2024 Q2 Economic Indicators

mmcrebuildstg on October 3, 2024

2024 Q2 Economic Indicators High interest rates are causing ongoing uncertainty across various market segments for the rest of 2024. Projects that depend on financing are facing significant challenges, limiting substantial growth. Despite these hurdles, the broader industry is showing resilience against economic pressures, positioning us for steady, incremental growth throughout the year.

Projects most impacted by financing include multifamily, lodging, and commercial construction. According to the AIA, one-third of delays are due to financing and economic concerns, with billings falling for the 11th consecutive month. Despite these challenges, the FMI report forecasts that engineering and construction spending will finish 6% higher than in 2023. Manufacturing and public safety are up 20%, supporting the industry alongside education and healthcare, which are expected to show sustained growth. Dodge reports that data centers account for a significant portion of the backlog in the commercial market.

Quick facts:

  • AIA: 11th consecutive month of declining billings.
  • ABC: Backlog is down to 8.4 months from 9.3 in 2023.
  • FMI: Spending is forecasted to be up 6% YOY.
  • Dodge: Data centers are accounting for a significant portion of commercial growth.

The Fed began cutting rates in Q3 and is expected to continue doing so in a slow, methodical manner. If rates keep dropping, delayed projects may gain momentum in 2025. For more insights on how interest rates impact backlog and project planning, read our report.

MM Market Experience:

Much of our pipeline in Columbus and Charlotte aligns with the segments reporting growth. Year-to-date, we have responded to 130 RFPs, with 45% being public projects that are not affected by interest rates. While we have seen some activity from clients in the multifamily, hotel, and office sectors, these projects have generally been slower to secure financing and move forward.

MM Market Breakdown YTD:

  • 45% Public / Higher Ed. / Government
  • 20% Commercial / Warehouses / Data Centers
  • 13% Healthcare
  • 16% Industrial / Manufacturing
  • 6% other (religious, recreation, etc.)

Kannapolis approves money for realignment of city hall to accommodate growth

mmcrebuildstg on August 28, 2024

KANNAPOLIS — As part of the implementation of the Imagine Kannapolis Strategic Plan, the city council Monday night approved several budget amendments, including one that will allow for “upfits” or adjustments in space to accommodate growth in city hall.

Read more at: https://www.salisburypost.com/2024/08/14/kannapolis-approves-money-for-realignment-of-city-hall-to-accommodate-growth/

Miles-McClellan Construction Helps North Carolina Community Beat the Heat With Historic Community Pool Renovations

mmcrebuildstg on August 18, 2024

North Park Pool

As cities nationwide continue to experience record-breaking summer temperatures, the importance of community spaces that allow residents to find relief, socially engage and promote safe physical activity becomes that much clearer. In Burlington, North Carolina, one of those spaces is the historic North Park Pool. Originally built in the 1950s, it was one of the first places black families could gather for special events, celebrations and summer pool days in a still segregated country. It continues to hold special importance to the community today, so when it was time for the space to receive some serious upgrades, the City of Burlington reached out to the experts at Miles-McClellan Construction.

The city opted for a design-build construction plan, which is when our experts take a project from conception to finish, delivering a finished product that meets the desired needs and budget. The North Park Pool project was significant, not only because of its deep historic roots, but also because it is the City of Burlington Aquatics’ largest outdoor aquatic recreation facility. While the city originally planned to tear down the existing building and build a new facility, Miles-McClellan Construction determined that revising the plans to utilize the existing building would allow the city to complete the project within budget.

Renovations for this project included:

  • New zero-entry pool with a tiled walking path
  • Competition race lanes
  • Splash pad with water features
  • Diving well
  • 13,000 SF deck
  • Shade pavilion
  • Revitalizing the outdated support building by adding a pump room and concession area in conjunction with updated changing areas and a meeting room

Design-build services provided by Miles-McClellan Construction included:

  • Project management and administration through project leadership and overall team coordination
  • Interdisciplinary coordination
  • Review of codes and standards
  • Identifying opportunities for economy of scale
  • Project planning and scheduling
  • Coordination of contract documents
  • Providing documents and drawings

The North Park Pool

“The North Park Pool is an important part of our community’s history. We are honoring that history by preserving the mural dedicated to the members of North Park’s late 1950s swim team. [This] modern outdoor recreation facility provides new ways patrons can stay active and have fun during the hot summer months.”
Rachel Kelly
Assistant City Manager for Administrative Services
City of Burlington, NC

Ultimately the North Park Pool project was completed on time and under budget. The community was grateful to have this historic gem restored to its former glory, and the city even decided to commemorate its unique past by preserving one of the original murals.

