s congratulate the Chicago City Council and Wal-Mart for forging this relationship and putting the people of Pullman first. Speaking in terms of commercial construction trends, this is a model in public/private partnership that I’m sure will be adopted not just in other struggling Chicago neighborhoods desperate for new commercial construction, but across the country. If it can work in Pullman, why not someplace else, too?

A Wal-Mart/Englewood Construction partnership
Of course I would love for Wal-Mart to use Englewood’s commercial construction services for the Pullman project – from both a professional and personal aspect. But if it doesn’t work out, that’s okay. What matters more is that Pullman’s residents will once again be able to experience the same community feeling my family enjoyed for so many years. Grandma and grandpa would be proud.

What are your thoughts about the new Wal-Mart in Pullman?

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

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

www.englewoodconstruction.com

Distressed hotel construction

Whenever I see commercial construction news on high-profile stalled hospitality construction projects, like the Shangri-la Hotel and Waterview Tower in downtown Chicago, I always wonder if the construction site was not only safe and secure before it was shut down, but if it was preserved in a way so that the existing developer or a new owner could start it up again quickly once the construction loan or funding comes through.

When we took over the hospitality construction work last year on six REO hotels, we saw first hand how poorly the hotels had been preserved, which meant an increase in time, construction costs and safety concerns to complete the buildings.

1. Safety – A construction safety plan should be in place even if you’re not at the site on a daily basis. Secure the outside of the building and property. An idle commercial construction site is just begging to be explored by anyone from the curious passerby, to kids or even vandals and thieves.
   1. Have your general construction contractor board up windows and openings easily accessible from the ground.
   2. Make sure the interior is secure, too. Cover all floor openings, like plumbing trenches and especially elevator shafts. Believe it or not, when we arrived at one of the REO hotels there was an open elevator shaft on every floor.
   3. And while the lights might still be on at the project to ward off vandals, there should be no live, exposed wires or open electrical panels.
   4. Inform the local police department about the condition of the site so they know to keep watch for vandals and transients.
2. Money – To keep your construction budget in check once the project starts back up you should plan for the following:
   1. Secure construction materials so you don’t have to pay twice. Pallets of brick, cement block or lumber should be locked up and stored inside the building so they can still be used when work starts again. Worst-case scenario, a vendor will have a lien on these items, so you don’t want them to leave your site unaccounted for.  For instance, with the REO hotels we found copper piping removed from walls, lighting fixtures torn from walls and ceilings, and plumbing and HVAC units removed after being installed.
   2. Vandalism can also run rampant in stalled construction projects that aren’t properly locked down, which means someone will have to pay to clean up any mess.
   3. Shut off the water. If pipes crack and water is still left in the lines, you’re going to have to pay to replace damaged materials, if not a large portion of the structure.
3. Time – Unless your commercial construction contractor is familiar with REO projects or knows how to plan for a building to sit empty for days, weeks or months, time is not your friend.
   1. Be prepared for erosion if your site is unfinished and exposed to the elements. With our hotel REO project, some of the sites had been graded in anticipation of a retention pond, but then it rained … a lot. By the time we began work we had to re-grade the site.
   2. To make a project less susceptible to neglect, a structure needs building wrap on the outside before the project is shut down. We’ve encountered projects where it’s just rotten plywood on the outside. Roofs also need to be tied down properly to protect the property from water and snow.
   3. No matter how many site visits are performed, there are always unexpected and unanticipated conditions uncovered resulting in extending schedules and increased costs.

So whether you need to cease construction for a period of time on your site or you are acquiring REO commercial properties at discounted prices, align yourself with a commercial construction company well versed in this subject. Their construction services and ability to develop a rapport with the existing subcontractors and suppliers, inventory materials, and assess what can be saved or re-used, as well as properly protect a site from damage, neglect and safety hazards, can save you time, money and peace of mind.

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

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

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

www.englewoodconstruction.com

Step 1: Chuck Taylor showing his commitment to St. Baldwick’s

It amazes me in today’s commercial real estate market when I hear commercial construction news about companies or people who just phone it in with their commercial construction services.

I understand the word “commitment” can be scary to some people, especially guys. But I was always drawn to the idea of commitment. In fact, I started dating my wife my sophomore year in high school.

So as I get older, I have an even greater appreciation for people and commercial construction businesses committed to something they believe in, whether it’s a strong work ethic, family, friends or a worthy cause.

Granted, when most commercial developers or owners bid out their new restaurant construction project or retail retrofit, a general contractor’s construction costs and experience are a priority, as they should be. But don’t you want to align yourself with a true partner who won’t just do the work, but is committed to completing the project the right way and will go the extra mile?

1. Response Time. Do your commercial construction vendors respond to your requests quickly or do they keep you waiting? Will they give you a response time in writing? We offer our commercial property maintenance clients one-call dispatching 24/7 and guarantee a response time for emergency services. Your vendors should offer you nothing less.
2. No cutting corners. We’ve all had clients who veer off plans and ask us to “just put it up on the wall.” But we can’t do it. We have to cut open a wall, inspect it and install wood blockings to make sure the wall can support the materials. We won’t compromise a construction safety program to save construction costs. And no general contractor should. See our earlier blog posts on commercial construction safety plans regarding BP and the Sephora Fire at the Shops at North Bridge for more details on this subject.
3. 

   Step 2: Chuck Taylor “betting his head” to St. Baldwick’s

   Accessibility. Does your general contractor’s commercial construction management team make itself available after hours? Is it easy to find a status update on your new commercial construction project? At Englewood, we’ve implemented a paperless construction project management system that houses all documentation for each of our jobs in one electronic folder hosted on our web site. This means that all parties working on a job (us, the client, subcontractors and architects) have access to all job files 24/7, which is ideal when you have multiple projects in different time zones. Your vendors should make your job easier, not harder.

