Crain’s Chicago Business: Roundtable on Life Sciences

With thriving neighborhoods and more affordable real estate, Chicago is emerging as a life sciences hub.

Investment in life sciences was at an all-time high in 2021. As a result, demand is quickly growing for research and development space in Chicago which is emerging as a major life sciences market. Three experts in commercial real estate development, design and construction, shared their insights with Crain’s Content Studio on the trends that are shaping the future of life sciences in Chicago.

Life sciences companies are rapidly evolving, and they need spaces that can accommodate that. What factors most influence the commercial real estate, design and construction decisions companies face?

Andy Halik: Labs typically need more technically sophisticated structures with more complex mechanical systems—particularly power and HVAC—than a typical office building. Structurally, they’ll need more risers and shafts; the good news is, if the building doesn’t have these structural needs, they can usually be installed to accommodate the lab-specific needs. Access to adequate power is critical. Life sciences tenants use an average of seven times more electricity than office tenants, because their lab and systems like HVAC, exhaust and electrical load systems need more finely tuned environments.

Suzet McKinney: To meet the evolving needs of life sciences tenants, real estate developers serving the sector must broaden their vision beyond merely functional, purpose-built laboratory facilities of decades past. That journey begins with a collaborative relationship between the developer and the life sciences tenant to ensure an adequate understanding of the needs of life sciences companies, not just for their current business needs, but also for their growth needs as well. Some of the unique building needs for life sciences companies include a flexible lab footprint and space design to accommodate workflow, efficiency, size of equipment, and traffic flow throughout the lab, as well as proximity between labs and offices. Human-centered architecture and amenities are important because, at the end of the day, buildings and laboratories don’t make scientific breakthroughs–scientists do. By creating lab environments where research and the exchange of ideas is easy, enjoyable and seamless, we increase occupant satisfaction and set the stage for innovation.

Brett Taylor: Fundamentally, there are a few building requirements that are unique to life science tenants to accommodate their lab needs. The structural grid for a lab building consists of 11-foot modules, a time-tested and universal approach that takes lab bench width and other attributes into account. Floor-to-floor height is 1-1.5 feet higher than a typical office building to accommodate additional building service requirements. Additionally, some lab tenants may install sensitive equipment that require low building vibration, therefore the structural system may need to be modified to accommodate those specific requirements. Collaboration space is critical. As such, lab buildings typically have higher collaboration / amenity ratios than typical spec offices, especially multi-purpose areas that are often used for hosting lectures and other industry presentations.

What factors are driving the industry’s interest in Chicago?

McKinney: Most of the key demand drivers that make for a successful life sciences market already exist in Chicago. Namely, top-tier research universities and healthcare institutions, STEM talent, National Institutes of Health funding and venture capital funding. However, Chicago has never had sufficient lab space to keep entrepreneurs and their companies here. At Sterling Bay, we’ve recognized the damage this exodus has done to our economy for decades. We think by providing quality lab spaces and full life sciences ecosystems, we can stop the bleeding to the coasts and the departure of talented scientists and entrepreneurs that come out of the universities here. Our government has awakened to this fact as well. We now have a more cohesive effort that is centered around the goal of growing Chicago’s life sciences ecosystem and raising the city as a major life sciences market.

Halik: There are two main factors driving this industry’s growth. One is an increase in Chicago-area universities and local incubators developing young talent and providing them with pathways and resources to start companies. The idea of setting down roots in Chicago is appealing to this talent pool. The second main factor is the pandemic-related needs for more life sciences research. Both factors are resulting in demand for more specialized lab space in Chicago. Higher vacancy rates in traditional office space have also caused many building owners to consider converting office space to lab space.

Taylor: There’s a desire to invest in Chicago for lab space because it is an emerging market compared to coastal cities where the industry is more established. At the same time, many adjacent industries, including tech, education and health have large presences in Chicago. The talent and important points of connection are already here. There are opportunities to build synergy with nearby universities and hospitals, and that creates huge benefits. We’re seeing life sciences buildings being designed for various users who require a mix of dry labs, wet labs and office space. These new buildings are dynamic enough to accept a variety of users, which is another reason why the Chicago market is so desirable. Many life sciences companies are used to having to adapt an existing building to a lab use rather than working with a developer who can accommodate their specific needs.

The full Q&A continues at Crain’s Chicago Business.

Could your building help meet soaring demand for lab space?

Lab sciences is one of the most talked-about sectors in real estate right now – but how can a traditional office building owner court these companies as tenants? By understanding what lab sciences leaders look for in potential lab and office space, commercial real estate owners can determine whether their buildings might be prime candidates for this dynamic market.

Today’s lab sciences firms are booming across the spectrum, from record-breaking investment in life sciences to unprecedented technological breakthroughs in materials science and electrical engineering. Add in intensifying talent wars and extreme pressure to get innovative products faster to market than ever before, and it’s no wonder there’s extreme competition for quality space.

At the same time, the great work-from-home experiment of the last 20+ months inspired professional services firms to rethink their footprints. As tenant demand shifts from familiar faces to new ones, many building owners are asking what it might take to convert, say, a Class A office building into a desirable lab space.

The answer depends on a variety of factors, including location, structure and more – but it may be more feasible than you think.

Five Ways to Win Lab Sciences Tenants

How can you break out of the decades-long mold of owning a conventional office property? A little creative thinking – backed by engineering insight – goes a long way.

Consider the following on your journey to a scientific-tenant-friendly building:

1. Get up to speed on prospective lab sciences tenants.

If you’re not already familiar with the various lab sciences categories, now’s the time to learn some basics.

Wet labs work with biological matter and therefore have stringent requirements for air filtration, plumbing, equipment, waste disposal, life safety and fire protection. But dry labs, which focus more on applied and computational mathematical research, can more easily plug into existing real estate.

Many different types of lab sciences needs exist, from dialysis samples to small electronics manufacturing, to general labs akin to your old high school chem lab. Startups are also bringing new momentum to the market – and unique space needs, such as access to flexible lab space, as well as more meeting-oriented office space.

2. Understand the role of your building’s location.

Professional services and other office-anchored work need locations that will appeal to staff as well as the clients and customers they serve. In life sciences, however, it’s more important to have the right functioning space than to offer a convenient location for customers.

That said, location is key to recruitment and retention for your prospective tenants. For those reasons they’ll favor real estate options in a bustling market, preferably near universities or medical campuses, and where life sciences innovators may be able to rub shoulders with others on the street. However, still keep an eye on locations that are attractive in the market more generally; for example, Skender is building out a company’s research and development lab space in an office building in an exciting neighborhood.

You’ll also need to ensure any lab science facility needs won’t disturb neighbors in, say, a residential area. Lab work that disposes of chemical load via the exhaust fans shouldn’t be near an apartment building with porches, for example. So, before taking on a tenant, consider how their particular work would affect any neighboring areas.

3. Evaluate your building structure to learn what it can handle.

Can your building accommodate the intensive systems that lab sciences firms require? Labs typically need more technically sophisticated structures with more complex mechanical systems. Structurally, they’ll need more risers and shafts than an office building would.

Access to adequate power is also critical. Life sciences tenants use an average of seven times more electricity than office tenants because their equipment and systems need more finely tuned environments, from air conditioning and fans to exhaust and electrical load systems.

Conduct a feasibility study with a mechanical and electrical engineer to determine your best course of action when such tenants come knocking.

4. Remember the human experience for talent.

Amid the war for talent, lab sciences tenants want buildings that prioritize convenience and offer flexible layouts. So, for example, these tenants might look favorably on secure parking lots and/or showers and locker rooms for their bike-to-work contingent.

Within the workspace, they also tend to value flexible design that facilitates collaboration and engagement, with easy access to shared spaces as well as comfortable, inviting break rooms where employees can catch a breath.

5. Provide private access to non-public-facing infrastructure. 

Avert awkward elevator moments by keeping orange biohazard-labeled materials out of common elevators. Because they work with specialized equipment and sensitive chemicals, lab sciences tenants need a private way to get in and out of their space without running into other tenants. This often includes a loading dock, a dedicated service elevator, and private storage areas.

Are You Ready to Capitalize on This Growing Market?

Demand for quality lab sciences space is only expected to rise. By adapting existing space to accommodate their specific needs, building owners can reposition their portfolios for a more resilient future.

This article is authored by Skender’s Jeff Janicek and Jason Utah. It was originally published by NAIOP.

Multi-Housing News: Occupied Rehab: A Solution for Affordable Construction Challenges

Skender’s Joe Pecoraro shares a solution for dealing with uncertainty in costs, schedules and labor.

Making the numbers work for financing affordable housing construction was a challenge even prior to the pandemic—and now the compounding factors of construction material delays, rising material costs and labor shortages are making it even more difficult. New ground-up construction needs solid financial data to secure financing, and the uncertainty of the supply chain and labor market means developers are facing protracted due diligence periods before they even begin work. The bottom line: it is taking longer to get much-needed affordable housing units into the marketplace at a time when the demand is greater than ever.

At the same time, much of the existing stock of affordable housing in the U.S. isn’t meeting the standards of safety, sustainability and disability accessibility required of new construction. Equally of concern, it’s not meeting our shared mission in the affordable housing industry of providing dignified and high-quality homes to our neighbors who most need them.

One option that helps to solve this problem, while not taking affordable multifamily stock off the already depleted market, is occupied rehabilitation. An occupied rehab program allows affordable housing developers to take advantage of the rehabilitation tax credit to make necessary updates to existing or recently acquired housing stock, while the building remains occupied.

How Occupied Rehab Works

During the renovation, residents are moved out temporarily (usually for a period of one to two weeks) to a hotel or a vacant unit in the building. They return to newly rehabbed apartments that not only have a fresh look, but also are ADA-compliant, have updated kitchens, bathrooms, mechanicals, and appliances, and are more energy efficient—all important components of the rehabilitation program.

Using Lean construction methods, which emphasize the reduction of inefficiencies, redundancies and waste, contractors can keep projects on budget for owners and complete them with minimum disruption to residents. Groups of units are worked on in a phased approach, and each subsequent phase is further streamlined as lessons learned are applied from earlier units in real time, such as knowledge of the building’s existing mechanical and electrical features and accommodations that may have to be made to bring energy-efficient appliances into the apartment.

Improvements can be relatively small in cost—especially compared to ground-up construction—but have a dramatic impact on the quality of life of residents. For example, plumbing work done during the rehabilitation has allowed residents to take hot showers for the first time in months. Other updates can improve the longevity of the building and reduce its environmental impact. Many older buildings need to upgrade their elevator systems and points of entry and exit for safety and accessibility concerns.

In addition to upgrading individual units, occupied rehab projects can include common areas. Renovating areas such as a cafeteria/multipurpose room, common restrooms or a fitness center, further provides opportunities for the residents to enjoy an improved living experience.

Why is now the right time to consider occupied rehab?

Lawmakers increasingly support raising affordable housing fund. Earlier this year, the 4 percent low-income housing tax credit (LIHTC) was fixed at a true 4 percent rate, a boon for affordable housing investors. More recently, the “Build Back Better” legislation, which has so far passed in the U.S. House of Representatives, includes several provisions to expand and improve the LIHTC program.

While the bill’s details are still being debated in the Senate, housing tax credits could increase by up to 40 percent, and the package will include significant funding for affordable housing, including $65 billion for public housing repairs and preservation.

Most of the work done in occupied rehab can be financed through a combination of 4 percent tax credits, 9 percent tax credits, and other programs such as Tax Increment Financing (TIF) zones. With new federal commitment to bolstering these programs, developers should take a look at which buildings in their current portfolio could benefit from an occupied rehab project.

Occupied rehab can be a win-win for owners of affordable housing multifamily buildings as well as their residents. The renovation process treats residents with respect, giving them safer and better places to live, while not disrupting or displacing them for a long period. It allows developers to take advantage of tax-credit programs to bring their buildings up to standards in shorter time frames and without affecting occupancy rates. In this time of uncertainty in costs, schedules and labor, occupied rehab is a way to make affordable housing construction work.


Joe Pecoraro, project executive, Skender, is a leading adopter of Lean construction techniques and has helped shape Skender’s Lean-focused culture since joining the company in 2005. Pecoraro oversees Skender’s multi-unit housing team, and his expertise has helped deliver a wide range of successful multifamily residential, affordable housing and senior living projects.

This article was originally published by Multi-Housing News.

Occupied Rehab: A Solution for Affordable Construction Challenges

In this time of uncertainty in costs, schedules and labor, Joe Pecoraro of Skender, shares a solution.

Joe Pecoraro

Making the numbers work for financing affordable housing construction was a challenge even prior to the pandemic—and now the compounding factors of construction material delays, rising material costs and labor shortages are making it even more difficult. New ground-up construction needs solid financial data to secure financing, and the uncertainty of the supply chain and labor market means developers are facing protracted due diligence periods before they even begin work. The bottom line: it is taking longer to get much-needed affordable housing units into the marketplace at a time when the demand is greater than ever.

At the same time, much of the existing stock of affordable housing in the U.S. isn’t meeting the standards of safety, sustainability and disability accessibility required of new construction. Equally of concern, it’s not meeting our shared mission in the affordable housing industry of providing dignified and high-quality homes to our neighbors who most need them.

One option that helps to solve this problem, while not taking affordable multifamily stock off the already depleted market, is occupied rehabilitation. An occupied rehab program allows affordable housing developers to take advantage of the rehabilitation tax credit to make necessary updates to existing or recently acquired housing stock, while the building remains occupied.

How Occupied Rehab Works

During the renovation, residents are moved out temporarily (usually for a period of one to two weeks) to a hotel or a vacant unit in the building. They return to newly rehabbed apartments that not only have a fresh look, but also are ADA-compliant, have updated kitchens, bathrooms, mechanicals, and appliances, and are more energy efficient—all important components of the rehabilitation program.

Using Lean construction methods, which emphasize the reduction of inefficiencies, redundancies and waste, contractors can keep projects on budget for owners and complete them with minimum disruption to residents. Groups of units are worked on in a phased approach, and each subsequent phase is further streamlined as lessons learned are applied from earlier units in real time, such as knowledge of the building’s existing mechanical and electrical features and accommodations that may have to be made to bring energy-efficient appliances into the apartment.

Improvements can be relatively small in cost—especially compared to ground-up construction—but have a dramatic impact on the quality of life of residents. For example, plumbing work done during the rehabilitation has allowed residents to take hot showers for the first time in months. Other updates can improve the longevity of the building and reduce its environmental impact. Many older buildings need to upgrade their elevator systems and points of entry and exit for safety and accessibility concerns.

In addition to upgrading individual units, occupied rehab projects can include common areas. Renovating areas such as a cafeteria/multipurpose room, common restrooms or a fitness center, further provides opportunities for the residents to enjoy an improved living experience.

Why is now the right time to consider occupied rehab?

Lawmakers increasingly support raising affordable housing fund. Earlier this year, the 4 percent low-income housing tax credit (LIHTC) was fixed at a true 4 percent rate, a boon for affordable housing investors. More recently, the “Build Back Better” legislation, which has so far passed in the U.S. House of Representatives, includes several provisions to expand and improve the LIHTC program.

While the bill’s details are still being debated in the Senate, housing tax credits could increase by up to 40 percent, and the package will include significant funding for affordable housing, including $65 billion for public housing repairs and preservation.

Most of the work done in occupied rehab can be financed through a combination of 4 percent tax credits, 9 percent tax credits, and other programs such as Tax Increment Financing (TIF) zones. With new federal commitment to bolstering these programs, developers should take a look at which buildings in their current portfolio could benefit from an occupied rehab project.

Occupied rehab can be a win-win for owners of affordable housing multifamily buildings as well as their residents. The renovation process treats residents with respect, giving them safer and better places to live, while not disrupting or displacing them for a long period. It allows developers to take advantage of tax-credit programs to bring their buildings up to standards in shorter time frames and without affecting occupancy rates. In this time of uncertainty in costs, schedules and labor, occupied rehab is a way to make affordable housing construction work.

This article is authored by Skender’s Joe Pecoraro. It was originally published by Multi-Housing News magazine.

WSJ: Builders Hunt for Alternatives to Materials in Short Supply

Shortages of key construction materials are forcing some builders and contractors to turn to substitutes and hunt for alternative suppliers as they rush to meet high demand for new housing.

Construction companies are looking for replacements and new sources for everything from wood paneling to ceiling joists to pipes, saying that potentially higher costs and added complications to design and construction can be preferable to putting a project on hold for months while waiting for planned supplies.

Supply shortages stem from a series of supply-chain disruptions hitting industries around the world this year, from port congestion in Asia and the U.S. to labor shortages at factories. Heavy storms in Texas and Louisiana have also slowed production of some building materials, while semiconductor shortfalls have made appliances harder to secure.

Read the full article, which includes commentary by Skender’s Andy Halik, at the WSJ.

Podcast: IN Construction Influencers with Nate Lelle

This weeks guest is Brian Simons, Project Executive and Vice President, Indiana. Brian works with teams in Chicago and Indianapolis areas to build and manage healthcare and interior construction projects. Regularly managing new construction, build-outs, renovations, upgrades and modernizations for hospitals, healthcare systems and corporations.

At Skender, we build lasting relationships, create meaningful experiences and help our clients achieve groundbreaking results. We do this through high-performing teams who are obsessed with delivering the premier construction experience. Skender is a full-service building contractor with specialized new construction and renovation capabilities in all major sectors, including commercial, multifamily and healthcare.  Guided by efficiency, anchored by value and driven by results – our customers repeatedly rave about the way we work and our ability to deliver extraordinary results. Faster, smarter, leaner, stronger.

While the bulk of our work is in the Midwest, we also have extensive experience managing projects in other states. Our multi-state capabilities are enhanced by our national partner network.

Listen to the podcast episode here.

Six Ways to Mitigate Construction Material Costs

Across all property types, both ground-up and renovation projects are facing the dual challenges of price volatility and scarcity of supplies.

The U.S. Bureau of Labor statistics reported staggering spikes in construction material prices between May 2020 and May 2021: increases of 146% for refined petroleum products such as diesel fuel and asphalt base, 114% for lumber and wood products, 107% for cold-rolled steel sheets used for metal studs, and 39% for copper wire and cable. In mid-June, lumber futures for July delivery were down 42% from their record high reached in early May.

Across all property types, both ground-up and renovation projects are facing the dual challenges of price volatility and scarcity of supplies. And with general contractors, subcontractors, and suppliers unable to guarantee pricing of materials more than a few weeks out, many are shifting the risk associated with price uncertainty to owners and developers. Mitigating these risks can be challenging, but the following tactics can help alleviate the effects on a project’s bottom line:

1. Assemble the team early.

At Skender, we’ve found that combining project teams sooner rather than later can significantly increase speed-to-revenue. When architects and contractors collaborate early in the process, either in a design-build or design-assist delivery method, schedules can proceed more quickly, and expensive, time-consuming redesigns can be avoided. For example: in a ground-up project, a smart design choice regarding the location of the major vertical circulation (i.e., stairs and elevators) can result in significant cost savings.

2. Invest in Lean Construction.

To achieve greater stability, reliability, efficiency, and flexibility, owners and developers should leverage Lean construction principles and tactics. In addition to navigating material shortages, a Lean builder such as Skender can help maximize ROI by conducting ongoing research, monitoring economic trends, and providing counsel on lifetime costs, environmental impact, inflation, and other factors. A builder with a Lean approach specializes in optimizing projects for efficiency and reducing waste during all stages of construction — both of which can help mitigate risks associated with rising material costs.

3. Amend budgets.

Historically, material cost increases have slightly exceeded the rate of general inflation (3-5%); in the current environment, PMA advises owners and developers to consider escalation contingencies of 10-15% per year. Predicting exactly when material prices will stabilize is impossible, but establishing strategic budget reserves, contingencies, and reinvestment plans can help owners and developers manage risk.

One budgeting approach Skender’s teams have employed involves building a strategic buffer and establishing a timeline for reassessing risk, then gradually releasing reserved funds back into the project as economic conditions improve. For a project with a $15 million budget, aim to spend $14.5 million, and systematically release the balance as appropriate. Converting surplus contingency adds real value and can enable developers and building owners to secure wish-list items, from upgraded finish materials to appliances and landscaping.

4. Explore alternative or unconventional materials.

At both PMA and Skender, we are firm believers that expanding materials options for every component of a building, from the foundation and superstructure to the various systems and interior building materials, can help control costs. Pre-cast concrete, ready-mix concrete, DensGlass, zip-board, and alternative wood species can all be useful substitutes for materials that are over budget or difficult to procure. For wood-framed projects, prefabricated wall panels and framing systems can limit material waste, decrease labor costs, and potentially expedite project schedules.

Now more than ever, owners and developers should be challenging architects and engineers to exercise their creativity and incorporate unconventional materials in their designs, as well as ensure that extending the list of acceptable substitutes does not compromise on safety, quality, durability or functionality.

5. Procure materials well in advance.

In addition to exploring alternative materials, both our firms suggest procuring materials in advance whenever possible to mitigate risks around pricing and availability. Buying materials earlier typically results in cost savings and greater decision-making power about other factors later in the project. It mitigates unknown exposure to shortages and can ensure access to materials when needed. Some owners and developers have made the decision to purchase materials directly, believing it will avoid markup costs. But going that route also eliminates a variety of services and introduces a higher level of risk, so it’s not something to undertake without examining the full picture.

6. Manage contracts and partner with contractors.

Developers and owners should be mindful of how material price volatility can affect both new and existing agreements. At PMA, we emphasize the importance of fully understanding any material cost escalation clauses. Often, force majeure clauses will be modified to allow for recovery of costs (not just time extensions) for catastrophic events, which can lead to cost escalation. Developers should also avoid contracts with open-ended allowances for material costs. In the current environment, partnering with contractors and suppliers to set an indexed price point with a cap, with an agreement to share in the savings or overages up to the cap, is a more appropriate approach to mitigating risk. This approach also allows for owner participation in any upside as prices stabilize.

Last but not least, owners and developers should keep in mind that steep increases in material costs may lead to subcontractor defaults or bankruptcies. Staying abreast of subcontractors’ and material suppliers’ financial health is critical to minimizing project disruption, even when construction agreements are properly structured to protect the owner from subcontractor defaults. Prompt payment and properly structured agreements can go a long way in helping subcontractors manage cash flow. Ultimately, avoiding default is a better outcome than merely being protected if the situation does occur.

The economy is uncertain, and owners and developers have no way of knowing exactly when the prices for building materials will stabilize. Fortunately, the risks associated with material price volatility are generally tolerable and quantifiable. A combination of the above strategies—along with a little extra planning, creativity, and flexibility—can help mitigate economic variables and ensure reliable, on-time, on-budget delivery of construction projects.

This article is authored by Andy Halik, VP and corporate interiors co-lead of Skender, and Roger McCarron, President and CEO of Project Management Advisors Inc. (PMA). It was originally published by Facility Executive magazine.

Solutions for Building Office Properties Through Supply Shortages, Rising Prices

U.S. coronavirus cases are plunging and businesses are fully reopening. Meanwhile, the challenges of developing new office buildings and renovating existing ones are only compounding as project pipelines fill up amid unpredictable economic factors: skyrocketing materials prices, a tightening labor market, soaring demand and problematic supplies. Real estate developers, owners and their builders must take action to mitigate the financial impacts and keep projects on track.

It’s no secret that building component costs have risen at an unprecedented rate in the past year. According to the U.S. Bureau of Labor Statistics, from April 2020 to April 2021, material prices increased an astounding 143 percent for refined petroleum products such as diesel fuel and asphalt base, 90 percent for lumber and wood products, 78 percent for cold-rolled steel sheets that are used for metal studs, and 31 percent for copper wire and cable.

Such extreme material price increases have intensified over the pandemic and spread to other components, all while severe shortages and supply chain bottlenecks have lengthened timelines for production and delivery. These challenges are not limited to one type of building construction—both ground-up and renovation projects across all property types are realizing the effects of higher prices and scarce supplies.