Are you ready to discover how our design-build services can build excellence in your community? Then contact us today and learn more about our superior design-build services and solutions!

Building a Brighter Future Through Nonprofit Construction

mmcrebuildstg on August 5, 2024

Grove City Library is one of many non-profit construction projects completed by Miles-McClellan

One of the most satisfying aspects of our work in the construction industry is getting to see firsthand how our projects improve communities and make an IMMPact. Nonprofit construction is especially rewarding for our team, as nonprofit construction is driven by the mission to create spaces that empower residents, improve quality of life and improve safety, which aligns with the values our company has held for over 46 years.

Our work in nonprofit construction covers a wide variety of different structures, including community centers, parks and healthcare centers. While nonprofit construction is incredibly rewarding, at times it can present a variety of unique challenges. Proper planning and strategy are key.

In this blog we outline our top tips to help your next nonprofit construction project go smoothly and be successful.

Make Sure the Vision is Clear

Before ever breaking ground, make sure all goals, objectives and uses for this space are clearly defined. Will the space have multiple uses? What purpose will it ultimately serve? What budget constraints could arise? Making sure everyone is on the same page as far as vision is incredibly important, and when it comes to nonprofit construction, that vision must remain agreed upon and consistent amongst multiple people, including nonprofit staff, board members, community leaders and stakeholders.

Secure Funding Early and Develop a Realistic Budget

Funding is a crucial part of construction in any industry, but it can be especially complex for nonprofit projects. Nonprofit funding usually comes from a combination of grants, donations and loans, and all of that should be secured before construction begins. All involved with funding should receive full transparency about the project’s goals, timeline and financial needs, and project teams need to develop a detailed and realistic budget that accounts for all aspects of the project, including permits, materials, labor, contingency funds and potential delays.

Document Everything

Because nonprofit organizations have a variety of different stakeholders they must answer to, keeping detailed records of all communications, contracts, permits, change orders and financial transactions is essential. This documentation will be invaluable for accountability, and reporting to funders, the board and government agencies.

Stay Transparent

We’ve said this before, and we’ll say it again – transparency should be a priority on any construction project!  Establish a communication plan from the very beginning that includes regular updates and open lines of communication for the key players involved. This builds trust, ensures everyone is on the same page, reduces mistakes and builds excellence.

Keep the Community Involved

Don’t forget that the end goal of nonprofit structures is to support the community, so let the community know of important updates! Showcase on your website, newsletters, emails and social media platform all of the milestones of the project. The community will love hearing about the progess of the project, and may have valuable feedback that could be useful!

We Are Doing Our Part to Make a Difference!

Nonprofit construction has a special place in our hearts, because making an IMMPact in the community is an important part of our values. In fact, as a company we support 58 non-profit organizations, provide paid internships, offer apprenticeships and mentoring, support our employees’ causes monetarily and allow them to volunteer during work hours.

How can we help ensure your next nonprofit construction project lives up to your vision? Contact us and let’s discover how working together, we can change lives!

Building Communities: The Importance of Exceptional Construction in the Public and Municipal Space

mmcrebuildstg on July 8, 2024

The CMPD University City Division

“Working with Miles-McClellan on Fire Station No. 6 has been a great team experience all the way through design and well into construction. They have demonstrated their ability to perform on previous projects and have continued to deliver. It is great working with a trustworthy contractor that wants to do what’s right for taxpayers and stakeholders.”
Christopher Wyckoff
Facilities & Construction Director
The Town of Mooresville

With every construction job, we are focused on building excellence, because we know that transforming spaces in a community can also transform lives.

