Financial advisors

Financial advisors

Trump International Hotel and Tower (Chicago)

May 23, 2006

September 14, 2007 (3 months before completion)

Construction projects can suffer from preventable financial problems.Underbids happen when builders ask for too little money to complete the project. Cash flow problems exist when the present amount of funding cannot cover the current costs for labour and materials, and because they are a matter of having sufficient funds at a specific time, can arise even when the overall total is enough. Fraud is a problem in many fields, but is notoriously prevalent in the construction field.^[21] Financial planning for the project is intended to ensure that a solid plan with adequate safeguards and contingency plans are in place before the project is started and is required to ensure that the plan is properly executed over the life of the project.

Mortgage bankers, accountants, and cost engineers are likely participants in creating an overall plan for the financial management of the building construction project. The presence of the mortgage banker is highly likely, even in relatively small projects since the owner's equity in the property is the most obvious source of funding for a building project. Accountants act to study the expected monetary flow over the life of the project and to monitor the payouts throughout the process. Cost engineers and estimators apply expertise to relate the work and materials involved to a proper valuation. Cost overruns with government projects have occurred when the contractor identified change orders or project changes that increased costs, which are not subject to competition from other firms as they have already been eliminated from consideration after the initial bid.^[22]

Large projects can involve highly complex financial plans and often start with a conceptual estimate performed by a building estimator. As portions of a project are completed, they may be sold, supplanting one lender or owner for another, while the logistical requirements of having the right trades and materials available for each stage of the building construction project carries forward. In many English-speaking countries, but not the United States, projects typically use quantity surveyors.

Construction processes

Construction processes

Design team

Shasta Dam under construction in June 1942

In the modern industrialized world, construction usually involves the translation of designs into reality. A formal design team may be assembled to plan the physical proceedings, and to integrate those proceedings with the other parts. The design usually consists of drawings and specifications, usually prepared by a design team including Architect, civil engineers, mechanical engineers,electrical engineers, structural engineers, fire protection engineers, planningconsultants, architectural consultants, and archaeological consultants. The design team is most commonly employed by (i.e. in contract with) the property owner. Under this system, once the design is completed by the design team, a number of construction companies or construction management companies may then be asked to make a bid for the work, either based directly on the design, or on the basis of drawings and a bill of quantities provided by aquantity surveyor. Following evaluation of bids, the owner typically awards a contract to the most cost efficient bidder.

the best modern trend in design is toward integration of previously separated specialties, especially among large firms. In the past, architects, interior designers, engineers, developers, construction managers, and general contractors were more likely to be entirely separate companies, even in the larger firms. Presently, a firm that is nominally an "architecture" or "construction management" firm may have experts from all related fields as employees, or to have an associated company that provides each necessary skill. Thus, each such firm may offer itself as "one-stop shopping" for a construction project, from beginning to end. This is designated as a "design build" contract where the contractor is given a performance specification and must undertake the project from design to construction, while adhering to the performance specifications.

Several project structures can assist the owner in this integration, including design-build, partnering and construction management. In general, each of these project structures allows the owner to integrate the services of architects, interior designers, engineers and constructors throughout design and construction. In response, many companies are growing beyond traditional offerings of design or construction services alone and are placing more emphasis on establishing relationships with other necessary participants through the design-build process.

The increasing complexity of construction projects creates the need for design professionals trained in all phases of the project's life-cycle and develop an appreciation of the building as an advanced technological system requiring close integration of many sub-systems and their individual components, including sustainability. Building engineering is an emerging discipline that attempts to meet this new challenge.

Residential construction

Residential construction

The most popular method of residential construction in North America is wood-framed construction. Typical construction steps for a single-family or small multi-family house are:

• Develop floor plans and obtain a materials list for estimations (more recently performed with estimating software)
• Obtain government building approval if necessary
• Clear the building site
• Survey to stake out for the foundation
• Excavate the foundation and dig footers.
• Pour a foundation and footers with concrete
• Build the main load-bearing structure out of thick pieces of wood and possibly metal I-beams for large spans with few supports. See framing (construction)
• Add floor and ceiling joists and install subfloor panels
• Cover outer walls and roof in OSB or plywood and a water-resistive barrier.
• Install roof shingles or other covering for flat roof
• Cover the walls with siding, typically vinyl, wood, or brick veneer but possibly stone or other materials
• Install windows

Framing

• Frame interior walls with wooden 2x4s
• Add internal plumbing, HVAC, electrical, and natural gas utilities
• Building inspector visits if necessary to approve utilities and framing
• Install insulation and interior drywall panels (cementboard for wet areas) and to complete walls and ceilings
• Install bathroom fixtures
• Spackle, prime, and paint interior walls and ceilings
• Additional tiling on top of cementboard for wet areas, such as the bathroom and kitchen backsplash
• Install final floor covering, such as floor tile, carpet, or wood flooring
• Install major appliances
• Unless the original owners are building the house, at this point it is typically sold or rented.

