'Time is money,' the adage goes, and if you're IRR-driven, it's literally the difference between success or failure when combined with cost.
This is Part 2 of the 'Build Now Trilogy' — Part 1 was all about costs, which was issued a couple weeks back. There may be a prequel, but after Jar Jar Binks, I’m having nightmares from prequels. It also was not a trilogy when I wrote Part 1. What can I say, I am fickle when it snows a lot. Plus, the message really is, Build Now!!!!!!! The opportunity for cost and schedule exists now, in a potentially short window of time.
It's interesting that we don’t seem to dedicate as much time or maybe effort talking about construction duration (time) as much as we do cost. It’s not reliably benchmarked as much; there are plenty of 'cost guides' from numerous companies, but I do not believe there is an equally regarded 'time guide.' Discussion, or complaints, around productivity are also common — we are compared to manufacturing but then it's not really applied in a practical sense to time, aka schedule. It is often discussed at a higher level, based on say a percentage of productivity using much more subjective measures (such as GDP and so forth) versus how long it takes to construct a building of 'X' size over time.
It’s somewhat of an odd anomaly in an industry with so much available historical data, yet we do so little work to benchmark and provide guidance specifically on time. Time often becomes a number of months in a pro forma, and most people can not read an actual Gantt schedule (we all need our fingers to figure out durations from them). Also, critical path tends to only become a major discussion once there is an actual delay.
There are challenges around schedule and time; the variance in time to complete a project from one construction manager to another can be significant. Then even at the trade level you could see a swings of 20-plus weeks when tender levelling of formwork alone between different contractors. Part of the reason we see such swings is interpretation of the project, perceived risks, ability to deliver, and the other aspect is being somewhat ‘cute’ and excluding weather days, holidays, or they are absolutely certain there will be change orders the trade can get delay/cash for. Other impacts on schedule could be the trade knows the owner maybe can’t make decisions, certainty of delivery, or they do not buy into plan, and then that adds layers of time and complexity.
Delay can be and often is serious money. A six-month delay in a project could be over a $1 million a month on a good-sized project (more during high periods of escalation), but there is an obsession with cost over anything else, sometimes sacrificing time, which is precious for relatively peanuts in savings.
The 'penny rich pound poor' — people are very comfortable talking about cost, but the same same can't be said for time. People will try to benchmark by number of floors (but not consider size of floor plate, transfers, repetition etc.), or by area (but forget number of floors). As an example, two identical buildings in terms of gross construction area, but one is tall and one is mid-rise, look utterly different in time. Two nine-storey towers could be 24 months, whereas an equivalent 37-storey could be 35 months.
This is why people tend to have all sorts of cool rules of thumb that don’t work for every job. 'Parking is one month down and one month up per level' is a famously quoted one — but here's a question, if you're 25,000 sq. ft per floor or 100,000 sq. ft per floor, does that not change? What about accounting for height, shoring, water, soil conditions, massive transfer at the ground or a raft slab? Another one is '37 floors = 1 month per floor' — but again, it does not really work that way all the time. The devil is in the details.
What if you could have your building early, is that not worth it for you? Bringing in rents three to four months before you planned or closing the units, does that not have value? Going faster should be almost more important than cost. Not to say cost isn’t important, but time is really where money tends to go, and profit bleeds with time. The issue is certainty over time; promising quick delivery and not delivering is potentially devastating to a pro-forma.
Time tends to be subjective, even more so than cost. While everyone understands formwork duration, they don’t always get the nuances of a complex project and the interdependencies of activities that occur, which can impact other trades. Also, weather days matter. It’s hard to keep structure going in winter or high wind, and Canadians seem to hate rain, never mind the tendency for the odd snowflake in winter. At 50 storeys and above it tends to get ‘fun’ for scheduling, but a bad winter at any height can cause your project to suffer — you might lose 10+ days in January alone. How you mitigate those delays, work around them, accelerate, open WorkFaces up and so forth matter. Proactiveness and being able to change strategy and flexibility in options to recover become critical.
This is where the 'head in the sand' approach to time often comes back to bite hard. It’s why there are critical milestone for service connections, or ordering equipment or steel — miss them and the $1 psf you saved on formwork becomes irrelevant. If you finish one trade five weeks earlier, but that impacts the other trades, for 12 weeks, you’re going backwards. A couple years back I did an analysis that demonstrated high-rise projects in 2023 took 10% to 15% longer for the same building than those a decade or so before. Basically, the market was overloaded so the ability to deliver and quality dropped off rapidly. With the market in the doldrums, some of that ‘lost time’ has been gained back.
Building on the article on costs, the time and opportunity is now to get in the ground. Labour is becoming available, and that's good quality and experienced labour that can build quickly as the market is not as overloaded as it was in 2021-2022 (crane count's down 20%, starts in Toronto down 68% year over year), and that makes a difference. There's also time for innovations, and there are some cool options. Say something like CLT and panelized wood, throw it out in the 'burbs with on-grade parking a 100-unit building could be done in 12 to 14 months. The same building in concrete could be done in 18 months. Like cost, the devil tends to be in the details. Location also matters quite a lot, as well as site constraints, size of crane, type of crane, ability for laydown areas; logistics are critical.
It's critical to continuously analyse projects, looking at new solutions or products to go faster, but the push-back in the industry sometimes tends to be interesting; not everyone likes change in the NIMBY city we live in. 'I have done it that way for 30 years' is a famous saying in the industry, but has nothing else has changed in the last 30 years? I mean, it's just like the '90s out there. Famous inventions 30 years ago: Palm Pilot, Portable DVD Player, Nintendo 64 (I did like that one), Game Boy, Nokia 5110, Tamagotchi, Walkman, PS1.
CAD in the '80s became a huge thing and hand drawings fell by the wayside by the early '90s, giving way to the first stages of 3D. We still do not have full BIM adoption in the industry, which is slow, so slow to change. Or maybe it's more so that it's cheap and fearful of changes — 'my dad did it like that and so did my grandfather, so why change it works'...
The challenge is that construction in Canada rarely gets pushed to look seriously at innovation; it's an inherently risk adverse culture in an industry that is not the most organized or good at working together. It tends to be each person or company for themselves. There are pockets of resistance, real ideas, but that’s based on commercial opportunity for an individual company versus an industry level.
The other key aspect to a construction schedule is the owner doing their bit: make decisions and if you’re in charge of connections, permits etc., do not miss dates.
We have a housing crisis and speed is critical, time is money. But remember, the conductor of the orchestra controls the timing not the individual musicians. The construction manger needs to control the project and not the other way around; inmates running the asylum never works out well. Nor does too many cooks in the kitchen. Another challenge in the development world: 'white hat bias', which breeds like rabbits, slowing projects down.
