General construction industry news, rants, questions

[BigHorn'13 3340]

46 minutes ago, troph said:

You still looking ?  I described our steel problems in the build thread. We sourced our metal tray from Houston. Don’t recall where the beams came from but with design rework and sourcing vendors we saved over 60% (she used her crews to install for part of that savings) maybe more on a complex steel job. 

Thanks but I'm talking wholesale and several thousand pounds

[washparkhorn 9894]

Aluminum spiking after Guinea coup. Supply chain issues on the horizon.

[deadshank 24644]

17 hours ago, troph said:

My gf is stressed to the hilt. From cost increases to delays, we are looking for her exit in the next 2-3 years. She’s burned out. Stressed out, just not ok levels of stress.  The only good part is the impact on net worth and her ability to consider an early exit.
 

Plumbers and electricians are the worst vendors right now.   Costs are insane and every day it’s a new supply chain crisis. Not a great time to be a builder tbqh.  She heard hardie is back ordered til Jan 1. Appliances are a disaster. She’s got all of hers ordered way in advance or already in her possession. Windows are 16 weeks out. Steel is up, ACs who knows what else. 
 

Finishing up an 04 project that will sell for almost 2x what her last project on the same street sold for less than 4 years ago.  LT project is in design now but we are in no rush to start until next year.  The rest are customs and they are dicey for the same reasons. 
 

Still it’s not worth it even with increases in sales prices and values.
 

Everything you said is true and we are feeling it in Houston.   We have 8 new build or remodel projects going right now with 2 more starts in 30 days.  
 

Supply chain issues are a disaster. Labor is a disaster.  Fortunately, owners have been reasonable and understand.  Their patience has been a blessing.  

[Onboard 2.0 9083]

18 minutes ago, deadshank said:

Everything you said is true and we are feeling it in Houston.   We have 8 new build or remodel projects going right now with 2 more starts in 30 days.  
 

Supply chain issues are a disaster. Labor is a disaster.  Fortunately, owners have been reasonable and understand.  Their patience has been a blessing.  

Yeah, I think its the same everywhere. I'm not seeing price increases for labor like for materials, but appliances are months, and months out. Windows that typically take 4 weeks are 16-20 weeks.  

AND yet, I'm still getting calls for new work, new houses (3) in the last 45 days, and I'm designing 7-10 additions, and renovations projects.  May even be working with a Surly member on one.

[deadshank 24644]

4 hours ago, washparkhorn said:

Aluminum spiking after Guinea coup. Supply chain issues on the horizon.

On your marks….

[washparkhorn 9894]

[Assman 1830]

I might as well just give up on trying to build this house.

[troph 23963]

8 hours ago, Assman said:

I might as well just give up on trying to build this house.

We are trying not to break up over the build of ours.

[Incredulity 11141]

3 hours ago, troph said:

We are trying not to break up over the build of ours.

A tale as old as time...

[deadshank 24644]

19 hours ago, Assman said:

I might as well just give up on trying to build this house.

Where are you building?  What stage are you in?

[Onboard 2.0 9083]

32 minutes ago, deadshank said:

Where are you building?  What stage are you in?

The rage stage apparently.

[troph 23963]

9 hours ago, Incredulity said:

A tale as old as time...

tie between fuck around and find out and laugh uncontrollably.  I chose the former because it has the word "fuck" in it.

[troph 23963]

48 minutes ago, Onboard 2.0 said:

The rage stage apparently.

that's a damn good one.

[Assman 1830]

2 hours ago, deadshank said:

Where are you building?  What stage are you in?

DFW burbs.  We're completely done with the plans and selections.  Just waiting to pull the trigger.  Our plan was to break ground in summer 2020, but put it on hold due to Covid.  Then our plan was to break ground in late summer 2021, but construction costs put that on hold.  Our build has gone up $400K from March 2020 to today.

[deadshank 24644]

9 hours ago, Assman said:

DFW burbs.  We're completely done with the plans and selections.  Just waiting to pull the trigger.  Our plan was to break ground in summer 2020, but put it on hold due to Covid.  Then our plan was to break ground in late summer 2021, but construction costs put that on hold.  Our build has gone up $400K from March 2020 to today.

Your builder has submitted to you a new schedule of values with a job item description and a corresponding monetary value each time?   Hard price and allowance items clearly separated?   Fixed price or cost plus contract?

I’m not saying prices have gone upward that much.  I’m asking to make sure there is no manipulation going on that could benefit your builder. 
 

 

[Onboard 2.0 9083]

12 minutes ago, deadshank said:

Your builder has submitted to you a new schedule of values with a job item description and a corresponding monetary value each time?   Hard price and allowance items clearly separated?   Fixed price or cost plus contract?