How can developers, owners and builders overcome these economic challenges and mitigate the risk to their project’s bottom line? Consider the following five solutions:

Blend the team early

Time is money, so in order to ramp up speed to revenue, break down barriers and combine teams sooner than later. Early collaboration between architect and contractor—in a design-build or design-assist delivery method—will accelerate schedules and prevent expensive, time-intensive redesign. For example, making smart design choices in terms of where the major vertical circulation (i.e., stairs and elevators) is placed in a ground-up project can preserve substantial budget dollars.

Stronger, earlier collaboration on these elements avoids do-overs later, but challenges are bound to happen. Develop backup scenario plans in advance – this strategy will allow the team to rapidly and seamlessly shift to an acceptable plan B or C and avoid delays or cost overruns.

Build lean

Lean construction provides greater stability, reliability, efficiency and flexibility. A Lean builder can help navigate market conditions and material shortages and will maximize ROI by conducting ongoing research, monitoring economic trends and providing counsel on lifetime costs, environmental impact, inflation and more. Builders with Lean DNA are master planners and professionally trained in delivering optimally efficient projects, reducing waste during all stages of construction.

Dodge Data & Analytics research demonstrated that “high Lean-intensity projects” were three times more likely to complete ahead of schedule and two times more likely to complete under budget. Dodge found that of projects that did not implement Lean methods, 61% finished behind schedule and 49% completed over budget.

Expand the material mix

Evaluate and analyze substitute materials and systems to expand the menu of choices for all components of a building, including foundations, superstructures, framing, enclosures, systems, interior building materials and more. Working with the contractor and strategic trade partners early in the design phase can ensure that extending the list of acceptable substitutes does not compromise on safety, quality, durability or functionality. Every project has options.

Specifically, pre-cast concrete, ready-mix concrete and different wood species have become useful substitutes. On one recent project, the original plans called for Douglas Fir for the wood-framed structure, but the suppliers couldn’t guarantee delivery in time, so the team determined that Spruce Pine Fir would be a suitable alternate to maintain the construction schedule.

Procure materials earlier

Material prices are moving fast and furiously, causing daily uncertainty about how much a product could cost down the line. Working from real, data-driven expectations can aid in making material procurement decisions earlier. Buying materials earlier will typically result in cost savings and greater decision-making power about other factors later in the project. It mitigates unknown exposure to shortages and can ensure access to materials when needed.

Establish strategic budget reserves and a reinvestment plan

Try to carry extra contingency and avoid building to your max budget upfront. Build a strategic buffer, and, more importantly, a schedule of milestones for reassessing risk at the last responsible moment and gradually releasing reserved funds back into the project as risk diminishes. For instance, if your project budget is $15 million, target a spend of $14.5 million and then systematically release the balance if economic conditions improve. Converting surplus contingency adds real value and allows for adding project wish-list items such as upgraded finish materials, appliances, technology, landscaping and more.

The economy is uncertain, but the risks are tolerable and quantifiable. Lean, experienced builders know how to manage projects throughout increased volatility. A combination of these solutions—early team collaboration, Lean best practices, material flexibility and agility, and strategic budget reserves with reinvestment milestones – will help mitigate risky economic variables and ensure the reliable, on-time, on-budget delivery of your next construction project.

This article, authored by Skender’s Justin Brown and Dan Ulbricht, was originally published by Commercial Property Executive magazine.

‘Isolation Is The Enemy’: Next-Gen Office Designs Focus On Togetherness

Decision time is approaching for Chicago’s biggest office occupants. Companies that have been delaying their office return plans are now facing the choice of whether to renew their leases, find new space or even overhaul their entire real estate strategy.

“We’re seeing an uptick in tours and leasing activity, as well as clients who are ready to move forward with their pre-Covid real estate plans again,” said Andy Halik, a vice president at Skender who helps lead the Chicago construction firm’s interiors group. “They’re not looking to kick the can anymore.”

In Chicago, many of the companies setting the tone and pace of the return are those interested in the recently converted warehouses and new towers being developed in Fulton Market, an office submarket that has swelled over the last decade, attracting tech giants, law firms, design agencies and other corporations that pride themselves on culture driven by architecture and design.

The new challenge for these companies is not just to create spaces that are functional and cost-effective, but spaces that attract people to collaborate, coexist and build corporate culture, even for employees that may only be coming in a few times a week.

The yearlong experiment in working from home has shown companies the value of flexibility and how crucial it is to give employees control over how and where they work and even who they sit and work with on a daily basis. But 2020 has also revealed the negative impact on employee health when engaging with co-workers in an office environment isn’t an option.

“We are human, we want to coexist, and isolation is the enemy,” Halik said. “The challenge of designing an office now is creating a space that encourages flexibility while solving the problem of isolation by offering what the home office can’t provide: space that brings us together.”

Many of the companies in Fulton Market are anticipating that on average, their offices may only host around 70% of the staff that they hosted pre-pandemic, and Halik said most are looking to cut back slightly on their overall office footprints. But those reductions are likely to come from individual work areas, not collaboration and client experience space.

After a year of working alone and hosting video calls, the Fulton Market crowd expects its employees to be starved for collaboration and connection. Employees may choose to come into the office on days they need to meet face to face with colleagues, to give presentations or to welcome guests and visitors. Accordingly, conference rooms and other open areas for teams to meet are likely to stay the same or expand, as will event spaces to host celebrations or guest speakers. Those changes should make days spent in the office feel more purposeful and special, Halik said.

For many organizations, the idea that every employee must have a personal desk is fading. Halik said he is seeing more demand for nontraditional seating, including long high-top tables, as well as for spaces that can be cleared for large-scale gatherings and events. Some companies are creating online reservation systems for individual desks, while others are looking to create desk “neighborhoods” that allow small teams to gather for periods of a few weeks at a time to collaborate on projects.

At the outset of the coronavirus pandemic, the shoulder-to-shoulder density of modern offices was seen as a health risk. But as vaccinations become more widespread and fear of contracting Covid recedes, parts of the office may expand, but actual seating areas are likely to stay just as dense.

“Companies are looking to build more places for people to coexist and feel something that makes the office a compelling place to work,” Halik said.

Finishes that make the office beautiful — like biophilic design, art and wood accents — are on the rise, as are upgrades to daylight and air quality.

An office renovation or tenant improvement budget can be stretched a lot further by a contractor who knows the local market. Halik said that understanding the logistics of each building, localized construction activity and even parking within Fulton Market has given Skender clients more financial room to tailor their offices to their particular needs.

With the pace of vaccination rising, workforces may be ready to return to the office in a matter of months. But companies are also facing another deadline: While low demand kept construction pricing down during the pandemic, prices for tenant improvements and other small projects could shoot right back up as soon as the first wave of office users make their decisions.

“There is a real financial benefit to making a decision now, before others have jumped on the bandwagon,” Halik said. “We see the improvements in market confidence happening fast and when the tipping point comes, pricing advantages will quickly evaporate.”

This article originally appeared on Bisnow.com.

Chicago office designers envision post-pandemic workplaces that function and feel like neighborhoods

What will the post-pandemic office look like when workers return to downtown Chicago? One only needs to take a walk around their neighborhood to get an idea. At least this is what some top office interior designers and builders are saying as business leaders finally start preparing their strategies for bringing employees back downtown.

But another key theme that will come about from the tidal wave of the pandemic, and after spending more than a year working from home, will be the idea of control.

Having some semblance of control over the work environment will allow employees to feel safer, and when the workforce feels a deeper sense of security, then we can begin to move forward and get back to focusing on in-person collaboration and fostering company culture, Eric Gannon, a principal at the Chicago office of the global architecture firm Gensler, believes.

“The expectation now is that you’re returning to something different, and you’re returning to something that you have some control over,” says Gannon. “So, I think what that means is how you reserve or how you gauge the intention to what you need, and there’s an expectation that the space is flexible to us as individuals and what we might need to support our work.”

In addition to a flexible, hybrid model of work where employees can choose to work from the office or at home, there’s going to be changes to the office that give employees a similar sense of control that they have at home, Gannon adds. For example, allowing employees to directly adjust lighting at workstations, changing the temperature, or forming a workplace “bubble,” gives more autonomy to choose what feels most comfortable.

This focus on user control and autonomy in the workplace isn’t entirely new, but it’s something that’s being kicked into high gear because of the pandemic. And in many ways, it can also be viewed through the larger lens of the mainstream focus on wellness and fitness in recent years.

And then in terms of the actual layout and programming of any particular office, each company will have different needs, but the industry is moving away from a straight-forward open office environment to one that’s still largely open, but also intentionally planned.

“The open office was a product of real estate efficiency,” says Gannon. “We were crunching down desk sizes to fit more [people] and I think we believed for a while in the energy that was created in the ability to turn your chair around as a benefit to culture and to the work environment.”

Instead, the antidote to the current workplace conundrum in a post-pandemic world might be the office “neighborhood,” or a layout that looks towards urban planning for inspiration.

“When you think about a workspace from an urban planning construct, you’ve got the main plaza space that’s more communal and you’ve got smaller, more intimate type spaces,” Gannon says of the new way of thinking for office design. “So, I think that the modular approach to the neighborhood is a way to achieve flexibility but also prepare for ongoing change in the short term.”

Beyond the programming, the neighborhood concept is also different in the sense that it’s not a set-it and leave-it approach to office design, Gannon adds. Designers will have to continue periodically checking in with clients about what’s working and what’s not in order to make adjustments and changes to the office to better foster collaboration and productivity.

Andy Halik, a VP at Chicago-based Skender also sees a future for the neighborhood layout, or the “address-free office,” as he calls it. And we could start seeing these changes in the office sooner than later.

“Generally speaking, flexibility is more about how a business behaves rather than the space it offers,” Halik says of the oft-discussed theme of workplace flexibility. “The space that companies are offering are still very much driving what they used to be about, if not more so now, which is about culture, collaboration, and succeeding through this together.”

Halik says that there will certainly be a return to the office as companies have learned of some major caveats of having entire teams and staff working from home exclusively, including lower employee satisfaction, retention issues, and a sense of being disconnected or disengaged from colleagues, as well as the company’s mission and culture.

And regardless of office location, type, or layout, the big question that employers and office designers need to spend more time thinking about is what the office offers that working from home doesn’t.

“I’ve heard a lot of people forecast that lower density buildings or build-to-suit single occupier situations are going to be the hottest office properties out there, and I do think that demand for those types of buildings will go up,” Halik says. “But the reality has more to do with answering the question: What does the office provide that working from home does not? The buildings and the neighborhoods that answer that the best will be the ones to provide the most opportunities for people to be together, period.”

Afterall, there is an element to working in an office downtown that’s maybe not as easily defined — the sense of being part of something bigger than oneself.

Just the simple act of going into the office over the next couple of months may be enough for many workers to feel better about the changing world and workplace.

“I’ve been going downtown more, and every time I do, the anxiety wears off a bit of what it’s going to be like,” says Eric Gannon about heading into Gensler’s office in The Loop. “So I think that there is a very emotional, human piece of just doing it and getting used to it again.”

This article originally published in the April 2021 issue of Illinois Real Estate Journal.

Construction sector showing signs of life despite COVID

When Rahm Emanuel was mayor, he would tout a simple metric as evidence Chicago was on the path of progress: the number of construction cranes on the city’s skyline.

By 2017, the count had risen to 33. Today’s tally? Just 12, according to the Chicago Department of Buildings.

Attribute the decline to the coronavirus pandemic, which interrupted a building boom that transformed the skyline and urban life in Chicago with new luxury apartment towers and trendy hotel and office projects. Construction starts in the Chicago area fell 25 percent in 2020, representing $10.1 billion in projects, according to Dodge Data & Analytics, a Hamilton, N.J.-based research firm.

But after being knocked down last year, the local construction industry is starting to get back on its feet. Some developers have shelved plans for big projects, unable to secure financing. But the pandemic merely delayed other developments. Construction executives are feeling a mix of relief that the worst is over and hope that a nascent recovery is already underway.

Read the full article, featuring commentary from Skender President & CEO Justin Brown, at chicagobusiness.com >

Redevelopment of Space for Booming Life Sciences Firms

As the race for a vaccine or widely available treatment for COVID-19 kicks into high gear, many life sciences firms are looking to ramp up their production capacity — for this and future public health crises. With this anticipated growth in production volume comes the need for more lab space. But when looking for space to expand, life sciences firms may need to look beyond space specifically built for life sciences and identify sites that have been redeveloped into lab space.

Developers are taking note that some markets that have the assets of a life science cluster — such as proximity to large medical and university campuses and quality-of-life benefits for a growing workforce — haven’t yet actualized into a cluster, and they have an opportunity to seize the moment. Such developers are building new offices and research facilities and converting old structures into labs. Economic development commissions also have the opportunity to partner with developers to help bring the pieces together to draw life sciences companies and create these new clusters.

An Eye to Distinct Requirements
When looking for the right space, life sciences firms should partner with developers, designers, and a construction team that will redevelop the space with an eye to the nuances and distinct requirements of labs, such as ceiling height, mechanical and HVAC systems, and space for lab equipment. Since each type of lab — chemistry, biology, pharmacological, etc. — looks different and requires unique equipment, a first-time lab developer that goes with a one-size-fits-all approach probably won’t appease its lab tenants.

Specific improvements for different lab users could include more fume hoods and sinks for chemical labs; extra room for negative air pressure chambers and changing rooms to keep parasites from escaping the lab for biology researchers; and more specialized temperature and humidity controls to keep samples safe for pharmaceutical scientists.

But labs aren’t the only part of life sciences workspace — researchers spend a surprising amount of time at their desks or in conference rooms. Some developers think that the only focus should be the lab — which is certainly important — but savvy developers know the office space is just as much of a priority for researchers. Life sciences firms should look for development and construction teams that know how to balance lab and office space to bring to life a full workplace.

Read the full article, authored by Skender’s Jeff Janicek, at areadevelopment.com > 

Chicago Is A Lab Sciences Desert. But What Kinds Of Labs Does It Need?

Chicago is no slouch when it comes to lab sciences. The Chicago region boasts the headquarters of pharma giants Abbott Laboratories, AbbVie and Baxter International. But with lab spaces scattered across the suburbs and spread around the city’s research universities in Evanston and Hyde Park, the city lacks a centralized laboratory cluster like those in Cambridge and San Francisco.

Developers have recognized the void in the market and are pouring money into building new offices and research facilities and converting old structures into labs, said Skender Vice President Jeff Janicek, who focuses on healthcare and lab construction.

But creating a lab space isn’t as easy as bringing a few microscopes into a corporate office. Without the right guidance, first-time lab developers may end up building a kind of lab entirely different than what tenants are asking for.

“People tend to say ‘life sciences,’ when they really mean ‘lab sciences,’” Janicek said. “A chemistry lab looks entirely different from a biology lab, which looks different from a pharma lab. If developers go in with a one-size-fits-all mindset, they are not going to make it far with their lab tenants.”

Because the Chicago development market does not have much experience building labs, developers will sometimes propose sites that don’t make sense for the lab tenant market, or which aren’t appropriate for labs.

Janicek described how one client arrived with a landlord, a broker and what they thought was a bulletproof plan to put a chemistry lab on an upper floor of a building in the Loop. Janicek had to inform them that because of the volume of chemicals it would handle, the lab could only be on the first or second floor of the building. Plus, the building did not have the mechanical systems or vertical access shafts in place the tenant would need to retrofit the space.

After finding the right space, developers also have to be knowledgeable about what sorts of improvements each type of lab user will need. Chemical researchers usually require more fume hoods and sinks, while life sciences researchers may need more specialized temperature and humidity controls to keep samples safe. Biology researchers often need extra room for negative air pressure chambers and changing rooms to keep nasty parasites and spores from escaping the lab.

The key to successful lab construction and renovation projects, Janicek said, is to consult very early with the intended tenant about what their needs are and to consult with an engineer and contractor that can make those needs a reality. When it comes to retrofits, pre-construction will likely begin even before a property has been sourced.

“Sometimes the victory is in not wasting money,” Janicek said. “When developers involve us in the process early enough, we can steer clients away from poor choices, and we can propose other choices that will create a better, more affordable project.”

While researchers typically spend between 20% and 40% of their time in the lab, they also spend a surprising amount of time at their desks or in conference rooms, Janicek said, and developers that don’t set enough room aside for traditional workspaces may not see many nibbles for leases.

Sourcing a location for a new lab space is also a challenge. More and more, Janicek said, potential tenants in Chicago are former grad students looking for lab space to continue their research or launch a startup and they don’t want to have to commute out to the suburbs to go to work. For that reason, more developers are looking for potential lab renovation spaces in neighborhoods like Lincoln Park, the West Loop and Fulton Market.

Most of the buildings in these neighborhoods will have trouble being converted to lab space, Janicek said, but there are a select number of sites that could be promising. Former healthcare facilities and even warehouses that were previously built for cold storage often have the infrastructure they need to be renovated into lab spaces, including piping systems, low ceilings and thick walls.

Janicek pointed to 2430 North Halsted St., a 120K SF commercial lab space and the first project in Sterling Bay’s life sciences initiative, The Labs. Exicure, the first tenant for the lab space, was growing rapidly and needed space to expand. The team at Skender was able to reposition some of the building’s existing infrastructure, delivering the lab space a mere four months from the initial idea to relocate and expand.

As the race for coronavirus therapies and a vaccine continues, Chicago is feeling the immediate crunch for lab space, but Janicek said an investment in more research facilities would also ensure Chicago remains a destination for lab sciences in the long term.

“The need for research space has been emphasized by the pandemic, but it’s always been there,” Janicek said. “The real estate community needs to try to give young scientific talent from Chicago a reason to stay close to home.”

 

This feature was produced in collaboration between the Bisnow Branded Content Studio and Skender, and was first published by Bisnow.

Lessons Learned from Chicago’s Landmark Old Post Office Redevelopment

Even as many Chicago companies have delayed reopening offices until the threat of coronavirus has lessened, eventually companies will return to their workplaces for collaboration, to boost company culture, and to regain a separation between work and home for their employees. In the meantime, work continues on one of Chicago’s most talked-about office developments of the past few years: the Old Post Office redevelopment.

Inside this gigantic 1921 Art Deco structure, tenant representatives, architects, interior designers and general contractors have the unique opportunity to create the next era of office space in Chicago – one that honors the building’s historic integrity while delivering design, technology and amenities that will propel work into the future. But doing so is not without its challenges, even pre-pandemic.

As one of the early contractors to work inside the Old Post Office with two completed projects and three in progress, our Skender interior construction team has learned the unique nuances of building out in this adaptive reuse development.

Lesson 1: Merging old with new begins with care and planning.

The Old Post Office actually comprises three buildings and 2.5 million square feet: The original six-story building and two nine-story buildings from the 1930s. The north and south additions have floor-to-floor heights as high as 19 feet, and they are connected to the original east building with corridors that have 16-foot ceilings. In addition to the varying ceiling heights, each of the buildings has unique requirements to maintain the historic designation. Some tenants are only in one of the structures, while others span all three.

All of these factors add up to challenges that are critical to understand and plan for from the outset, ideally using building information modeling. Once the client and project team are in alignment, the State Historic Preservation Office (SHPO) and National Park Service (NPS) review all drawings for tenants building in the space, as well as all the finishes selected, to ensure they comply with restoration guidelines.

In the last few months due to COVID-induced supply chain challenges, Skender has worked with the design team early to get a list of finishes to check on availability before they’re submitted to the SHPO and NPS for approval, eliminating the need for multiple revisions.

Lesson 2: Understand the constraints of historic preservation – and the impact on your timeline.

The art deco elements that proffer the Old Post Office’s historic status can be difficult and expensive to source. Before beginning work, the team needs to observe the structure’s marble base, wood and wire molding, and wainscoting to see what needs to be repaired, and then source it to match. For example, there’s only one vendor in the U.S. that is able to replicate the mosaic tile that runs through the corridor and is required to be included in the design by the SHPO and NPS. To avoid costly delays and reorders, Skender does a floor survey early to order the right quantity of tile and plan for its production in the project timeline.

Placing updated mechanical, electrical and plumbing systems in a historic building can present issues as well. For example, the north building has a polished, non-industrial design, which means exposed data cabling for tech systems must either run in conduit or cable tray that is painted and finished to blend with the building’s elegant, pristine look.

AbelsonTaylor Lobby

Lesson 3: Responsiveness may be our greatest design tool.

The pandemic has taught us that the ability to be responsive to challenges is necessary. What works for your company in this moment may need to be changed. When it does, being able to turn to a firm that understands not only the unusual requirements of the space, but also your company culture and the demands of your work is essential.

While office spaces that are currently under construction may be more focused on separating coworkers and decreasing density, once a widespread treatment or vaccine is available for COVID-19, companies may want to reorganize to encourage collaboration or allow colleagues to gather again.

Pandemics are not the only event that require a company’s space needs to evolve: resizing the workforce, undergoing a major rebrand, merging with or acquiring another firm, adding new technology, or simply realizing that the realities of workflow mean different departments or colleagues need to be closer together can all require reconfiguring an office.

AbelsonTaylor Staircase 

Lesson 4: Experience counts.

Most project leads choose to work with general contractors that have an established reputation and plenty of successful projects in their portfolio. For a redevelopment with as many specific considerations as the Old Post Office, it can be beneficial to work with a contractor that has experience in the space and can carry information about maintaining preservation and addressing design challenges from one job to the next.

Our work on a current project is informed by issues we worked through in our past project. We know that the clay tile that is part of the deck construction requires special anchoring. We understand how to work with the high ceilings to maximize natural light by building walls that don’t reach all the way to the deck. We’ve sourced the correct metal caps for the exposed columns in two of the buildings. These examples are just some pieces of the knowledge we bring to each project.

Being part of a large-scale redevelopment of a landmark building offers a unique opportunity to learn on the job. The project team can honor the surviving historical features, while ensuring that what’s built around them is high-quality and balances longevity and flexibility. Building today may be uniquely complicated because of the pandemic, but adaptive reuse presents added complexity that can be lessened through experience.

 

This article, authored by Skender’s Lauren Torres, was first published by NAIOP.

4 next-gen technologies that are changing construction today

For most of the last decade, emerging technologies designed to transform the built environment weren’t much more than fun toys to play with. They lacked sophistication and the ability to promote true efficiency and accountability or analyze data.

Not anymore. Yesterday’s toys have become today’s tools.

New, data-driven technology has finally given rise to construction efficiencies. New software and gadgets are advancing timelines, improving project team integration and collaboration, reducing costs and enhancing overall building quality.

According to the Boston Consulting Group, when technology permeates construction, there’s an almost 20% reduction in a project’s total life cycle cost as well as substantial improvements in completion time, quality and safety. The study estimates that the use of technology cuts construction costs for commercial office buildings by 12%, lifetime operations costs by 18% and reduces the construction timeline by 30%.

Take a look at the top four technologies Skender is currently using to break down industry productivity barriers and push the envelope beyond what construction was capable of just yesterday.

+ Laser scanning.

Attached to a tripod, a laser scanner looks like most land survey equipment – except it doesn’t just measure a single point at a time. It collects 28 million points in three minutes, with accuracy within 1/16 of an inch.

The laser scanner creates a point cloud for each measurement to be used as the base model for BIM coordination. Laser scanning is useful for project measurements that require precise detail, like floor leveling. Human error and guessing are eliminated, and costs are reduced when flooring subcontractors use the laser scanner to determine slope and elevation, and therefore, the amount of preparation and materials that are actually required for the job.

A point cloud created by the laser scanner can be analyzed to create a heat map of the floor plan, where cooler colors are the floor’s higher elevation points and hotter colors represent the lower points.

