Cursed By Knowing The Numbers

The AIA form of construction contract entitles an Owner to a "competent superintendent" supervising the work under contract.  This relatively passive role allows you to check the outcome, but not who is supervising the improvements.   I was reminded of this when a friend called the other day who was concerned about what he felt to be the lack of supervision on his project.  He asked me what could be done.

Our conversation went back to basic principles.  The most important thing on the job is safe, quality construction.  The next most important element is how you define what the final product is, so you can tell if what you are getting is what you contracted for.  The third most important element is paying promptly for what you contracted for.

Supervision falls under a contractor's right to determine its means and methods of producing what you contracted for.  Specifying who, or what constitutes competent supervision is either done in division one of the project manual, by change ordering in supervisory requirements if they are not in the project manual, or by rejecting work that has not met contracting requirements.

What are the signs of competent supervision?  A clean job site.  Tradesmen with the proper safety equipment.  A schedule on the job trailer wall that is current.  A team that understands the critical path and what the next three tasks are.  Organized layout and coordination of workflows.  And communicating with the Owner where you are in construction. 

If you are a student of the property business, you are a student of economics, of architecture, of politics, and of human nature.  I am 80% through the 16-CD audiobook that is combination memoir followed by a series of essays on global economic issues.

I am now more deeply grateful for Alan Greenspan's contributions. This book deftly handles the story of his life while not preening over his accomplishments.

Economics can oft times make for dreadfully boring reading--but not here.  This is the story of an extremely interesting character.

Here is the Economist's review of the book--succinctly captures what this 544 page tome is about.

One thing I did not fully appreciate was how influential Ayn Rand was on his life.

Here is the Chairman's interview on Jon Stewart--

Global warming is becoming such a core issue that for a project to be attractive economically it needs to make sense environmentally. 

Economically sustainable is environmentally sustainable.

I don't see any other option--getting the numbers to work environmentally makes for a more attractive project, and is the right thing to do.

Buildings contribute over 60% of total carbon dioxide emissions during their lifecycle.  Learning how to build and operate for a minimal environmental footprint is essential. As a builder and developer, I see no other way to build.  You are creating a more attractive asset--for neighbors, investors, tenants, and owners. 

Condo guys sweating bullets,

Risk being priced as risk again--not opportunity,

Quality is king,

The dollar debauched,

Financiers explaining why the punchbowl went away, and 

Everyone trying to figure out whether "green" is risk in drag--or a new world.

The fall Urban Land Institute conference is a good way to get a gut check on the health of the real estate industry.

The impending green wave, coupled with cap rate expansion, gave me the distinct impression that the crowd was bifurcated into two groups--heretics and dinosaurs. 

Participants were either expounding the benefits of a greener planet--and acting dumbfounded why everyone else didn't see it, or you were thinking green--and LEED in particular--is a racket conjured up by a bunch of consultants.

What a lot of people didn't seem to see was that green offers a new way to crush an opponent when your asset is developed, operated, and positioned ethically and theirs isn't.

I mentioned to a couple of young Columbia MSRED students that I find the real estate industry is often the last group to realize an impending inflection point--too focused on making a cheaper buggy whip.  What an amazing opportunity for professionals just starting their careers. 

What is it going to take for the rest of us to get it?