December 2016 Newsletter
What we’re talking about in December:
- The economic experts from ConstructConnect, AGC, and AIA weigh in on the election’s impact on construction.
- Sage is making a heavy investment in the future of construction software!
- A consultant’s honest opinion on when/why you should upgrade before Year End
- Speaking of YE, the more you buy, the more you save on Sage construction products — up to 17%!
- Mobility for Sage Service Ops just got wayyyyy cooler.
- Quickbooks can’t but Sage CAN – free webinar this week!
- Awesome ‘Tips and Tricks’ for Sage 300 CRE | Sage 100 CON | Sage Estimating
Nuggets from the ‘Post Election Outlook on Construction and Design’
by Joanie Hollabaugh
ConstructConnect hosted their annual end-of-year, state of construction and design report with their trio of heavy-hitting economists from ConstructConnect, the AIA, and the ACG of America. The following nuggets are plucked from the plethora of information and stats the trio compiled.
ConstructConnect provided the abstract:
The economy has limped through much of 2016. Some analysts say uncertainty over the U.S. presidential and congressional elections has caused businesses and consumers to hold off committing to construction and other spending. Once the election is finally over, will construction get a bounce or fall into a sinkhole? What are the likely impacts on housing, private nonresidential investment, infrastructure and other public projects? Will labor availability ease or continue to plague many contractors
? Are materials prices heading up, down or sideways?
AIA’s Kermit Baker’s Top Points
Kermit Baker is the Chief Economist for American Institute of Architects (AIA). He originated AIA’s Architecture Billings Index and AIA Consensus Construction Forecast Panel; is an honorary member of the AIA; and has a Master’s degree in urban planning from Harvard University and a Ph.D. from Massachusetts Institute of Technology. Follow him on twitter: @AIANational.
- Single family construction recovery is “plodding” along
- Moderate growth in Y-T-D non-residential construction spending
- The construction labor “shrinkage” is not increasing with the upturn
- Women in construction still very low
- Aging labor force
- Reliant on foreign workers
- Labor shortages are resulting in fewer/higher bids from contractors
- No major construction sector seeing strong growth rates at present
Election Issues for Construction and the Economy
Unusually high levels of uncertainty continuing
- Trade: construction materials prices
- Immigration: workforce issues
- Tax reform: increased business investment
- Infrastructure: $1 trillion proposal
- Regulations: speed up construction; reduce costs
- Finance: secondary mortgage market reform
AGC’s Ken Simonson’s Top Points on Non-Residential
Ken Simonson has been AGC Chief Economist since 2001; AGC Chief Economist since 2001 (fellow and past president); he writes The Data DIGest weekly construction economics bulletin with 47,000 subscribers (subscribe at http://store.agc.org); and holds BA in economics from the University of Chicago and MA in economics from Northwestern University. Follow AGC on twitter: @AGCofA.
A look at construction sectors
Power, manufacturing and recreation:
- Solar, wind power are growing again; expect more gas-fired plants, natural gas pipelines into ‘18
- Manufacturing decline led by completion/delay of chemical plants (ethane crackers, petrochemicals, LNG) and transportation equipment (cars, trucks, jets, railcars)
- Amusement & recreation spending is very “lumpy”—a few big stadiums at irregular intervals; but funding for local, state, federal parks keeps eroding
Roads, transportation, sewer/water:
- Highway funds benefit from more travel, hence fuel purchases; gradual pick-up in state funding & P3s; little likelihood of higher federal funding
- Railroads slashing investment; pickup in airport projects but no increase likely in port, transit construction funding
- Eastern & Midwestern cities under orders to make long-term upgrades to sewer systems that should boost spending; water utilities hurt by drought, conservation but may get money for lead abatement
Education & health care:
- Bond issues should boost funding in some districts but preK-12 enrollment nationally is flat; more children staying in cities and filling underused or charter schools, so construction no longer matches population growth
- Higher-education enrollment is shrinking, so colleges need fewer dorms & classrooms; apts. (multifamily) replacing dorms (educational construction)
- Hospitals face more competition from standalone urgent care, outpatient surgery, clinics in stores; more investment in small facilities, short stays
Retail, warehouse, office, hotel, data centers:
- Retail now tied to mixed-use buildings & renovations, not standalone stores or shopping centers
- Warehouse market still benefiting from e-commerce; more local than huge regional distribution centers likely in future
- Employment sets records each month but office space per employee keeps shrinking; growth mainly in cities & renovations, not suburban office parks
- Hotel construction likely to drop as revenue per available room slows
- Data centers remain a strong niche but no data available on how strong
ConstructConnect’s Alex Carrick’s Top Points
Alex Carrick is the North American Chief Economist since 1985 for ConstructConnect and CanaData; his online analyses are a popular feature of the Daily Commercial News and Journal of Commerce; and Alex holds a BA in Economics from the University of Western Ontario and an MA in Economics from the University of Toronto. Follow him on twitter: @Alex_Carrick.