4. When Lucky Brand Jeans told us we had less than four weeks to complete the build-out of its new store on Michigan Ave. we shifted into overdrive. Anyone in new retail construction knows that’s almost an impossible deadline, but the store had to be open by Black Friday. So we got a hotel room down the street, which allowed us to work around the clock. When people were tired they crashed in shifts at the hotel. To the chagrin of our families, we were still working Thanksgiving morning. But we made our deadline. And I was so thankful that I invited Lucky’s construction manager to my house for Thanksgiving dinner.
5. 

   Step 3: Chuck Taylor and Josh Crosby raising money for St. Baldrick’s

   No vanity. I think one of the reasons I love working at Englewood Construction is because we’re all willing to do whatever it takes to get the job done. Nobody is “too good” to make copies, “too proud” to walk a construction site or “too big” to get their hands dirty. We’re willing to sacrifice a lot to show our commitment to a client or a cause. And sometimes, we’re even willing to sacrifice our hair.
   I’ll admit it. I have a bit of a Samson complex when it comes to my hair. But I knew what I was getting into when I committed to raising funds for St. Baldrick’s, the world’s largest volunteer-driven fundraising event for childhood cancer research. So I bet my head to raise money for children with cancer and didn’t regret it for a minute…well, except for maybe that photo with the lone tuft of hair on top.

Now, would I shave my head just to get a new client? Let’s say I would definitely be interested in entertaining offers.

What’s the craziest thing you or your vendors have done to show your dedication to a project or cause? Let me know at chuck.taylor@englewoodconstruction.com.

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

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

www.EnglewoodConstruction.com

Commercial construction preventive maintenance

If there’s one thing everyone involved in the BP Deepwater Horizon rig explosion can agree on, it’s that it could have been prevented. Granted the explosion and resulting oil spill is a worst case scenario, but it begs the question: Do you have the appropriate commercial construction preventive maintenance checklist in place?

Whether you own or manage a shopping center building, office building, restaurant or retail store, what is not investing in your commercial construction maintenance budget now going to cost you later?

As a commercial construction general contractor, it’s our job to know not only what equipment needs to be checked and how often, but the difference in construction costs to maintain equipment verses replacing it. We can also help put a commercial construction safety plan into place in the case of equipment malfunction.

That said, listed below are some items that should be routinely reviewed to ensure your existing or new commercial construction project is running at optimal performance. For a more detailed preventive maintenance construction punch list you can email me.

1. HVAC – The typical rooftop unit should be checked every quarter. Investing a minimal amount each quarter in the construction maintenance costs of your HVAC can drastically increase its longevity. Do you want the HVAC to last five years or 15?   If you don’t maintain your HVAC, you could spend as much as $10,000 for a rooftop unit. That doesn’t include the construction costs to rent a crane to remove the old unit, install the new unit and power down the building or retail store. Plus, certain rooftops aren’t accessible by a crane and instead require the rental of a helicopter at a minimum of $3,000 an hour. For example, any rooftop work at Woodfield Mall in Schaumburg, Ill., requires a bird.
2. Electric – Electricians and breaker manufacturers suggest annual reviews before a retail store or office opens. If you exercise your breakers by shutting them off and on to make sure they run you can diminish them shutting down accidentally.
3. Plumbing – Needs to be reviewed once a year. When it comes to restaurant maintenance, a number of restaurants have annual jetting of the pipes.
4. Kitchens – The health department walks these once a year. At the least your restaurant construction contractor should touch up the caulk and grout before the inspector’s visit.
5. Roof – Some shopping center owners forget you can have a warranty on the center’s roof for 10, 15 or 20 years – just like you can a home, as long as you have it inspected. Along this same line you should also keep up with the maintenance of the mall’s parking lot, landscaping and the shell of building.

As a shopping center landlord, or commercial property manager, having the appropriate preventive maintenance plan in place can also help you secure new tenants or help in rental negotiation.

For example, we are often brought in by tenants during the inspection process of a new store location to estimate just how much equipment or fixtures can be reused to keep their retail construction costs down.

In situations where the existing mechanicals have not been properly maintained, the prospective tenant often goes back to the shopping mall landlord or property management team to negotiate a lower rent. In the extreme case where the vacant store has been neglected for too long or the construction renovation costs to get the equipment up to code are too high, the tenant might just opt out and move onto a different location.

I know everyone is watching their bottom line right now and we’re all guilty at one time or another of thinking “if it’s not broke, why fix it?” But as we all learned from the Deepwater Horizon explosion, we often don’t know something is broken until it’s too late.

What’s the most recent preventive maintenance job you’ve encountered and what was the outcome?

If you like this post and would like to receive more commercial construction trends, tips, or insights, click on HardHatChat emails to have posts emailed to you.

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

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

www.englewoodconstruction.com

Commercial construction change order myths.

If I had a dollar for every time I had to set the record straight on commercial construction costs and change orders… I would still have this job. But, I would also be a lot richer. There’s a misconception that general construction contractors love change orders. Trust me, we don’t. To prove it, I’m going to debunk some popular change order myths and their affect on commercial construction budgets, project construction management and the design-build process.

Myth #1 – Anyone can request a change order
When it comes to taking orders in the commercial construction project food chain, it goes like this: client→ general contractor→ subcontractor. That doesn’t mean clients won’t walk the site and ask subs to make “small” changes. But, if the GC has done his job, then his subs know they can only fulfill change order requests made by the general commercial construction contractor – in writing. After all, the subs aren’t under contract with the client, they’re under contract with the GC. We tell our subs, if it isn’t in writing from us, it doesn’t exist. That saves everyone time, money and frustration when it comes to paying change orders – see Myth # 3.

Myth # 2 – Construction change orders are unavoidable
While some construction change orders will be out of your control, such as last-minute requests from a municipality, the majority of change orders happen because the full scope of work wasn’t included in the bid drawings. And that my friend is something you can control – design and construction.