New construction techniques and sustainability

As efficiency codes have come into effect in recent years, new construction technologies and methods have emerged. University Construction Management departments are on the cutting edge of the newest methods of construction intended to improve efficiency, performance and reduce construction waste.

New techniques of building construction are being researched, made possible by advances in 3D printing technology. In a form of additive building construction, similar to theadditive manufacturing techniques for manufactured parts, building printing is making it possible to flexibly construct small commercial buildings and private habitations in around 20 hours, with built-in plumbing and electrical facilities, in one continuous build, using large 3D printers.^[12] Working versions of 3D-printing building technology are already printing 2 metres (6 ft 7 in) of building material per hour as of January 2013, with the next-generation printers capable of 3.5 metres (11 ft) per hour, sufficient to complete a building in a week.^[13] Dutch architect Janjaap Ruijssenaars's performative architecture 3D-printed building is scheduled to be built in 2014.

In the current trend of sustainable construction, the recent movements of New Urbanism and New Classical Architecture promote a sustainable approach towards construction, that appreciates and develops smart growth, architectural tradition and classical design.^[15][16] This is in contrast to modernist and short-lived globally uniform architecture, as well as opposing solitary housing estates and suburban sprawl.^[17] Both trends started in the 1980s.

The construction site may be shut down due to bad weather. Erecting scaffolded tents over the site may reduce the number of lost work days, increasing productivity.

Building construction

Building construction

Building construction is the process of adding structure to real property or construction of buildings. The majority of building construction jobs are small renovations, such as addition of a room, or renovation of a bathroom. Often, the owner of the property acts as laborer, paymaster, and design team for the entire project. Although building construction projects typically include various common elements, such as design, financial, estimating and legal considerations, many projects of varying sizes reach undesirable end results, such as structural collapse, cost overruns, and/or litigation. For this reason, those with experience in the field make detailed plans and maintain careful oversight during the project to ensure a positive outcome.

Commercial building construction is procured privately or publicly utilizing various delivery methodologies, including cost estimating, hard bid, negotiated price, traditional, management contracting, construction management-at-risk, design & build and design-build bridging.

Residential construction practices, technologies, and resources must conform to local building authority regulations and codes of practice. Materials readily available in the area generally dictate the construction materials used (e.g. brick versus stone, versus timber). Cost of construction on a per square meter (or per square foot) basis for houses can vary dramatically based on site conditions, local regulations, economies of scale (custom designed homes are often more expensive to build) and the availability of skilled tradespeople. As residential construction (as well as all other types of construction) can generate a lot of waste, careful planning again is needed here.

Construction

Construction is the process of constructing a building or infrastructure. Construction differs from manufacturing in that manufacturing typically involves mass production of similar items without a designated purchaser, while construction typically takes place on location for a known client. Construction as an industry comprises six to nine percent of the gross domestic product ofdeveloped countries.Construction starts with planning,^{[citation needed]} design, and financing; and continues until the project is built and ready for use.

Large-scale construction requires collaboration across multiple disciplines. An architect normally manages the job, and a construction manager, design engineer, construction engineer or project manager supervises it. For the successful execution of a project, effective planning is essential. Those involved with the design and execution of the infrastructure in question must consider zoning requirements, the environmental impact of the job, the successful scheduling, budgeting, construction-site safety, availability and transportation of building materials, logistics, inconvenience to the public caused by construction delays and bidding, etc. The largest construction projects are referred to as megaprojects.

Types of construction

In general, there are three sectors of construction: buildings, infrastructure and industrial.Building construction is usually further divided into residential and non-residential (commercial/institutional). Infrastructure is often called heavy/highway, heavy civil or heavy engineering. It includes large public works, dams, bridges, highways, water/wastewater and utility distribution. Industrial includes refineries, process chemical, power generation, mills and manufacturing plants. There are other ways to break the industry into sectors or markets.

Engineering News-Record (ENR) is a trade magazine for the construction industry. Each year, ENR compiles and reports on data about the size of design and construction companies. They publish a list of the largest companies in the United States (Top-40) and also a list the largest global firms (Top-250, by amount of work they are doing outside their home country). In 2014, ENR compiled the data in nine market segments. It was divided as transportation, petroleum, buildings, power, industrial, water, manufacturing, sewer/waste, telecom, hazardous waste plus a tenth category for other projects.In their reporting on the Top 400, they used data on transportation, sewer, hazardous waste and water to rank firms as heavy contractors.

The Standard Industrial Classification and the newer North American Industry Classification System have a classification system for companies that perform or otherwise engage in construction. To recognize the differences of companies in this sector, it is divided into three subsectors: building construction, heavy and civil engineering construction, and specialty trade contractors. There are also categories for construction service firms (e.g., engineering, architecture) and construction managers (firms engaged in managing construction projects without assuming direct financial responsibility for completion of the construction project).