My favorite optimistic economist, Mr. Carrick is more of a ‘silver lining’ guy than ‘the sky is falling’ type. He started out his presentation with good news:
What is there to still like about the U.S. economy?
- Q3 2016 GDP growth a strong +2.9%;
- Latest PMI of ISM 51.9%;
- Initial jobless claims less than 300,000 for 87 weeks in a row;
- JOLTS openings (level and rate) quite high;
- Monthly average jobs growth so far this year +181,000;Inflation +1.5% y/y all items; +2.2% y/y core;
- Interest rates continue to be extremely stimulatory;
- Home prices are +5% to +7% y/y;
- Population growth +0.7% y/y;
- Stock market indices near all-time peaks;
- Helped by Panama Canal expansion, America is now exporting natural gas.
The put-in-place investment is slowing down
However, he did show the flip side of the economy, with slow growth in all but two sectors:
A paradigm shift revealed
Most interesting (to me), Alex shared his insight of market behavior that will/has changed construction:
Logistics Rule …
Explaining that ‘logistics’ is the new king:
- The goal of improved ‘logistics’ is to move goods, services and people faster, cheaper, safer and greener.
- The words ‘logistics’, ‘infrastructure’ and ‘productivity enhancements’ have become synonymous.
- The push for both ‘hard’ (i.e., roads, sewers, pipelines, etc.) and ‘soft’ (schools and hospitals) infrastructure largely comes down to striving for productivity enhancements.
- ‘Soft’ infrastructure supplies the brains (through educational facilities) and the healthy workers (medical facilities) to create and maintain the whole super-complicated logistics apparatus.
- The nation that understands and adapts to this new dynamic will prosper best.
Thanks to ConstructConnect
A special thank you to ConstructConnect, who repeatedly allows us to share nuggets of these seasonal reports on the Construction economy.
Please follow them on twitter at @ConstructConnx and visit their website at http://www.constructconnect.com/.
Sage’s Investment in the Construction Software Future
Sage 300 CRE’s new mobility suite
Sage announced this fall they have committed to invest in a major, multi-faceted development project that will result in the accelerated delivery of innovative new products and significant product enhancements to the Sage 300 Construction and Real Estate (CRE) customers. These changes should transform your total experience and bring mobility, improved workflows, and a new modern user interface to enable you to work on the go, drive top line growth and manage bottom line profitability.
Specifically, Sage 300 Construction and Real Estate will deliver three new mobile services: Sage Mobile Projects, Sage Mobile Service and Sage Mobile Insights over the next eighteen months.
Also, Sage will be delivering a whole new Sage300CRE product experience from user interface to backend database, all delivered within about the next 42 months. Releases of improved user experience began with the September 2016 release of V16.1 and will continue with significant drops approximately every six months.