When you bring a general commercial contractor into the design process as early as possible, and particularly when you hire a design-build contractor, it is their responsibility to review all architectural drawings to ensure the scope of work is complete before requesting vendor bids. It also means change orders come out of the GC’s pocket, not the clients’.

Myth # 3 – Commercial Contractors make their money with change orders
False! The biggest problem with change orders is that they typically come up in the heat of battle. Pricing is secondary to getting the job done. So the subcontractor completes the change order and submits his invoice to be paid in full. Then the client reviews the “new” commercial construction costs and wants them reduced. Enter the general contractor, who – if skilled enough in negotiations – can resolve the situation to avoid a potentially adversarial client and subcontractor relationship.

However, any of the following could still happen during the change order process:

• The client refuses to pay the subcontractor in full, so the sub puts a lien on the project.
• The payment dispute goes to court.
• The client gets the extra scope of work, but the general contractor ends up paying the sub in full. Now relations are tense between all three parties.

Bottom line – nobody wins with a change order. Not the client. Not the sub. And especially not the commercial general contractor. My best advice to elude change orders is to bring the GC in as early as possible on the project.

Do you have any change order myths you would like shed some light on? If so, let me know at chuck.taylor@englewoodconstruction.com. If you like this post and would like to receive more commercial construction tips, insights and trends, click here to have posts emailed to you.

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

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

www.EnglewoodConstruction.com

In the post I said we should “Look for a solid increase in construction renovations versus new locations, which should hold especially true with new retail construction.” Think I’ll give myself a “B” on that one.

Just look at all the retail renovation projects underway – Disney is remodeling all of its stores, Target is introducing new retail store concepts that incorporate a larger grocery area, and
JCPenny is partnering with Mango for a store-within-a-store concept by installing MNG by Mango “stores” at JCPenny locations across the country.

The same holds true for shopping center development. As I mentioned in my last blog, it wouldn’t surprise me to see shopping center developers and mall landlords take advantage of market conditions and turn a struggling enclosed shopping mall into a successful open-air shopping center for a fraction of what it would cost to take on a new shopping center construction project.

Opening day at American Girl near Denver

As for new retail construction, it seems the big winners are niche retail brands that dominate a market category, such as American Girl and lululemon. The retail construction work is there because the public is positively responding to the unique shopping environment of these stores, which in turn leads to the brands opening more stores. In fact, you can click here to read about the new retail construction stores we recently completed for these two niche brands.

National retail construction contractors are also seeing niche retail brands feed off each other like the new Little Miss Match store and the American Girl Place store in Water Tower Place shopping center in Chicago, both projects we worked on. Talk about a smart move. Little Miss Match is now in the same shopping mall as the largest American Girl Place store in the country. Girls will never want to leave the building.

Where retail construction seems to fall short is for the average retail brand. Despite an increase in overall retail sales this year, new commercial construction has been shelved for a lot of stores that don’t stand out either for their low price point or customer experience.

Still, things are getting “back on track” for commercial construction contractors compared to last year. Phones are ringing, there are retail construction projects to bid on and commercial construction permits to pull. Looks like brighter days are ahead.

How do you think retail construction is performing so far this year? I’d love to hear your comments at bill.disanto@englewoodconstruction.com.

If you like this post and would like to receive more tips and insights on commercial construction trends, click on HardHatChat emails to have posts emailed to you.

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

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

www.englewoodconstruction.com

For those familiar with Chicago retail construction, think back a couple of years to when the dated Orland Park Place interior mall underwent construction and turned itself inside out to became one of the area’s most successful outdoor shopping centers.

Sportmart at Orland Park Place (now a Sport Authority)

Those not familiar with shopping center construction may think it’s not cost effective to de-mall a mall. But for shopping mall owners watching the bottom line, the cost savings in renovating an existing shopping center development can be huge in comparison to building new retail construction, especially if you follow the tips below.

1. Hire a design-build general contractor. By having your shopping center general contractor on the front end of all design plans and in charge of selecting the engineer and architect, you greatly reduce the risk for unnecessary change orders. A commercial design-build general contractor should also perform exploratory work up front, before you pay for architectural plans. Conversely, if you hire the architect before the GC, you might have plans drawn up that need to be changed (and paid for again) if the construction general contractor discovers something during the exploratory phase that alters the original plans and construction bid work.
2. Let the structure dictate the shopping center design. The best way to keep construction costs down is to keep as much of the physical structure as possible. Don’t work against the existing shopping center floor plans, but evolve them into the new design. Reusable elements should include:
   • Steel and concrete – save as much of the physical shell as you can
   • The base structure – no need to pour a new foundation
   • Roof systems – depending on their age and how they work into the new plan
   • Concrete slabs – only cut as needed to accommodate tenants
   • Parking lot – this can require very little reconfiguring
3. Reuse as much of the existing mechanical infrastructure as possible. These aren’t always the most visible features of a shopping center plan, but they can yield impressive savings if reused wisely.
   • Main electrical systems – this includes switch gear, disconnects and meter panels
   • Electric rooms – typically these are back of house, so they can easily be converted
   • HVAC – consider age, efficiency and life expectancy (review the warranty)
   • Sprinkler risers and main lines – should already be tied into the municipal water system although they might need to be brought up to code
   • Plumbing waste, vent and supply lines – inspect for age and to make sure they’re in good working condition. Water supply lines will change with tenants, but waste lines should easily tie into existing system

What’s your favorite de-malled shopping center project? Or what mall do you think should be de-malled? I’d love to hear your comments at bill.disanto@englewoodconstruction.com.

If you like this post and would like to receive more tips and insights on commercial construction trends, sign up here to have HardHatChat posts emailed to you.

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

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

www.englewoodconstruction.com

A. Chuck, the construction costs on my project would soar if I don’t hire a local general contracting construction firm.

B. The travel expenses alone for a non-local general contractor would inflate a retail construction bid to the point where the job isn’t economical.