Nothing drives this point home more than the work we have performed in the public and municipal sectors. This type of construction, and these structures, are critical for community development as they provide essential infrastructure and services. However, they come with a unique set of challenges that must be considered, which includes handling tight budgets, securing funding sources, obtaining the necessary permits and approvals, managing the expectations of stakeholders and staying compliant with numerous laws and regulations. At Miles-McClellan Construction, we have decades of experience managing these types of projects, and have a deep understanding of municipal codes, funding and how to work well with the municipal team.

Here are some strategies that have served us well when working with public and municipal projects:

Plan Thoroughly and Keep the End Goal in Mind:

Municipal projects usually begin with very clear goals and a firm budget. At Miles-McClellan Construction, we always ensure that we maintain open communication with all involved in a public or municipal project, including members of our team, stakeholders, any public officials involved, architects, design teams, etc., to keep everyone on the same page at all times. It’s important to establish the full scope of a project and make sure that it is realistic with the time and funds allotted. It’s also necessary for the construction team to understand current industry trends that could affect aspects of the project, for example, supply chain issues. This level of awareness gives way to foresight which allows construction project managers to communicate these potential issues to all involved and find creative solutions before it becomes a bigger problem.

Compliance is Key

Compliance with public and municipal projects is crucial for ensuring that projects are completed safely and in accordance with established standards. Construction companies need to confirm compliance with local building codes, be familiar with local laws and regulations and understand how to obtain the necessary permits. Some cities also have environmental rules and regulations that must be followed when working on a construction project.

Prepare for the Unexpected

Even the most well-planned construction projects can encounter obstacles, and that applies to public and municipal construction as well – just ask anyone who was waiting for government funds to begin a project when the pandemic hit in 2020. We highly recommend having a contingency plan that maps out potential risks and possible solutions. It could ultimately save a project thousands.

Check out two Miles-McClellan Construction municipal projects that ended up improving their respective communities:

Need assistance with your next public or municipal construction project? Then contact Miles-McClellan Construction today and we’ll do our part to help your community shine even brighter!

Construction Manager at Risk Vs. Design-Build: What’s the Best Method for Your Next Project?

mmcrebuildstg on June 25, 2024

Construction Manager at Risk Vs. Design-Build

In construction, the first step in any project is determining a project delivery method that ensures the best outcome. Two popular methods that we offer at Miles-McClellan Construction are design-build and construction management at risk (CMR), which while similar in some respects, also have distinct differences that can be the defining factor in executing a project that is well-planned, goes smoothly and leaves all involved feeling satisfied with the results.

Keep reading to learn more about these delivery methods and when they are best utilized.

An Overview of CMR and Design-Build Project Delivery

First, it’s important to understand how these methods are different on a base level. With CMR, one of our skilled project managers commits to delivering a construction project within a guaranteed maximum price (GMP). That construction manager will be your consultant throughout the project, doing whatever it takes to ensure that all aspects of the projects are being handled properly and that there is a smooth transition from one phase of a project to the next.

With design-build project delivery, the design-build contractor teams with the chosen architect to complete construction based on your project needs and wants. Because of this partnership between contractor and architect, an established guaranteed cost is provided early in the process, allowing you to secure funding faster.

Advantages of CMR

Every strategy has its unique strengths. Let’s explore those in a CMR collaboration. 

  • If you have an architect who has worked well for you throughout the years, CMR allows you to continue working with the architect who understands your business and vision, while the contractor keeps that vision within budget.
  • Because the construction manager is involved early in the project, they can provide valuable input during the design phase, which can lead to more accurate cost estimates.
  • When a GMP is established from the very beginning, overrunning the budget is less likely.
  • CMR fosters a sense of collaboration with everyone involved in a project, including, owner, designer, architect, stakeholders, etc., which leads to better communication and problem-solving.
  • With CMR, the owner sets and leads the design while being financially responsible, giving the owner more control.
  • We recommend CMR as the form of project method delivery for more hands-on owners.

Advantages of Design-Build

Now let’s explore the benefits of design-build project delivery.