Sage 100 Contractor now available on SQL
In the biggest update in decades, Sage released 100 Contractor 2016 (Version 20.2) on the SQL platform (Sage has plans to move 300 CRE from Pervasive to SQL replication in 2017). This is a change at your server level; you are literally changing the “language” on which your entire database operates. (Sage is only supporting 19.7 and SQL 7 for Year End – so now is a good time to upgrade. Read more on planning for this here and the logistics here.)
Not to worry, Sage 100 CON will look the same; it’s just going to perform better! The beauty of a SQL server is that it is able to handle a large amount of data without slowing you down. Faster reports, faster processing, and smoother integrations with other applications running on SQL – it’s a win-win.
Sage Special: The More You Buy, the More You Save!
Take advantage of tax credits before they expire!
Until we are alerted otherwise, Section 179 retains a permanent limit of $500,000 towards equipment and software. From the Section179.org website (and yes, Sage 300 CRE and Sage 100 CON qualify as “off the shelf” software):
IMPORTANT: Section 179 for Current 2016 Tax Year (This Year)
Section 179 can provide you with significant tax relief for this 2016 tax year, but equipment and software must be financed and in place by midnight December 31, 2016. Use this 2016 Section 179 Calculator to see how much the Section 179 tax deduction can save your company.
Sage Promotion: Up to 17% OFF software purchases (plus 0% financing)!
This is your chance to add estimating, mobile & field, document management software – or even CRM or ERP to your Sage suite. Dream BIG! The more you spend on software the bigger the discount Sage will offer you. Use the form below to let us know what you would like to consider.
You can receive an additional 4% discount when your purchase is combined with a Paperless AP Package, or an additional 8% when combined with a Paperless Premium Package!
Year End Upgrades, Caveats, and Resources
Version 16.1 – What you need to know
LAI’s Senior Enterprise Consultant, Kyle Zeigler, notified you in the last newletter about the features and functionality in Sage 16.1 (click here to review).
Warnings about Sage support and third-party vendors:
And in case you didn’t see the email last week, she also provided this critical advise:
- The year-end software update for 2016 will only support versions 15.1 and 16.1; if you are presently using version 14.1 or earlier, we recommend you upgrade your version prior to the end of the year.
- We further recommend that if you use any 3rd party programs with your Sage 300 CRE software, you upgrade only to version 15.1 at this time.
Cheatsheet Session Recording
This year, we started off “The Beginning of the (Year) End” training with a free “cheatsheet” class on December 2nd. DON’T WORRY you can still watch here:
The remaining courses are scheduled chronologically to your accounting deadlines:
FEE – $149. In this 2-hour online training, Kyle will instruct you how to use Aatrix forms for W2s and HR forms plus tips for reconciling data in PR and more.
FEE – $149. In this 2-hour online training, Kyle will address the sequence and processes for closing applications, how to verify vendor totals, and step-by-step process for preparing 1099s in Aatrix.
Archiving – February 2
FEE – $149. This 2-hour online class will give you all the tips you need for proper archiving. You will learn practices that will help reduce processing time for reports and Sage 300 CRE tasks, as well as protect your data against risk of loss.
Sage Service Operations Gets Updated!
Release Version 6.4 for Sage 300 CRE
One of the most exciting products Sage has developed recently for Sage 300 CRE and Sage 100 CON is the web-based, mobile app Sage Service Operations (SSO). This nifty add-on to your construction software delivers information like employee assignments, job status, work order details, invoice status, a dispatch board, and much more straight to any web browser, mobile device, or tablet.
This release (not available for Sage 100 CON at this time) provides functionality that expands beyond service into construction management with the ability to schedule jobs and assign equipment using the same tool to schedule work orders. Time entry and Superintendent Roles are available as separate SKUs, giving companies a cost effective way to manage field personnel time and equipment.
- Project Managers can quickly identify available resources and schedule construction jobs using a job assignment.
Construction Job Time Entry
- Simple and flexible job time entry from the assignments page; Users can specify the number of hours worked and enter cost code or use an easy to use clock in and out system that can track travel time, breaks, and lunches.