I’m not saying prices have gone upward that much.  I’m asking to make sure there is no manipulation going on that could benefit your builder. 
 

 

That increase seems awfully damned high to me.  I'd also not even proceed with that project unless I had money to burn. Prices will come back down if you can wait.  The opt save g grace right now is cheap money.  Does the interest savings offset the cost increases ?

[deadshank 24644]

1 minute ago, Onboard 2.0 said:

That increase seems awfully damned high to me.  I'd also not even proceed with that project unless I had money to burn. Prices will come back down if you can wait.  The opt save g grace right now is cheap money.  Does the interest savings offset the cost increases ?

Agreed on the cheap money offset.  That is the oxygen for the fire  

The $400K increase may not be all increases in materials and labor. It may be less but then the OH&P, BR insurance and GL insurance load is tacked on and telegraphing a much larger number.   
 

Also, he could be building a really big and very nice house and $400K is not that much money in relative terms.  
 

Who knows?

[Onboard 2.0 9083]

7 minutes ago, deadshank said:

Agreed on the cheap money offset.  That is the oxygen for the fire  

The $400K increase may not be all increases in materials and labor. It may be less but then the OH&P, BR insurance and GL insurance load is tacked on and telegraphing a much larger number.   
 

Also, he could be building a really big and very nice house and $400K is not that much money in relative terms.  
 

Who knows?

Yeah, all good points.  Shit I wanna build a house that's now about $600K all in land included.  1,800-2,000 sq. ft.  That house was about $500k based on what I wanted to do a year ago.

[deadshank 24644]

1 minute ago, Onboard 2.0 said:

Yeah, all good points.  Shit I wanna build a house that's now about $600K all in land included.  1,800-2,000 sq. ft.  That house was about $500k based on what I wanted to do a year ago.

Cheap land!!

[Onboard 2.0 9083]

6 minutes ago, deadshank said:

Cheap land!!

Yeah it is.  Sweetheart deal with a contractor I design lots of homes for. It's a small, wooded lot with lots of fall on a creek, w/ 2 RPA areas to deal with.  One of those lots most people look at and don't know what to do with, but it's on a secluded cul de sac you'd never know was there, and you can be Downtown in about 5 minutes without traffic.

[TXSG8R 3325]

I started a LV business 3 years ago, RNC but starting to do some small CNC. I think we have been impacted the worst wrt supply side because just about everything we use has a chip in it. First wave the big issue was manufacturing and logistics. Now it’s chips and still logistics. We go through 6+ month waits for items like AVRs through some of the biggest distributors.  What little supply that is making it into the country is being fed to retail, but even that is drying up with the chip constraints. 

I talked to some vendors at an expo a couple of weeks ago and they told me that they used to pay $3k per shipping container out of China. That price is now $25k, and doesn’t include the price hikes/delays at the port, and on trucks to ferry stuff to the warehouse, etc. All of our vendors have given us a 7-10% price increase.

One thing we didn’t see until last month were the material increase impacts to customers.  We had a customer back out of a $20k job because his lumber prices went up $60k, pool went up $35k, metal went up $40k, yada yada.

This market is 75% VA loans and most of these guys don’t go into a house with any real savings since they can get a million dollar loan and move in for a dollar. Most have a military retirement check, disability check (and a lot are 100% disabled so zero taxes), and most have a third income/retirement/pension. Guys base their build around what they can afford monthly and have very little wiggle room for changes because they have little in savings. This is the first house to get to trim out that ate this big materials increase, so I expect a few more customers to pull way back on LV hardware for houses we prewired this spring. 

[Fudge Nuggets 18825]

On 9/5/2021 at 1:34 PM, troph said:

Finishing up an 04 project that will sell for almost 2x what her last project on the same street sold for less than 4 years ago.

If it takes her 17 years to finish a project then supply chain issues may not be the biggest problem.

[troph 23963]

2 hours ago, Fudge Nuggets said:

If it takes her 17 years to finish a project then supply chain issues may not be the biggest problem.

huh? I didn't say it took her 4 years, she's been playing on the same street the last few years.

[deadshank 24644]

37 minutes ago, troph said:

huh? I didn't say it took her 4 years, she's been playing on the same street the last few years.

"Finishing up an 04 project"

Seems like the project started in 04 hence the comment.  That' what I though, too.  

Liquidated damages be damned!!!!

[troph 23963]

3 hours ago, deadshank said:

"Finishing up an 04 project"

Seems like the project started in 04 hence the comment.  That' what I though, too.  