Case in point: On a recent project, a quick laser scan revealed that the architectural drawings were slightly off in measurement compared to the physical space. The laser scan was uploaded to the project BIM model, and the architect was able to correct the CAD model. When glass fronts were ordered for offices, we were confident they would fit the space. Had the materials been ordered when the offices were measured at difference of four inches, we would have waited an extra six weeks for new glass, installation and completion of offices. Together, these seemingly small changes shaved off significant time and money from the project.

+ 360-degree photo documentation. 

A small piece of consumer equipment typically used by YouTubers and Instagrammers, the 360-degree camera is easily accessible and relatively inexpensive. Most importantly, it captures an entire room in a single image. Add software like StructionSite and now you can place these photos directly into a facility’s 2D digital floorplan and client communication.

Instead of having to take eight to 10 photos to capture a room, 360-degree photo documentation allows contractors to capture more data in one photo, providing a significant time savings and comprehensive visual update. As with laser scanning, sharing the 360-degree images with subcontractors is another more efficient way to determine the amount of materials required.

 

 

TIP: Capturing 360-degree photos once a week during construction can provide a lifecycle view of the facility for a remote owner.

+ Drones.

Taking images of a job site from the ground up (no matter which iPhone you’ve got!) can’t compare to what a flying drone can capture in a three-minute land survey. Employed ideally on large site surveys, drones can easily capture progress photos and videos from 400 feet in the air. With the ability to pre-plan the route and desired documentation of the site via software, drone automation promotes ease of use and time savings.

Case in point: A recent job had a batch of soil that needed to be removed from the site, but it was impossible to determine how much until the team actually arrived to dig. Deploying Skender’s drone provided a precise measurement of soil on the ground, which allowed the team to plan for and accurately price out its removal.

 

 

+ Augmented/mixed reality. 

While augmented or mixed reality has been around for a couple of years, Microsoft’s second iteration of the HoloLens propelled the technology from a toy to a useful construction tool. A headset device worn like glasses, the HoloLens 2 provides an immersive experience for its users.

Uploading a project’s BIM model into the HoloLens 2 makes it possible for owners, end users and other stakeholders to strap on the device and physically walk through the job site, “feel” the final finishes, and view them in real time as digital objects on top the existing building structure. HoloLens 2 provides users with the ability to touch and even “move” building elements and furnishings while walking through the physical core and shell space. A self-contained computer with Wi-Fi connectivity, the HoloLens 2 is a game changer for construction.

 

NEW TECHNOLOGIES BRING NEXT GEN BUILDINGS CLOSER

Efficiency, data-driven analysis and productivity are paramount to the financial success of any construction project. New technologies like these streamline project management and the construction timeline, reducing waste and ultimately delivering a more precise project to the owner—every time.

 

This article, authored by Skender’s Clay Edwards and Ben Stocker, was first published by Building Design+Construction.

10 Renovations To Consider Before Reopening Your Office

This summer, as offices are starting to reopen across the country, many companies are considering all their options to make a safe and healthy return to work for employees. Even as states have begun their reopening process, the threat of COVID-19 is still present, and it will require a careful, vigilant and ongoing plan to ensure a workplace that’s the safest it can be. Companies will need to do more than put hand sanitizer dispensers everywhere and rearrange desks to put employees’ minds at ease.

Some safety measures may require a company to consult their architect and general contractor to implement renovations, ranging from small face-lifts to more significant structural updates. Companies looking for worry-free, low-risk and high-quality renovations should partner with contractors with proven project delivery processes and commitment to clean and safe construction sites. GCs with healthcare construction experience often carry over the high standards practiced at healthcare job sites to their other projects – which is especially important now when rigorous measures need to be taken to keep on-site employees safe, and reduce the risk when office employees return to the space, too.

Regardless of whether your company is heading back into the office ASAP or still managing a remote workforce, there’s still time to make updates with no or little disruption to your return-to-work timeline. Here are 10 recommended office updates to support a healthy return to work:

1. Dedicate separate rooms for deliveries and visitors.

By designating or creating distinct spaces – one for packages and deliveries and another for visitors – employees can limit contact with people coming into the office. Keeping deliveries as contactless as possible by using applications to manage them can also reduce transmission from outside the office.

2. Make the most out of reception.

Turn the reception area into a multipurpose space for employees to sanitize their hands, have their temperatures taken, and pick up safety equipment like face masks and sanitizing wipes. It can also be the checkpoint and physical reminder for where the “new normal” starts, with prominently placed signs featuring instructions and directions on how employees should interact with each other.

3. Install signage and floor graphics to demonstrate where and how employees should move through the office.

While most employees know they should be keeping distance between each other, it’s sometimes hard to know exactly how far apart that is – and the regular reminder doesn’t hurt. Placing stickers on the floor to indicate this distance, or arrows in hallways to determine which way people should be flowing through, can help employees maintain proper distance and avoid crowding in tight areas.

4. Add keycard-operated automatic doors to reduce touch-shared surfaces.

Limiting the number of high-touch surfaces is a key tactic of containment, and door handles are one of the most touched surfaces in an office. Automatic doors activated by keycards or ID badges can eliminate the need for those risky surfaces. This is a bigger financial lift, but is worth considering for longer-term health and safety of the office.

5. Divide break areas and spread out pantries.

The central kitchen and eating area of yesterday’s open office will need to be broken up to curb virus spread. By installing smaller pantry areas around the office, employees can still access these spots without gathering in large groups. Spreading out smaller kitchenettes with sinks provides more handwashing stations, too. You don’t have to close off lounge-type spaces, but spread the seating to encourage distancing or smaller pods rather than gatherings. Similarly, maximizing your company’s use of any outdoor space, which many health experts consider safer, by making them tech-ready is another away-from-the-desk option.

6. Upgrade HVAC systems.

Since coronavirus particles travel through the air, HVAC systems should be a major focus of reopening efforts. Upgrading HVAC systems with the ability to more carefully filter air and limit widespread circulation can reduce disease spread. This will likely be controlled by the building owner when leasing or subleasing space in a multi-unit building, so it’s worth bringing up when coordinating the reopen.

7. Separate benching systems or add dividers between desks.

Breaking up current benching systems and spacing them out six feet apart and/or adding dividers between desks that can’t be spaced out can ensure employees are adequately spread out. Adding dividers can be a quick installation or require a heavier lift to build more substantial partitions, depending on the route you want to take.

8. Add wall-mounted monitors and cameras in conference rooms.

Even when offices reopen, many firms won’t bring back all employees or will institute alternating on-site and at-home schedules – so collaborating with the remote workers will require enhanced digital collaboration. Installing tools to promote digital work can naturally facilitate that collaboration.

9. Build out new rows of phone booths.

Creating new enclosed spaces for employees to take calls can serve the dual purpose of promoting virtual collaboration with remote teams and boosting office health. Placing hand sanitizer and wipes near these booths encourages employees to keep them clean, too.

10. Rearrange existing or install new furniture.

Outside of rearranging desks, other office furniture can be spaced out to provide additional seating for employees while promoting social distancing. New furniture with resilient and easy-to-clean materials and surfaces can also improve cleanliness. As comfort has become a key element to working from home, furniture with comfortable materials can ease employees’ transition back to the office.

While the immediate impacts of the coronavirus pandemic have quickly disrupted all aspects of daily life – including the office environment – the long-term effects are still forming. Plus, the threat of COVID-19 will likely exist for an indefinite period of time, even as business must go on. We anticipate that these healthy return to work considerations won’t just be temporary fixes, but rather will last past this crisis and transform the workplace for the healthier and better. Investing in these office renovations now will demonstrate to employees that their health and safety is important not just for the near term, but for the long haul.

 

This article, authored by Skender’s Clay Edwards, was first published by Work Design Magazine.

Creating a Contemporary, Collaborative Place for HERE Technologies’ Future

When a company builds location technologies, it only makes sense for its office locations to represent the company culture. In 2018, HERE Technologies, or just “HERE” – a global leader in mapping and location intelligence, autonomous driving and “smart city” technology – needed to bring two offices together to create a new Americas headquarters.

After negotiating a lease extension at 425 West Randolph Street in the Chicago Loop, the company called upon three other pioneering Chicago companies to help: Gensler Design, to visualize the transformation; Skender, to build it and bring the new headquarters to life; and JLL, to provide guidance and overall project management.

It’s a given that innovative firms such as tech companies offer their employees modern and exciting offices. These spaces are designed to convey brands, inspire people, and become a physical representation of the firm’s forward-thinking business model. What isn’t a given is the time, money, design skill and technical knowledge it takes to achieve these offices.

For the HERE project, two particular challenges confronted the design and construction teams:

  1. balancing the investment in the space in a way that maximized the benefit to employees, and
  2. minimizing workforce disruption while enhancing productivity. The final design had to reflect the company’s vision, brand, and history of innovation, while also bringing together employees from across multiple departments.

HERE leadership chose to expand its presence at 425 West Randolph, making room for employees from another Chicago location to unify in one headquarters. The project’s aim was to reuse or repurpose existing elements and cohesively integrate the company’s new branding elements across all floors.

Extensive interviews of key HERE stakeholders were conducted to best understand ways of working; the understanding formed the basis for the design plan.

For 10 months, the eight floors comprising the HERE office were transformed into a contemporary environment, including space for more than 1,400 employees in an open-floorplan seating arrangement that facilitates better and faster collaboration.

The Old Main Post Office: A Historic Landmark Gets a High-Tech Facelift

Almost 100 years after it was first constructed — and 20 years after the U.S. Postal Service suspended its operations there — Chicago’s Old Main Post Office is nearly ready to welcome its first office tenants.

The iconic building spans two full city blocks and an interstate highway and is the subject of an $800M renovation effort from 601W, a New York-based development firm. With floor plates 10 times larger than the bulk of Chicago’s downtown office buildings and structures that date as far back as 1921, the Old Post Office is set to capitalize on a growing demand for airy office space with an aura of history.

“As an offering in the Chicago market, it’s pretty incredible,” said Andy Halik, a senior project manager at Skender, a Chicago-based construction, design and advanced manufacturing firm. “With that volume of space, the opportunity is immense.”

Modern office tenants are embracing spaces with a historic patina and exposed structures, but they still demand modern amenities, including gyms, food and beverage, green space and high-speed internet. Chicago has become a crucible for this kind of construction — it boasts a family of mega-buildings, including the Old Post Office, the Merchandise Mart, the Macy’s building at 111 North State St., 600 West Chicago Ave. and 900 North Kingsbury St.

For Skender and other construction companies involved in the renovations, the Old Post Office has presented a thicket of challenges due to its former state of disrepair, its size and the preservation laws that protect its historic floors, walls and beams. However, it has also given them a massive, three-dimensional canvas where they can explore innovative design and construction ideas to create one-of-a-kind office spaces.

The Post Office landed its first tenant, Walgreens, in June 2018. The pharmacy chain chose Skender to represent its interests in the building. A handful of other tenants have inked leases, including advertising agency AbelsonTaylor and the Ferrara Candy Co. 

The building is actually three buildings in one. The east building was constructed in 1921 with floor plates around 37K SF, not much bigger than the average office building in Chicago today. By the 1930s, Chicago had become the mail-sorting capital of the United States, thanks to Montgomery Ward and Sears, Roebuck & Co., two mail-order department stores based in the city that in their heyday accounted for millions of pieces of mail every week.

All that demand necessitated a major expansion, so the city built the nine-story north and south buildings, which featured floor-to-floor heights as tall as 19 feet. These additions were then connected to the existing east building, which was only six stories tall, with 16-foot ceilings.

Those mismatched floor heights have created numerous logistical hurdles for Skender, but Halik said they have also opened up functional benefits for the building’s occupants.

“Tenants in the building may want an assembly space to gather all of their employees at once,” Halik said. “The location in between two buildings can provide that opportunity through stairs, stadium-style seating or balconies.”

The ability to house an entire company headquarters on a single contiguous floor is something Halik said will appeal to companies that prize collaboration. He said there is a particular energy to having all of a company’s employees housed on a single floor.

The lofty ceilings also present numerous design possibilities as tenants decide how to partition their space.

“They can run walls all the way up to the deck, or leave them at a lower datum line,” Halik said. “There’s so much you can do with the height.”

Dealing with the endless possibilities of space is nothing new for Skender. In 2014, the company oversaw the construction of Motorola’s headquarters in the historic Merchandise Mart, where the telecommunications giant once occupied 600K SF between the four top floors and the roof.

Halik said Motorola’s offices set off a wave of projects throughout Chicago that married history and modern design, transforming massive floor plates into top-tier office spaces. Skender has been at the center of the trend, building out flagship offices for ConAgra Brands in the Merchandise Mart, Echo Global Logistics at 600 West Chicago Ave. and, most recently, Google, whose 357K SF headquarters in a former cold-storage facility on North Morgan Street helped turn Fulton Market into the booming office center it is today.

But along with the possibilities, the Skender team also faces a host of constraints, many in the form of historic preservation rules. The rules are intricate and vary wildly across the different parts of the building.

“Depending on the condition, what may be required in the north building might not be allowable at all in the south building,” Halik said. “One of the biggest challenges for tenants is understanding what the historic opportunities and limitations are and appreciating that they vary building by building.”

Much of Skender’s job in representing tenants’ interests in the building is anticipating the financial and design implications of the historic requirements, and applying resources thoughtfully. To that end, the company has invested in an extensive pre-construction process to avoid surprises during construction.

To Halik, though, all those logistical challenges sound less like constraints and more like a fascinating puzzle.

“Being the first has been incredibly powerful for us and our clients,” Halik said. “As the first, not only do you gain a complete understanding of what is possible within the building, but you develop a deeper understanding of why each opportunity is possible. Rather than being given a very clean list of requirements from someone else, you were the one to figure it all out.”

This feature was produced in collaboration between Bisnow and Skender.

Chicago Design Firms Behind Braintree, Google Explain What Makes Tech Offices Unique

Unlike some other industries, tech companies have garnered a reputation for creating and maintaining outstanding offices, oftentimes putting unique design, personalization and comfort front and center.

Whether startup and tech companies are hiring artists to create company-branded murals or landscaping idyllic rooftop terraces outfitted with Wifi, they are prioritizing having an office that looks and feels good as they attract and retain talent.

But what goes into this process? How exactly are tech companies deciding the layout of their offices, the number of kitchens to add and the kinds of art they want on display?

Many Chicago tech founders and leaders have an idea of what they want their future offices to look like but still rely on the expertise of local firms like Partners by Design to help them bring their ideas to life.

To help make some of those more difficult construction decisions are contracting firms like Skender. The Chicago-based business has built offices for locally-based tech companies, such as ShopRunner, HERE Technologies, Braintree and Motorola Mobility. It has also built Facebook, Glassdoor and Google’s Chicago offices.

Clay Edwards, the vice president at Skender who runs the firm’s commercial interiors department, said the main difference he has noticed in working with startup and tech companies as opposed to established, corporate companies, is that they, of course, are typically on a budget.

“Until you are a publicly-traded tech company, it’s about making the numbers work while still trying to grow and attract talent,” he said.

While drafting an office layout for Chicago startup Upwork, Edwards helped the company make cost-cutting decisions.

“The big thing with Upwork was analyzing tons of different scenarios,” Edwards said. “Do we paint everything on the ceiling or do we leave it exposed? Because painting it comes with a cost.”

“Luckily in the tech world, sometimes leaving that raw, untouched space is attractive. Plus, it helps with the budget,” Edwards continued.

Another cost-cutter is opting for an open floor plan. Though the design has roots in fostering teamwork, Edwards said it has evolved into more of a money-saving mechanism, and that even corporate companies are now choosing the layout.

“The latest trend to go open office now by the corporate world is driven by cost of real estate, but when the tech world started it, it was driven by collaboration, interaction and working together,” Edwards said.

Though Edwards, who has worked in the contracting business for more than two decades, said he enjoys the glossy and polished designs of more traditional businesses, like law firms and banks, he still jumps at the opportunity to build a tech office.

“I like both sides of the equation,” he said. “But startups are fun, fast-paced and ever-changing.”

Read the full article at Chicago Inno.

Office Wellness Has To Begin Long Before Move-In

Articles on office wellness are filled with tips and tricks on how to plan corporate outings, the benefits of yoga or whether to offer pretzels or fruit. While wellness initiatives like these may increase job satisfaction somewhat, many fail to address one sticking point. Employees can’t just be happy while exercising at a company-subsidized gym or having a snack — they need to be happy while hard at work.

A commitment to wellness has to begin long before a company moves into a new space, with the design and construction of the office itself. Environmental factors like office layout, lighting and noise levels can have profound effects on employee engagement, satisfaction and productivity.

“Office wellness can’t just be an afterthought — it needs to pervade the entire process as companies choose a building, plan the office and work with contractors,” Skender Vice President Clay Edwards said. “Design decisions have to be made early, so it’s crucial to bring in a general contractor that can quickly set goals and calculate costs.”

Design is the central issue of office wellness. Since the layout of an office will impact every day of employees’ lives, Edwards said companies that have wellness in mind need to make the right choices to avoid falling into an open office trap.

The last true revolution in office design was the open office. In the early 2000s, technology companies began to eliminate grids of cubicles in favor of airy layouts that clumped desks together. And while the stated goal may have been a more collaborative workspace, the real reason for open office was to cut costs, Edwards said.

“Corporate America latched onto the open office trend mainly as a way to save on square footage, not to promote collaboration,” Edwards said. “Now they’ve crammed too many people into too small a space. All that noise and clutter can seriously hurt productivity and happiness.”

In order to preserve productivity, open offices require other design elements, including dedicated quiet work spaces and multi-use communal spaces. For quiet spaces, Edwards suggested having breakout rooms for two or more people, a central quiet workspace like a library and single-person workspaces that are better lit and decorated than traditional phone rooms.

Along with these quiet spaces, Edwards suggested companies build a single large communal area, separate from workspaces. Part kitchen, part meeting room and part event space, these areas can bring employees together for spontaneous interactions that don’t distract people at their desks.

“At the Skender offices, we have what we call the Hub, and it’s really the focal center of the office,” Edwards said. “It’s a place that’s meant to be active and boisterous — it feels outside the day-to-day grind, and it’s where creativity happens. Plus, it means that loud interpersonal meetings aren’t happening in desk areas.”

But wellness does not stop with the initial layout — office finishes have a large impact on how employees feel about their workspaces and employer. Preserving the original feel of a space can make employees feel that they work somewhere unique.

“Exposed finishes are getting more and more popular here in Chicago, since we have so much architectural history to celebrate,” Edwards said. “In loft-style buildings in neighborhoods like Fulton Market, companies now want to leave the original exposed brick. And in high-rises, we are seeing requests for brick veneer to get that kind of raw look.”

Edwards said he sees growing demand for finishes like raw concrete floors and recycled wooden accents. Fortunately, many of these trendy finishes also happen to be very sustainable, which can help employees know that their office is not just beautiful, but also environmentally friendly.

Materials like wood and concrete are also cost-effective — Edwards said finding savings is important to keep wellness a priority.

“When it comes to wellness design, companies will often make a list of everything they want, without actually pricing it out,” Edwards said. “Then they see the bill and slash it all and forget about their goals.”

Bringing in contractors, designers and engineers early in the process can help companies know which decisions are cost-effective and which are not, and can help to keep wellness design goals.

“These decisions can’t happen in a vacuum,” Edwards said. “Companies need to get their team together as soon as possible and design wellness to a target budget.”

This article was originally published by and in collaboration with Bisnow.

3 Top Trends Show Green-Building Technology on the Rise

The Johnson Controls Asia-Pacific headquarters in Shanghai, China, is one of the most sustainable corporate complexes in Asia. In the summer of 2017, the campus opened as the first building in China to earn three green certifications: LEED NC Platinum, the World Bank’s EDGE, and China’s own Green Building Design Label.

Although just one example, the Johnson Controls building is indicative of a larger move toward green building worldwide. According to the World Green Building Trends 2018 report, three emerging trends in green-building technology are advancing the sustainability revolution in architecture: energy-analysis tools used at every stage, the promise of generative design, and the use of data from design through the building’s entire lifecycle.

Dodge Data & Analytics, publisher of the report, surveyed more than 2,000 architecture, engineering, and construction professionals and found global growth in green-building projects: 47 percent of industry professionals expect more than 60 percent of their projects to be “green” by 2021.

NBBJ, one of the architecture firms surveyed for the report, takes green building quite literally for its project The Spheres (Amazon’s new Seattle office complex)—its interconnected steel-and-glass domes form a conservatory for more than 40,000 plants from the world’s cloud forests. However, the report defines “green” projects as including, at a minimum, efficient use of resources; waste and pollution reduction; high indoor-air quality; and as much renewable energy, nontoxic and sustainable materials, occupant quality of life, and environmental adaptation as possible.

Many incentives now entice architecture and construction firms to create buildings that meet those requirements. Owners are seeing a 10 percent or greater increase in asset value for new green buildings compared to traditional ones—as well as decreased operating costs and a shorter payback period. Survey respondents were also much less concerned with the higher cost of green building, with only 49 percent of them citing it as a factor, compared to 76 percent in 2012.

Continue reading the full article at Redshift by Autodesk.

The Future of Fulton Market Lies in New Office Towers, Not Renovated Industrial Lofts

The first wave of major development in the Fulton Market neighborhood is coming to an end, but a new one is just beginning.

Sterling Bay set off the development explosion when it bought 1000 West Fulton, a cold storage building that towered over the once-industrial area west of the Loop, in 2012 for $12M and by 2015 transformed it into 1KFulton, the regional headquarters of Google. The influential tech firm’s arrival signaled that Fulton Market had become a true office submarket.

“That gave everyone the green light,” Skender Vice President Clayton Edwards said.

His firm recently built out a number of Fulton Market office spaces, and  Edwards will be a featured speaker at Bisnow’s State of the Office event Feb. 14, which will explore what the future holds for the West Loop.

Developers renovated many of the industrial loft buildings around 1KFulton, which were quickly populated with creative users.

Much of that renovation work is done, and developers have now kicked off construction on a set of new office towers, including ones built on spec, that will continue the neighborhood boom by placing more traditional users alongside Fulton Market’s creative and high-tech pioneers.

McDonald’s decision to abandon its suburban Oak Brook campus in favor of a new 490K SF Fulton Market office building developed by Sterling Bay late last spring was a signal, from an iconic traditional business, that the neighborhood was seen in a new light.

Continue reading the full article at Bisnow.

The Doctor Is in: Healthcare Is the New Retail

There was a time not long ago when you could spend a leisurely afternoon at Park Avenue and 57th Street browsing for books at the local Borders Books outlet.

If you go to that location now, you’re probably there for health-related reasons.

With the transition to e-commerce, it’s little surprise that Borders, like many other bookstores and leisure-related outlets, is now gone. What’s unexpected now is that all of that space, with the exception of a piece on the ground floor, is being replaced by a medical facility, making it part of a growing trend of seeing healthcare providers in retail environments.

Numerous factors led to this change. Paul Wexler, head of Wexler Healthcare Properties at The Corcoran Group, explained that the preference for easy access healthcare crosses demographic lines.
“Several factors are influencing this,” Wexler said. “Millennials are pressed for time and are concerned about health and wellness while the Baby Boomer population is aging and requiring more healthcare. These generations make up the majority of the population and now seek to obtain their healthcare services the same way they experience retail. As a result, the patient experience has become a retail consumer-like experience. Instead of going to a primary care provider, people are more interested in being able to get in and out of a place quickly. Sitting in a waiting area has become obsolete.”

Deciphering the Fine Print of Tenant Improvement Clauses

Take a close look at that “generous” tenant improvement (TI) allowance that the owner of a new building has offered. What, exactly, is covered? While the amount may be larger than that offered by the landlord of an older building, a careful analysis might reveal that you will barely break even — and you may even have to pay out of pocket.