C.  If I don’t hire local construction workers, I’ll be the pariah of the community.

Rest assured, I haven’t lost my mind. Unfortunately, some commercial real estate developers and even shopping center landlords think a local construction management team is the only way to go because a national general contractor is a traveling group of gypsies roving from project to project.

Well, it’s not like that. And the way our commercial construction services are set up, we can actually save our out-of-state clients time and money.

1.   It’s better to work with a national retail construction contractor who is familiar with building your store in other cities verses a local general contractor who’s never built for you before. The national general contractor knows your expectations, how you operate and your brand. There’s no learning curve involved.

2.   By hiring a general commercial contractor with national reach, but no satellite offices, you can actually keep costs down. For example, in the last two years Englewood Construction has worked in 28 states, but we only have one office to support, so we don’t have a high overhead that gets passed along to a client.

3.   Because Englewood Construction’s staff is so experienced and efficient, we only need one construction superintendent on site. Conversely some, lesser-experienced local firms may be logging extra man hours to get up to speed on your brand.

4.   While your general contractor doesn’t need to be local, it’s imperative that the subcontractors are local. Quality, local subcontractors are the lifeblood of any successful commercial construction project. So make sure you ask your construction firm about the subs on your job because using local subs usually means the following:

• The pricing model your GC used is accurate for the region.
• You’ll have an easier time with local jurisdictional construction and permit approvals.
• The construction project should be completed on time, if not earlier, due to the subs’ familiarity with the area, zoning, traffic, etc.
• You’re pumping money back into the community. For more details on this benefit, make sure you read about the newest American Girl store in Denver.

At Englewood Construction, we have a database of more than 20,000 of the best commercial construction subcontractors from all over the country, which means we have the flexibility to follow our clients no matter where their next design build or renovation project is located.

Where is your local general contractor following you?

Let’s continue the discussion at chuck.taylor@englewoodconstruction.com.

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

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

www.EnglewoodConstruction.com

So since it feels like I’ve walked a mile in everyone’s shoes when it comes to shopping center construction I wanted to share some important tips. Keep these in mind when the retail market starts to rebound and you’ll be ahead of the game on your next shopping center development.

1. Establish relationships early in the design stage with your commercial construction general contractor. This lets your general contractor weigh in with estimated construction costs before plans are finalized and sent out for subcontractor bids. Miss this step and your architect could be sending out plans for bid that are out of whack with your construction budget.

2. Allow design and construction teams to interact early with jurisdictional authorities. One client of ours thought village officials should be thanking their lucky stars this retailer was building a store. By the time we were brought in for permitting services, nobody wanted to work with us because the client was so arrogant. When it comes to building inspectors, the health department, etc., you can’t forget you’re in their sandbox. The sooner they see you and your general contractor as a partner, the sooner your construction project will be approved.

3. Make sure you’re working with a general contractor experienced in shopping center construction so they can review your tenant design criteria to keep commercial construction costs down. GCs well-versed in mall construction know what is reasonable for landlords to provide to tenants and what the tenants are responsible for themselves in a retail build-out.

4. Have your shopping center general contractor create a sequence of events and logistics plan to keep track of each tenant’s construction and delivery deadlines. If a tenant is 20 weeks out from moving in merchandise, the mall general contractor needs to have the service court paved in time for that deadline. Seems obvious enough, yet you would be surprised how many shopping center contractors are only focused on their timeline and have very little consideration for your tenant’s needs. Your tenant’s needs are important to you, so they need to be important to your general contractor.

5. Keep calm and carry on. If I’ve heard clients say it once, I’ve heard them say it a thousand times that they don’t think we’ll make a grand opening date. In 30-plus years of business, I’ve never missed a grand opening deadline. If you’re a shopping center construction contractor, the key to remaining calm is keeping the channels of communication open. Weekly meetings with all retail contractors and shopping mall subcontractors throughout the mall’s construction cycle are a must so you can share construction schedules and delivery timelines.

I know, these five tips to successful shopping center development may seem like common sense, but it’s rare for all of these best practices to be implemented on a project during the construction process. However, follow the advice above and your next new-construction shopping center is sure to be the exception to the rule and not the norm.

When do you think shopping center construction will pick back up? I’d love to hear your comments at bill.disanto@englewoodconstruction.com.

Unfortunately, a landlord’s biggest liability in a commercial construction project can be an insensitive general contractor whose only concern is making his deadline and budget. What’s wrong with a general contractor focused on commercial construction costs and his construction schedule? Plenty, if the GC’s actions are hurting your tenants’ business. Following are five signs your general construction contractor is making your tenants mad and damaging your business.

1. No parking – Make sure your general contractor and subs aren’t using premium parking spots. Construction contractors should pull up, unload tools or equipment and park in the back lot, leaving the most convenient parking for customers.
2. Sloppy site – Is a construction safety plan in place and is the site clean? Sure the site is under construction, but are there clear paths free of debris and equipment? Nothing scares customers away faster than the thought of potential injury.
3. Confused customers - The construction project management team should oversee the installation of visible temporary signage during a shopping mall remodel or office building renovation letting customers and clients know you are open for business and the improvements being made.
4. Quiet over there! Shopping center construction contractors and office construction companies should schedule all loud noise activities for before or after business hours. Nothing hurts a sale or new-biz pitch more than the lovely sound of a jackhammer.
5. Confused tenants – Commercial construction contractors who don’t share their construction schedule with tenants are putting you in the line of fire for complaints. Tenants don’t like to be in the dark and have to respond “I don’t know” when a customer or client asks about shopping center construction improvements or building updates, especially if the question is “When will the work will be completed?”

Now, I’m not going to name names, but when we were the retail construction contractor for a couple of stores at a suburban Chicago mall a few years ago, everything was on the timetable of the shopping center general contractor, who could have cared less about the mall’s tenants. Seriously, the mall’s general contractor was still in the ceiling of our stores just four days before we had to finish. Needless to say, our clients were not happy with the shopping center developer.

