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Value Engineering is Not a Negative Word – 4 Ways VE Benefits Your Real Estate Development
When developing commercial real estate, ensuring the project is successful and sees a return on the investment is the ultimate goal. However, there are often factors and circumstances that can impact or delay the project. A lack of resources in the construction industry – mainly knowledgeable and skilled trade labor – can impede a project’s development schedule and impact the bottom line. But value engineering through modularized and panelized construction methods can be a huge benefit and savings for the project.
Today’s VE options include manufacturing panels in a factory and then shipping to and assembling the wall panels on site. The steel frames arrive to the construction site in a packaged, labeled pre-cut wall assembly that can easily and quickly be bolted into place. The Ikea-like assembly process eliminates the need for labor to cut and build walls on site. The time savings impact for the entire construction schedule can be several months.
Modular rooms are another VE option that is ideal for buildings with repeatable elements and floorplates, such as multifamily, hospitality, and residential halls. These ‘pods’ are completely assembled rooms or bathrooms that are manufactured in a plant, then shipped to the construction site and easily hoisted into place.
There are 4 main benefits to utilizing modularized and panelized VE options in a commercial real estate development:
1. Adhere to the construction schedule. Often these VE methods allow a project to finish ahead of schedule, saving time and money.
2. Mitigate material waste. Traditional construction methods, especially by labor unskilled in working with specific materials, often requires the purchase of excess materials to allow room for error and mismeasurement. Panels shipped to the construction site for assembly minimize massive material waste and expense.
3. Maintain quality control and assurance. Assembling pre-manufactured wall panels on site ensures every component is of the same high quality, leaving little room for costly construction mistakes and delays.
4. Diminishing on-site labor demands. A lack of labor resources in the construction industry, especially in tertiary markets, make VE an appealing solution to completing a development project on time and on budget.
Engaging a highly skilled development adviser like Vision+Architecture Studio early in the design process ensures VE options are evaluated and implemented in the development plan. Panelized and modularized value engineering methods can have a significant impact on the construction schedule and budget, producing savings of 20 percent or more for a single property development.
