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Architects Report Better Business Prospects

per the AIA Home Design Trends Survey

In more housing construction news, results from the first-quarter AIA Home Design Trends Survey show that residential architects are reporting better business prospects. Billings at residential architecture firms are up, showing more growth than they have in six years. 35 percent of the firms that participated in the survey reported a billings increase in the first quarter of this year over the fourth quarter of 2011, compared to only 22 percent that reported a decline. Importantly, the improvements in business conditions are happening in each of the major regions in the country.

As for design trends, a common feature of new homes and additions tended to be accessibility. Many homes were built with wider hallways, fewer steps, and more open space layouts (as opposed to enclosed rooms) in the home.
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Posted by Scott Sweeney on June 29, 2012 10:26:00 AM EDT #

Single-Home Construction Up in the Month of May

Construction statistics from the month of May suggest that the housing market may be showing signs of recovery despite other areas of the economy weakening. A report in the Washington Post indicates that the Commerce Department revealed that construction of single-family homes increased 3.2 percent in May. This was the third straight monthly increase for construction of single-family homes. However, apartment construction (which is usually volatile) fell 21.3 percent, causing the housing market as a whole to fall 4.8 percent.

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Posted by Scott Sweeney on June 25, 2012 10:50:00 AM EDT #

Environmental Claims Studies

From 2001 through 2010, some of the most severe claims against firms in our environmental program derived from manufacturing projects, with an average indemnity payment of $220,956. Indemnity payments from office building/bank projects averaged $213,157. Claims stemming from civil engineering projects (highways, bridges, tunnels, and dams) had average indemnity payments of $130,627. The following is an example of a real claim made against an environmental policyholder:

An environmental engineer was retained by a developer to provide a Phase I Environmental Assessment for a property to be developed into a residential subdivision. During construction, the Department of Environmental Protection halted work on the project when hazardous chemicals were found to be contaminating the site. The developer filed suit for the clean-up costs. There were multiple defendants in this case, and the environmental engineer was not considered one of the primarily responsible parties. However, it was alleged that the environmental engineer failed to detect the hazardous materials. The engineer argued that at the time he conducted the assessment several buildings where contaminants were later found were inaccessible. However, an expert hired by CNA felt that the engineer could have been more specific in advising the developer of the need for further sampling at the site. The engineer could have been more specific in advising the developer of the need for further sampling at the site. The engineer faced additional exposure due to the uninsured status of both the firm that conducted the Phase II Assessment and the general contractor.
 
Compounding the problem was the fact that the general contractor continued demolition even after being warned of the presence of contaminants. The continued demolition spread the contaminants beyond the initial locations. Defense counsel believed that the engineer was facing potential exposure of up to $1 million on both the original claim and a cross-claim from a co-defendant. This claim settled for $234,500, which was much less than defense counsel and CNA anticipated paying on behalf of the engineer. CNA also paid $138,000 in expenses.
 
For more information including risk management advice, please see our entire environmental claims study (access limited to policyholders and brokers). This study was updated with current statistics in August, 2011.
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Posted by Scott Sweeney on June 14, 2012 9:50:00 AM EDT #

California Increases its Energy Efficiency Standards

California continues to push its green design and sustainability agenda into new territory. As the GreenBiz blog published (which was a reprint of a blog entry written by Natural Resources Defense Council Staff Blog (NRDC)), the California Energy Commission (CEC) recently voted to approve new energy efficiency standards for residential and commercial buildings.

While California already had energy efficiency standards in place, these new standards will supersede the 2013 standards and go into effect January 1, 2014. CEC estimates that “Californians can expect energy savings of 25 percent for homes, 30 percent for commercial buildings, and 14 percent for low rise multifamily buildings.” These percentages should result in billions of dollars of savings for California residents and building owners.
 
As NRDC states: “It's forward thinking policies like these that enable California to hold per capita electricity use essentially flat over the past 30 years while the rest of the nation saw per capita electricity use increase by nearly 50 percent.”
 
NRDC includes two highly informative infographics that detail how the standards will be implemented with building materials and processes and the anticipated savings for such changes.
 
CEC estimates that these new standards will add $2,290 in additional costs to the construction of a new home. However, they estimate a savings of $6,200 over the course of a 30-year loan. In other words, for an average monthly increase of $11 over a 30-year mortgage, the new standards will save $27 per month on heating, cooling, and electricity bills. The CEC has published a useful FAQ about the new standards, which you can download.
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Posted by Scott Sweeney on June 8, 2012 7:57:00 AM EDT #