Liquidated damages be damned!!!!

Ahhhhh. 78704 zip code sorry for the Austin slang. 

[deadshank 24644]

Just now, troph said:

Ahhhhh. 78704 zip code sorry for the Austin slang. 

You Austin cool kids are so….cool

 

[troph 23963]

6 minutes ago, deadshank said:

You Austin cool kids are so….cool

 

waited my whole life to be a cool kid.

[BottleRocket 635]

I work on the GC side and all I know for sure is than any and all material and manpower issues are being blamed on COVID/supply chain.

No show sub? Crew got the COVID.
No concrete? Driver shortage due to the Covid.
No light fixtures? The circuits got the covids.

Schedules are all borked. Owners being tolerant.

[UT_OB1 2193]

Just had a contractor quote us $100k to replace ~200 sqft of fiberglass panels in one of our warehouses/production units. Materials are $47k. They may have to replace a few purlins, but the panels should be the biggest part of the martial cost.  I called around a bit and found the exact same Tred-Safe panels for $2500 out of Louisiana. 
 

Someone else had to get a quote to run some Ethernet. Contractor quoted 54 cents per foot for cat 5 (plus $75/h for the “technician” to run it, no conduit, supports or anything.  I’ve seen this guys work, he zip ties shit everywhere).  Again, a little digging and we found the same cable for 19 cents a foot, and shielded gel filled cat 6 for about 24 cents. 
 

I feel like all our contractors are using labor shortages to excuse obscene material markups.  

Edited September 10, 2021 by UT_OB1

[deadshank 24644]

15 minutes ago, UT_OB1 said:

Just had a contractor quote us $100k to replace ~200 sqft of fiberglass panels in one of our warehouses/production units. Materials are $47k. They may have to replace a few purlins, but the panels should be the biggest part of the martial cost.  I called around a bit and found the exact same Tred-Safe panels for $2500 out of Louisiana. 
 

Someone else had to get a quote to run some Ethernet. Contractor quoted 54 cents per foot for cat 5 (plus $75/h for the “technician” to run it, no conduit, supports or anything.  I’ve seen this guys work, he zip ties shit everywhere).  Again, a little digging and we found the same cable for 19 cents a foot, and shielded gel filled cat 6 for about 24 cents. 
 

I feel like all our contractors are using labor shortages to excuse obscene material markups.  

How else we gonna be Surly 1% AND pay of our bass boats. 

[UT_OB1 2193]

41 minutes ago, deadshank said:

How else we gonna be Surly 1% AND pay of our bass boats. 

Turns out the sqft I was told on the roof panels was off.  So buying the materials ourselves would actually be $12k.  I feel better knowing they aren't screwing us as much as I thought and only marking it up about 3x.

[deadshank 24644]

Just now, UT_OB1 said:

Turns out the sqft I was told on the roof panels was off.  So buying the materials ourselves would actually be $12k.  I feel better knowing they aren't screwing us as much as I thought and only marking it up about 3x.

Well, then, let me sell you something.  
 

 

[washparkhorn 9894]

Aluminum rocketing in price as speculators pile into the market. 

Reuters:

LONDON, Sept 13 (Reuters) - Aluminum prices rose to $3,000 a tonne for the first time since 2008 on Monday as restrictions on output in China, the biggest producer, fuel fears that supply will run short.

Prices of the lightweight metal used in packaging and construction have leaped 50% this year and 15% in only three weeks as speculators pile into the market.

The benchmark contract on the London Metal Exchange (LME) was up 0.7% at $2,943.50 a tonne at 1045 GMT after touching $3,000.

Factors fueling the rally include the Chinese output cuts, a rapid increase in the price of alumina, from which aluminium is made, dwindling exchange stockpiles and strong demand, said Gianclaudio Torlizzi at consultants T-Commodity.

“It’s very, very hard to be bearish,” he said.

The pace of the rally means a correction is likely in the short term, he added, “but the trend is definitely higher”.

CHINA: Yunnan province, home to about 10% of China’s aluminum capacity, has told smelters using hydropower to keep average monthly output for September-December at August volumes or lower, a government document shows.

Yunnan aluminum smelters had already shut down nearly 1 million tonnes of annual capacity by August, researcher Antaike said this month.

ALUMINA: Futures of the aluminum ingredient on the Comex exchange have surged 20% this month to $365 a tonne.