For companies considering the cost of locating in a new building versus the cost of renovating space in an older building, it’s important to read the fine print – and make sure you’re not comparing apples to oranges. Contrary to popular perception, the cost of a build-out in a new building will run, on average, $14 per square foot more than the cost of a renovation — that’s a whopping $1.4 million on a 100,000-square-foot lease.

Comparing Apples to Apples: TI Allowances in New Buildings Versus Older Space

Glimmering new construction has its appeal. Leasing office space in a newly constructed building gives you a rare opportunity to design your workplace from carpet to ceiling tiles. The catch? As one of the first tenants in the building, you risk bearing the brunt of the costs to complete the space unless you negotiate your IT allowance carefully. Not all TI allowances are created equal.

Typically, you’ll need approximately $14 per square foot more to finish your space in a new building than renovating a ”used” space. That amount may sound high, but it includes the cost of drywall column build-outs, perimeter diffusers and soffit, power distribution panels, fire hose valve cabinets, after-hours hoisting expenses and more. Those costs should not be the tenant’s responsibility, but the project may turn out that way.

So You’ve Chosen Space in a New Building

The TI allowance isn’t the only cost consideration when you’re budgeting for brand-new space versus previously occupied second-generation space. The construction schedule, material choices and logistical factors also can impact short- and long-term costs. Here are a few considerations to keep top of mind:

  • Allow time to review your space and your lease before move-in. Carefully review the space and your lease to ensure that you’re getting a fair deal in terms of the space and the TI allowance. Consult early and often with the project team to review these conditions to confirm they can meet all your demands. For instance, a construction company that uses lean construction principles will provide built-in steps to keep you informed at every stage of the process and avoid onsite surprises.
  • Look up and look down — carefully. Conflicting requirements for overhead infrastructure can make achieving high ceiling heights tricky. Nobody wants to visit their new space and find lower ceiling heights than expected— an unfortunate occurrence that is more common than one might realize. And, rarely is a floor as flat as promised. Trust the developer and base building general contractor — but verify the reality of what’s being built.
  • Confirm that the building owners are on track to deliver the infrastructure needed for interior construction. Interior build-outs require power tools — and that means electrical power must be available in the newly constructed base building. And, you need permanent power, because heavy equipment can’t run on temporary power. If permanent power isn’t available as promised, work will not proceed. Also important, check the restroom turnover date. Otherwise, you’ll be funding the cost of temporary toilets for the construction crew.
  • Don’t bring the outside in any longer than necessary — or risk adding an extra month to the schedule. When the interior of a building is exposed to the elements, it collects moisture — and your interior finishes and flooring aren’t made for that. If interior moisture levels are high, the build-out will be delayed until the humidity falls. Furthermore, many environmentally friendly products don’t dry as quickly as traditional products. Excessive humidity only extends the construction schedule even further. The general contractor should test moisture levels before interior build-out begins. First, however, the building must be fully enclosed, with the HVAC system live.
  • Coordinate large deliveries and installations carefully. Be sure to plan the delivery of larger supplies before the skip (debris container) and external elevators are removed. Similarly, you’ll need to allow time for testing fire alarms and elevator call buttons, and installing lamps. In Chicago, tenants aren’t allowed to relocate base building devices until the equipment being installed has been tested to meet building certificate of occupancy requirements.

 
Know Before you Go

While many costs are unavoidable in an interior build-out, understanding construction needs, necessities and associated costs can help you negotiate a better deal with the landlord. Most important? Don’t ignore the fine print that may hide unpleasant surprises — and be sure to compare apples to other apples, not oranges.

This article was authored by Skender Sr. Project Manager and Team Leader Ashlee Pforr, and originally published by NAIOP.

Rising Costs Make Pre-Construction Planning More Essential in Senior Housing

Value engineering is an accepted inevitability in construction, and it’s become increasingly important as construction costs have been on the rise in senior living. But while smart value engineering will identify the best ways to cut costs without sacrificing quality, too much value engineering can compromise the vision and integrity of a project, and cause a developer to deliver a building that may be practically obsolete upon arrival.

Veteran senior housing developers and operators recognize that a thorough, detailed pre-construction process can minimize the need for value engineering before the foundation of a building is laid, particularly since senior housing development presents its own unique challenges, Jim Moore, President of Moore Diversified Services, a senior living and health care consultancy firm in Ft. Worth, Texas, told Senior Housing News.

“The design features (for senior housing) are much more complex than most conventional real estate,” Moore said. “It falls into three primary areas: living units, common space and back-of-the-house space which contains storage, commercial kitchens and other amenities.”

Variabilities in terms of details such as unit finishes, cabinets, and mechanical and electrical systems to service the needs of senior housing residents add gray area to what is typically a cut-and-dried pre-construction process, Solera Senior Living founder and CEO Adam Kaplan told SHN. Solera, based in Chicago, has four new senior housing developments in its pipeline, in various stages of construction in Denver, suburban Washington, D.C, Philadelphia and Austin, Texas.

“When building another product type, like a self-storage or a retail building, you’re building a box and it’s a commoditized process,” Kaplan said. “The challenge with pre-construction in senior housing early on is to get an indication of pricing from general contractors (GCs), and then do an apples-to-apples comparison.”

Lock in pricing, labor ASAP

The current construction boom period is facing growing pressures from a tight construction labor market and rising materials costs. A February report from the Cato Institute revealed the unemployment rate in the construction industry is at its lowest since 2000. The tight labor market is creating problems for GCs, and some delays for projects, when it comes to subcontracting for specific materials and services, according to Joe Pecoraro, Project Executive for Chicago-based construction services firm Skender.

“Subcontractors are being extremely selective as to what jobs they’ll accept and are only committing to projects where they have good relationships with GCs,” he told SHN.

Rising materials costs are causing suppliers to pressure developers and GCs to lock in the lowest price quotes as soon as possible. Pecoraro, who specializes in multifamily and senior housing for Skender, said he has had suppliers increase their quotes for materials at least a half-dozen times in recent months.

Click here to read the full article at Senior Housing News.

Skender and BuiltWorlds Release “Going Lean: Toward Waste-free Building” Report

Nearly half of the nearly 2.2 billion annual tons of solid waste projected by year 2025 is generated on the construction job site. Today, a new report from Skender and BuiltWorlds offers “Going Lean: Toward Waste-free Building.” The 10-page research report, available for download here, is a resource filled with waste-reducing possibilities using lean construction solutions.

Skender, a fully-integrated construction, design and manufacturing firm headquartered in Chicago, has compiled this lean construction guide based on a thorough examination of the history of lean production utilized by some of the world’s largest manufacturers and most innovative brands. BuiltWorlds has a network of over 50,000 members sharing tech-driven news on innovation in the built environment. The Skender+BuiltWorlds report uncovers the practical ways to translate lean from manufacturing to construction, add value and reduce sources of waste in construction. Driven by Skender’s commitment to the high-efficiency and waste-reducing principles of Lean construction, the report conveys the value of optimized processes.

Download the “Going Lean: Toward Waste-free Building” report by clicking here.

Top 10 ways to build smarter

As material and labor prices escalate every day, building process economics are playing an increasingly critical role in every project. Firms involved in the commercial building process across the industry must look for innovative ways to deliver high-quality projects while stemming the tide of rising costs. Collaboration, transparency and waste reduction are key to an efficient, streamlined process.

At Skender, we recently released the “101 Ways to Build Smarter” report, which provides insight from our corporate real estate, tech clients and project partners over the past six decades. When employed comprehensively, this advice can have a huge impact on quality and costs. Following are 10 strategies to add value to your upcoming projects without driving up the budget.

  1. Go lean. Start by hiring an integrated design and construction team with experience in lean construction, our industry’s take on The Toyota Way. These pros will share a focus on reducing wasted materials, time and labor costs.
  2. Confirm an end-to-end team. Avoid costly hand-offs associated with siloed departments by establishing a unified end-to-end team at the outset. This will optimize cost, quality and schedule.
  3. Engage in uncompromising collaboration. Finding widespread efficiencies is only possible if you have a lean team in place; a group of professionals fully engaged with one another, 100 percent committed to collaborating and cross-checking every process and decision.
  4. Include end-users early and often. The users of the space, particularly the final-stage planners, are the ones with the core knowledge of what will meet their needs. If those needs change during the process, knowing sooner rather than later will reduce the need to redo, redesign or reconstruct—all activities that could add to the cost and schedule.
  5. Engage the power trio: owner, design team, general contractor. Set up a system of frequent and thorough communication among the team members that impact the outcome most.
  6. Understand the real meaning of efficiency. Increased efficiency means reduced waste, time and materials. It doesn’t necessarily mean cost savings on individual items, but does ultimately result in reduction of the overall cost of construction.
  7. Embrace the irony of value and cost. Greater value doesn’t necessarily mean lower cost for any given item or component. When you consider the big picture and long-term operations, cost savings will come through.
  8. Reducing risk means reducing costs. Less risk, fewer mistakes, safety, fewer Requests for information (RFIs), and fewer unresolved issues ultimately means the overall project cost plummets. Listen to the members of your team speaking up about risks, and don’t be afraid to mitigate them early and often.
  9. Increased decision-making power means real-time cost savings. When members of the team are empowered to act on opportunities and ideas, cost savings result naturally.
  10. Always over-communicate. When lines of communication are open, ideas can build on one another, and collaboration thrives.

This article was authored by Skender. It first appeared in San Francisco Business Times. 

5 ‘Giant’ Trends Poised to Change the Face of Construction

As the Building Design+Construction editorial team wrapped up work on the 42nd annual Giants 300 report in late June, a number of intriguing industry trends and themes bubbled to the surface. Some are new to us, others simply confirmed our original notions.

The Giants 300 report agglomerates financial data and business dealings from the nation’s largest architecture, engineering, and construction firms (a record-number 480 firms submitted data this year). The AEC “Giants” are a powerful group. Collectively, they represent 60-80% of all design and construction work completed in the nonresidential buildings market in a given year, depending on the building sector and discipline.

Compiling the Giants 300 report gives BD+C editors a unique, bird’s-eye view of the market. Based on the 2018 report, we’ve identified five emerging trends that are likely to transform the construction market in the near future:

  1. Offsite construction is here to stay. Once a novelty, offsite construction is taking hold across the industry, as labor shortages persist, the Lean movement grows, and tech-based workflows become prevalent. Major GCs are moving toward manufacturing-based operations, and select owners are requiring prefab on projects.
  2. Silicon Valley is eyeing AEC. Billions in venture capital and strategic funding are flooding the AEC market, as nontraditional industries (especially tech) see dollar signs in the transformation of this antiquated, low-margin industry. A Built Worlds report identified 25 VC funds, strategic funds, and accelerators actively targeting AEC. The industry’s new darling, Katerra, nabbed a whopping $865 million from SoftBank. There’s plenty more to come.

Read the full list and article at Building Design+Construction.

The Hidden Costs of Open Ceilings

Open ceilings are a signature element of most contemporary office designs because of the spaciousness and casual, cool vibe they add to a space. Many decision-makers also assume open ceilings are less expensive than drop ceiling because they use less materials, labor, and time. But, do those assumptions play out in reality?

2008 study of retail and office interior construction in five cities seemed to back up that assumption.  Sponsored by the Ceilings & Interior Systems Construction Association (CISCA), the study found that initial construction costs for suspended ceilings were 15-22 percent higher than for open plenums in offices, and 4-11 percent higher in retail spaces.

Unfortunately, those findings don’t give the full picture. Over the years, our experience has shown that open plenum ceilings have many benefits—but costing less isn’t one of them. It’s important to plan ahead for the unforeseen costs of open ceilings, which typically make them come in as more expensive, particularly over a building’s life cycle.

Deconstructed Look Takes A Lot of Construction

Open ceilings don’t require the new infrastructure that a suspended ceiling does, so it seems contradictory that they’d be more expensive. However, it’s not as simple as removing suspended ceiling tiles and walking away. Existing infrastructure that’s been hiding behind suspended ceilings is often unsightly, requiring major work to make it attractive to employees or customers.

For example, those exposed ducts seen in modern offices are often not original to the buildings they’re in. Old ductwork is typically blocky, dirty, oily and generally not aesthetically pleasing. Round or oval ductwork, as we used in the build-out for Glassdoor’s new headquarters, delivers a more “finished” look, but is significantly more expensive.

In addition to swapping unsightly ducts, space users want everything painted from the exposed ceiling to the ductwork and plumbing—a job that’s far more complicated than simply painting walls. This also helps tie together what you see when you look up with the color scheme, décor, and branding choices on the floor. In other words, the casual look of an open plenum is actually the result of a lot of skilled labor.

In Short: Skilled Labor Shortage Affects Ceiling Work, Too

As commercial construction has ramped up in recent years, developers are seeing a shortage of skilled labor in many trades, driving up construction costs. Open ceilings may involve lower material costs than suspended ceilings, in some cases, but any savings is more than offset by the cost of labor-intensive tasks required for open plenum.

For instance, added labor-intensive tasks may include running all electrical distribution conduit tight to the deck above with the associated additional bends in the runs, rather than running all of the conduit that crosses paths at different elevations.

For our work on Capital One’s tech incubator space in Chicago, ductwork, electrical conduits, and other infrastructure were all seamlessly integrated so the ceilings complemented the colorful, yet sleek space.

Can You Hear Me Now? Sound Considerations of Open Ceilings

Another invisible, but inevitable, cost in open plenum plans is the need for acoustical treatments. The panels in suspended ceilings are called acoustical tiles for a reason: they absorb sound to keep ambient noise levels from being disruptive. The hard surfaces of exposed ceilings –and the cement floors and glass walls they’re often coupled with – create an echo chamber. And, as people raise their voices louder to be heard over the ambient noise, the noise is amplified. White noise systems can help, but some people find the white noise itself to be disruptive.

If designers and construction firms don’t plan together to address sound issues, employee productivity, privacy and job satisfaction can suffer. For workplaces in which people must handle sensitive information, conduct frequent client calls, or collaborate closely with their colleagues, a noisy workplace is an ineffective one – and can create costly mistakes.

Solutions for noise problems in open plenum plans add to renovation bottom line. Office users may install acoustical panels directly onto the deck, or suspend baffles to absorb sound in critical areas. Spray-on acoustical material applied to the ceiling’s hard, reflective surfaces is another solution. These products soften the surfaces to absorb some of the noise, and typically have other benefits such as thermal insulation and fire protection. Spray-on solutions also cost less than panels or baffles, however, no work can be done in the space while the spray-on material is being applied. This adds seven to 10 days to the construction schedule, diminishing the savings.

Efficiency Over the Life of the Space

Even if open plenum ceilings can be installed cost-effectively, operational cost considerations can change the equation somewhat. Many planners and designers now consider the entire life-cycle cost of different solutions, including the cost of energy consumption and maintenance over time as well as the initial materials and labor.

The five-city CISCA study previously mentioned noted that energy costs were found to be lower in suspended ceilings than in open plenum ceilings, ranging from 9 percent to 10.3 percent energy savings in offices. In addition, CISCA noted that open ceilings required frequent cleaning and periodic repainting that’s unnecessary with suspended ceilings. The study concluded that when you consider both first-time and operating costs, suspended ceilings are extremely cost effective.

Open Ceilings Aren’t Going Anywhere, So Plan Ahead

All things considered, the additional cost of open plenum ceilings shouldn’t be a deal-breaker. Most companies that are investing in new or renovated offices will want the hip look and blank slate that open ceilings provide. And, designers’ primary goal is to create a space that’s appealing and productive for the employees who use it; incurring an incrementally higher cost structure is a secondary concern.

Designs teams and their clients who are getting ready to build out space should be aware of the true cost of different alternatives to avoid unexpected budget blows. Informal, exposed ceilings may seem less expensive than suspended ceilings—but reality is often quite different. Make sure to account for added materials, added labor, and long-term efficiency when you’re pricing out your project.

This article was authored by Skender Vice President Clay Edwards and originally published by Work Design Magazine.

7 Myths Surrounding Hotel Conversions and Renovations

“Conversions, renovations, and franchise affiliation changes, oh my!”—this doesn’t have to be your theme song if you find yourself embarking on a hotel repositioning effort. It’s important to be aware of the myths surrounding hotel conversion projects to dispense with some of the headaches that plague others who are not in the know.

Myth 1: “To reduce renovation costs, commercial area HVAC, major mechanical, and plumbing replacement/repairs can wait until after re-opening when revenues start flowing.”

Mistake. This cash flow decision is not rooted in proper long-term asset management decision making and diminishes ROI unnecessarily because it defers true cash flow. During a recent $12 million conversion and renovation to become an upscale property, a full-service, 178-room, 30-year old midscale brand took this approach. Once open, old issues that previously plagued the hotel immediately came back to life. Repair costs surged with crews trying to avoid unsightly damage to brand new walls, floors, and public spaces. Meanwhile, guest scores tanked. If you’re contemplating renovating, you must budget accordingly for key components to the operation during that process, not after.

Read all seven myths at Lodging magazine.

The future of the ambulatory surgery centers and acuity levels

Offering the one-two punch of cost savings and convenience, ASCs are increasingly becoming the venue of choice for both physicians and patients.

Few would argue that the healthcare landscape is rapidly evolving. Today’s healthcare consumer has become far more engaged, not only demanding a greater level of personalization and convenience in their healthcare experience, but also seeking greater transparency in areas such as network coverage and medical costs. These changing patient expectations, coupled with advances in medical technology, have created a paradigm shift in healthcare delivery that is taking emergent care and surgical procedures beyond hospital walls and into outpatient facilities such as freestanding emergency departments (FSEDs) and ambulatory surgery centers (ASCs). Offering the one-two punch of cost savings and convenience, ASCs are increasingly becoming the venue of choice for both physicians and patients because of their ability to perform increasingly complex surgeries thanks to improved anesthetic techniques and less invasive surgical procedures—services that typically come with a much higher price tag when performed in a hospital setting.

Given this market trend, it is quite feasible that ASCs will be receiving a greater number of high-acuity patients in the future. In fact, recent legislation in Florida proposed that ASCs should be able to keep patients for at least 24 hours, and then allow them to stay up to 72 hours in a post-surgical Recovery Care Center (RCC), while Arizona, Connecticut and Illinois have all established licensing standards for RCCs. If this trend continues, it will open the door to an entirely new type of outpatient facility where an ASC can take on more complex and varied types of surgeries.

Read the full article at Building Design+Construction.

7 Ideas for Containing Construction Costs

Though the real estate industry has seen a development rebound over the past decade, rising construction costs are weighing down the buoyant market. The persistent skilled labor shortage makes staffing and maintaining sites expensive. Materials are pricier, and now tariffs on steel, aluminum and lumber imports may only make the problem worse. At the same time, interest rate growth is converging with all these issues, making project financing more difficult to obtain and more costly.

A recent survey of top construction lenders conducted by Construction Lender Risk Management Roundtable found that almost two-thirds said they saw projects running over budget either more often or much more often, and 87 percent said they saw projects running behind schedule, driving up the risk of project defaults and unfinished sites.

Everyone involved in the built environment — including real estate investors, developers, lenders, contractors and architects — is looking for ways to keep costs down without sacrificing quality, as well as eliminate the delays, mistakes and course corrections that bust budgets.

The future of healthcare design and construction? It’s factory made.

What if we could make patient care better and more accessible by applying intelligent design and manufacturing principles to build healthcare spaces?

Rising costs and complexity across healthcare and construction have made it more challenging to enhance patient experiences through new healthcare facilities. One solution: deliver customization via intelligent design. Technological advancements make it possible to manufacture many healthcare building components — think complete patient and treatment rooms — offsite, to be assembled onsite for higher quality, yet more-efficient construction.

At the same time, these added efficiencies allow providers and their teams access to better options at lower prices—ultimately making healthcare more accessible to the communities that need it the most.

Read more at Healthcare Facilities Today.

5 Ways To Make Affordable Housing Development Feasible

U.S. cities continue to swell in population. But for people looking to live in urban areas, limited affordable options are the new normal.

The U.S. needs an additional 4.6 million apartments to meet demand by 2030, the National Multifamily Housing Council and the National Apartment Association estimate. The U.S. Department of Housing and Urban Development defines affordability as housing for which the occupants pay no more than 30% of their household income on rent. But across all renter households, nearly half allocate more than 30% of their income toward housing.

Despite high demand, affordable housing inventory continues to decline while luxury development experiences oversupply across major markets. Discouraged by rising construction costs, land restraints and zoning regulations, developers favor market-rate housing. Apartment completions in the 150 largest U.S. cities increased to nearly 400,000 units in 2017, but luxury buildings accounted for almost 80% of the new supply in the current cycle.

“Recent developments in the tax credit arena have affected how developers are able to make new affordable housing projects viable,” Skender project executive Joe Pecoraro said. “The old formula just doesn’t work as well, if at all, in today’s new reality. Developers and their construction partners will have to explore new ways of financing deals and new ways of building to keep affordable housing deals cost-effective.”

The push for more affordable development has led some developers to look beyond government incentives. From working with nonprofits to partnering with a contractor specializing in lean construction, here are five ways to make affordable housing more cost-effective.

Continue reading this article on Bisnow.

Does Your Modern Build-out Have a Hearing Problem?

Open ceilings, exposed concrete floors and glass-walled spaces are the hallmarks of contemporary interiors. These design choices convey a hip and modern mindset for the companies and retailers that inhabit them, but they can come with a drawback that impacts business: noise.

Without the sound-dampening effects of the acoustical tiles used in drop ceilings and wall-to-wall carpeting and other soft surfaces, ambient noises such as conversations, whirring heating and cooling systems, and shifting furniture are amplified. And plans to mitigate this heightened noise can add extra materials, labor costs and time to your build-out.

Head Off Office Noise Woes

As I described in “Heads Up: The 5 Hidden Expenses of Open Ceilings,” open or plenum ceilings come with hidden costs that should be considered before a build-out is planned. One of these costs is dealing with loud and distracting spaces created by them in conjunction with the popular open floor plans of contemporary offices. Without enclosed offices or high cubicles to retreat to, the cacophony of conference calls, impromptu meetings, and even innocuous email alerts and typing sounds can be overwhelming.

Ignoring the issue may lead to decreased employee productivity, feelings of privacy and job satisfaction. Noisy spaces may also make a poor impression on clients or lead to costly mistakes caused by misheard or overheard sensitive information.

White noise systems mask some noise, but employees may find the artificial noise itself to be a distraction. For open offices, acoustical sprays are increasingly popular for replacing the effect of the acoustical tiles that compose drop ceilings. The biggest downside from a build-out perspective is that all other site work must pause for a week or more while the acoustical spray is applied. The cost of the materials and labor to install acoustical sprays should also be factored into the budget.

Handling Ambient Noise in Retail and Restaurants

Creating inviting retail and restaurant interiors not only has to do with how they look, but also how they sound. Customers may avoid restaurants where the ambient noise level makes it hard to have a private conversation or retail spaces where they must shout to receive service.

Getting the industrial look without industrial noise requires using construction and interior design solutions that help absorb sound. In addition to acoustical spray, the team may want to incorporate banquettes or booths, upholstered furniture and carpeted areas, as well as curtains, wall hangings or other textiles. These measures create the potential for many new design choices, and add cost and time to your build-out, so they should be planned for accordingly.

Don’t Forget the Unseen When It Comes to Modern Interiors

Open ceilings and other contemporary design choices will continue to be popular because of their sleek, stylish looks. But, make sure not to neglect hearing when you’re designing to please the senses. One of the biggest complaints about work and retail spaces with these features is their noisiness. With some advanced planning and investment, using acoustical spray, white noise, and furniture and textile choices can help alleviate the echo effect that open ceilings create.

This is the two in a two-part series on pros and cons of on-trend office and retail design elements. Read part one of the series, Heads Up: The 5 Hidden Expenses of Open Ceilings.

Read more at blog.naiop.org > 

Hack the Office: Turning Underperforming Spaces Into Workplaces of the Future

Towering glass office buildings are becoming obsolete.

