Building Industry Magazine - May 2011 - (Page 14)

BY JUDITH SHINSATO REVIVING AGING PROPERTIES E veryone knows about reading, ‘riting and ‘rithmetic. Also popular is reduce, reuse and recycle. But when it comes to renovation, the “three Rs” are usually: repurpose, reposition, reinvigorate – the main reasons the work is necessary. Renovation and remodeling is about maintaining valuable assets while saving the embodied energy used to construct the original structures, all within the parameters of the owners’ needs. Here’s an updated report on how Hawaii’s construction industry is meeting consumer demands while sustaining their own business requirements in our current economic environment. BIG PIECE OF THE PIE Just how much do renovation and remodeling projects contribute to a healthy contracting business? Judging from the response we received, many businesses would be in dire straits if it weren’t for renovation work. “Our current backlog is comprised of approximately 60 percent new construction and 40 percent renovation work,” states Dan Jordan, principal, Honolulu Builders LLC. “Of this renovation work, 70 percent of it is public sector and the balance is private. … It is clear that given the long process of entitlements and permitting, renovation is often a much more viable option. With financing still tight, renovation of an existing facility is much less of a risk and makes business sense in most financial models.” At Swinerton Builders, George Ehara, its vice president and Hawaii division manager, adds, “Renovation is a more significant portion of our backlog this year for several reasons: 1) In a recession, our clients may not have the budgets to build ground-up projects, but the smaller renovation projects still get funding. 2) It is less expensive to renovate an 14 | BUILDING INDUSTRY | MAY 2011 existing property than to build new. 3) In this economy, many distressed properties are being repositioned, and if the new buyers got a fire-sale price, they are more willing to spend the money to upgrade the property. Our backlog is currently more than 50 percent renovation work.” “There is a considerable amount of renovation activity currently and it represents about 40 percent of our backlog. With new construction still very slow, and most likely another two years out, we expect renovations and refreshes to continue and to increase,

Table of Contents for the Digital Edition of Building Industry Magazine - May 2011

Building Industry Magazine - May 2011
March in the BIA Parade
First Wind Turns on Kahuku Wind Farm
Two New Rail Contracts
U.S. Transportation Head Visits Hawaii
Kalakaua Sidewalk Improvements Begin
New Turf for Aloha Stadium
Contracts Awarded
Hawthorne Hauls Blocks for Mission House
Low Bids
Spotlight on Success: West Hawaii Civic Center
Best Practices
Concept to Completion: Heleloa Neighborhood
New Products

Building Industry Magazine - May 2011