INVENTORIES: Aluminum inventories in LME-registered warehouses have fallen 33% since March to 1.3 million tonnes and stocks in Shanghai Futures Exchange (ShFE) stores have slumped 42% to 228,529 tonnes since April. AL-STX-SGHMALSTX-TOTAL

POSITIONING: Speculators are betting on higher prices, raising their net long in LME aluminium to 35% of open contracts by Thursday, from 19% a week earlier, brokers Marex Spectron said.

MARKETS: Global equities slipped to 2-1/2 week lows and the dollar strengthened, pressuring metals, which are priced in the U.S. currency.

OTHER METALS: LME copper was down 0.2% at $9,679 a tonne, zinc fell 0.7% to $3,097.50, nickel slid 2.5% to $19,890, lead was 1.9% down at $2,275 and tin fell 0.5% to $33,400.

https://www.reuters.com/article/global-metals/metals-soaring-aluminium-hits-3000-for-first-time-since-2008-idUSL1N2QF0PY

[Jiggy-Z 3419]

On 9/4/2021 at 12:05 PM, Hefeweizen said:

I’ll tell you what has gone completely off the rails: raw land in the central Texas area.  Prices in multiple dollars per square foot for Jarrell, Taylor, Hutto, Marble Falls, San Marcos, and Manor.  Like to the point we’re going to see starter homes from Lennatmr, KB, and the doctor being around 400k.  It’s unhinged from reality and being fed by foreign money looking for return and security.  Mostly Indian and Chinese coming through investment groups.  And then there are some others (like Musk) who are buying land all over to ride the wave.

If you have family land right now is a really good time to sell.

My folks who have a ranch southeast of San Antonio are getting offers for their 400 acres that are just ridiculous.  The only thing saving them from nutty taxes is the fact that all of it is ag exempted, as my 87 year old dad is still ranching.

[UT_OB1 2193]

42 minutes ago, Jiggy-Z said:

My folks who have a ranch southeast of San Antonio are getting offers for their 400 acres that are just ridiculous.  The only thing saving them from nutty taxes is the fact that all of it is ag exempted, as my 87 year old dad is still ranching.

Live look at Jiggy-Z Bar Ranch tax negotiations
 

 

Live look at Jiggy. Who knew?

[Jiggy-Z 3419]

57 minutes ago, UT_OB1 said:

Live look at Jiggy-Z Bar Ranch tax negotiations
 

 

Live look at Jiggy. Who knew?

I actually had to go to the Wilson County tax office to protest this year.  Dad is hard of hearing and seemed befuddled by the whole process. Which is weird since dad has a PHD in economics and was a small time builder and developer in Austin and is otherwise just as sharp as he ever was.  The protest was pretty tame.  We just had them reclassify some things and do some grouping of parcels etc.  He thinks I am some kind of hard hitting tax slayer now.

I am not much of a rancher, but I did build him some new foundations for his garage and house remodel along with a new 1 acre stock tank free of charge.

[Onboard 2.0 9083]

8 hours ago, washparkhorn said:

Aluminum rocketing in price as speculators pile into the market. 

Reuters:

LONDON, Sept 13 (Reuters) - Aluminum prices rose to $3,000 a tonne for the first time since 2008 on Monday as restrictions on output in China, the biggest producer, fuel fears that supply will run short.

Prices of the lightweight metal used in packaging and construction have leaped 50% this year and 15% in only three weeks as speculators pile into the market.

The benchmark contract on the London Metal Exchange (LME) was up 0.7% at $2,943.50 a tonne at 1045 GMT after touching $3,000.

Factors fueling the rally include the Chinese output cuts, a rapid increase in the price of alumina, from which aluminium is made, dwindling exchange stockpiles and strong demand, said Gianclaudio Torlizzi at consultants T-Commodity.

“It’s very, very hard to be bearish,” he said.

The pace of the rally means a correction is likely in the short term, he added, “but the trend is definitely higher”.

CHINA: Yunnan province, home to about 10% of China’s aluminum capacity, has told smelters using hydropower to keep average monthly output for September-December at August volumes or lower, a government document shows.

Yunnan aluminum smelters had already shut down nearly 1 million tonnes of annual capacity by August, researcher Antaike said this month.

ALUMINA: Futures of the aluminum ingredient on the Comex exchange have surged 20% this month to $365 a tonne.

INVENTORIES: Aluminum inventories in LME-registered warehouses have fallen 33% since March to 1.3 million tonnes and stocks in Shanghai Futures Exchange (ShFE) stores have slumped 42% to 228,529 tonnes since April. AL-STX-SGHMALSTX-TOTAL

POSITIONING: Speculators are betting on higher prices, raising their net long in LME aluminium to 35% of open contracts by Thursday, from 19% a week earlier, brokers Marex Spectron said.