Conversely, when Englewood Construction served as the commercial general contractor for the Shoppes at Farmington Valley in Canton, Conn., we came in on time and under budget without one complaint from any of the retailers.

No complaints? When was the last time that happened to you?

Thoughts? Concerns? Or just looking to talk about shopping center construction news?
I’m your guy.

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

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

www.EnglewoodConstruction.com

The same can be said for all those savvy national retailers who are currently taking advantage of the availability of prime space at regional shopping centers and decreased construction costs in order to enter high-profile markets.

Retail Power Center

Now some of you may say retailers are crazy for opening new locations or expanding into new shopping centers at this time and that they should just update current stores with a construction renovation. But others, like those who commented on Ian Ritter’s recent Globest.com blog “A Lifestyle Center Actually Getting Built?” will say those retailers and shopping center developers are crazy like a fox.

Think about it. Shopping center landlords have probably never been more willing to work with national retailers and restaurant operators on rent concessions and design build schedules of stores. If you’re a rent-sensitive retailer, this is your best time to enter a top market.

And with commercial retail construction costs down 10-15 percent compared to three years ago, you’re going to win on a couple fronts.

1. Better construction service: Everyone wants work right now, so subcontractors are more likely to bend over backwards to accommodate your needs and timeframe.

2. Top talent: Like everyone else, subcontractors have had to trim staff, often keeping only the best employees.

3. Easier permitting process: The decrease in new commercial construction projects in 2010 means commercial construction permits can be issued faster than before.

Just this month it was announced that Roundy’s is entering the Chicago market with two stores, CVS opened its first Memphis store with two more on the way and Chick-fil-A is planning for 78 new locations in 2010. That’s not bad company to keep.

If you’re waiting for a better time to take your big box retailer, specialty store or restaurant concept to a regional mall, power center or lifestyle center, good luck. Opportunities like these may not present themselves for another four years – just like the Winter Olympics. Go for the gold!

What new stores or restaurants would you like to see open in shopping centers near you?

1. Are there any discrepancies in what construction work has been completed versus what has been paid? Don’t be caught paying for thousands of dollars of uncompleted work. Instead, align yourself with a commercial general contractor who has distressed asset experience and can expose inconsistencies in actual completed work versus value of work paid to previous contractors and subcontractors.

2. Can you use the existing subcontractors within the balance of their contract value or do you need to rebid the entire project? By using the existing subcontractors instead of hiring someone new, you can resolve or avoid a mechanics lien as you’ll be adhering to the original subcontractor contract. This will also keep your distressed property construction costs down as you won’t have to pay twice – once for the original subcontractor and once for the new one.

3. Is there any damage to the property due to neglect or vandalism? Once, when we were inspecting a vacant building we noticed water had been left in the lines. We turned on the water and noticed leaks everywhere from cracked pipes. It’s better to catch that damage upfront so you know the true cost of the construction project instead of increasing your scope and budget afterwards.

4. How were construction payments disbursed prior to the project stopping? Were they disbursed through a title company? Cross your fingers they were, otherwise you might run the risk of extra fees. It’s not unheard of for subcontractors who were paid outside of a title company to go out of business before paying their suppliers. Next thing you know, that supplier is asking the new owner (you) for payment – once again, running the risk of duplicate payments for the same scope of work.

5. Where do you stand with the city inspectors of your distressed property project? Has the building permit expired? Are there hidden costs? Have new building codes been enacted since the project was vacated? Make sure your general contractor covers these bases or you could find yourself inheriting several thousands of dollars of unpaid fees left over from the previous developer.

Bottom line, make sure you’re working with a reputable commercial general contractor who has experience with distressed property projects. Or, what you thought was a “great deal” can turn upside down quickly.

What have your dealings been like with distressed properties?

Champps Restaurant

I thought it would be interesting to start this blog post with a question to test your restaurant construction IQ. What’s the difference between building the back of the house of a TGI Fridays and a McCormick and Schmick’s?

Nothing. That’s right, when it comes to restaurant kitchen construction, it doesn’t matter if you’re building a five-star restaurant or a chain of Red Robins − the back of the house is the exact same. General commercial construction contractors have to put in the same plumbing, three-compartment sink, dishwasher and cook line regardless of the restaurant’s name or construction costs.

Now that’s not to say just any commercial general contractor can build a Gibson’s. When it comes to restaurant construction, it’s vital for your GC to have great relationships with health and building departments and know how to manage what you don’t see, like how the underground gas and drain lines are lying.

Speaking of health departments, here’s another restaurant construction pop question for those in the Chicago area. Which county has the toughest health department? Hands down, DuPage County. It has set standards that counties across the country have adopted when it comes to inspections. If your GC has built a restaurant in DuPage County, rest assured they know what they’re doing.

For example, one of the first things your commercial construction general contractor should do is partner with the health department as early as possible as the inspector might divulge information that will facilitate the inspection process. Keep them abreast of construction plans and offer a courtesy inspection prior to closing up any walls.

We’ve worked with some tough inspectors who would walk from the front of the house to the back with a clear caulk tube on the hunt for areas that needed to be fixed. By working with the best inspectors, you become a better general contractor.

Passing inspection on the first round is key to meeting deadlines. Meeting deadlines allows you to grand open the restaurant on or ahead of schedule so the owner starts making money and keeps restaurant construction costs down.

So when you’re vetting your next restaurant construction contractor, pay attention to where they’ve built. If they know how to work with the inspectors in your jurisdiction, you’re golden.

Have tips to share on your latest restaurant construction project? I’d love to hear your comments at bill.disanto@englewoodconstruction.com.