  • If your construction project contains multiples of the same type of building (for example, maintenance complexes, a tradition K-12 school, banks, and public institutions such as fire stations, police station, post offices, etc.) design-build is a very effective choice.
  • The design-build contractor holds all of the risk for the owner by contracting with both the architect and subcontractors.
  • With design-build, the design-build contractor and architect are partners, creating a situation that requires less checks and balances.
  • Design-build can significantly reduce the overall project timeline, as both the construction and design phases of a project take place at the same time.
  • We recommend design-build for owners who want to focus on their business instead of taking on the responsibilities of the construction on a heavily funded project.

Still Have Questions? Let Us Put You on the Right Track!

Overall, there is a give and take to both delivery methods that should be taken into account when considering your next project. If you still have questions and would like insight from construction experts with decades of experience, contact us today and let’s build excellence while finding your ideal construction solution!

2024 Q1 Economic Indicator

mmcrebuildstg on June 11, 2024

2024 Q1 Economic Indicator
Contrary to earlier predictions of a recession in early 2024, the AIA and FMI now suggest a potential slowdown in the back half of 2024. While our indicators do point to a deceleration, our internal data and anecdotal evidence consistently demonstrate the robustness of the construction industry, which does not align with the notion of a significant downturn.

To summarize the AIA and FMI reports, they expect an increase in construction spending between 2-3% in 2024, followed by a rise of 1% in 2025. Accounting for the anticipated slowdown of construction over the next two years, the AIA points to three factors that, when combined, cause banks to tighten up lending, resulting in difficulty in getting projects started:

  1. Rising long-term interest rates.
  2. Higher construction input costs with input prices remaining 35% to 40% higher than pre-pandemic rates.
  3. Construction labor costs are continuing to rise at a 4% annual pace.

Despite the AIA Billing Index remaining below 50 for 9 consecutive months and the Dodge Momentum Index staying low for the past 10 months, the Charlotte and Columbus construction markets are still brimming with potential. Contractor backlogs, as measured by ABC and FMI, saw an increase at the end of Q1. This positive trend is mirrored at Miles-McClellan, where our backlog is higher today than it was at the end of Q1.

As you read the full report, you will learn more details about these numbers and trends.

Recent MM Bidding Experience

Immediately below is a summary from one recent bid effort, but it indicates what our teams are experiencing as they continue to price projects for our clients actively.

Sharing a recent bidding experience, Brad Bloomberg, MM Vice President, expressed, “Our most recent bid was for a local office remodel in downtown Columbus. The project primarily focuses on updating elevator lobbies, restrooms’ finishes, lighting, and ceilings. We had a prequalified list of limited subcontractors invited to the project. While the coverage was average on drywall and fire suppression, we received feedback from painters, electricians, and HVAC contractors that they were too busy with the existing backlog over the summer months to take on any new work.”

  • Painting: 2 bidders of the 7 invited.
  • Electrical: 2 bidders of the 10 invited.
  • HVAC: 1 bidder of the 10 invited.
  • Flooring: 2 bidders of the 6 invited.
  • Drywall & Demo: 4 bidders of the 5 invited.
  • Fire Suppression: 3 bidders of the 6 invited.

This level of bidding activity is typical for the summer months. We will monitor the trends and report on contractor backlogs in Q3.

Read the Report

Miles-McClellan Construction Director of Field Operations Steve Parsons Discusses the Benefits of Owner’s Representation in Construction

mmcrebuildstg on May 30, 2024

Greasecycle’s Charlotte facility

Construction projects are complex and require effective management of many different moving parts, such as groups of subcontractors, estimating costs and supervising work to ensure it is of the highest quality. Our owner’s representation services offer support during the planning, design and construction cycles of a project, and allow a project to meet the owner’s expectations in terms of scope, quality, schedule and budget. We customize our owner’s representation services to be flexible based on the owner’s needs, and the owner decides how much involvement and decision-making authority we receive. This leads to exceptional results with a project completed on schedule and on budget.