Time Entry Review / Approval Feature
- Supervisors, project managers, and payroll administrators can seamlessly review and approve payroll time in one area for work order, job, and miscellaneous time entry.
- Dispatchers — larger and customizable views to quickly and easily schedule employees, subcontractors and equipment to jobs.
- Enhanced map view allowing dispatchers to schedule from the map and visually identify the best resource.
- Service manager/controller charts, and metric views are available on the dashboard.
- Set up individual groups (or teams), each with customized workflows based on their process for submittal of time and management review and approval.
Miscellaneous Assignment Scheduling
- Dispatchers can schedule PTO, safety training and sick time alongside work orders and job assignments on the same schedule.
Want to see Sage Service Operations in action? Click below to schedule a demo with Tony Merry, today!
Guess What? Quickbooks Can’t But Sage CAN!
FREE Webinar this Thursday, December 8th
Let’s face it, QuickBooks Contractor is great for a small startup company; it shows the expected financials and has an easy learning curve.
However, it was NOT designed with job-specific financial information that contractors, specialty contractors, subcontractors, GCs and commercial or residential builders need most. The focus of Sage 100 (formerly MasterBuilder) is based around THE JOB.
The Sage 100 CON dashboard shows all of the same financials that QB does. However, it takes functionality to the next level with critical information of the JOB: cash flow by job, under/over billings by job, job contract budget and cost to date, job uncommitted billing, etc.
For example, the Job Contract, Budget and Cost to Date Status report in Sage 100 CON shows the contract, change orders to the budget, percent complete, and estimated profit on a job. Another exclusive feature in Sage 100 CON is the Committed Costs snapshot that lists standard Cost Codes separate from the parts list. QB combines those codes and locks them into one item category.
Don’t miss Dec. 8th FREE event for non-Sage users (QB owners or others):
Follow LAI on Social Media for immediate construction and technology news!
Twitter | Facebook | LinkedIn LAI Page | LAI Sage 300 CRE Users Group
Upcoming LAI Online Training and Networking Events:
Simplify project data from anywhere
Experience expert data management, from field to office, with Core Cloud Systems, CCS. Developed by the makers of TimberScan®, CCS gives data-dependent businesses flexibility and control over time tracking, expense management, inventories, and so much more. Creating and collecting form information from a mobile device with synchronized data tables is just part of how CCS delivers information processing at a higher level. Designed especially for project-driven businesses, CCS provides secure, document storage; workflow and task assignment, as well as notification options. Choose from standard form inputs or build your own with connectivity that creates optimal usability. Standard CCS solutions include:
CCS Mobile Purchasing & Receiving
CCS Mobile Purchasing & Receiving is a web-based purchasing and materials management solution that automates and mobilizes inventory-related business functions. Request materials, receive goods, make transfers, consume, and much more with CCS, right from a mobile device. Optional enhancements include per diem, equipment time, production, and billing support tracking. Transactions can flow from TimberScan directly to CCS eliminating the need for double entry. Even sync commitments to both TimberScan and your ERP system for a total experience that is unmatched in the marketplace.
- Eliminate paper receiver tickets and smudgy, carbon-copied POs.
- Manage commitments automatically in financial systems
CCS Mobile Time Entry
Track and document time worked–from anywhere–with CCS Mobile Time Entry. Use pre-built timesheets OR customize them for various methods of timekeeping to meet business requirements. Once timesheets are submitted, administrators can evaluate and approve them using custom grids in CCS. Administrators can also push approved time to Sage 300 CRE Payroll data entry. Project-intensive businesses enjoy the time and cost savings CCS offers in simplifying the, typically, complex process of payroll. Additional customizations are available such as automatic routing of timesheets to TimberScan AIM or reporting billing information to accounts receivable team members.