As creative space gains traction among companies beyond the tech industry, opulent lobbies and renovated elevator bays no longer attract young workers like they used to. Professionals crave space designed around user experience. Office workers want a balanced place with room to collaborate, socialize and concentrate on heads-down work.

Spaces like converted warehouses pioneered the push toward customization. This replaced button-up environments with the collegial and modern feel companies have sought to adopt. These offices have become scarce in the market, and many are too small to support large companies. But traditional Class-A spaces, which used to accommodate these businesses, have experienced a market slowdown. In the Chicago Metro Area, vacancies fell 40 basis points to 17.4% in Q4.

Rather than build a new office from scratch and drive up vacancy rates further, design firms are exploring how underperforming assets can be remade into attractive creative space scaled to meet the needs of each individual. Gensler was among the first to pioneer the idea of hackable buildings, but the concept has since grown in popularity.

“Every company wants an office that is their own,” Skender Vice President Clay Edwards said. “‘Hacking’ the office allows users to build on an existing design, to take it from something impersonal and informal to a space that truly defines their brand and corporate culture. ”

A Personalized Welcome

Gensler’s plan for hackable office space adapts existing buildings through a series of project-based renovations. At the Latitude 34 office complex in Playa Vista, Los Angeles, one project included personal entry doors for each tenant. Rather than have every company in the building shuffle staff through the main lobby, individual front doors offer a connection between interior office space and the exterior facade. The design mimics comparable entry design in warehouse conversions and gives employees a sense of place and brand identity from the moment they arrive at the office.

Latitude 34’s makeover paid off. Video media company Fullscreen and media investment company GroupM both signed leases in the revamped office space in 2014.

Manipulating the volume of the interior space is another form of placemaking and personalization. At Latitude 34, one office space renovation called for the creation of two connecting floors, creating an open, loft-style environment. When Gensler moved into a former banking hall in Downtown Los Angeles, it followed a similar design philosophy, adding skylights and multilevel office space.  Erik Drost/Flickr The J. Edgar Hoover FBI Building in Washington, D.C.

Optimizing Underutilized Space

The rise of mobile computing and remote work has changed the way workers use office space. Employees can work from coffee shops, on couches or even from home. Companies now have emptier offices. Some estimates placed 2015 office space levels at 30% of what they were in 1970.

By hacking office space, businesses transform underutilized desk space into new areas for collaboration or social activity. A well-lit corner of the floor can become a lounge space while kitchens and dining areas act as impromptu meeting spaces.

Areas of the office that were once overlooked have also entered the conversation. In its proposed remodel of the J. Edgar Hoover Building in Washington, D.C., Gensler suggested adding a rooftop soccer field to the FBI HQ. The field would not only provide office users with an additional fitness space but also improve the urban landscape by becoming a public park.

Promoting Flexibility

Co-working made flexible work environments a possibility for emerging startups. Businesses can pick and choose the number of desks they need and adjust as the company grows or consolidates its workforce. Large companies have adopted the practice within their own spaces to accommodate shifting employee headcounts and various working styles. The conference room in demand today might not be necessary tomorrow.

Taking a cue from pop-up retail, hackable office design uses construction practices like movable walls and multipurpose spaces to deliver offices quickly, efficiently and with an emphasis on people. Employees retain the ability to adjust the space as their needs evolve.

At the 1871 tech center at the historic Merchandise Mart in Chicago, Skender worked alongside Gensler and JLL to deliver a collaborative tech incubator space in four months. After touring entrepreneurial work sites to learn about what tech workers needed, the design and construction team transformed the existing showroom space into an open office floor plan. Most of the space is designed for flexible use. The large common area can transform from 100 workspaces to a 275-seat auditorium.

Like a living, breathing organism, the Class-A office buildings of today have the potential to become the dynamic, attractive workplaces of tomorrow.

This article, authored by Travis Gonzalez with commentary by Skender’s Clay Edwards, originally appeared on Bisnow.com.

Heads Up: The 5 Hidden Expenses of Open Ceilings

Open ceilings, with their exposed ductwork and industrial vibe have become popular – but trendy rarely equals inexpensive. For many years, omitting the traditional drop ceiling was assumed to be not just cooler but also to cost less. Common sense seemed to be that by choosing open ceilings, the cost of the drop ceiling was simply avoided, saving on labor, materials and time.

2008 study of retail and office interior construction in five cities seemed to back up that assumption. Sponsored by the Ceilings & Interior Systems Construction Association (CISCA), the study found that initial construction costs for suspended ceilings were 15-22 percent higher than for open plenums in offices, and 4-11 percent higher in retail spaces.

Great news! Or was it? It appeared this popular feature that conveys a sense

of spaciousness and casual charm also saved money. Unfortunately, the news was premature.

Our years of experience have shown that open plenum ceilings have many benefits, but being cheaper isn’t one of them. It’s important to consider the hidden costs of open ceilings, which almost always make them more expensive, particularly over a building’s life cycle.

Hidden expense #1: Open does not mean unfinished

At first glance, it might seem contradictory to think that an open ceiling would cost more than installing a suspended ceiling system and infrastructure. The catch: there’s work required in both cases. Even when ductwork is exposed, it’s anything but unfinished. Hidden ductwork is typically blocky, dirty, oily and generally not aesthetically pleasing. Round or oval ducts deliver a more “finished” look but are significantly more expensive.

Hidden expense #2: Higher labor costs

As commercial construction has ramped up in recent years, developers are seeing a shortage of skilled labor in many trades, driving up construction costs. Open ceilings may involve lower material costs than suspended ceilings, but any savings is more than offset by the cost of labor-intensive tasks required for open plenum. For instance, this may include running all electrical distribution conduit tight to the deck above with the associated additional bends in the runs, rather than running all of the conduit that crosses paths at different elevations.

Hidden expense #3: Making it pretty

At a minimum, space users want everything painted, from the exposed ceiling to the ductwork and plumbing — a job that’s more complicated than simply painting walls. More significantly, existing infrastructure that’s been hiding behind suspended ceilings is often unsightly, requiring major work to make it attractive to employees or customers. In other words, the casual look of an open plenum is actually the result of substantial work.

Hidden expense #4: Sound considerations

In addition to visual considerations, open plenum plans come with a need for acoustical treatments. The panels in suspended ceilings are called acoustical tiles for a reason: they absorb sound to keep ambient noise levels from being disruptive. The hard surfaces of an exposed ceiling can create an echo effect that gets amplified as people talk louder to be heard over ambient noise.

Avoiding noise problems in open plenum plans comes at a cost. Office and retail users may install acoustical panels directly onto the deck, or suspend baffles to absorb sound in critical areas. Another solution: spray-on acoustical material on the ceiling’s hard, reflective surfaces. These products soften the surfaces to absorb some of the noise, and typically have other benefits such as thermal insulation and fire protection.

Hidden expense #5: Skyrocketing energy bills

Even if open plenum ceilings can be installed cost-effectively, there are operational cost considerations that can change the equation somewhat. A major trend in construction cost estimation is to look at the entire life-cycle cost of different solutions, including the cost of energy consumption and maintenance over time, as well as the initial materials and labor.

The CISCA study mentioned previously noted that energy costs were found to be lower in suspended ceilings than in open plenum ceilings. The savings ranged from 9 percent to 10.3 percent in offices, and from 12.7 percent to 17 percent in retail spaces studied. In addition, CISCA noted that open ceilings required frequent cleaning and periodic repainting. “Considering both first-time and operating costs, suspended ceilings are extremely cost effective,” the study concluded.

Weighing the pros and cons

The additional cost of open plenum ceilings shouldn’t be a deal-breaker. Office and retail space should be designed and built to maximize its appeal to employees or customers and to enable productive use of the space; incurring an incrementally higher cost structure is a secondary concern. But users who are getting ready to build out space should be aware of the true cost of different alternatives to avoid surprises during construction. It’s natural to make the assumption that an informal, exposed ceiling is less expensive than a suspended ceiling — but the reality is often quite different.

This is the first in a two-part series on pros and cons of on-trend office and retail design elements. Stay tuned to Market Share for the second part of the series.

New Year, New Job

A new year signals fresh beginnings and, for many of you, finding a new job may be at the top of your list of resolutions.

Read more at consupt.com >

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Lean Construction: Reducing Waste And Enhancing Value

Many designers, architects, engineers and contractors have discovered methods, collectively known as “Lean Construction,” to improve the overall process of creating a new project, along with cutting construction costs.

Medical Campuses Are Becoming Mixed-Use Hubs

At a growing number of hospitals across the country, it is now possible to have a cappuccino with your CAT scan. Mixed-use real estate is coming to healthcare, and more hospitals are integrating shops and appealing public spaces into their designs.

Avoiding Wasted Time and Materials in a High-cost Development Cycle

As founding members of the Chicago chapter of the Lean Construction Institute, Skender Construction has implemented Lean principles for more than a decade, proving time and time again that use of the Lean Construction method can reduce waste and save both time and money.

How Building Occupants And Construction Can Co-Exist

Contractors and end users need to decide on a construction method that fits budget, timing and safety concerns. For Skender, that means devising a plan that combines flexibility, creativity and regular communication.

#WorkTrends Recap: Building Great Cultures

A great workplace culture where employees can thrive and take an organization to the next level can have a lasting impact on recruitment, retention, and the bottom line. But how do you get there?

Over the Rainbow Association: The Mantra Build, Build, Build Takes on Higher Meaning

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In 1995, a young Evanston man was driving home from work when he swerved to avoid hitting a deer, crashed, and was left completely paralyzed. After a lengthy rehabilitation he moved in with his elderly mother.  When she died, his home became his biggest challenge. Without assistance from another person, he was unable to do many of the things he once could—including leaving his own house.

According to Eric Huffman, executive director of Over the Rainbow Association, adults with mobility impairments who don’t have other options are spending thousands of dollars to retrofit their own apartments or condos. They still live with their parents, or they move into nursing homes at a young age because there is nowhere else to live. The supply of independent and accessible housing is just too scarce.

“The need is enormous. I kind of feel like, if you build it they will come,” Huffman said.

That’s the non-profit’s ambitious vision: To be a leading provider of affordable, barrier-free housing solutions for people with physical disabilities. Over The Rainbow  is moving toward that reality by building dynamic teams with the entrepreneurial vigor to drive social good.

“We‘ve provided a home for people who didn’t have a real home before,” Huffman said. “We are approaching 300 units at this point, so that’s 300 people who wouldn’t have a home, and the dignity attached to that, without us.”

With the help of many, Huffman and his team have built nine apartment buildings in the Chicago area, from Freeport to the west, east to Waukegan and south to Matteson. Every development exceeds ADA compliance. Limited carpet to better accommodate wheelchairs, large roll-in showers, drop-in cook tops, wall-mounted oven ranges, precisely positioned kitchen sinks and easy-to-open custom windows are just a few of the features that empower people with mobility impairments to be more independent.

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An Opportunity to Be Bold

Southwick Place opened in July 2015 and has 40 units, including two-bed, one-bed and studio apartments. When it is full, it will provide housing for about 60 people, many of whom, like the young man from Evanston, are coming from emergency conditions. Huffman knew that creativity would be the driving force to make this project different and successful.

“We really wanted to make a statement by pushing the boundaries from a design and construction standpoint. We wanted to convey that affordable housing doesn’t have to be so basic – it can be exciting,” said Huffman.

The building takes on a geometrical form with an angled roof system, and the façade is a vibrant combination of color and materials, connected by a floor-to-ceiling glass vestibule that allows sunlight to enter each floor. The wood truss system, according to project architect Dennis Langley of Weese Langely Weese, expanded the limits of what was possible.

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All about Trust

Being bold didn’t come without challenges, especially when construction began in September 2014 instead of July because of a delayed closing. Everyone had been closely communicating, questioning possible solutions to ensure expectations were clear and challenges were curbed as much as possible, but nothing could hold off Chicago’s harsh winter from breathing down their necks.

The main issue was the roof, a modern design that resembles butterfly wings. Given the new schedule, Skender figured it would go down around Christmas—the worst time of year to put on a roof in Chicago.

“Our team looked at alternatives and quickly set up a meeting with the owner, architect, the roofing manufacturer and roofing subcontractor to discuss options,” said project manager Brian Skender. Ultimately, the team chose a roof system that can be installed in temperatures 10 degrees colder than a typical system. The result not only allowed OTR to stay on schedule, but also cost less than the original product.

With Skender’s guidance, Southwick changed from a four-story building to a three-story one without compromising the program. The team cut a significant amount from the total cost of the project by creating landform features with excess dirt as opposed to paying to have it hauled away. They considered the value of masonry versus other materials for potential cost savings. They carried out true value engineering and completed construction in nine months.

It would have been very easy for things to go awry had the team not agreed to leave their egos at the door, said Skender.

“No one had an agenda, and everyone was highly motivated to get our tasks done in an honest and upfront style. We developed this give and take relationship where no one wanted to fail because we all knew we were building something that would give others a sense of dignity and independence,” he said.

“This was a true ongoing professional relationship where Skender was able to identify what was driving the costs within the project and methods that were more affordable, which allowed everyone to make the best decisions,” Langley said.

For its tenants, Southwick offers valuable design features, but more importantly, it offers a real home.

“The focus was always what is best for the tenants. There’s nothing in there that we didn’t want,” Langley said of the Southwick project.

Capital One Financial: Reimagining the Way 65 Million Customers Interact With Their Money

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Hannah French, Capital One’s senior manager of design and construction, confesses that people just don’t think banks are exciting. But Capital One is not your average bank.

“We’re a top-ten bank on a journey to become a leading high-tech company and digital innovator,” she said.

French just wrapped up managing the design and construction of The Shop, a dazzling new space for the firm’s partnership credit card business that’s re-branding them as a player in the world of high technology. Designed by Gensler, The Shop occupies the 22nd floor at 77 West Wacker Drive. Teams of developers create innovative and intuitive apps that enhance shopper experiences and drive sales for the company’s private label clients. The 22,000 square foot space is one of industrial chic, with raw concrete floors and graffiti-painted walls.

Making a powerful first impression, the elevators open to a darkened central corridor and an enormous LED light wall. The wall is programmable to stream text and images, such as the corporate logo of a visiting client. Circling the corridor is an open floor plan with one area of function melding into another.

A cheerful, fully-stocked café and coffee bar link to a great multi-purpose space with a raised stage, which can be used for large gatherings, training sessions and celebrations. Tucked everywhere are huddle nooks for all moods, including an indoor garden and a Ferris wheel chair overlooking Lake Michigan. There are labs for conducting consumer research, a mock retail store and a maker space complete with a 3D printer. Floor-to-ceiling windows capture skyline views in all directions.

The Shop was purposely designed to support Design Thinking, the method Capital One’s developers use to build the products and experiences to fulfill their customers’ needs. This human-centered methodology, coupled with a “fail fast” attitude, allows teams to quickly identify, build, and test their way to success. It was also important to attract young talent that might also be drawn to tech giants like Facebook, Yahoo and Google, said French.

“We want people to see our space and say, ‘I want to work here.’”

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Fast-Paced and Flexible

Capital One has 1,600 employees at 77 West Wacker and the Atrium Corporate Center in Rolling Meadows. The financial services firm entered the Chicago market in 2012 after it acquired HSBC’s U.S. credit card division.

The Shop has about 85 employees, with more being hired in the short- and long-term future. They work in tech teams comprised of six to ten employees with synergistic skills and assigned to various projects. As their assignments are completed, and new ones come in, team members often move around. Certain projects could require more or fewer team members.

The Shop’s creation has measurably transformed the teams into high-performance teams. As an example, product managers previously sat with a line of business serving a particular client. The technology pros were in a different geographic location. Now the product managers are grouped with the tech team, which is comprised of developers, engineers and data analysts. Their closer proximity facilitates communication and feelings of inclusiveness.

In addition to having greater access to each other, team members also interact more efficiently with other Capital One departments. The bank leases four additional floors in the building. Those floors are designed to appear more traditionally corporate.

Since the buildout was completed in Fall 2015, teams have dramatically shortened their delivery times, French said. “If we help our clients become more successful, we become more successful.”

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Bring on the Innovation

The teams are arranged in pods, but they decide how to arrange their individual stations to best accomplish their tasks. Some teams face inward toward each other and some face all in one direction, classroom style.

To make re-configurations possible without re-building and re-wiring the pods every time the teams change, Gensler came up with an innovative idea: Hard-wired, pivoting fences between workstations. The fences easily rotate to supply power no matter where the stations are placed within the pod. (Special permission to use flexible conduit was obtained from city building officials.)

And the overhead zig-zagging fluorescent light strips were carefully calculated to illuminate evenly throughout the work areas, said Skender project manager Dan Polito.

“If a team moves into a corner, they won’t find themselves in a shadow,” he said.

The concept of flexible floor planning is evident throughout the entire floor. Movable dividers are fashioned from imaginative yet practical media: embellished glass, chainmail curtains and even corrugated overhead garage doors.

“One quarter of the floor is dedicated to conference areas, and they are all modular,” said Tim Rogers, Skender senior project manager. “You can cordon spaces off and have smaller conference areas or open the partitions and go from medium to big. They are adjustable to whatever is needed.”

Extreme Makover: Martin Luther King Jr. Plaza Apartments | Academy Square Apartments

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As landlords know, renovating an apartment is an exercise in timing and coordination. But renovating an entire building is more like an Olympic event, especially when it is fully occupied. Skender Construction last summer took on the massive rehabilitation, inside and out, of two circa 1970 rental communities on Chicago’s West Side. Within weeks, hundreds of residents had brand new surroundings to call home.

The communities, both designated for low-income populations, are the Martin Luther King Jr. Plaza Apartments and Academy Square Apartments. They had been recently acquired by separate out-of-state owners who specialize in the preservation of affordable housing buildings. Although the two projects were similar in nature, they also bore remarkable differences. Both were challenging and ultimately rewarding for all who were a part of it.

Key to this accomplishment were meticulous advance planning, frequent and open communication, and a well-defined work schedule, said the Skender project superintendents, Bill Darrah at MLK and Dan Kenny at Academy Square.

The MLK project modernized 138 apartments in an enclave of nine low-rise masonry buildings in East Garfield Park. Between April and August, most kitchens and baths were remodeled with new cabinets, appliances and fixtures. All apartments were outfitted for the first time with air conditioning units, much to the delight of the residents. About 10 percent of the apartments were made partially handicap-accessible. After significant asbestos abatement, the team removed all existing galvanized piping and replaced with copper piping. The buildings were tuck-pointed and re-roofed, and new windows and lintels were installed all around.

Academy Square comprises 200 apartments in five buildings: A 7-story precast concrete tower for seniors and four masonry low-rises for families. The kitchens were gutted and rebuilt, and the baths were substantially remodeled. Heating and air conditioning units were replaced. Common areas were updated with new carpeting, light fixtures and paint; a maintenance room was converted to a library. Exterior renovations included an enhanced security system, new roofs and sidewalks, upgraded lighting, accessible entries and extensive landscaping. The duration of the project was from mid-March through September.

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Preserving Resident Life 

At both locations, the work had to be done with as little disruption to resident life as possible. The solution was to create a schedule that completed an entire apartment renovation in less than a week, and to group the apartments into batches, based on their locations and connection to the building’s infrastructure. The residents were instructed on how to arrange and protect their belongings, so the crews could move about. Then they were temporarily relocated to nearby hotels and paid a stipend for their expenses and inconvenience. Typically, they left on Sunday evenings and returned the following Friday evenings.

“The residents were very concerned at first that we were evicting them and making the community market rate,” said Nick Tufano, director of construction at Preservation Partners Development in Torrance, Calif. An affiliated company purchased Academy Square. “It was imperative that we treat them with the utmost customer service and respect.”

Managing both apartment communities is Chicago-based Evergreen Real Estate Services, LLC. John Noonan is Evergreen’s director of facilities and purchasing; he also served as the MLK owner’s representative during the rehab project.

Noonan credits the herculean efforts and tremendous input of site managers—Althea Collins at MLK and Zenita Monroe at Academy Square—who coordinated the tenant moves in accordance with the construction schedule and insured tenant needs were met. The site managers made sure everyone had a place to go at the prescribed times and received their compensation on a timely basis. They also affirmed the tenants had properly prepared and secured their belongings so the crews could do their jobs. Theirs was a vital role, Noonan said.

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Working in Batches

Dividing the apartments into batches was an essential strategy. Many renovations can be organized with one trade after another cycling through the building until the project is completed. Not this one.

“At MLK, we needed to shut down all the plumbing in the buildings for at least a couple of days,” Noonan said. “The batches made the job easier in terms of not having to schedule individual entries into apartments because the residents were not there.”

But making the batches logical and efficient took a massive amount of advance planning and collaboration. Skender was given a firm budget and absolute completion dates. That meant finishing between 12 and 20 apartments every five days to meet the deadlines. The project superintendents brought their trade partners and vendors into phase meetings to enlist their ideas and commitments. Each day was carefully planned out: On Mondays, kitchens were gutted. On Tuesdays, the cabinets were installed. Contingency plans for worst-case scenarios were developed. Deliveries were rigidly scheduled—storage and staging space was at a premium. In a few instances, vendors had materials delivered to their warehouses until they were needed at the jobsites.

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An Hour-by-Hour Schedule

“We even arranged times,” Darrah said. “The flooring guy came early in the morning, so he could get out of the way and make space for someone else to be right there. Everyone was working in the same place at the same time.”

“We really had to plan our manpower,” said Pat Story, project manager at Bensenville-based Ewing-Doherty Mechanical Inc., the MLK plumbing contractor. “We did whatever it took to get the job done, even if it meant overtime to meet milestones for that day. Most projects are based on weekly or monthly milestones, but because of the huge scope, our milestones were sometimes split up into two- to four-hour segments.”

The tower at Academy Square required special consideration. The water had to be shut off to remove and replace plumbing fixtures, but the building would never be entirely vacated. The batches followed the risers, which serve two apartments on each of six residential floors. Hence, 12 became the batch size. Meanwhile, in the rest of the tower, residents were traversing through the common areas as usual.

“Everybody had to be cognizant of that fact and be extra-cautious to keep the hallways clear,” Kenny said. “The common footwear worn by the residents is knit socks and slippers. We had to be sure no debris or sharp pieces of metal were left on the floor.”

During the first week of construction, a few minor glitches arose, but the crews soon found their rhythm and met all milestones. The MLK team even took off a week for the 4th of July holiday. Then, as summer turned to fall, the work came to an end, and the residents were elated with the results. Many extended to the crews hugs, gratitude and a few tears of joy.

“I had initial trepidation about working with any contractor on a job of this magnitude,” Noonan admitted. “By the end of the project, I had so much trust worked up with Skender and particularly with Bill, and we had a very successful project.

Tufano credits Kenny with the transformation of Academy Square. “It takes a unique personality to oversee these projects,” he said. “You have to keep your cool while dealing with my needs as the property manager as well as the residents’ needs. He carries most of the weight, and he did it beautifully.”

Tufano’s advice to those embarking on similar projects?

“It doesn’t matter how much you plan,” he said. “Things will change. As long as you have a team that is good at problem-solving, you can get through it.”

“Spend more time on planning and coordination prior, and the construction time is less,” Story added. “We do some pretty substantial projects in unbelievable time.”

Down to Detail: NorthShore Place

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When Senior Lifestyle Corporation set out to develop its first Signature Collection community in the country, they knew that architectural details and innovative amenities would be key to achieving new heights of luxury.

“We knew we wanted something first class,” said Jerry Frumm, executive vice president at Senior Lifestyle. “We wanted it to be very warm and comfortable for our residents, who have a level of sophistication that reflects the market we are in.”

While many visitors have compared the Northbrook assisted living and memory care community to a high-end resort or hotel, Frumm prefers the analogy “country club.”

