A Job Costing Solution to Improve Multifamily Construction

Construction projects are increasingly costing more–but it’s not just a shortage of labor that’s driving costs up during one of the nation’s biggest construction booms. Creative apartment designs, rising material prices, regulatory issues, and interior vanity details are tacking on a superfluous price tag for market investors. Multifamily construction–whether it is unit renovations or ground-up development–isn’t always as easy as 1, 2, and 3. The National Association of Home Builders (NAHB) revealed that the biggest challenge facing builders this year is the cost of materials with nearly 89% of survey respondents expecting building material prices to be their top concern. The second biggest problem builders reported is the availability of materials along with the time it takes to obtain them. Why projects suffer When it comes to multifamily construction issues, there’s more to it than building costs and labor pains. A recent study showed that the leading causes of poor productivity and cost outcomes had little to do with externals, and everything to do with internal management and monitoring. A combination of poor organization, inadequate communication, flawed performance management, contractual misunderstandings, insufficient risk management, and limited talent management resulted in a long and arduous construction process. After analyzing more than $1 trillion worth of capital projects over five years, the research uncovered that “improving ‘basic’ project-management skills offers the most potential to improving site performance.” Although the answer to productivity may be improved project-management skills, the typical property manager isn’t using the kind of software that encourages the speed and scale required to manage a large-scale project. Additionally, there are inconsistencies in reporting which means managers and owners often do not have current and accurate information s...