Sunday, May 29, 2022 May 29, 2022
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CRE Opinion

Kicking off a Real Estate Project Post-Pandemic

Extended lead times, permit delays, labor shortages, and elevated material and labor costs are just a few things to consider, according to Cushman & Wakefield's April Desabrais.
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Workers on a construction site.
Workers on a construction site. McCarthy Building

We have all been guilty of jumping into a project, either at work or home, without having a complete well-thought-out plan. Too often we are so enthusiastic to get started that we begin the process without strategizing the best approach or developing an overall game plan.  We all know from experience this inevitably costs more time and money down the road.

Commercial construction projects continue to pop up across DFW as we come out of the pandemic. For real estate brokers, project and property managers, consultants, and contractors this all comes with excitement until reality hits that our network of professionals must mitigate multiple issues to meet rigorous timelines and unrealistic budgets. Some of these issues include extended lead times, permit delays through the local jurisdictions, labor shortages, and elevated material and labor costs. According to the Bureau of Labor Statistics’ Consumer Price Index, the all items less food and energy index increased by 6.4% for the 12-month period ending in February 2022.

As owners and tenants consider options for their next office spaces, I recommend kicking your project off with an educated construction market approach through some of the exercises below. These items can all be completed concurrently while building tours and lease negotiations are in process.

  • Establish common goals for the space among your leadership team. Don’t forget to consider sustainability, flex work environment, and talent retention.
  • Develop a preliminary project budget that encompasses all project costs for your relocation. You will be shocked at how it compares to your previous move!
  • Local jurisdictions continue to be a huge impact to project schedules through the permitting process.  In the past we could use expedited methods to shorten this task and gain time in the schedule.  Unfortunately, their teams are inundated with higher-than-normal volumes of plans and labor shortages.  We have seen upwards of 8-9 weeks for some local jurisdictions.
  • Develop a preliminary project schedule with the help of an industry professional.  Labor and material shortages are not expected to recover anytime soon and must be planned for accordingly. 

Whether your company is considering down-sizing, stay-in-place, or relocation, it is important to start building your comprehensive project plan early to avoid delays and cost overruns.  Time is money and considering today’s current economic climate of labor, material, and general supply chain issues, it is essential to seek advice from a professional and develop a strategic plan immediately. 

April Desabrais is a senior project manager and director for Cushman & Wakefield.

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