The 175,000-square-foot, five-story, 156-unit, all masonry North Shore Place welcomes residents and their guests with a spacious marble entry, grand spaces, extensive cherry millwork and custom built-ins throughout. Among the common areas are a bistro and coffee shop; restaurants for casual and formal dining; movie theater; beauty salon; library; therapeutic fitness and exercise center; and craft and game rooms. While all units are fully licensed for assisted living, 116 units are appointed with full kitchens featuring stainless steel appliances, granite countertops and in-unit laundry. The remaining 40 units, designed specifically for residents requiring memory care support for Alzheimer’s and other forms of dementia, are located on the second floor.

“A lot of thought went into the layout and spatial planning,” said architect Jon Lindstrom of SAS Architects and Planners in Northbrook. “There are many opportunities for personal interaction, both indoors and outdoors. Some are private and secluded, and others are more open.”

Ground was broken in February 2013, but weeks of pre-planning took place first. North Shore Place was a complex project entailing an irregular footprint, numerous specialty spaces and more than 25 trade partners. The client established a budget but the interior design was not complete and the finishes had yet to be selected.

Working around these challenges and completing the job on time would require intense coordination. The project team used Building Information Modeling (BIM) software to virtually work out every detail of the structure and critical systems before construction began.

One enormous task was coordinating the placement of miles of wiring, piping and ductwork running horizontally and vertically through the building. That’s where BIM came in. Each subcontractor devised a schematic, and the schematics were interpreted into three dimensions and compared.

“The first time through, we had more than 500 conflicts on a single floor,” said Skender superintendent Brian Ribordy. “The HVAC sub wanted to put something in a certain spot, and so did the fire suppression sub. Or they would be running into rebar. We had to work out the details.”

“With a cast-in-place concrete structure, you have to know where the rebar is, and that reinforcement has required clearances should a contractor need to make a core or penetration,” said Lindstrom. “It gets pretty complicated.”

Later, trade partners used GPS locators to find the exact spots to penetrate the concrete decks for their particular jobs.

“With a traditional system, you have laminates or vellums on a light table, draw everything in 2D, and then perform the layout with tape measures,” said Skender project manager Blake MacGregor. “It takes an infinite amount of time. With BIM, we were laying out 30,000 square feet of floor plate in three days.”

BIM’s three-dimensional capabilities also proved valuable when laying out various components, equipment and distribution lines in the mechanical room of the basement, he said.

“When anyone questioned why we thought something wouldn’t fit, we had it visually ready in 3D form,” he said. “It ended those philosophical discussions.”

To help schedule each day’s work, Skender relied on the expertise of their trade partners to plan schedules in great detail. They provided input as to the amount of time they needed, what had to be finished before they could start and at what points they could work alongside other trade partners rather than independently.

“It’s easier to hold them accountable if they help make the schedule,” said Ribordy. “Instead of dictating the plumber’s schedule, we would ask him how many days he needed in order to complete his work.  When you approach the trades and actually ask for their input, they are more committed and can better manage their manpower.”

“Brian was very attuned to the scheduling process,” said MacGregor. “He was always playing out milestones. He would say, ‘We have to start this activity on this date,’ and then work backward to see that the shop drawings, procurement, reviews and everything was completed in time. That really drove the production of the project.”

Not finishing on time could potentially damage Senior Lifestyle’s brand, he added.

Scheduling was especially critical when it came to completing the masonry before the second winter set in. The building footprint, far from rectilinear in shape, was a stylized “S” with many ins and outs and an extension on one side. The decision was made to build vertically in batches, which were determined by the scale of the scaffolding, and to circle the building.

“When you’re working in small batches, you’re able to focus on that piece rather than monitor 200 people across a huge building,” said MacGregor. “Everyone is in one spot.”

“It also allows the trades to have consistent manpower,” said Ribordy. “Instead of 10 laborers today and 25 tomorrow, there’s no roller coaster. They appreciate that and want to keep working with you.”

And even though interior design decisions weren’t finalized until early spring of 2014, advance planning gave trade partners—particularly the electrician and finish carpenter—enough notice to organize and reallocate manpower for critical path work.

Many other efficiencies helped move the project through one of the worst winters and one of the wettest springs in Illinois weather history. North Shore Place was delivered to the client two weeks earlier than anticipated.

“Skender really stepped up for us and did a great job,” said Frumm. “They came to us with great solutions in terms of how quickly they could get the building done, and they hit every step along the way.”

“Value starts with the process and the team,” said Lindstrom. “When you have a team that can work together toward a common goal, there is value. In addition, being responsive when issues come up or questions need to be answered, that creates value. Not only does it keep things moving, it creates trust along the way.”

The Changing Workplace: New Offices Are Smaller but Smarter

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The modern-day office environment has undergone a massive transformation. Spaces are smaller, but they also are smarter and more efficient. The walls have come down, both literally and figuratively.

“The way people worked 20 years ago no longer exists,” said Bill Conopeotis, founder and president at ConopCo Project Management in Hoffman Estates. “Before, they worked individually. Now they work in teams. People are working differently, so we have to design their spaces differently.”

The traditional workplace of yesteryear was configured like a hotel, with private offices branching from networks of hallways. The next iteration positioned executive-level offices along exterior windowed walls; everyone else worked in high-partitioned cubicles in the middle. The current trend is the open office: Workstations, separated by low or no partitions, ring the perimeter. Private offices, if any, are centrally clustered and fronted with glass walls for greater transparency.

Leonora Georgeoglou, associate and interior architect at Harley Ellis Devereaux in Chicago, noted that private offices are shrinking in size.

“We used to see a lot of 150-square-foot offices and 200-square-foot offices,” she said. “Now the standard is 100 square feet.”

Driving the changes are market forces such as escalating real estate prices, advancing technology, contemporary management theory that emphasizes collaboration, and the desire for healthier lifestyles. The build-out of ShopperTrak’s new 50,000-square-foot corporate headquarters is a prime example.

ShopperTrak is the leading global provider of shopper insights and analytics used to improve retail profitability and effectiveness. Its services and products are deployed in more than 70,000 locations and 90 countries and territories. As a rapidly growing high-tech company, it needed more space for its 150 Chicago-based employees.

They found it on the 41st floor of Willis Tower. After a fast-tracked 13-week construction schedule, the company relocated in May 2013.

A key requirement was the build-out had to facilitate collaboration, said ShopperTrak’s chief operating officer Kurt Phillips. The company has adopted the Agile software development methodology, whereby problems and solutions evolve in real time through the collaborative efforts of cross-functional teams.

“Having easy access to one another is extremely important,” he said. “We needed everyone to be on the same floor and have room for future expansion as well.”

ShopperTrak also wanted many spaces for employees to congregate. Its previous location had four. The new headquarters has nearly two dozen such spaces of varying sizes. On the small side, strategically positioned sofas and loungers invite casual interchanges. The largest space, used for monthly all-employee meetings, is created by opening the glass walls of the conference rooms near the reception area. In addition, product displays and bright graphics in the reception area showcase for visitors the company’s expertise and global reach.

“Real estate is expensive, so people want their space to do multiple things,” said Georgeoglou. “No dedicated pantries that get used only at breakfast and lunch, for instance. Now they are set up like a café and used for meetings all day long.”

Even ShopperTrak’s furniture is multi-functional. Modular work stations, now seating two employees, can someday seat a third. Low-slung filing cabinets topped with cushions provide bench seating for small conferences at workstations.

A variation on the open office concept is unassigned seating for telecommuters and other occasional workers. Unassigned seating takes two formats: hoteling, which is reservation-based, and hot desking, which is not. ShopperTrak, which favors interpersonal communication, chose not to support unassigned seating.

“Some of our traditional clients, like in finance, are starting to implement work-from-home programs, but people are not signing up as much as corporations expected them to,” said Georgeoglou. “People don’t feel the trade-off of working from home two days a week is worth giving up your assigned space to work in a compact hoteling cube.”

Open offices have both proponents and detractors. On the plus side are improved collaboration and, as in the case of ShopperTrak, more employees who can enjoy cityscape views and natural lighting. Construction is faster and less expensive. As for the negatives, open offices can be noisy and are not conducive to private conversations concerning sensitive matters.

“You’ve got to have a balance of private and open space,” said Phillips.

Montreal-based DEGW is a global consultancy focused on the changing nature of work and its impact on people, places and performance. The firm in 2010 conducted a study on time use and time loss in the workplace. Among the findings, after surveying more than 44,000 knowledge workers:

Average response times are significantly lower in open office arrangements than in enclosed offices, especially when soliciting feedback from managers as opposed to peers. However, when managers work in open offices, their response times are similar to response times of peers.

A common criticism of open offices is that productive time is lost due to distractions, particularly from noise and unscheduled pop-ins (in-person, email and instant messaging). However, the study showed production time actually is not significantly different for open workplaces versus enclosed workplaces. Both were about 25 minutes.

The DEGW conclusion: The right office design depends on the organization and its goals.

Another factor impacting office design and employee production is advanced technology, particularly Wi-Fi and audio-visual systems.

“We had Wi-Fi before, but it wasn’t as robust,” said Phillips. “Now our employees can meet in the café or anywhere else. They don’t feel they have to be tethered to their desks because that’s where they get the best reception.”

“More money is spent in the tech area of build-outs than ever before,” said Conopeotis. “Clients aren’t as interested in having a beautiful granite floor. They are spending money on cabling, AV and security. Technology and infrastructure can be 50 percent of the project cost.”

They also are investing in sustainability. Greater numbers of clients, including ShopperTrak, are applying for certification under the U.S. Green Building Council’s green rating system, Leadership in Energy and Environmental Design.

“Today, between 30 percent and 50 percent of clients are going for some level of LEED,” said Conopeotis. “Ten years ago, it was under 5 percent.”

In the future, what will workplaces look like? Designers and construction professionals are already pondering the question.

“Today we are pushing the limits of new design, but tomorrow we will have to innovate differently than we are now,” said Conopeotis. “The world is changing faster than ever. We just have to get ahead of it.”

Moto Moving Forward

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It was the largest tenant build-out the city has seen in at least a decade: The Motorola Mobility global headquarters relocation to Chicago’s historic Merchandise Mart. Leasing 600,000 square feet on four floors, Moto’s new space has been likened to a 25-story high-rise turned on its side. But the massive adaptive re-use project constituted much more than fields of offices and workstations: It incorporated seven highly sophisticated research and development mega-laboratories, powerful new rooftop mechanicals, a grand architectural staircase and the services of two helicopters—all in 45 weeks.

As home to the renowned international telecommunications company, formerly in suburban Libertyville, the new headquarters spans floors 16 through 19 of the circa 1930 Art Deco landmark building. The labs, which are on the upper three floors, occupy about 80,000 square feet of the interior, and the two structures housing their dedicated mechanical systems cover an additional 50,000 square feet on the rooftop.

“The floor plates are so massive, we had to create an interior campus defined by various neighborhoods, paths and nodes, so that the employees could easily navigate through the space,” said Ingrida Martinkus, one of the project architects at Gensler. “The labs are the anchoring elements around which offices, meeting/huddle rooms and open workstations are organized. Corridors wrap and transverse the floors, with micro-kitchens and various ancillary spaces interspersed along the way, allowing for moments of expected, and unexpected collaboration.”

Among the most striking design features of the new headquarters are a trailer-sized LED wall and a monumental steel staircase linking the 18th and 19th floors. The staircase offers platform seating for small group meetings at the mezzanine level, and wooden slats enclose it on three sides. Many of the building’s vintage details such as columns and doors are melded into the new architectural elements.

Before construction could begin, the work had to be organized into a master schedule. The task was challenging in part because many program details were yet to be determined and, therefore, the schematic drawings were incomplete. So in order to get the ball rolling, the project management team engaged trade partners, asked for their input and brought many disciplines together to stay ahead of the planning process.

The lengthy, detailed pre-planning meetings were invaluable, said Martinkus. “Transparency and coordination were key. This allowed the team to identify any and all potential challenges and arrive at solutions before conflicts arose.”

“There were literally thousands of items that had to be completed,” said Dan Marijan, Skender senior superintendent and partner at the firm. “We worked backwards, dealing in milestones. We knew the end date, and that couldn’t be changed. Before that, the furniture had to go in. But before that, the carpet had to go in, and before that, the drywall. And so on.”

Multi-story build-outs like this one typically are phased one floor at a time. But because of the complexity of the labs, they had to be started early and simultaneously. Furthermore, they are located on different floors.

“Once the real estate was set aside for the labs, it was divide and conquer. The labs were the first and most important task that needed to be programmed because all of the major infrastructure was related and required the most amount of time to coordinate and build out,” said Marijan. “Once the real estate was locked down, we began our riser and infrastructure work. We phased the project in 50,000-square-foot batches, and we figured we could start four batches at any given time. Two hundred thousand square feet per floor seems overwhelming, but the way we broke it down was very manageable. For much of the duration, the work progressed not sequentially, but on parallel paths. That’s how we got it done in 45 weeks.”

Skender also took the innovative step of forming teams according to discipline: Separate superintendents and project managers were assigned for the labs, mechanical systems and LEED.

“When specific questions arose, they were directed to that team,” said Marijan. “It became a very fluid process.”

While Motorola was tweaking its program, the project team moved ahead with the infrastructure. The existing systems, according to Andrew Lehrer, ESD vice president, project manager and one of the lead mechanical designers, had to be upgraded to meet the project goals, and new systems had to be installed.

“The labs were stacked fairly vertically, which allowed us to have two central utility platform cores running straight down,” he said. “That made the distribution and infrastructure as efficient as it could be. Once we knew what equipment we needed, we found two spots on the roof to build the raised platforms that would support the equipment. Then we had to figure out how to get all of it up there.”

Building a crane that would hoist dozens of large pieces of equipment and 184 tons of steel to the upper floors didn’t make logistical sense, nor would it fit into the project’s timeframe. So, two helicopters made an unprecedented 180 lifts over a two-day period from a barge floating on the Chicago River. The mechanical contractor built further efficiency into the process by pre-sorting the materials into bundles and making sure each one was balanced before delivering them to the site.

As for the labs, each one is different in size and function as well as design requirements for technology, climate control and acoustics. Exterior walls are variously clad in materials such as wood planking or corrugated metal, and were inspired by the view of Chicago looking north.  They were about 70 percent completed when the client decided two of the larger spaces, encompassing over 20,000 square feet, should be shielded from radio frequency interference to contain cellular signals.

Marijan explained: “The Merchandise Mart is in close proximity to a 911 call center. Everyone was hyper-sensitive to disrupting emergency calls or even being associated with disrupting those calls. A lot of detail had to be ironed out to create these rooms, so there are no errant signals coming from them. The Libertyville location was more forgiving because it was not in close proximity to the same concentration of cell towers or emergency providers.”

“It was a difficult and costly change, but because of the flexibility we had, it was a change the owner could make without derailing or delaying the project,” said Lehrer. “That’s what was most valuable to them.”

Another big change was the decision to not locate Motorola’s manufacturing and production facility within the Merchandise Mart as originally planned. The facility’s miniscule tolerances for vibration, humidification and temperature were too difficult to control in a high-rise environment. Instead, it was moved to a nearby 63,000-square-foot, single-story warehouse, which the project team gutted and outfitted to the proper specifications.

“One of the key things they did, instead of trying to communicate solely by emails and phone calls, was meet with us in Libertyville with their tradesmen. They walked through our facility numerous times instead of only relying on paper layouts,” said Motorola’s Lance Vondrak, director of operations at the facility.

Vondrak also credited prep work, exhaustive reviews, design summaries and clear communication with enabling the team to successfully meet its milestones.

“At the end of the day, what is important to me is that the production lines came up on time,” he said. “We got things right the first time.”

Construction progressed, with as many as 500 tradesmen working on both sites at the same time. Meanwhile, the rest of the 4 million-square-foot Merchandise Mart was operating as usual, with frequent and hugely populated trade shows running through the course of the year.

“It was a stressful time, grinding through the details, but everybody did what they could to make it a lot easier, from the owners to our trade partners,” said Marijan. “Everybody knew we were setting out to create something bigger than themselves, and they were up for the challenge.”

Ultimately, the hard work paid off. The project was complete in 45 weeks, with the new headquarters at the Merchandise Mart earning LEED Platinum Status for corporate interiors.

Lehrer and Martinkus agreed that teamwork was the factor that brought the project to its successful conclusion.

“Value is not always about money,” said Lehrer. “Often, it’s about time. Motorola had a very compressed schedule and a complex project, but it was met effectively because of the team and the process. Everyone was working toward the same goal.”

“It was a collaborative team that challenged people to bring their best ideas and solutions, ultimately creating a creative and healthy work environment for Motorola,” said Martinkus. “This is one of those ‘once-in-a-lifetime projects,’ for which we would all jump at the opportunity to work on again.”

Stephen Monaco, Motorola’s head of global real estate & workplace services, said communication ultimately created value on the project.

“The toughest challenge was really not the tight schedule, the technicality of the labs or the lifting of steel, but managing the complex matrix of relationships between Motorola and Google at the time. The multiple consultants and the trades were always square and level on all sides of the conversation.  That was the driver for our successful outcome,” he said.

Building on Opportunity: Shop & Dine Northwestern Brings the Right Mix of Retail Offerings to the Healthcare Environment

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When Northwestern Memorial Hospital set out to integrate shops and restaurants into its program four years ago, they discovered they were catering to a much larger population than the average hospital. A comprehensive study revealed that a staggering 13.5 million retail transactions were occurring in the medical campus’ neighborhood of Streeterville each year. With nearly 10,000 employees, 67,000 neighborhood residents, and 3,000 hotel rooms within a five block radius, one thing became clear: It was time to capitalize on the opportunities right outside its doorsteps.

But retrofitting the hospital with an array of restaurant and retail options is tricky business, according to Northwestern Memorial HeathCare’s Vice President of Real Estate Gina Weldy.

“Healthcare buildings are complicated places, and restaurants are a very different type of business and a very different type of build,” Weldy said.

From the beginning, Northwestern Memorial wanted restaurants and retailers that would fit into their mission and vision of healthy, fresh and uplifting concepts. But finding the right mix wasn’t always easy.

“We went out and found a team of retail brokers that started talking to our prospective tenants, and we found out that retailers and restaurateurs had been interested in our campus but didn’t really know how to talk to us or find us,” said Weldy. “We were able to tell them about changes we were making in the buildings that would make it more attractive for their uses.”

The first of these changes included exterior doors that welcomed neighbors into the space without feeling like they were walking into a hospital. Northwestern Memorial’s buildings are large, often taking up the full city block; and retail customers prefer to stroll into quaint shops and sidewalk cafés, Weldy said. Northwestern Memorial worked with research and design firm Kiku Obata & Company to create the retail program and the Shop & Dine Northwestern brand including storefronts on the first and second floors that would be welcoming, local, and strike a balance between retailers.

“The design goal was really to create a set of elements and materials that the hospital could use to complement its own interiors, but also to control the appearance of the retail,” said Kiku Obata’s David Leavey. “The wood and glass walls that make up the retail storefronts create a very recognizable pattern that patients, visitors and staff can clearly define as retail. It’s a modern, clean, timeless framework that works within the context of the rest of the hospital.”

 

The wood and glass storefronts are used by the second-floor retailers GRK Kitchen, Protein Bar, Pulse Gift Shop, Au Bon Pain and the newly opened Saigon Sisters. On the first floor, stores with windows to the street create a neighborhood feel that would welcome foot traffic and create a sense of being part of the city for visitors coming from within the hospital. One key retailer on the first floor was Barbara’s Books, which, since the demise of Borders, has become the closest brick-and-mortar bookstore to the Magnificent Mile on Michigan Avenue. The space also attracted a very unique new tenant. Dan Rosenthal, Managing Director of Trattoria No.10 and owner of the Sopraffina Marketcaffè fast casual restaurants, was eager to share his product with the Northwestern Memorial community. But in addition to his traditional fast casual concept, he is also introducing an upscale small-plates concept restaurant called Cicchetti.

“Being a block off Michigan Avenue and having thousands of hotel rooms within two blocks and 10,000 employees in the building are all music to a restaurateur’s ears,” Rosenthal said. “It’s all about opportunity, and we feel there’s a lack of quality restaurants in this area, which makes it a great opportunity for us. Also, our concept of making environments that we have today better for people tomorrow aligns with the hospital’s goals.”

The 9,200 square foot dual restaurant initiative is the largest space in the Shop & Dine Northwestern project, and it includes a 2,000 square foot mezzanine, which wasn’t included in the base building. Like many of the other restaurants, there were challenges with moving into the building.

“There is a fair amount of risk putting a restaurant in a hospital if the design and construction is not carefully managed and executed,” Weldy said. “Some of the required infrastructure is rather atypical. When you’re co-locating underground plumbing lines, black iron and linear accelerators, it can get interesting and it requires teams who are willing to sit down and work out all of the issues together.”

That’s where Skender Construction came in, according to Weldy. With experience building at Northwestern Memorial and building retail in general, Skender was able to bring together restaurant owners and the hospital to use Lean principles to plan and track daily activity. While start-up seemed like a slower-than-usual process to Rosenthal, detailed production planning was playing a big role behind the scenes.

“I kept asking when we were going to get moving and one day I walked in and there were nine lifts in the space. The mezzanine was completed in five days,” Rosenthal said. “It was an amazing thing to watch.”

With several spaces already completed, Weldy has noticed positive results popping up on the second floor.

“The second floor feels very different now. By adding retail, the general energy is very uplifting,” Weldy said. “For patients and their family members, being in the hospital environment is stressful. They might be dealing with long-term illness and unexpected life events. Now these shops and restaurants are providing a place to sit down and have a bit of respite.”

Making it Functional: Integrating Restaurants and Retail into the Healthcare Environment 

They say form follows function. But when the construction team started laying the infrastructural groundwork for Northwestern Memorial Hospital’s new retail and restaurant spaces, they found that many spaces would need to take on a new form.

Retrofitting what was once hospital administrative space for retail and restaurants meant that many spaces needed new black iron duct work shafts to deliver fumes from kitchens to the outside, new electronic systems to support retail and restaurant computers and pipes to deliver natural gas for cooking to various sites.

“It wasn’t possible for us to go in and verify all the existing conditions prior to construction starting,” said Skender Senior Superintendent Mark Bussey. “We had to learn and discover that process as we went along as well as remain on schedule.”

As each tenant moved, the team tracked the infrastructural conditions and found solutions as projects progressed. The team also ensured that each construction area was properly sealed off from the rest of the hospital so that dust and noise from construction wouldn’t disturb doctors and their patients.

“We were really sensitive to areas where there would be patients and communicated the expected noise levels day and night,” Bussey said.

In one case, the team had to reroute supply, return and exhaust ductwork from the first floor and decrease the size of the duct shaft to give restaurants on the second floor more space. The construction team found a unique solution that allowed them to do this without disturbing the existing first floor main lobby—they built scaffolding hanging down from the second floor into the mechanical shaft to get the work done, saving money and time and eliminating disruption to the hospital’s main lobby on the first floor.

“We were able to devise the plan with our key trade partners and then propose it to the architect and engineer,” Bussey said.

Change is Good: Mercedes-Benz of Ontario

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Fletcher Jones Motorcars’ philosophy is to provide the same high-end service and satisfaction one might find at a five-star hotel or resort. As one of the most successful luxury automobile dealer groups in the country, their brand is built on creating memorable experiences and lasting relationships with their customers.

With an established presence in California, they saw an opportunity just east of Lost Angeles in the San Bernardino Valley. The Inland Empire, an emerging upscale metropolis, boasted an international airport and an interstate highway. But the area did not offer much in the way of public transportation. It was an ideal location to build a Fletcher Jones luxury automobile dealership: Mercedes-Benz of Ontario.

“The region was expanding; new developments in housing and retail were emerging at a healthy pace. The opportunity to have a presence and be visible just off the interstate was very attractive to us,” said Keith May, president of Fletcher Jones.