Why? Because without skilled subcontractors a commercial construction general contractor is just a guy in an office. Back in the ‘90s, Englewood Construction would get tables full of holiday treats from subcontractors. I like caramel corn as much as anybody, but I would tell subs there were only two things we needed – a competitive bid and outstanding service. Without the best bid, we can’t win the project. And without the best service, the bid is meaningless.

So, how do you ensure that you have and retain the best subs available? The easy answer to finding subcontractors is to use The Blue Book of Building and Construction. We have another tip to finding the best subs for a project, but you’re going to have to email me for it – we can’t give away everything.

Keep in mind, the cheapest subcontractor may not be the best sub for the project. Just like the general construction contractor who submits the lowest construction costs in the bid process is not always the best choice.

To keep subs happy, be honest and give them a fair scope of work. Don’t be the company that doesn’t pass along a revised set of drawings to subs after the initial contract so they’re stuck doing more work for less pay.

Most importantly, pay your subs on time. However, billing requirements and title trusts may differ from one retail construction project to the next, so educate your subs on filling out reports and billing. Otherwise, your subs may not get paid on time.

And while it’s not supposed to happen, it’s not unheard of for a project owner or superintendent to walk a site and strike up a conversation with subcontractors. This usually goes one of two ways.

1.    The owner or superintendent starts asking subs about the project and their relationship with you. This could be good or bad, depending on how you treat your subs.

2.    The owner or superintendent makes work changes or requests directly to the sub. If you have great, experienced subs on the job, they’ll know they can’t take direction from anyone but you. If you don’t, your work flow and budget may suffer.

Bottom line: treat your subcontractors with the same respect and integrity that you treat your clients.

Curious about Englewood’s secret to finding the best subs for a job? Email me at chuck.taylor@englewoodconstruction.com. I’d also love to hear your additional comments and suggestions for a successful contractor/subcontractor relationship.

© Azusa Nakamura

When the news broke before the holidays about a fire at The Shops at North Bridge on Michigan Ave., I had to hold my breath. As a national retail construction contractor, Englewood Construction has completed a number of retail construction projects in that mall. Was anyone hurt? Was it one of our stores? 

Thankfully, the answers to both questions were no.

But I had to wonder, while I know we have a plan in place for such crises, do all general contractors? Or more importantly, do developers and owners have a construction safety plan at the ready or know what to do in case a disaster strikes?

One thing you should do is review the warranty you have in place with your commercial construction contractor. Next, ask your GC what they would do if a crisis occurred after the warranty expired. I stand behind each project we complete, so our interest in a project exceeds our warranty. In fact, if there was a problem in one of our stores outside the scope of our warranty, we would call the store immediately and ask two questions:

1.   Is there anything we can do to help?
2.   Is there anything we did wrong?

So as we start off a new year, not to mention a new decade, it behooves everyone who offers commercial construction services or is involved in the design build process to remember how much our work affects the public and their safety. If the drawings call for blocking, then install the blocking. If an item doesn’t have the UL label on it, don’t install it. Don’t cut corners and don’t align yourself with others who do.

Here’s to a safe, happy and prosperous 2010!

1.    Back on Track. Call me an optimist, but with unemployment leveling off and consumer confidence gaining ground, all signs point to businesses getting back on track next year. At this time last year, there were very few construction projects to bid on as many companies sat on the sidelines. Now, they’re opening their playbooks and gearing up for 2010. While ground-up work should be stronger in 2010 than 2009, most companies will still be watching their bottom line closely. Look for a solid increase in commercial construction renovations verses new locations, which should hold especially true with new retail construction.

2.    Green is Gold. Green buildings across all commercial construction sectors will continue to gain in popularity. And it’s not just that more projects will be built with sustainable construction materials (bamboo flooring, energy-efficient lighting and low-VOC paints) as they seek out LEED status, but expect a rise in commercial buildings that serve the green industry, too. According to the Dec. issue of Shopping Center Business, Go Green Stations, a new alternative fuel distributor, is planning approximately 1,000 stores in 2010, compared to 100 in 2009. Going green also allows building owners to take advantage of energy efficient commercial building tax deductions.

3.            Franchise on the Rise. The loss of jobs over the past year led many to cash in their 401Ks and become their own boss by starting a franchise. Expect to see increased commercial construction franchise work in 2010, particularly in food service. According to retailerdaily.com, a number of companies that previously only had store-owned locations are now looking to add franchised operations to their roster, such as Corner Bakery Café and Smashburger. In an ironic twist, Vermont, the maple syrup state, was the only state without an IHOP location until a franchise development came into play.

4.    Outside the Big Box. Expect to see new innovation in store concepts, especially when it comes to capitalizing on vacated commercial space in prime locations. Short-term holiday stores certainly popped up en masse in 2009, although they involved little design build construction. In 2010, we should see more creative re-use of empty commercial space, which means shopping center and retail construction renovation should increase, as well as office and industrial construction. For example, America Public Media notes how an old CompUSA store was converted into an animal hospital.

5.    Less is Still More. Even though there should be more construction projects in 2010, those projects will probably be smaller in size than previous years as owners continue to look for efficiencies in cost and square footage. And as stated in No. 4, seasonal stores that require short-term leases and less construction will still be hot in 2010.

What do you think 2010 holds in store for the commercial construction industry? I’d love to hear your thoughts at bill.disanto@englewoodconstruction.com.

High – Green building

According to the 2009 Green Building Survey, there was a surge in green building activity across all building types from 8/08 – 8/09. In fact, we worked on two green projects this past year and we hope to do even more next year as we are committed to helping our clients reduce their carbon footprint through sustainable commercial construction. Our industry is just at the tip of the iceberg in better green building and business practices.

Low – Chicago losing the 2016 Olympic bid

When Chicago lost the 2016 Olympic bid this fall, it was a devastating blow to the city’s restaurant and retail construction industry. Not only did it mean the loss of thousands of new jobs, but it also meant we would continue to see larger general contractors bidding on jobs “at cost” to maintain their crews, boxing out the mid-size contractors that specialize in retail, restaurant and hotel construction. Unfortunately this is a problem we’re seeing across the country. Jobs that used to have 2-3 bids, now have 10.