- Consolidate timecards across the business and accurately code jobs with hours worked
- Execute payroll faster with detailed submissions and less back and forth
CCS Credit Card Reconciliation & Expense Reporting
As part of CCS Credit Card Reconciliation & Expense Reporting, users can snap pictures of receipts and enter costs right on their own devices. AP and other finance personnel can review, approve, return for correction, or process expenses directly from CCS to optimize workloads and help put an end to data-related redundancies. This CCS solution lets users collect receipts and reconcile transactions using downloaded statements then sends an invoice automatically to TimberScan for an unprecedented processing experience.
- Make expense reporting easy with mobile photo captures and desktop file attachment functionality.
- Complete a 3-way match from CCS
CCS eForms lets users turn your existing paper forms into electronic forms; deploy, distribute, and collect them from any device, and even integrate to your existing accounting, project management, and content management systems. CCS eForms offers several pre-built forms to get you started, too.
- Gain complete control to match forms to your business processes
1099 Preparation for Sage 100 CON
Join an LAI consultant for a live, online FREE session.
Employee W-2 Preparation and Audit
Join an LAI consultant for a live, online FREE session.
GL vs. Job Costs Reconciliation
Join an LAI consultant for a live, online FREE session.
DOL Overtime Rules Suspended – What Lies Ahead?
Submitted by Bryan Eto, CPA BeachFleischman
Many employers have been wrestling with plans to comply with new U.S. Department of Labor (DOL) overtime rules since last May. That’s when the rules were finalized, with a December 1 compliance deadline. Those new rules included raising the minimum salary overtime exemption to $913 per week from $455. A little more than a week before the deadline for the rules was to take effect, a federal court has issued an injunction, at least temporarily blocking implementation of the changes.
In its decision, the court stated it believes the DOL exceeded its authority in promulgating the rule. In addition, the court said the DOL failed to follow Congress’s intent, which was to reexamine the duties test of the overtime rules, and not to focus solely on the salary level, as the final rules do.
The DOL’s initial response was to state that it “strongly disagrees” with the ruling, and is “currently considering all of our legal options.” A couple of short-term legal scenarios remain possible: The U.S. District Court for the Eastern District of Texas, which issued the ruling, could drop its temporary injunction.
Alternatively, the ruling could be kicked up to the local U.S. Court of Appeals, which could overrule or uphold the injunction. But the chances of the appeals court rendering a decision on the issue before December 1 are slim.
What Lies Ahead?
In the longer term, the outlook is also unclear. It seems unlikely that the Labor Department under the Trump Administration would fight the ruling, though other parties might. Initial analysis of the district court’s decision by Judge Amos L. Mazzant suggests that holes could be poked into the logic that led to his conclusion. At issue is the fact that the National Labor Relations Act, which laid the groundwork for overtime pay, failed to address the need to periodically adjust the salary threshold. However, a provision for adjusting the threshold was incorporated into regulations way back in 1940.
Also, while Judge Mazzant took exception to the idea of periodic salary threshold adjustments in the context of exempt status, he didn’t declare that it was invalid with regard to all DOL rules.
In any case, employers have several issues to deal with immediately. Those issues vary according to what actions they’ve already taken. Employers that were waiting until December 1 to roll out their plans are in a better position simply to hold tight and act as if the regulations were never issued.
The benefits of a wait-and-see approach are that there’s no disruption to the status quo and, in most cases, there will be no spike in payroll costs. However, that approach may also bring risks, including having to scramble to make adjustments if the regulations ultimately are upheld. That scrambling might involve paying extra wages due to affected employees retroactive to December 1.
Another hazard is that employees who have kept abreast of the issue (independently of any statements made by their employers) who were expecting raises or eligibility for overtime pay could be angered that this benefit was snatched away from them.
Employers faced with this dilemma will need to weigh their appetite for regulatory risk, the level of financial pain that compliance with the overtime regulations would inflict, and the employee relations considerations.
