As construction economists, we encounter our share of elephants: a high-tech mechanical system, complex façade geometry, adjusting costs for a pandemic, etc. But, what do you do when a client asks you to price a building that resembles an elephant?

The great moderation was a period of disinflation spanning three decades through the 1980s to 2000s characterized by successive lowering of inflation rates, financial sector deregulation, boom and bust financial cycles, and deep recessions. Since the financial crisis, the world and the United States, in particular, have implemented a financial sector regulatory framework that controls money supply growth through numerous stress tests and mechanisms.

The most common theme is a project budget that is set inaccurately by trying to use dollar per square foot ($/sf) estimates and benchmarks. We understand there needs to be a starting point, but is there a better way? I will give you the conclusion right up front:

Designed to boost domestic production and as part of an economic strategy of “putting America first” President Trump announced on March 1, 2018, his intention to impose a 25% tariff on steel and a 10% tariff on aluminum imports.

HQ2 fever has economists in North America speculating more than high rollers at a Vegas casino. At the onset, major metropolitans on the East coast and even an Alaskan community, threw their hat in the ring to be considered for Amazon’s second headquarters.

Are you in a busy market and maybe concerned that the trades are stretched too thin? Are you concerned this may result in a lack of competition and an undesirable number on bid day? You might want to consider a strategy that we refer to as “90%-105%”. We recommend this strategy in busy markets where you design the base building to 90% of your target budget then create add alternates that equate to 105% of the target.

The “unknown” and “fear of the unknown” are likely the biggest cost drivers in the short term as local steel and aluminum mills begin to understand how their costs or opportunity to increase costs may be affected by the 25% tariff on steel and the 10% tariff on aluminum imports comes into effect.

There is no denying that garnering a second opinion can be tremendously valuable. We employ this strategy when buying a new car or in considering multiple mortgage brokers to ensure we are getting the best pricing or interest rate.