Developers Construction Materials Challenges

Goals

To understand the priorities and challenges of building developers and/or owners when it comes to construction, and specifically in the sourcing of materials. This would include understanding what trends, issues and disruptions building owners/developers are concerned about when sourcing construction materials, especially steel. This information will be used to rebrand a steel pipe and tube company.





Early Findings

Owners/Developers Concerns about Sourcing Construction Materials

1) Materials Cost Increase
  • The threat from the Trump administration of imposing import tariffs on construction materials has had a strong impact on the price of lumber, steel and aluminum products.
  • As a result of this threat to impose tariffs on lumber from Canada and steel from China, American manufacturers of building materials have reacted by raising prices.
  • However, other drivers such as natural disasters and a rise in construction activity have also contributed to the increase in construction materials costs.
  • In 2018, the cost of construction materials has increased by 10% compared to 2017.
  • The price of iron and steel has gone up by 14% during the same period and the price of softwood lumber by 23%.
  • The main issue for developers in 2018 according to a survey from the National Association of Home Builders (NAHB) was the rise in construction materials prices.
2) Materials Cost Volatility
  • Aside from a rise in materials costs, another issue for developers is the current volatility in the price of construction materials.
  • U.S. government policies such as sanctions on oil producing countries and tariffs on steel and lumber producers are continuously affecting the industry,
  • This situation is making it harder for housing developers to budget and plan for materials prices.
3) Risks related to Weather and Climate
  • Due to increased weather and climate conditions, developers had to source different materials to harden their buildings, build sea walls and berms, as well as on-site renewables and battery storage infrastructures.

    Focus on Sourcing Steel

  • Given the issue with tariffs targeting steel from China and the threat of 25% price rises, some developers rushed to source all their steel prior to the implementation of the tariffs in 2018.
In addition to this public search, we scanned our proprietary research database of over 1 million sources and were unable to find any specific research reports that address your goals.

Proposed next steps:

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