Construction Cost

After a soft May, second quarter data indicates that job gains were stronger in June 2016, while economic activity has been expanding at a moderate rate. Overall job growth in the first two quarters of 2016 declined from an average of 245,000 per month to 172,000 per month. The slowing trend could be part of a cycle witnessed in previous expansions. Commodity prices appear to have stabilized at a reduced level, which increases room for inflation in construction and other sectors.

The Pennsylvania State University is planning a $44.5 million renovation and expansion of the Agricultural Engineering Building in University Park. Providing multidisciplinary laboratories and classrooms, the project will add 35,000 sf to the existing 64,533-sf (44,581-asf) structure. The building houses the Department of Agricultural and Biological Engineering, a department jointly administered by the College of Agricultural Sciences and the College of Engineering.

Oregon Health & Science University broke ground in June of 2016 on the $160 Knight Cancer Institute in Portland. Designed by SRG Partnership to foster multidisciplinary collaboration, the seven-story, 320,000-sf facility is located on the South Waterfront Campus and will provide biomedical laboratories, administrative offices, interaction hubs, core labs, a 200-seat auditorium, and space for clinical trials.

Pfizer broke ground in late June of 2016 on the $350 million Global Biotechnology Center in China. Located in the Hangzhou Economic Development Area (HEDA), the facility will manufacture pharmaceutical biosimilars, which are drugs designed with similar active properties to existing licensed therapies. The project will feature a modular production facility created by GE Healthcare that utilizes flexible, single-use biomanufacturing technologies. The duration of construction will be 18 months with completion expected in early 2018.

Embry-Riddle Aeronautical University began construction in late June of 2016 on the $22 million STEM Education Center in Prescott, Ariz. Designed by LEO A DALY, the 52,500-sf addition will feature 20 laboratories, including specialized facilities for the study of robotics, aerial engineering, space technologies, and high-speed computation and simulation. The teaching and research building will also provide classrooms, undergraduate science labs, meeting rooms, an auditorium, a multimedia center, and a planetarium.

The economy started out the first quarter of 2016 in good shape, as energy and commodity prices stabilized at reduced levels. This led to more construction activity nationwide, with average prices coming in at an annual escalation rate of around 6 percent, depending on location. Construction job growth and dollar volume both continued upward trends as non-residential construction spending rebounded 48 percent from its most recent bottom in 2011. On balance, current indicators support stable construction growth over the short-term.

Dubai Electricity and Water Authority is planning to construct the $136 million Research & Development Center at the Mohammed Bin Rashid Al Maktoum Solar Park in Dubai. The four-building facility will be constructed using 3D printing and will support the creation of drones and 3D printing technologies for applications including solar power, energy efficiency, smart grids, and photovoltaic desalination.

JHL Biotech opened a biopharmaceutical manufacturing facility in May of 2016 in Wuhan, China. Featuring single-use bioprocessing technologies, the cGMP facility utilizes GE Healthcare's prefabricated KUBio system to produce biosimilars and monoclonal antibodies for late–stage clinical trials and commercial supply. The project was completed in just 18 months.

Embry-Riddle Aeronautical University has awarded Sundt Construction the design-bid-build contract for a new teaching and research facility in Prescott, Ariz. The 52,570-sf addition will provide classrooms, an auditorium, and labs for robotics testing, optics research, and high-speed computation and simulation. Featuring advanced building systems and exterior finishes, the project will support programs in applied science, aviation, business, engineering, space, computing, cybersecurity, and defense. Completion is expected in just 13 months.

STEM facilities built in the 1960s and 1970s aren’t up to hosting today’s science, and universities across the nation are wrestling with the question of how best to move forward. Building a new science facility isn’t always an option, due to funding limitations, insufficient swing space, or lack of administrative or political support. Fortunately, in-place transformation projects can often deliver a revitalized STEM environment for a significantly lower cost, if you begin with a solid roadmap, evaluate the building’s “bones,” and don’t underestimate your power to transform a building.

Beijing Construction Engineering Group and the University of Huddersfield in the United Kingdom have signed a five-year agreement to collaboratively develop Building Information Modelling (BIM) technologies. The partnership will leverage BCEG's expertise in lean construction practices with the University of Huddersfield's new degree program in Design Integration and Building Information Modeling. The Memorandum of Understanding (MOU) will also create employment opportunities at BCEG for both undergraduate and postgraduate students.

The U.S. economy continued growing at a healthy rate in 2015, adding approximately 221,000 jobs per month over the year. Wage and profit increases in the construction sector are expected to pull new entrants into the labor force with some restructuring from other sectors of the economy, for example energy and exports. Construction prices increased nationally, trending toward 8 percent, depending on location.

Construction Costs

The University of Cambridge is planning to build a $125 million biomedical research facility in the United Kingdom. The six-story, 190,000-sf Project Capella will house the Cambridge Stem Cell Institute, the Milner Therapeutics Institute, the Cambridge Institute of Therapeutic Immunology & Infectious Disease, and the Cambridge Centre for Haematopoiesis and Haematological Malignancies. Lean construction methodology will be implemented in the delivery of the facility, which is slated for completion in the second quarter of 2018.

Complex technology, expanding program, and increasingly specialized and segmented roles and responsibilities often create a disconnect in the process of designing and building sophisticated facilities. The result can be a research or diagnostic lab or high-containment animal building that becomes a burden to the owner, whether because it hasn’t been right-sized, is not energy efficient, or operates with sub-par reliability. The solution is to assign someone the task of aligning design decisions with the building’s ultimate scientific mission.

The Pennsylvania State University's Health and Human Development Building was awarded the 2015 Gold Project Leadership Award in November of 2015 by the Construction Owners Association of America (COAA). Completed in summer of 2015, the structure was the second building of a two-phase expansion of the College of Health and Human Development, collocating several research centers near the main academic departments.