High – Niche or value-driven retail construction

Retail construction projects in niche or value-driven markets. If you look at the Top 10 U.S. retailers that expanded in 2009*, three of them included the word “dollar” and one was a clothing retailer that created a niche by offering very current fashion trends.

• No. 3 Dollar General
• No. 5 Zara
• No. 7 Family Dollar
• No. 8 Dollar Tree

We’ve been fortunate to work on three Zara stores and each one provided valuable tips on how to run a successful commercial construction project.

*See the December 2009 issue of Shopping Center Business.

Low – Distressed properties

With the swell of foreclosed commercial properties on banks’ balance sheets in 2009, many banks found themselves in a role outside of their expertise – that of developer. They were thrown into a foreign world of subcontractor/vendor disbursement issues and estimating construction costs to complete a project. There are opportunities to be had on both sides of the table, but it’s not easy when we’re both speaking a different language.

High – This thing they call social media

As I’ve said before, it’s hard to teach an old dog new tricks – and I am an old dog. Most people who have been in the commercial construction industry as long as me still like printed material, whether it’s a newspaper or a brochure. However, I can’t deny the power of social media and its impact on the way we do business, stay in front of clients and learn from one another. It’s given us the opportunity to create Hard Hat Chat and for that I am very grateful. I love being able to share my ideas and create a dialogue with people that I might otherwise would not have met. Hard Hat Chat is still young, but so far it’s been a fun and interesting ride.

What do you think were the highs and lows in our industry this year? I’d love to hear them at bill.disanto@englewoodconstruction.com

I found the section about embracing energy retrofits especially timely as Englewood Construction recently completed our latest commercial sustainable construction project at Sloan Valve, a plumbing systems manufacturer in Franklin Park, Ill.

The Green Building survey states that 73 percent of developers have previously retrofitted properties, are in the process of retrofitting, or are considering retrofitting properties for greater energy efficiency. And 88 percent of developers and 86 percent of corporate executives consider green design to be as important or more important now as it was before the recession.

So I have to ask, if you’re not part of this majority, what’s keeping you from embracing a sustainable design build project or a green retrofit construction project?

If it’s the cost, you might be surprised by the survey’s findings as the majority of commercial developers say it takes only 3-4 years to recoup energy retrofit costs, including construction costs.

And you can always start with a small construction renovation like upgrading your HVAC, lighting or water controls to make them more energy efficient. Then, after you get comfortable, go for something more impactful like the two wind turbines and solar panel we installed on the roof of Sloan Valve’s headquarters.

But regardless of how you decide to dip your toe into the green pool, make sure you align yourself with a commercial construction contractor  well versed in sustainable construction, are members of the U.S. Green Building Council or have earned Leadership in Energy and Environmental Design (LEED) certification.

Have a question on sustainable commercial construction? Feel free to email me at bill.disanto@englewoodconstruction.com.

And depending on the condition of their new stores, the savings on retail construction costs to retrofit the space could be huge… if owners do their due diligence.

For example, Englewood Construction once worked on the build out of a vacant big box space that was only six months old. The commercial space was in great condition and the infrastructure was there for us to reuse a number of existing elements. In fact, the lighting fixtures we were taking out were the exact same as the new ones we were installing. Yet, our client opted to gut the interior and start from scratch.

As to why the client chose not to use existing elements in its construction renovation, there are a couple plausible reasons. One, they thought the warranty on a six-month-old lighting fixture wouldn’t be worth it compared to the warranty on a brand-new fixture. Or maybe they thought construction costs were already low compared to building new retail construction, so why not have a completely new interior?

Both are valid points, but let’s be honest, when market conditions were in their prime there was a lot of waste when it came to retrofits. Now that budgets are tighter, everyone involved in the design-build process should make an extra effort to see if there are existing elements they can use in a commercial construction project, such as:

• Air handler units
• Restrooms
• Break rooms/kitchens
• Electric service/breakers
• Fire alarm and sprinkler systems

Before you begin your next big box retrofit, make sure you bring your general commercial construction contractor  into the fold as soon as possible so they can assess your construction needs and help determine what structural or mechanical items are worth reusing. Not only will this help you save money, but it will also help save the environment.

Have a question on what you should keep during your next commercial construction retrofit? Feel free to email me at bill.disanto@englewoodconstruction.com.

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

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

But what I want to do is tell you what you may not know about the retail space construction of this Zara store and how to apply this information to your next retail construction project.

1.    Hidden traps in retail construction approval process

There are a lot of cooks in the kitchen during the commercial construction  approval process (landlord, city inspectors, alderman, etc.), but there are also the not-so-obvious entities that need to be informed about your project. Case in point, we’ve worked on Michigan Avenue for years, so we know you need to keep neighborhood associations like the Greater North Michigan Avenue Association in the loop. But Zara is from Spain and their architect is in Canada. They had never heard of the GNMAA. Make sure your general contractor has a VIP playbook.

2.    The holy trinity

The challenges faced in vertical retail store construction, like Zara at Chicago Place, are more complex than most shopping center construction projects as you need to be on the same page with a shopping center’s holy trinity: security personnel, dock managers and mall management. The more advance notice you give them, the more accommodating they will be when it comes to elevator use and scheduling deliveries.

3.    Don’t be a noisy neighbor

As Zara was located in a mixed-use building, we needed to respect its fellow tenants, which included a hotel. This meant we were very limited to the hours we could use loud equipment. Your general construction contractor needs to be comfortable working with the time constraints a mixed-use building enforces and know how to schedule work accordingly so you deliver on time and budget.

4.    Brush up on your foreign language skills

It behooves an owner and general contractor to have a talk up front about material deliveries, especially when working with an international retailer. With Zara, all the millwork and store fixtures came from Europe and the flooring from Asia. Coordinating overseas deliveries and working with customs is not for the faint of heart. 

