Q1

2022

the look
ahead

In this issue, we explore the current issues facing our National Healthcare Team, transportation, economics, and the geopolitical forefront and offer solutions to mitigating these impacts on construction.

Healthcare, Transportation & Geopolitics

National Market Overview

While portions of the construction industry are starting to see some relief due to the end to pandemic-related restrictions and immediate solutions to port delays and trucker shortages; protracted supply chain issues, skyrocketing inflation, and geopolitical tensions globally indicate another challenging year in 2022. In this issue, we explore the current issues facing our National Healthcare Team, transportation, economics, and the geopolitical forefront and offer solutions to mitigating these impacts on construction.

Construction
Indicators

The growth of aggregate input prices is expected to moderate until demand strengthens, bringing pricing patterns back to more familiar levels.

“Current trends have increased construction costs at a scale of 1%+ per month, which is the rate we have been advising our clients to expect for additional funding as we chart construction costs over the project’s life cycle. This rate is historically high as ANNUAL escalation over the previous 10 years was a steady 2-3% per YEAR.”

Sam O'Connor

Vice President

Preconstruction Services Director

Healthcare Spotlight

Sam O’Connor, Preconstruction Director – National Healthcare, describes what his team is doing to guide clients through the current staggering escalation. His clients are asking the same three questions consistently: How much does this project cost today; How much is it tomorrow; What can we do to keep moving forward?

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Insights

Transportation

Driver shortages, delays at the port and rising gas prices headlined transportation in 2022’s first quarter. These disruptions to the supply chain have left the construction industry scrambling to secure materials, and in some cases, change design and material selections at the last minute so as not to cause unnecessary project schedule delays.

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Insights

Economics

We’re all feeling escalation at the project level, but what is causing it at the macroeconomic level? The national health crisis created by COVID-19 caused the federal government to use their known mechanisms to stimulate the economy, which ultimately resulted in record-breaking inflation.

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Insights

Geopolitical

Numerous global factors play into the prices of construction materials. As pandemic-related restrictions were eased in lated 2021, early 2022 saw some relief in shipping gridlock, hopes were high that the global supply chain would see delay and price corrections. Instead, the war in Ukraine and new COVID-related lockdowns in China both caused havoc late in the quarter.

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