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The Reuse Alternative: What’s the Point?

Posted on by admin

Embracing adaptive reuse introduces a certain ingenuity about building from scratch that is gaining in demand. Bill Wilhelm of Construction Today highlights the practice used in multi-family, retail, office and larger-scale entertainment venues. What exactly does this imply?

The basics

Sparing no effort, adaptive reuse breathes new life into an old site or building for a use other than its original intent. A popular asset class that is seeing success for this purpose is hotels. The rate at which a property can come to market is much faster in a reuse scenario, which means a few things:

• “Heads in Beds Faster”: There is an opportunity for revenue streams to offset construction costs sooner, pointing to a healthier balance sheet.

• Cost savings: traditional building from scratch has an average cost increase of 20% due to adaptive reuse. The initial investment is lower, which allows operators to obtain a comparable result for a reduced financial backing.

• Protection of labor and materials: In his article, Wilhelm acknowledges that “labor and material costs change regularly. Sometimes it is revealing to look back at historical data from previous construction projects to see how much they increase or how much the costs of certain materials increase. fall, depending on the moment. Compression of the construction schedule through adaptive reuse mitigates risks associated with market ups and downs that affect labor and material costs.”

The challenges

No construction project is perfect. Adaptive reuse is certainly no exception. In the case of a building that requires on-site improvements by town/city code, there is often a significant capital requirement that puts the owner in a circumstance where it may make more sense to demo and rebuild from scratch. Every situation is different, however, there are countless structures where this notion makes sense.

In non-conventional localities or municipalities with a smaller population, there is a greater inclination for construction from scratch. Adaptive reuse becomes slightly more prevalent in areas of demand for the asset class and a shortage of suitable properties nearby.

Depending on the factors that influence a project, it is very likely that adaptive reuse has the potential to be an attractive option in saturated markets. Because savvy construction project managers value engineering at every stage, many recognize adaptive reuse not only as an opportunity to save money, but also to reduce valuable time on a schedule.

Referenced sources:

Construction Today Magazine, Volume 16, Number 3, Page 8, “Giving New Life”, Bill Wilhelm, 2018

About the Author:

JH Greene is a commercial general contractor and construction manager who seeks flexible building solutions wherever possible. Since 1974, we have been known for exceeding customer expectations. Learn more at http://www.jhgreene.com.

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