Each Monday, we'll let you know what's coming in the week ahead, including important residential and commercial report releases, as well as our feature articles.
"The Dotted Line" contract series: Lump sum agreements — May 10
In January, we launched our year-long series, "The Dotted Line," exploring facets of construction contracts each month. Our first installment delved into the pros and cons of guaranteed maximum price contracts, our second installment looked at construction bonding, our third installment investigated the intricacies of the design-build method, and our fourth installment addressed the often overlooked general conditions of a contract.
On Tuesday, May 10, we will publish the fifth installment in the series and explore lump sum, or stipulated sum, contract agreements. In a time when construction companies and owners are exploring the flexibility of design-build and cost-plus contracts, lump sum agreements are cut and dry — involving a specific scope of work in exchange for a specific dollar amount. What kinds of projects are best suited, or not, for this type of contract, and what are its benefits and drawbacks?
Offsite construction feature article — May 12
Offsite construction — also knows as modular or prefabricated — has seen a kind of renaissance in recent years, as construction experts search for ways to revamp the frustratingly stagnant building industry. Proponents of offsite construction champion the method's quicker schedule, higher quality, and often lower cost. However, lack of knowledge as well as resistance to change in traditional building processes have emerged as obstacles to stronger growth in the industry.
In our feature article on Thursday, May 12, we will explore the growing offsite construction method to find out why it is gaining popularity, as well as what lingering barriers it still faces.
Producer Price Index — May 13
The monthly Producer Price Index report from the Bureau of Labor Statistics will be released on Friday, May 13. That afternoon, the Associated Builders and Contractors will offer their take on the data, and we'll cover both reports in a combined story.
Last month, the BLS reported March construction material prices rose 0.9% but fell 3.4% year-over-year. March marked the first time in nine months that construction industry inputs in the Producer Price Index increased.
ABC Chief Economist Anirban Basu attributed last month's rise to the "rather profound percentage gain in oil prices," which grew 40.7% between February and March. However, he noted that "rapid material price inflation remains unlikely going forward," as the global economy is still moving slowly.
Will prices slide again this month, or was March just a fluke in an overall pattern of decline?