The family-owned company is known for making no small plans when it comes to building dealerships, and this venture was no different. The 100,000 square foot facility focuses heavily on architecture and an inviting interior environment.  About a third of the space is devoted to sales and showroom areas, and the remainder houses the service department. The roof deck offers an additional 60,000 square feet for parking. Guest amenities at the Ontario dealership include a children’s playroom, indoor lounge with business center, and an outdoor patio bordered by a soothing 120-foot linear water feature.

Construction was well underway when the client decided to make several major changes and upgrades. Among them were a massive LED sign and increased exterior lighting to catch the attention of drivers on nearby Interstate 10, the San Bernardino Freeway. Also, two free-standing buildings were added—another showroom area and a car wash, as well as a raised retaining wall and landscape enhancements.

These changes were not insignificant details. The car wash, for example, required greater site drainage and storm water management. A massive underground detention tank had to be installed to handle the run-off and meet municipal building codes. But an agile and collaborative project team quickly adapted and forged ahead.

Because the team members were assembled at the project’s inception, they worked in tandem with each other rather than the sequential norm. Skender simultaneously consulted with subcontractors and other specialists while the design was being created to provide feedback on techniques, scheduling and pricing. The innovative and efficient process allowed construction to be started—or re-directed—even before the final plans are confirmed. Every player was viewed as an invaluable partner in the project.

The results were remarkable. For Fletcher Jones, the Ontario dealership was delivered without delay and the original budget was reduced, even with the many deviations from the original design.

“There was value in bringing a building team together at the project’s inception. It not only brought all ideas to the table, it established a mindset that the end goal was to create the best product possible. It was challenging, but everyone from architect to contractor to subcontractor was personally invested in the end result,” said May.

Stepping It Up: Erie HealthReach Waukegan Health Center

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After an extensive search, Erie Family Health Center settled on the perfect building for a vibrant new community health center in Waukegan: A 1950s-era bank. Completely transforming a former financial institution into a quality medical and dental care facility that would serve 10,000 Lake County residents would be challenging, but the two-story masonry building was right for so many reasons.

“Our vision was to meet community health needs as well as plan for future growth,” said Amy Valukas, Erie’s vice president of planning and programs. “We needed to be accessible to public transportation, but we also wanted to be on a main thoroughfare in a place that was known, visible, comfortable and safe to the community.”

“One of the goals was redefining a strong iconic image—the bank—by converting it into a health care facility that would bring Erie’s brand to life,” said architect Casey Frankiewicz, director of health care at Legat Architects in Waukegan.

The new 25,000-square-foot Erie HealthReach Waukegan Health Center would greet its first patients in just 22 weeks. Examination rooms, nurse stations, laboratory, dental and vision suite, urgent care area and community education room with demonstration kitchen would reside on the first and second floors. The lower level would offer a lounge and fitness center for medical providers. The building would also gain new MEP, elevator and fire protection systems.

But the building had been expanded multiple times, and no meaningful documents existed. Both the schedule and budget were tight. There was no time or money for mistakes, even when there were questions about what was really behind the walls.

“We gutted the whole interior down to the exterior walls and rebuilt the inside, so there was no time for re-work or confusion. We had to make decisions, over-communicate and hold everyone accountable,” said Skender senior project manager Thomas Schlueter.

The team began with a major project: The removal of two large support columns on the second floor to provide more openness and longer sight lines. To compensate, the foundation had to be reinforced to support a huge galvanized beam placed on the roof to carry the new load.

“We were working with a building that had a different function and making an open floor plan out of something that previously had a lot of walls required adding tons of structural steel over the roof. Because of time constraints, everyone had to work together,” said Kazem Nemazee, project manager at David Architectural Metals in Chicago.

Erie also wanted to retain some of the design elements of the former bank. The most obvious was the dramatic spiral staircase connecting the first and second floors. But the staircase, which needed renovation, didn’t meet current building codes. Even if it did, the triangular-shaped treads were unsafe for those with mobility challenges.

“We knew it would cost more to try to bring it up to code than to put in a new stair that met code, so we proposed building an entirely new monumental stair after construction began. We knew a new stair would be safer and its modern look would add more value in the long-term,” said Schlueter.

But time was ticking, so the team used a design-assist approach to design and build the stair. This accelerated the process by reducing drawing and approval times. “Legat sketched the concept; then we worked with David Architectural to produce the drawings and help design to a target cost. The traditional approach of drawing, pricing, shop drawings, approvals and fabricating would have delayed the schedule for weeks,” said Schlueter.

The result was a new glass and stainless steel staircase extended to the lower level. Also, the front façade was torn out to insert a two-story extensive north-facing glass box that projected out of the building. The glass serves several purposes: It adds an inviting face to the façade and showcases the staircase from outside and inside. It also drenches all three levels with massive amounts of natural light. A small seating area adjacent to the stairs allows patients to wait and watch for their transportation.

The bank’s two vaults, however, were incorporated into the overall design. The cash vault on the first floor was turned into a touch-down area for visiting professionals. The safety deposit vault on the lower level became a cozy lounge with a decorated metal wall. Vault doors were removed for safety’s sake and bolted to nearby walls for ornamentation.

“Removing the vaults would have been difficult, so we celebrated them,” said Valukas. “They are really beautiful quiet spaces where our providers can be productive, and they are a reminder of the history of what was there before.”

While scope changes often play a role in adaptive re-use projects, the team relied on Lean Construction to manage scope changes, hold people accountable and ultimately fast-track the schedule. Trade partners participated in pull planning sessions, used the structural steel for the column removal and the monumental stair as critical paths, and planned backwards to capture every task on paper. The entire building was broken down into areas so the team could prioritize and build a production system. The lookahead schedule tracked all daily tasks and projected constraints that could halt workflow.

Although the schedule allowed for 22 weeks of construction, Erie HealthReach Waukegan Health Center was completed two weeks ahead of schedule.

“They have a great process of running jobs where they hold everyone accountable,” said Frankiewicz. “This job needed that kind of leadership on the construction end to meet the goal, and they provided it.”

“Skender is fantastic,” said Valukas. “There were multiple times that they made suggestions or value-added decisions that ended up having no material change in the outcome of the design but definitely saved us dollars. I don’t think any other general contractor out there could do what they did.”

Finding the Façade: American Society of Anesthesiologists

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The new headquarters of the American Society of Anesthesiologists is calmly situated among an expanse of office buildings in Schaumburg.  But the element of surprise makes this building wildly different than a typical build-to suit: The exterior’s mix of metal and glass is stunning from the outside, while the sophisticated open interior environment invites anyone to explore the fascinating profession.

Aesthetics aside, the goal was to celebrate the history of anesthesiology and showcase the association’s brand as a community of contemporary, forward-thinking medical professionals. The organization’s previous Park Ridge location, an assemblage of leased spaces, didn’t have room to bring its members together for events and conferences. And its collection of rare and vintage books, artifacts, equipment and tools—some hundreds of years old—wasn’t readily accessible for viewing.

“Our main goal was a stand-alone building that could service all ASA’s needs, but we wanted that ‘wow’ factor, not a plain precast building,” said Randy Bartosh, vice president at Development Resources in Chicago and ASA’s project manager.

The result more than doubled ASA’s existing space: A sleek three-story, 77,000-square-foot structure with a glass and steel façade on a wooded site overlooking a lake. Inside, a dramatic atrium with monumental stair is capped with a skylight, clerestory windows and glistening LED lights. Located on the first floor are a 250-seat conference room/auditorium equipped with advanced communications technology, cafeteria, and climate-controlled, moisture-resistant Wood Library-Museum of Anesthesiology. The upper floors house staff offices.

“The grand stair serves as a kind of connective tissue between the membership spaces and the staff spaces,” said architect and project manager Adam Quigley of Tilton, Kelly + Bell Architects in Chicago.

Ground was broken on the 12-month project, but several weeks of pre-planning assured the job progressed smoothly and on time. It was clear that Building Information Modeling (BIM) would be necessary to lay out the critical systems and infrastructure of the building, and collaborative schedule planning would ensure that every detail would be covered. But one critical question remained: What materials should clad the building? Glass and metal were givens, but specifically which glass and which metal? How should they be connected to each other and to other building elements? What type of support system is needed to prevent the metal sheets from “oil canning” or buckling?

“An architect can have an idea and put it on paper,” said Skender’s project manager Ramiro Trevino. “But you don’t really know what it’s going to look like until you see it in the exact location and how it interacts with the surrounding buildings, the other materials it comes into contact with, and the sun at different times of the day. All those variables need to be taken into account. Other buildings with the same glass won’t always look the same in different locations.”

“It was very important to get this right,” said Quigley. “Even though it was a stainless steel base with a glass curtain wall, that simplicity demands a high level of engineering precision. Many systems are coming together, and there is no other visual noise to mediate errors. If you have a complicated façade like masonry construction with a lot of ornament, the eye tends to glance past or forgive issues of alignment. But an imperfection on a metal panel can draw attention pretty quickly.”

In search of definitive answers, the project team took the unique step of building a nearly full-size, on-site mock-up, 10 feet wide by 30 feet high. Mock-ups are made from time to time, but they usually are much smaller. This one was so large, a building permit and foundation were required. Every element, from foundation to parapet, was replicated.

For two months the team tested numerous materials and constructions on the mock-up. They tried different colors of glass and considered zinc, aluminum and stainless steel as well as an assortment of finishes. They looked for signs of deflection and assessed their connections and supports.

“One particular type of support system could be OK for stainless steel, but aluminum is more fragile, so your substructure would have to be different,” explained Trevino.

The final choices were to clad various sections of the first floor with stainless steel paneling, perforated stainless over glass, and clear storefront glass. The second and third floors were clad with a low e-coated glass. Spandrel glass separates the floors and wraps the mechanical penthouse while a glossy black metal parapet outlines the roof.

“Working within the design parameters and tolerances, stainless steel proved to be the most advantageous option,” said Trevino. “It was more solid and less expensive than the other material options we explored.  We were also able to get the materials from the United States, which meant shorter lead times.”

“This process helped us determine that the stainless steel needed to be embossed,” said architect Michael Kelly, a TKB principal. “It gives additional rigidity to the material, and it refracts the light more evenly across the panel so that any glare is muted.”

Another big decision was how to hang the curtain wall. A time-saving unitized system was employed rather than building a framework, installing glass panels and caulking the seams. The manufacturer, Wausau Window and Wall, pre-fabricated and pre-glazed two-story sections that were delivered to the site and expeditiously set in place via crane.

“We were able to limit a lot of our field time by spending more time in the shop,” said Sean Hill, an associate at Elmhurst-based Glass Solutions. “Field labor is a big item in our industry. If you can reduce field labor in any way, you can reduce your costs.”

Pre-fabrication translates to a safer jobsite because both the amount of materials and the number of people working with them are lessened, said Trevino.

These efficiencies and more wrapped up the new headquarters as promised. They also helped assure the client that the building would perform well in the future, and the exterior would not lose its elegant flair over time.

“The curtain wall and skin investigations certainly were value-driven,” said Kelly. “When you do a building that is unique, costs tend to go up. The team worked diligently to make decisions that made sense while making a consistent effort to stay within the budget.”

Bartosh agreed. “Even with a tight schedule and all the challenges that took time to get resolved, Skender stepped up to the plate and presented solutions in a great way,” he said. “They bent over backwards and took extra steps to make sure that the building would represent ASA well now and into the future.”

Elevating the Industry: Howard Tullman

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The work at 1871 is never done. Just two years after its launch, Chicago’s largest and most talked-about tech incubator created 1,500 jobs, expanded its physical footprint in The Merchandise Mart and introduced 1871 2.0, a place that reflects the organization’s ever-evolving objectives and desire to constantly keep raising the bar. But innovation, fast growth and results like these don’t happen by chance; they happen when you take time to build a community and when you take the long view (multi-year view) of your goals. Howard Tullman, CEO of 1871 explains.

EL: Nearly everyone in the Chicago business community has heard of 1871. What were you trying to accomplish with 1871 2.0?

Tullman: We were trying to accomplish some things that weren’t part of 1871 initially but which were certainly part of the roadmap. 1871 1.0 was about creating a physical space that assembled a community of startups, incubators, accelerators, universities and venture funds. Now instead of focusing exclusively on building a broad horizontal community, we’re very focused on establishing vertical, domain-specific, clusters as well.

We also wanted to create a space for alumni offices. We didn’t want our success stories leaving, so we built a new area with more identity that would give them the ability to have a distinct place, and yet they could still take advantage of all of the shared resources and opportunities here. We also wanted to make sure our alumni would not incur the costs and the distractions of starting out and worrying about security deposits and furniture because you soon discover that it’s easy to lose sight of their primary mission, which is to keep building their businesses.

The last objective was to bring in out of state venture funds and let them have a presence here in part to meet our companies, and to also act as a launching place for their out of town portfolio companies. Last month we had a dozen companies from Turkey visit for a few weeks; this month we’ll have groups from Israel. So the idea is, if they want to enter the United States global market, 1871 and Chicago are the best jumping off points they can find anywhere.

EL: How has the mission of 1871 evolved since it first launched, and how is the evolution reflected in the design of 1871 2.0?

Tullman: The mission has changed, as I said earlier, because we were initially constructing a community.  In the old days, bragging about how much startups raised was probably appropriate. Today I would say it’s about results. We’re a startup factory, but the factory’s value depends on its output, not its input. What we want is to have people focused on sustainable recurring revenues, real jobs and the creation of companies that are going to last. And so 1871 2.0 is consistent with that up-or-out idea where you’re either growing and expanding and creating a real business or we want you to be doing something else, maybe somewhere else. It’s aspirational—we want people to say, “When I grow larger, I want to have an office over there in 2.0.” That was the intention and part of the design was to make it look not like a frat house or the tech treehouse, but to make it look a little more professional while retaining all the flexibility, the connections, and the fun that we think is always present here.

EL: 1871’s goal from the start was to create jobs, and with the addition of The Bunker, LEAP Innovations and The Good Food Business Accelerator, it’s opening new doors and possibilities for those who don’t always get exposure in the tech industry. Tell us about these initiatives, why they’re important, and what they’ll do for the local economy and the community.

Tullman: I think we have been very successful with job creation. We’ve created around 1500 jobs, our companies have raised about $42 million now and we’ve graduated 70 companies. It’s doing exactly what the Mayor and the Governor asked for and that’s job creation and business creation. Having said that, this year will be very much about new initiatives designed to broaden the scope and broaden the reach of 1871, whether it’s to women or to veterans, or to minorities or to people in certain designated industries.

We’re also focusing heavily on social investing and social entrepreneurship, but there’s no downside or weaker economics associated with the social side of business. Impact Engine, one of our accelerators, is not comprised of non-profit companies; they are for-profit businesses trying to solve important social problems. They’ll have just as much or maybe more economic impact, especially with younger generations who want to buy a product that is connected to a cause or work at a company or get involved with a company that has an intention not to just make money, but to also make a difference. That’s a big part of the 2.0 culture too, because we want to have an impact.

EL: How does cluster development and understanding the assets of a region maximize the value of a large initiative like 1871?

Tullman: I think people didn’t necessarily appreciate that who you bring together and the people you’re building your businesses around (and with) are as important as the physical space. So when we talk about clusters, we talk about lateral learning and lateral learning leads to solutions that work. A lot of value is created in these clusters. It spurs innovation and spurs other people to up their game, and we think that you have to constantly be iterating, constantly be raising the bar, if you really want to create lasting, sustainable value.

EL: 1871 was built on a little of bit of faith. At what point did you and others who helped create this initiative know that it was successful?

Tullman: I don’t think we’re ever successful. We measure progress which is ongoing, not success which is an endpoint, and we’re continuing to progress. This is an arms race; the expectations of customers are always progressive. Miracles today are so-whats six months from now.

I think we knew at the beginning of last year that a change was required, which was roughly when a whole new team came in, and the change was about metrics and accountability and it was about placing a focus on results. And so we’ll know we’re successful when we look back in another three to four years, we’ll have met the Mayor’s objective to have created 10,000 to 20,000 new technology jobs, and many of them will be in The Merchandise Mart. The whole Mart is being transformed from the old Mart of showrooms to the new Mart of technology and there’s probably at least one million square feet here, which are already devoted to technology companies. The good news is The Mart has about 3.5 million square feet of space, so we’ve got some room to expand.

EL: What advice do you give to members at 1871 that would be of interest to our audience?

Tullman: Ultimately talent is great, creativity is great, enthusiasm is great, but hard work and perseverance are what make the difference. We tell them that you can’t be all things to all people, so focus. We also tell them that multi-tasking is a flagrant lie and nobody can be a successful multi-tasker. All you can be doing in that situation is doing a mediocre job at a lot of different things. You have to get your head down, put all of the wood behind one arrowhead, and really focus on what’s important.

The Legacy of Giving

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Since its 2012 inception, Skender Foundation has raised over $500,000, helped more than 50 charitable organizations, thrown four benefits and founded one subcommittee. But there’s one number that matters most: The number of lives changed, both now and in the future.

“Our vision is to perpetuate the legacy of giving. That’s what drives me,” said Cheryl Skender, the foundation’s chair and president.

A 501c3 nonprofit, Skender Foundation donates funds and volunteer hours to groups that support wellness and education. To raise money and attention for organizations, the foundation throws the annual fundraising fete Summer Eclipse, which kicks off this year on July 17. On that night, hundreds gather to connect with one another and rally around a good cause.

While the evening’s event makes a big impact, Skender decided to push it one step further: She founded the Builders’ Board subcommittee to help young members of the Chicago business community get more involved. The subcommittee aims to inspire sustainable change by choosing a charity, and hosting an annual event called Harvesting Hope. This year, Harvesting Hope will be held on October 16 and will highlight Urban Initiatives, a nonprofit organization that runs health, education, and character development programming for kids in the Chicago Public Schools (CPS). Just as importantly, the Builders’ Board participates in forthcoming educational workshops that tackle topics such as fundraising, marketing and networking. According to Skender: “By giving future leaders the right tools, they are going to be capable leaders. They’re going to empower the next generation and change lives.”

For Skender Foundation, change is already underway. Skender recalls a moment she felt the foundation alter lives — including her own. At last year’s Summer Eclipse fundraiser, Skender Foundation invited students to speak about their experiences in the Chicago Scholars program, the recipient of the evening’s proceeds. One discussed growing up in the foster system and petitioning the state to live on his own as a teenager. “I couldn’t believe what I was hearing,” exclaimed Skender, recounting the story. Chicago Scholars, which mentors under-resourced high school students, helped him access the funds needed to go to college and graduate with a degree. “Due to mentoring, he is on the road to success. And after all he’s been through, he’s now giving back — and that resonates with me.”

This year’s Summer Eclipse benefits The Chicago High School for the Arts. Known affectionately as “ChiArts,” the institution receives funding for academic classes from Chicago Public Schools. But the arts programming — which begins after 2 p.m. and runs about three hours — relies solely on contributions from individuals, corporations and foundations.

These funds support every part of the arts classes — high-caliber training often found only in pricey private schools. Because the students enter with varying degrees of skill, ChiArts executive and artistic director José Ochoa joked that the school is run with military-like precision: “Every minute from 8 a.m. to 5 p.m. is accounted for. We say it’s not enough time to give the students what they need. We know we have a lot to teach, and the students have a lot to accomplish.”

The wholehearted dedication, embraced by ChiArts’ diverse body of students, attracted Skender to the cause: “The average student commutes 45 minutes. That’s an average, so many families and students commute for more than an hour — both ways.”

Summer Eclipse benefits individual ChiArts students, covering pointe shoes or a field trip to the Art Institute of Chicago. Students will be present at the evening’s events, performing, playing musical instruments and displaying their artwork. It’s an opportunity for donors to see their gifts in action, but for the students it’s also an opportunity to give thanks. “For a high school kid to understand the gift they’re given and to say thank you, it’s so rewarding,” Ochoa said. Let the cycle of giving continue.

Skender Foundation hosts Summer Eclipse to raise funds and awareness for causes impacting education and wellness. This year’s event helps fund the arts programming at The Chicago High School for the Arts.

Balancing Creativity and Value: United Way of Metropolitan Chicago

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When United Way of Metropolitan Chicago merged with its suburban counterparts a decade ago, the nonprofit human services agency was housed in a West Loop loft building. Its various departments and functions were physically spread out and segregated across three separate floors. That environment wasn’t optimal for an organization that views one of its primary roles as a “community convener.”

Cushman & Wakefield’s J. Frank Franzese and Steven Bauer identified these challenges very early on in the process and worked closely with the board of directors. When the board decided to sell the property and relocate the agency to the 30th floor of the CNA Center, building out a new headquarters from scratch for 100-plus employees was the perfect opportunity to engage strategic design and construction to better reflect and support their mission. “We knew we wanted to change the way we worked as an organization, so there were some features we had to have,” said Joseph Vanyo, the organization’s chief operating officer. “One was that everyone must be on the same floor. We also needed meeting and work space for our agency partners and donors when they visit. And we wanted the design to reflect who we are and the communities we serve, but not in an ostentatious way.”

Those weren’t the only considerations. The budget was tight, and so was the space. The agency was downsizing from nearly 60,000 square feet to 28,000 square feet. Fortunately, large conference space was no longer needed because it was available elsewhere in the CNA Center.

The new headquarters began as a blank square box, with the elevator bank and utilities in the center. The exterior walls are nearly floor-to-ceiling glass, capturing impressive views of the city. From there, the architect designed a floor plan with workstations and small conference areas positioned along the perimeter and glass-fronted executive offices circling the core. The entire floor is filled with natural light.

Architect Michael Berger of Partners by Design explained how the office geometry conserves space while expanding function: Conventional build-outs place offices along outer walls, where their size is defined by window mullions usually set five feet apart. They end up measuring 10 feet or 15 feet on the perimeter side and are rectangular in shape. The United Way offices, unrestricted by mullions, are 13 feet square. The size is conducive for office use or for small gatherings.

“We can place a larger work surface or meeting table there, and get four or five people in the room,” said Berger. “They don’t have to sit across from someone’s desk. By doing that, we were able to cut down on some of the other meeting spaces.”

And employees get the best views, said Vanyo.

The organization’s departments are arranged so that associates with related functions can conveniently interact. The marketing department is near the community building and fundraising departments, and finance is near operations. To further encourage confabs and innovation there are three hub areas, each designed for different work styles: One with comfy lounge seating, one with traditional table seating, and one with high-top counters for those who prefer to stand.

“The open floor concept helps us build collaboration across departments and allows us to more expediently get the information we need to make decisions,” said Vanyo.

The décor, with input from an employee team, is contemporary yet inclusive. The color palette of mostly white furnishings and slate gray carpeting are punctuated with accents of mustard, brown, taupe and turquoise. Environmental graphics in key locations boldly pronounce both the agency’s legacy, and its current work to bring quality programs and services in education, income and health to communities that need them most. In the reception area, for example, a wall of reclaimed wood is engraved with the United Way logo. In the lunch room, another wall is imprinted with the names of the 58 communities the agency serves.

Vanyo credits the project team for understanding the agency’s culture and values, and then translating it into an exceptional space on a lean budget.

“Partners by Design shared the concepts, and Skender helped us get the best price,” he said. “They have a very creative approach. They would say, ‘We can get you a beautiful piece that is scaled down from the original design but still something very professional.’”

Among the cost savings: Creating reception area seating from reclaimed wood was less expensive than buying sofas. Custom millwork was limited to cabinetry for the marketing group and the reception desk; other furnishings were stock purchases.

The three-month project was delivered on time and under budget. All the agency’s goals have been met, said Vanyo.

“We feel a different level of energy and camaraderie that is much more effective in how we work in this space than we ever did before,” he said. “We hear much less about ‘I work in operations’ or ‘I work in marketing.’ Now we hear, ‘I work for United Way.’”