In this interview with Miles-McClellan Construction director of field operations Steve Parsons, learn about his experience being an owner’s representative and how it has allowed him to “save the day” for his clients.

Let’s Hear More From Steve Parsons:

Q: What experience do you have as an owner’s representative on projects?

A: Greasecycle’s Charlotte facility was my first assignment as an owner’s representative. I look forward to my next opportunity as an owner’s representative.

Q: Why do you like being an owner’s representative for clients?

A: As a contractor, it is rewarding and challenging to experience the owner’s vision and assist them with their project’s planning, financial and schedule goals.

Q: What do you bring to the table – why would a client want to work with you?

A: Experience. I have fourty-four years of commercial construction experience with a diverse and long list of successful projects.

Q: Can you name an example of “how you saved the day” for a client?

A: During COVID-19 and Greasecycle’s project, we were advised that the lead time for the electrical switch gear equipment would be twenty-eight months after it was approved and released due to severe supply chain issues. This was unacceptable for a project with a goal of completion within nine months. Through my electrical supply contacts, I sourced a used and refurbished switch gear from a supply house in California and finished the project by the nine month deadline.

Q: Do you have any specific advice for those in the construction industry working as an owner’s representative for clients?

A: Be a good steward. Treat concerns and your client’s money like you would your own. Think outside the box of a typical contractor and bring creative solutions to the table. Listen to the owner’s concerns and draw down on all your experience. Pride the owner with your professional advice. Advise the owner of the risks before they become a problem. Always be fair but firm with everyone.

Do you want to make sure your next construction project goes smoothly, on time and without numerous unforeseen obstacles? Then learn more about our owner’s representation services and contact us if you have any questions.

Building Excellence from the Beginning: The Benefits of Construction Management at Risk

mmcrebuildstg on May 2, 2024

Construction Management at Risk

For over 46 years, our customers have trusted us to build excellence and find smarter solutions for all their construction needs to ensure the best possible outcome for any project. With comprehensive Construction Management at Risk (CMR) services, our strategic approach to crucial components of a construction project that include project and risk management, project cost estimate and budgeting and design and engineering services, we help our customers minimize risks, control costs and get projects completed on time and at the highest standard of excellence.

How Does Miles-McClellan Construction Approach Construction Management at Risk?

As with all of our projects, the process begins with one of our talented leaders serving as Project Executive and committing to delivering a construction project within a guaranteed maximum price (GMP). From there, the Project Executive takes on the role as consultant throughout the development and design phase, and does everything possible to ensure a project is prepared and ready to enter the next phase.

How Can Construction Management at Risk Benefit My Next Project?

In our experience, CMR with Miles-McClellan Construction provides several benefits that ensure a project is successful from beginning to end. These include:

  • Projects Completed on Time – When a construction manager is involved early in the process, they can optimize the construction schedule and plan for multiple aspects of a project, including delivery of materials, procuring labor and equipment, coordinating various timelines, etc. Ultimately, this allows for increased speed of project execution.
  • Construction Managers With Decades of Experience – Our construction managers have decades of experience, and are dedicated to client satisfaction and building excellence. They have worked with clients of all sizes in all industries, and found ways to overcome a variety of construction challenges. Learn more about their approach to construction and why they are the best in the business.
  • Enhanced Synergies Between Stakeholders- Talented construction managers have the ability to foster a culture of collaboration and transparency amongst stakeholders involved in a project, which allows stakeholders to identify areas for improvement and construction managers to adapt and plan for changing project requirements. This goes a long way in enhancing stakeholder satisfaction.
  • Cost and Pricing Transparency- As stated earlier, one of the hallmark features of CMR is the creation of a Guaranteed Maximum Price (GMP), which provides owners with cost certainty and transparency and ensures that projects remain within allocated budget constraints. This requires significant planning and cost monitoring from construction managers, and helps minimize the risk of budget overruns.

Ready for Project Success? Then Ask About Our Construction Management at Risk Services!

We believe in building excellence before construction ever begins and have the talent and expertise to provide a seamless and efficient design process that leads to exceptional results. Contact us to learn more about our CMR services and experience on time, on budget construction!