5.    Sleep is for sissies

If your commercial general contractor’s main office is in another time zone from you or your project, the GC should work on your clock, not theirs. As a national retail contractor, we’re used to having multiple projects in different time zones. With Zara, we responded to questions well into the evening because our contacts in Spain were six hours ahead of us and just starting their day.

Have a question on Zara’s Michigan Avenue store? Feel free to email me at chuck.taylor@englewoodconstruction.com.

Sure, I know there will always be commercial developers who competitively bid all their projects, but from a commercial construction cost and timeline perspective, it pays to negotiate with a designated general contractor versus requesting multiple bids on a construction project. And here’s why:

1.    Negotiating with a commercial contractor allows you to split unforeseen cost savings. When you competitively bid a project your general contractor can find a subcontractor that gives a lower  construction estimate than what was in the original bid and pocket the savings for themselves. When you negotiate, any cost savings your contractor may uncover are split between the two of you.  Englewood Construction spells  all that out up front in our best-practice pre-construction process.

2.    Work starts immediately. Reviewing bids can take weeks while negotiating takes days. The sooner your commercial general contractor is on the job the better, especially during the early stages of a project like the permit process and the ordering of long-lead-time items, such as HVAC roof units, flooring and lighting.

3.    Better attention. Would you rather go to a restaurant that knows exactly how you order your steak and you’re guaranteed a good meal, or drive around until you find one that’s offering an early-bird special?

4.    True partnership. Projects that are competitively bid have the potential to be an adversarial relationship whereas negotiated projects have more team feeling and familiarity. You’re in this together. That’s certainly how American Girl feels about its relationship with Englewood Construction. Ahem, right guys?

5.    Your contractor isn’t over his head or taking you for a ride. A good competitive bid should be within 5 percent of the other bidders. If a bid is higher or lower it’s covering more scope than you need or they’re padding their pockets. Neither of those situations is a concern in a negotiated project as together you and your contractor have collectively agreed on all costs, scope and subcontractors.

And here’s one more tip when it comes to competitive bids. Whether you’re working in office, retail, restaurant, industrial or hospitality construction, you should respect your business like your health. Would you go to the cheapest heart surgeon who was last in his class?

We’d love to hear your take on competitive bids vs. negotiating work.

In fact, just recently Disney announced plans to completely transform its 340 stores in the United States and Europe from Disney Stores to Imagination Park.

Regardless for your reason to remodel, you need to realize that a commercial renovation is a completely different animal than building new commercial construction.

For example, during a new restaurant construction project, owners are responsible for providing the majority of the supplies and drawings while the general contractor executes the work.

However, in a remodeling project, those roles are usually reversed, with the general contractor using its resources to supply most materials. Of course it depends on the scope of the renovation, but your general contractor should provide a better value when it comes to items such as new flooring, lighting, etc.

And while it’s always best to bring your general contractor into a project as early as possible, did you realize it’s even more cost effective to partner with them from the onset of a remodel? A commercial general contractor who has design build experience can lend a critical eye to your plans and should be able to spot cost savings.

Case in point, Englewood Construction once worked on a project where a client wanted to install stone columns at $3,000 a pop in the store. Through our connections we were able to find fiberglass columns from a local manufacturer that looked the exact same, but only cost $900 each. Not only did we save the client thousands of dollars, but we also reduced shipping and labor costs as it would have taken four men to lift each stone column, but only one man to install the lighter columns.

If you have questions about undertaking a commercial remodeling project I’d love to hear them.

 However, there are ways to stop the bleeding and minimize the costs of owning, maintaining and repositioning distressed and foreclosed commercial assets.

First, align yourself with a general commercial construction contractor familiar with completing distressed commercial properties. According to the fall 2009 issue of Development magazine, while hotels and retail properties are the most problematic in terms of default, foreclosure or bankruptcy, office distress is up 118 percent year-to-date in 2009 versus 2008. So make sure your commercial construction general contractor specializes in the asset class of your distressed holdings.

Next, make sure they can provide the following services, which are guaranteed to save you time and money during the workout process.

1. Expose discrepancies in actual work completed versus value of work paid to previous contractor and sub-contractors 
2. Provide cost estimates to complete the construction project 
3. Analyze damage to subject property due to elements and neglect and cost to repair damage
4. Develop subcontractor/vendor disbursement procedures with the title company
5. Intercede with appropriate jurisdictional authorities regarding sworn statements. Note that each town and state has a different set of jurisdictional authorities that a general contractor must work with.

Looking for more suggestions or information on how a general contractor can help an owner turn around a distressed property? Feel free to email us at info@Englewoodconstruction.com.

Red Flag #1: Be wary of the commercial general contractor that has no questions, exclusions or qualifications and agrees with all requests. A general contractor who just submits a bid without certain questions or qualifications may not understand the complete scope of work and schedule.

As an architect, I am fully aware that all drawings and bid documents will have some errors or contradictions. And as a commercial construction general contractor, I know it’s my ethical responsibility to identify any errors, contradictions or conditions to a potential client. The awareness of these issues should be a part of the owner’s decision-making process. In my opinion, a general contractor’s integrity and level of knowledge on plan drawings and bid documents should trump all other aspects of the contractor selection process.

Red Flag #2: Think twice about a retail general contractor who doesn’t guarantee you the same level of service, quality, value and adherence to schedule for one store as he would for multiple stores for a retailer.

Red Flag #3: The low bid isn’t always the right bid – especially now. As both the residential and commercial construction markets are depressed now, there are a number of general contractors being vetted for retail construction bids that are outside of their expertise. In some cases, projects that would typically have three bidders now have 10-12 bidders. You owe it to the success of your project to make sure your commercial construction contractor isn’t outside of his realm.

If you have any other red flags you’d like to share, I’d love to hear them.