Fast Growth: BigMachines, Inc.

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In a little over a decade, BigMachines, Inc. has grown fast. What began as an internet start-up founded by MIT graduates in 2000 has transformed into a global company that has doubled its business year over year. Headquartered in north suburban Deerfield, BigMachines knew that their current office location was a temporary solution. When it was time to renovate and expand their current 55,000 square foot space, it simply didn’t make sense to go beyond the budget of the interior tenant allowance. But coming up with smart and targeted solutions to create an environment that would attract some of tech’s top talent was still a must.

The company’s growth created some challenges from a cultural and operational standpoint:  It wasn’t uncommon for patchworks of suites and spaces to enlarge as needs arose. They were adequate but not particularly consistent or cohesive. According to Sean Fallon, BigMachines’ chief operations officer and chief financial officer, the renovation offered an opportunity to step back and really think about how space could transform the company’s work environment.

“We wanted a large, open space that would encourage collaboration and innovation among our employees,” said Fallon. “It had to invoke a modern warehouse feeling, like you would expect to see in a leading tech company. We recruit a lot of young engineers and technologists, and we wanted to create a place where they wanted to work.”

But the budget for the job was tight. To make the dollars work, the project team scrutinized the design plan over and over to weigh every cost against every benefit. Many compromises and concessions were made.

The client elected to focus the major portion of the budget on three key areas that most supported its goals: The lobby, the café and employee work areas.

The lobby was critical because it visually introduces visitors to the company’s high-tech, high-energy culture—it had to make a strong impact. To do that, the ceiling was opened to expose wiring and ductwork and the concrete floor was polished to a shine. The primarily black-and-white palette was warmed by occasional punches of color and a wall of wood paneling behind the reception desk.

The new café is spacious and comfy, roomy enough for communal gatherings like the free luncheon provided by the company every Friday. Game tables invite moments of relaxation and camaraderie.

Major demolition was required to make way for clusters of employee workstations. These low-partitioned cube-and-seating arrangements facilitate face-to-face communications while their modular configuration allows for flexible expansion. In addition, huddle areas and a large meeting room enable teams of all sizes to collaborate as needed.

Along the way, the bottom line was a constant reminder for the project team to be efficient and cost-conscious. Every wall that had to be torn down and every foot of concrete that had to be cored was questioned. Each door, light fixture, hardware set and piece of furniture was shopped.

“Skender understood our budget, and that was a big deal,” said Fallon. “They gave me a lot of choices, which helped me make the trade-offs I had to make.”

Some of the much-desired items turned out to be far more expensive than expected. The client’s original vision included open ceilings and polished concrete floors throughout the space. However, neither was a simple matter. Tearing out the existing acoustic ceilings to expose the structure meant removing, re-aligning and re-supporting ductwork, lighting fixtures, sprinkler heads and other infrastructure. And wall-to-wall carpeting was more economical than prepping, staining and finishing the raw concrete floors. After much review, the client opted for an exposed ceiling in the lobby only and for concrete floors in the lobby and café. Faux concrete was also used for decorative accents.

“We looked at everything,” said Fallon. “We tried to be very disciplined about choosing finishes and making changes. We made many trade-offs no one is even aware of, but we did them.”

A few of the trade-offs came at additional cost, like the sidelights that frame doors to the perimeter window offices. The client had eliminated them from the original design to cut cost. After construction began, the realization set in that the interior floor space, where the greatest mass of work stations would be located, would receive insufficient natural light. The sidelights were reincorporated.

Construction took place over a fast-paced 11 weeks. Now settled into its new headquarters, BigMachines is well-poised and well-appointed for continued growth.

“It turned out very well,” said Fallon. “We have an environment that is far more collaborative and consistent, and our employees are much more in touch with each other. We got what we wanted.”

Skilled Labor Shortage: Builders Gear Up for a Changing Workforce

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The Great Recession is fading into the past, and construction is on the upswing. But many industry leaders have found they can’t simply pick up where they left off. An estimated 2 million jobs were lost to the economy, and that’s a tough blow. Even if the jobs come back, many of the best workers are gone forever. Companies must find creative solutions to address the skilled labor shortage, or projects will be delayed and more expensive. The savvy ones are already doing just that.

Tracking the numbers is FMI, one of the leading providers of management consulting, research and investment banking to the engineering and construction industry. According to its “2013 U.S. Construction Industry Talent Development Report,” which surveyed thousands of construction firms nationwide, 53 percent of the respondents said they were facing skilled labor shortages, 27 percent said they were not, and 10 percent said “not applicable.”

Although the severity of skills shortages varies geographically, most engineering and construction sectors are impacted by retiring Baby Boomers, leaving companies to grapple with finding good people to replace leadership roles, says Sabine Hoover, an FMI senior research consultant in Denver.

“In terms of the construction trades, it takes a long time to train workers like pipe fitters, welders and electricians,” she said. “Successful companies have instituted comprehensive career development paths, in-house training programs and are cross-training people to do more than one job. The ones who let people go during the recession and now have to fill key positions are going to be in a real crunch. In the oil and gas sector, for example, many firms are confronted with a chronic shortage of engineers, project managers and skilled tradesmen.”

Tom Villanova, president of the Building and Construction Trades Council in Chicago, differed: “There is no such thing as a skilled labor shortage in the Chicago area. We still have unemployment in our trades. What we have is a skilled labor shortage willing to make $8 an hour.”

He continued: The recession hit hard for three or four years, with some trades reporting up to 50 percent unemployment. People lost their benefits, homes and farms after not working for a couple of years. The U.S. Department of Labor, which controls the number and timing of apprenticeships, closed them off.

“It doesn’t make sense to train people if we don’t have jobs for them,” he said.

Now that the industry is recovering, apprenticeships are opening up, and demand is high. Three years ago, when the council was allowed to offer 300 spots, 4,000 people applied. Applicants represent a cross-section of ages and backgrounds, and many have earned college degrees.

“We’ll have no problem replacing Baby Boomers,” he said. “There is a steady stream of apprentices coming to fill those gaps.”

Villanova envisions a bright future, considering the projects coming down the pike. Among them, Wolf Point and the McCormick Place expansion represent several years of work. “These jobs have longevity,” he said.

At The Hill Group, a Franklin Park-based mechanical contracting firm, the sentiments are mixed. President Jim Hill and Director of Technology Integration David Pikey agree there’s no current shortage. But they are keenly aware the workforce is evolving.

“Our biggest hurdle in the next five years is making sure we have the right people to fill the jobs,” said Hill.

“Many unions are top-heavy at this point,” said Pikey. “That’s not the same as saying there is a shortage, but the demographics are not positive. We’d love for that age distribution to flip toward younger workers.”

Those younger workers are harder to find these days. Parents in recent decades have steered their children toward professions, not trades. Most adolescents and young adults prefer computer work over physical labor. However, that tide could turn as recent college graduates with huge loan debt realize they can’t make the same money in their chosen field as a union plumber.

“It feels like it is changing, we are seeing more apprentices taking the opportunity as a career and not a job,” said Hill.

The demographic challenges are spurring companies to seek myriad innovations that help them perform better with fewer resources. Some have adopted philosophies and processes like Lean Construction, Lean Manufacturing and Integrated Project Delivery, which promote collaboration and time- and cost-efficiencies. Others have turned to labor-saving prefabrication and modular construction to build components as simple as a wall or as complex as a complete mechanical system. Many are harnessing the power of technology, both in-house and on the job site; they are implementing software, hand-held devices, automation, robotics, virtual construction and more as rapidly as new uses and refinements are developed.

Technology not only is readily accepted by the existing workforce, but it also could help attract a younger one, said Pikey.

“One of the things we’ve done here, and what most construction companies are doing, is work hard to use technologies to create efficiencies and safe conditions in the daily process,” he said. Using iPad’s, virtual construction, and other advanced construction technologies on the jobsite creates a more attractive environment.”

In Hill’s view, the recession was an opportunity as much as it was a challenge. “It gave us time to become more efficient internally and stretched our abilities to construct virtually,” he said.  “A down market provides tremendous motivation to be more competitive and keep our people working. We think leveraging technology provides us this ability.”

FMI’s Hoover noted that while much progress is being made, greater steps must be taken to preserve the institutional knowledge of retiring workers and to stimulate younger workers and make them feel valued.

“The labor shortage and recession combined has forced companies to take a fresh look at how they build talent pipelines, develop leadership succession plans and build competency. Industry leaders are integrating their HR objectives with core business functions and tying them directly to strategic goals.”

Community Health Centers: Affordable Care Act Spurs Growth, Centers are up for the Challenge

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As the Affordable Care Act continues to unfold, this landmark legislation is providing millions of Americans with better health and better life quality.

It also is changing the delivery of health care and, in turn, the design and construction of health care facilities. A growing movement is replacing the traditional model of testing, diagnosing and treating the (sometimes advanced) ailments and diseases of patients with a holistic continuum of care that focuses on keeping people well in the first place.

This new focus has led to the rapid growth of community health centers such as those of the Chicago-based Erie Family Health Center. The nonprofit agency, founded in 1957, provides comprehensive primary medical, dental and behavioral health services to underserved communities in the city and suburbs. It has grown to 12 centers, with two more—one in Waukegan and one in Mundelein—under construction. At Erie, no one is turned away because of inability to pay.

“The biggest impact ACA has on us—and we are thrilled about it—is we believe more of our patients will become insured, and more patients will be seeking primary care,” said Amy Valukas, Erie’s vice president of planning and programs. “We very much want to be there to serve them.”

The most recent addition to the agency’s portfolio, which opened in November 2013, is the Erie Evanston/Skokie Health Center, a cheery, light-filled 16,000-square-foot facility transformed from a circa 1940s manufacturing plant. Key areas include a collaborative care-team center, clinical spaces, dental suite and an education center with a demonstration kitchen.

“ACA and health care reform, which are driving more individuals to be insured, are going to create the necessity for a greater number of centers to provide primary care and other ancillary support services,” said architect Casey Frankiewicz, principal and director of health care practice at Chicago-based Legat Architects. “This is a very exciting time to be working in health care.”

Meeting those comprehensive community needs requires thoughtful planning that is also sensitive to construction budget restraints, said Valukas.

“Of course, everyone wants to be good stewards of their money, and we do too,” she said. “We want to make sure we best use every inch of space we have and maximize every dollar we get. The fact that some of our patients may be uninsured does not mean they deserve to be seen in anything less than a high-quality facility, just like anyone else.”

The first step is finding the optimal location, which varies from community to community. Centers must be conveniently located, which generally means easy access to public transportation. They also must have adequate infrastructure to support the clinical needs of the center. Quite often, because of the lack of vacant land for new construction, existing buildings will have to be gutted and retrofitted.

“Every location is unique to the search,” said Bill Conopeotis, president and founder of ConopCo Project Management in Hoffman Estates. “Older buildings are clearly more challenging, but it’s a matter of what real estate you can find in that market, whether you can buy or lease, and what will be the best fit for Erie.”

Repurposing an existing building often meshes well with a center’s desire to be a vital community partner. For example, the Waukegan facility is a former bank, and architects have incorporated some of its more prominent architectural features into the new design.

“We try to capture the personality of the community,” said Frankiewicz.

“Existing buildings may not all be architectural gems, but they are landmarks in the community,” said architect Alan Bombick, a Legat principal and director of corporate/commercial practice. “When those things disappear, it becomes disruptive. When they take on new life, it strengthens what is already there.”

The interior environment replicates sentiments of integration and more, said Sylvia Kowalk, Legat’s director of interior design. In Evanston, where the community demographic is diverse, the color palette is bright and joyous—swaths of purple and flashes of turquoise against a ground of white and tan. An attractive children’s play area is stationed near the waiting room, and patient rooms are oversized to seat accompanying family members. The ambience more closely resembles a fine hotel rather than a hospital.

Near the front entrance is the education center equipped with a demonstration kitchen, a feature that presents opportunities for community outreach. The center hosts a calendar of wellness programs, events, such as new baby care and food preparation for a diabetic diet. It also invites local groups to use the space for their activities.

“Lifestyle is a huge driver for many of the health issues that impact patients,” said Valukas. “For us to be able to work with them in culturally relevant ways like learning how to cook their favorite dishes in a healthier way is a great benefit.”

Subtle design elements facilitate improved patient care as well as health care reform measures. And technology—in the forms of electronic record-keeping, laptop computers and wireless connectivity—plays a huge role while conserving space. Care-team centers keep staff and providers located closely together, where they can easily collaborate on patient care. Their work stations are separated by low walls or glass partitions, so they can stay tuned to their surroundings and maintain a degree of privacy. Sensitive conversations are held at strategically placed consultation rooms. Members of the care team move between patient rooms rather than requiring the patients to traverse, and they carry their laptops with them. Patient rooms are laid out so providers can make chart notations while maintaining eye contact, not while facing a wall. Numerous touch-down areas allow them to comfortably stop and make notations or look up information while either standing or sitting.

“The design is easier on the patients and is more caring for them,” said Kowalk. “It enhances the healing experience.”

“We are designing facilities for what we believe is going to be our new delivery model,” said Valukas. “It is about integrated team care, and making sure that comprehensive teams are working in a coordinated and seamless way to keep patients healthy and out of the hospital.”

Keeping it in Full Swing: Albion at Loyola Station

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For Loyola University Chicago, creating a community reaches beyond the immediate campus. The faith-based institution has supported its Rogers Park neighborhood with the development of new luxury rental housing, retail spaces and a parking garage. The most recent endeavor is Albion at Loyola Station, a 29-unit, market rate apartment complex that opened last May.

“Loyola believes that campus and community are joined together, and we are investing capital dollars in our vision of a safe, secure neighborhood for everyone,” said Peter Schlecht, senior project manager at LUC.

The handsome three-story brick apartment buildings today anchor Albion Avenue near the CTA Red Line’s Loyola station. They reveal no hint of the myriad challenges this location presented: an irregularly-shaped site, elevated rail tracks and utility poles along boundary lines, and unsuitable soils.

The compact triangular lot had been used for decades for overflow parking. To maximize the space, the architect designed the 43,000-square-foot Albion at Loyola Station as five side-by-side buildings. They are configured with six units per building for a total of 28 two-bedroom apartments and one four-bedroom apartment plus a mechanical room. Parking spaces are tucked behind the buildings.

It’s a tight fit. The rear boundary is angled and abuts a one-story concrete retaining wall that supports CTA elevated train tracks. The apartment buildings are sandwiched between tracks on the west and ComEd utility poles on the east, with just a five-foot clearance on each side. Neither the tracks nor the poles could be moved. It was up to the project team to work around them.

ComEd and CTA were brought on board during the pre-construction phase. The project team wanted to share its plans and incorporate the other stakeholders’ concerns and recommendations. Doing so from the start would save backtracking later.

Safety, for example, was a serious issue for CTA. The tracks were very close to some apartment balconies. To help mitigate safety concerns, Skender erected plywood sheeting to shield the construction from the view—and reach—of train passengers and passersby. The contractor also lowered the hydraulic scaffolding at the end of each workday. Another CTA concern was how vibrations caused during excavation and construction might impact the tracks and retaining wall. The agency was able to review and approve the development program for reassurance.

Over on the east side, ComEd agreed to re-locate some of the switches on its utility poles and re-string power lines to provide greater clearance for the crews. Even so, the project team had to change the way they constructed the outer walls in that area. Traditionally, they would complete the inner block layer and then the outer brick layer while working outside the structure. Because they were cramped for space, they built both layers simultaneously, one row at a time, from inside the structure, using a method called overhand brick-laying. The architect also made a small design modification to a cornice to shorten it.

But before the construction could start, the site had to be excavated. That’s when crews discovered remnants and remains of buildings and businesses that once stood there. The buildings were long gone, but the foundations had been left in place and buried, a common practice at the time. They had to be removed. In addition, the chemical waste left behind by a former automotive garage had contaminated the soil, which required remediation to meet environmental standards.

These issues and more were resolved through proactive planning and involving subcontractors early and throughout the process. Lean Construction practices guided the process and accelerated the project schedule. When the unforeseen surprises emerged, overtime charges were avoided by engaging the entire project team —including subcontractors and suppliers —to make adjustments to the plan and re-sequence the project. The project was finished three weeks ahead of time at no additional cost. Crews worked only one Saturday, and that was because of inclement weather.

Schlecht, who had not previously worked with Lean, is more than pleased with how the process works and the outcome.

“It was a huge advantage,” he said. “They had the whole project planned out ahead of time as opposed to reacting to situations. The schedule was detailed and results-oriented, day by day and item by item. There was always a cause and effect. If we got pushed out of one thing, there were always other things we could do to get back on schedule.”

Elevating the Industry: Google

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What’s it take to build a great culture? Some tout buzzwords in an effort to build culture, others try to meticulously design it from the top-down. One thing is clear: For those searching for that sustainable one-up over the competition, culture is becoming a critical part of the conversation.

If companies take a lesson from Google, a large part of culture starts with empowering project teams. Employees don’t think about improvement in 10 percent increments, they think about how they can take it to a completely different level. Many project initiatives are created by employees themselves because they have a generous amount of autonomy over how they work and use their time. To those Googlers, projects are not about building new code; they’re about solving really big problems using technology.

Jim Laumann, Google’s director of real estate, design and construction, has seen the company grow from 2,000 to nearly 50,000 employees in his almost 10 year career there. As a person who has played a major role in establishing a sense of place across the globe, he expresses that culture is really where vision, values, people and place collide. It’s a place where employees are expected to act as creators, promoters and keepers of the culture.

That’s only one part of the formula. Laumann describes Google as an open culture, one similar to start-ups, in which smart, curious people are constantly interacting, trading ideas and opinions on the matter at hand. This culture strikes a balance between work and life. People are empowered to have the courage to try new things. Failure is not perceived as bad, it’s viewed as a part of the process.

“I think culture is a fiber that holds a company together and gives people a sense of belonging. Larry Page, our CEO and co-founder, always felt Google was like a family. When we approach creating environments, we try to create that feeling of family, that feeling of place—almost home—that people have,” said Laumann.

So forget the cliché conference room. Employees meet up on a rooftop deck, a pub-inspired lounge or a comfy, enclosed egg-like structure. Every office or “campus” celebrates the flavor of the local community and culture. And every Googler is welcome to meals in cafes that double up as a place to collaborate and create the next big idea.

According to Laumann, it’s important to provide opportunities for spontaneous interaction and encourage people to explore the campus for all it has to offer.

“Our real estate group combines the principles of creating an experience while we promote health and well being, and sustainability within each campus.  And what Google strives for in every functional environment is finding the most creative and efficient way to optimize performance and organizational behavior,” he said.

As the company’s Chicago office prepares to make a move to 1KFulton in Chicago’s Fulton Market district in late 2015, Laumann is looking forward to what’s next for the company, the Chicago tech community and their newest campus.

“What’s interesting about Chicago is we’re seeing so many startups, and so much has happened at the Merchandise Mart with Motorola Mobility and 1871. I think this environment is going to provide tech companies with a good canvas to grow and really succeed in Chicago. With Google moving to 1KFulton, we’re going to have the opportunity to look at what the future of the workplace really looks like and start to bring more and more technology into the workplace,” he said.

What’s in store for Google’s new Chicago campus is still very much in the works, but one thing’s for certain: Culture will be front-and-center.

“I think success in any endeavor increasingly depends on innovation and collaboration. The marketplace is so competitive, and companies are competing for that advantage and skilled talent that can really take things to the next level. If companies want to compete, they must make the choice to create an infrastructure that provides people with a sense of ownership and freedom to shape their role. Physical space has the power to effectively encourage interaction, shared experience and community.”

Elevating the Industry: Andy Gloor

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For anyone who works in commercial real estate, it’s no secret the neighborhood known for its meat packers and industrial chic is about to boom. Google and bicycle manufacturer SRAM are gearing up to call the area known as Fulton Market home. Others are following suit, making this location one of the most actively evolving sectors in the downtown Chicago market.

As more tenants head west to take advantage of its commercial and residential offerings —what challenges are ahead for the neighborhood that’s used to flying under the radar? Andy Gloor, managing principal of Sterling Bay Companies explains.

EL: Why is the Fulton Market area becoming an attractive option for commercial real estate?

AG: I think people are attracted to its authenticity. Personally, the buildings remind me of Chelsea Market in New York City’s Meatpacking District. The neighborhood is kind of messy but it’s genuine and pedestrian-friendly. A lot of tenants are looking for large floor plates and the neighborhood offers a very unique building stock. It’s close to the Loop, but its real allure is the residential amenities. People can live in this neighborhood and when they leave work, they can walk to great local restaurants. There’s something less sterile about this neighborhood and I think people are realizing that more options are available.

EL: Why did it take so long to catch on?  

A few years ago, many didn’t know this neighborhood existed, or they recognized it as a dining destination.  Any urban area that is primed for office space needs public transportation and this area’s lack of transportation was holding it back. When the city completed the new Morgan Street Green/Pink Line Station, it stimulated interest and really accelerated growth. The restaurants have been here and now developers are working to fill in the gaps with office, retail and hotels.

EL: Is there a particular demographic or type of company that is drawn to this area? 

I think the simplistic answer would be that Millennials and tech firms will dominate this area, but the ability to mix commercial with residential amenities is very attractive to a range of companies. Law firms are considering this area. My father’s generation thought you had to stay in the Loop, but today’s decision makers and my peers look at it differently—even traditional companies who would normally stay downtown are considering locations they would not have considered ten years ago.

EL: One of the more high-profile projects in the area is 1KFulton. What possessed you to purchase a building that was formerly a cold storage facility?

Honestly, we tried buying this building for five years. I liked it—it had unobstructed views of the city.  I always thought it had the potential to be a cool office building where people could work where they live and hang out in their own neighborhood. It doesn’t appeal to everyone but companies like Google really get it and they’ve made similar moves in New York and San Francisco. The co-founder of SRAM lives a few blocks away, so he understood the appeal right away.

EL: What kinds of amenities are going to attract tenants to this area?

Again, transportation is huge. The new El station is a block away, and a handful of DIVVY stations are within a few blocks as well. 1KFulton is going to offer shuttle service to and from Union Station and Ogilvie. We’re seeing less emphasis on parking and we’re focusing on bike storage. Our storage area will hold up to 1,000 bikes on any given day. Many end-users will choose to ride their bikes year round—even in the winter months. Employees want to bring their pets to work. This was a huge point for Google, so we’re creating a pet-friendly environment. Outdoor space and easy access to restaurants and retail are other amenities that we’ll offer. Our retail and restaurant choices will be unique and local—that’s what will fit in with the neighborhood and our clientele.

EL: Speaking of unique – how is this neighborhood going to keep its edge and develop into a major business hub over the next few years?

I think a lot of people are comparing this neighborhood to what River North was ten years ago. It’s a little true in the sense that there will be more hotels and retail – but this area definitely has its own character. It’s transitioning from manufacturing to commercial. I think some of the manufacturers and meat packers will still call this area home, and that will help retain its original appeal. All of the restaurateurs love that locals hang out here, but I’m not sure how anyone will stop all of the momentum. In the end, I think it will be an authentic and really convenient place for people to live, work and play.

EL: Obviously adaptive reuse projects such as 400 South Jefferson and 1KFulton are very challenging. Is it a personal passion?

Absolutely. There are always surprises. Considering 1KFulton was frozen, we didn’t know what we were buying and we really didn’t know what kinds of unforeseen conditions we’d run into when we started construction. But we focus on modernizing buildings and we concentrate on the architectural details that just don’t exist in new buildings. We like to remember what was there and represent it as opposed to changing it, whitewashing it and sanitizing it.

Sterling Bay Companies is a Chicago-based real estate investment and development company with expertise in the acquisition, financing, leasing, and management of commercial property across a broad spectrum of asset size and type. Founded in 1986, Sterling Bay focuses exclusively on commercial real estate investment and development.