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On The Horizon

The latest TFM survey results show facility professionals will not only be juggling numerous projects, but they’ll be managing large budgets well.

By John Parkinson

Since 2004, Today’s Facility Manager has reported on the renovation and new construction spending projections of its readers. And according to the results of the survey conducted in conjunction with this report, facility professionals are getting ready to spend more time and money over the next two years.

The survey was conducted by The Wayman Group, Inc., an independent marketing research and consulting firm located in Cedarhurst, NY. At the end of the survey, 647 usable results were collected with a margin of error no greater than +/-4%.

Overall, respondents are planning 14.7 new construction projects and 18.6 renovation projects on average. Additionally, each respondent is planning to spend, on average, approximately $19.2 million on new construction and $12.9 million on renovation projects over the next 24 months. (According to a follow up survey conducted by TFM, respondents will be spending $697 billion on new construction and modernization projects.)

Budgeting Breakdown

Representatives from several different industries participated in the survey. The three most responsive sectors were business/financial services (23.5%), education (18.3%), and manufacturing (15%).

However, the survey indicated that most facility professionals—in all industries—are involved with juggling budget expenditures. A large majority of respondents (82.4%) are generally involved in the preparation of renovation and new construction budgets.

Survey participants were also asked about their budget projections for the next two years. More than half (51%) of facility professionals estimated their renovation budgets to be between $1 million and $24.9 million, while slightly less than half (47%) estimated their new construction budgets to be between $1 million and $24.9 million.

There were a number of reasons facility professionals were influenced to renovate their facilities, and the top three answers were close in percentages. Change in building use (62.1%) was the largest reason respondents said they renovated, followed by the need to upgrade technology (56.1%), and staff expansion/downsizing (52.4%).

Product Selection

Choices about materials and products take on great significance during projects, since they can be such a large expenditure. Interestingly enough, survey results showed several instances where facility professionals would be primarily charged with making purchasing decisions on items during projects.

A large majority (74.1%) said they made materials and products decisions in the design/development stage. However, 51.8% said they made such decisions during the bidding and negotiating stage with contractors. Based on these percentages, it is clear that purchasing decisions were most often made in the beginning of the process, but often were reviewed more than once and revisited at different stages.

Like the majority of the respondents, Charlie Kanthak, facilities services director for St. Luke’s Hospital in Maumee, OH, thinks it is important to get a jump on product selections early in a project. He says, “I usually start right at the beginning, looking at the options of the technologies; then I try to educate myself as best I can about all the products that are out there.”

Kanthak will even make an offsite visit when he has narrowed down his choices and just wants to make sure he is making the right decision. For example, several years ago he decided on a particular chiller and visited the manufacturer’s factory in Virginia.

For Adam Rubin, director of operations, The Sports Center at Chelsea Piers, New York, NY, making decisions on products starts once an initial price for a project is estimated. Rubin then looks to decrease the cost of the project by shopping for less expensive products. “Here’s my price now. How can I make it better?” asks Rubin during the purchasing phase.

He researches products through trade magazines to see if there are things applicable to his particular job, gets to a point where he is satisfied with the selection of materials and the prices associated with them, and then he signs off on the project.

Since Bob Barnes, director of facilities, Boston Symphony Orchestra (BSO), works for a private, not-for-profit organization, he says there are some slight differences from the corporate sector in working on projects. He, like many other facility managers, begins to think about products during the design development, but he also works with an ad hoc “standards committee” within the BSO. Barnes asks them to help narrow down the product choices.

Setting Priorities

When asked about which attributes were important to them when purchasing products, facility professionals said maintainability (83.4%), performance (83.1%), and price/initial installed cost (70.2%) were the three most influential.

Rubin believes price, along with maintainability, is paramount for product selection. He wants products that last.

Rubin completes a detailed walkthrough in his building every week. When he finds a piece of infrastructure that has gone through a lot of wear and tear very quickly and could be a recurring issue, he looks for a long-term solution to remediation instead of a quick repair to fix it.

“Why is this happening in terms of breakdown, and how can we prevent that in the long run?” he asks when making product purchases.

More Than Just A Band-Aid® At St. Luke’s

For Kanthak, several projects are already in the works. St. Luke’s Hospital is a 500,000 square foot facility that contains approximately 300 beds and is about 35 years old.

Construction is getting ready to begin on a $3 million substation near the hospital’s campus. Once this project is complete, the hospital will be off the local electrical company’s transmission lines and will be able to buy electricity off the grid. This move will eventually save the hospital 27.5% in electricity bills, according to Kanthak.

In addition, Kanthak has just finished up a master facilities plan for the hospital. This will include a five-phase renovation of the entire facility. Projects include: renovating surgery rooms, adding wayfinding signage, and changing rooms from semi-private to private. He estimates the project’s budget to be more than $40 million; it will take about five years to complete.

“My number one challenge is to stay up and running during all this and to protect our patients from dust and the infectious atmosphere created during construction,” he says.

St. Luke’s is a private, single entity hospital, and it competes with others that are part of health networks with greater resources. Consequently, Kanthak feels strongly that his hospital needs to keep up in order to be competitive.

Shaping Up At Chelsea Piers

The Sports Center at Chelsea Piers is a 150,000 square foot gym that includes a track, weight room, cardio area, pool, 10,000 square foot rock climbing wall, and Manhattan’s only indoor sand volleyball court. Rubin describes it as “the ultimate fitness club.”

Chelsea Piers Pool. Photo by Fred George.

His facility literally sits on top of piers located between the West Side Highway and the Hudson River. The piers do not have any shade or cover, so Rubin has to contend with all sorts of weather as well as the Hudson River. Choppy waters present challenges for the club’s pool, which moves with the pier as it responds to the river’s movements. “This is the only building I have managed that is surrounded by the natural environment,” he explains.

HVAC is another significant challenge for Rubin, because only the locker rooms are walled off. Rubin compares heating the club to keeping a barn warm.

The absence of other buildings to protect it from winds further strains the HVAC system of the Sports Center; however, Rubin would like to take what could be a challenge and harness the facility’s abundance of natural light. He is getting ready to make a presentation that would support a move to put solar panels on the roof. If this project is green lighted, he believes it will cost $1 million alone.

In addition to these large scale proposals, Rubin is expecting to complete between five to seven new construction/renovation projects. His estimated spending budget will be between $1 million to $1.2 million over the next few years.

A Renovation Of Historic Significance

BSO’s Barnes is in charge of two facilities. His main facility, Symphony Hall, is a historic building located in downtown Boston. The BSO resides there most of the year, starting in the fall and playing there through the spring. Tanglewood is the BSO’s summer residence in Lenox, MA.

Symphony Hall is 106 years old, and Barnes says his biggest challenge is to keep up care on the overall facility and maintain the world-class acoustics of the building. Barnes and staff also have to contend with a 10-week window of opportunity to complete building projects while the BSO performs at Tanglewood. He says when the season starts at Symphony Hall in late September, it becomes difficult to undertake remediation or capital projects.

In terms of acoustics, Symphony Hall is considered to be one of the top three halls in the world. When any renovation is planned for the interior of the building, great precautions must be taken.

For example, Barnes is in the midst of replacing the original stage floor. “We are trying to replicate the floor that was built in 1900, so we can maintain the wonderful acoustical properties,” he states.

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