MARKETS: Global equities slipped to 2-1/2 week lows and the dollar strengthened, pressuring metals, which are priced in the U.S. currency.

OTHER METALS: LME copper was down 0.2% at $9,679 a tonne, zinc fell 0.7% to $3,097.50, nickel slid 2.5% to $19,890, lead was 1.9% down at $2,275 and tin fell 0.5% to $33,400.

https://www.reuters.com/article/global-metals/metals-soaring-aluminium-hits-3000-for-first-time-since-2008-idUSL1N2QF0PY

Fuck China, it's time to move industry out of that shit hole, to places that aren't trying to take over the world with some 100 year plan.

[deadshank 24644]

25 minutes ago, Onboard 2.0 said:

Fuck China, it's time to move industry out of that shit hole, to places that aren't trying to take over the world with some 100 year plan.

For a moment I thought you meant aggyland.

[Onboard 2.0 9083]

1 minute ago, deadshank said:

For a moment I thought you meant aggyland.

Man you guys hate aggy....

[deadshank 24644]

4 minutes ago, Onboard 2.0 said:

Man you guys hate aggy....

you don't?

[Onboard 2.0 9083]

15 minutes ago, deadshank said:

you don't?

I'm from Va. I got my own demons here.....  I found this site thru a ski site that was posting Thujones dick pics, and I had to find the source...  I've been ruined ever since.

[tbone_ 13968]

Apartment developer here. Interesting thread.

We’ve been fighting it like crazy. But so far increasing rents and compressing investor yields have been covering. And crazy debt fund financing on stabilized deals driving cap rates to the floor.

Hard to tell where it will end.

[Incredulity 11141]

[tbone_ 13968]

Username fits

[Onboard 2.0 9083]

15 hours ago, tbone_ said:

Apartment developer here. Interesting thread.

We’ve been fighting it like crazy. But so far increasing rents and compressing investor yields have been covering. And crazy debt fund financing on stabilized deals driving cap rates to the floor.

Hard to tell where it will end.

 I do mostly single family architecture, but getting ready to finalize designs for (2) buildings housing 4 condos each in a very old historic district in a city starting to see gentrification of amazing early 18th-19th c. homes.  Some of the homes in this city were moved lock, stock, and barrel to Williamsburg ,VA. when they created the whole Colonial Williamsburg village back in the late 30's.

It'll be phase 1 of a 2 phase project. The second phase will be a pocket neighborhood across the street, consisting of colonial/federal style bungalow homes, with a centrally located, shared common park.

These 1,200 sq. ft. 3 bedroom units are gonna be for the first time buyers, empty nesters, etc.  How much of a % increase of costs above what they should  be, are you seeing in the multi family world ?

[deadshank 24644]

All of our distributors are out of copper coil, copper flat sheets, formed specialty copper gutters, downspouts and accessory trim parts.  
 

Orders are in and estimated delivery dates range from late-December through January and at the then market price.

Bought the last 25 stainless steel flat sheets we could find and aluminum coil is nowhere to be found.   
 

Not good, Bob. 

[T’Boo Ted Marshall 2718]

I’ve been waiting to install a 30 ton unit for an office building in Plano. We already installed the other 7 RTU. Promised 6 week lead time and ordered in May.
Yesterday I got my weekly update and is now slated for delivery November 12. So 6 months instead of 6 weeks. Client is not pleased and neither am
I.

[Superhero 8570]

We have a steel estimator who has a really good pulse on the market and his internal estimates are usually REALLY close to sub bids. On our last Amazon warehouse pursuit, his internal estimate was $95M. We got bids north of $130M.

Amazon is also sucking up all open web steel joists. One of my steel subs said order it now and you might get it end of 2022.

They are talking about redesigning the warehouses to use steel beams instead of joists at the roof. But that adds total tonnage, and the increased weight of the structure means bigger foundations and more piers. 

[Incredulity 11141]

28 minutes ago, Superhero said:

Amazon is also sucking up all open web steel joists. One of my steel subs said order it now and you might get it end of 2022.

They are talking about redesigning the warehouses to use steel beams instead of joists at the roof. But that adds total tonnage, and the increased weight of the structure means bigger foundations and more piers

Had this exact conversation today.  Same with metal roof deck.

 

Amazon has dealt with materials shortage by buying all of it.  That's gonna be a problem for everyone else.

[seven 1358]

I work for a steel fabricator, and the last few warehouses we've done have had beams at the roof because the client didn't want to wait for joist delivery. Our joist suppliers are booked to October right now, and so is our shop. Business volume is at an all time high but the steel price increases are cutting into what should be fantastic profit.