Some employers have already made their implementation strategy clear to employees. For employers that have announced plans to reclassify some employees from exempt to nonexempt, options include:
- Giving those employees the choice of whether to become hourly, or remain in salaried status, while cautioning them that they might need to be moved to hourly status in the future, depending on the outcome of the legal battle,
- Move forward with their conversion to hourly status to avoid possible future disruption if the regulations are upheld, or
- Drop the plan to switch them to hourly status.
If salaried employees had been promised raises to bring them up to the minimum salary threshold (in lieu of moving them to hourly status), dropping plans for those raises could give rise to problems, such as damaged employee morale. Legal issues could also arise, especially if the promised raises have already been granted. For example, employers could run afoul of notice requirements under state or local laws, and possibly violate common law doctrines governing implied contracts.
A compromise approach with respect to planned salary increases could be to phase in the increases instead of raising them immediately to the regulations’ threshold level.
If employees have already been moved to hourly wage status to comply with the regulations, before switching them back to salaried status, take a fresh look at the “job duties” test for exempt status. This test has always been in place and was not affected by the federal court’s temporary injunction. Businesses could find themselves in trouble regardless of the outcome of this legal battle if salaried employees have been misclassified for reasons other than failing to meet the minimum wage threshold.
How the issue will ultimately shake out is uncertain, at best. But observers in Washington, D.C., point out that although many members of Congress opposed the regulations as written, they agreed in principle that some increase in the overtime salary threshold was in order. That is, they didn’t reject the DOL’s legal authority to adjust the threshold, as it has done multiple times since the early days of the underlying statute.
Whatever actions, or non-actions employers take with regard to the rule, it’s essential to communicate as clearly as possible with employees about the issue. One basic message that would be reasonable would be for employers to explain that they are waiting for more clarity on the legal front before making any big decisions.
Employment attorneys are monitoring the issue carefully, and are an essential resource to take advantage of before taking any irreversible action.
Beach Fleischman 2201 E. Camelback Rd. Phoenix, AZ 85016 602.265.7011 | http://beachfleischman.com | twitter: @BeachFleischman
by Kelcie Jensen, Sage Certified Consultant
5 simple steps for setup
Reports are the life-blood for all of us in the construction industry. Sage 100 Contractor provides for detailed accounting and project management reports. But many clients can become bogged down with time constraints needed to run every report for each person in the office.
So what can be done to keep our much needed reports from becoming too much of a good thing? Consider utilizing scheduled reports. By scheduling the reports, accounting and project management information can be available at the drop of a hat. As long as the computer is on, Sage will process the report and either print, e-mail, or fax the report at whatever time you specify.
To schedule a report:
- Select the report that you want printed on a pre-determined schedule
- Click File, then Scheduling.
- Note: Reports that have an option selection are unavailable to be scheduled because there are programming restrictions behind the report. Contact your consultant if you would like to convert a locked report into a version that can be scheduled.
- Next, set the output options and determine the schedule for when the report should run.
- Identify how often you would like the report to run.
- Enter your Windows credentials (how you log into your computer) and click Save Schedule.
Need help with your Sage 100 CON reports? Kelcie can help! Click below to request an appointment.
Sage 300 Construction and Real Estate Year-End Help
Submitted by Kyle Zeigler, Sage Senior Certified Consultant
For your convenience, we have compiled the following list of help resources to get you through all of your year-end processing needs:
Sage Customer Portal:
To log in to the Sage Knowledgebase and for product downloads:
- Go to https://support.na.sage.com.
- Click Log on in the upper right corner of the page.
- Enter your Customer Portal Username and Password.
- Click Log on.
If you don’t have a Customer Portal Username and Password:
- Go to https://support.na.sage.com.
- Click Sign Up for a Portal Account (you will need your Sage customer number).
For detailed steps on installing Sage 300 Construction and Real Estate year-end update, see knowledgebase article 36508.
- Main webpage: https://sagecity.na.sage.com/
- Year-End Center for Sage 300 Construction and Real Estate:
- Affordable Care Act Center: https://sagecity.na.sage.com/p/aca
- Main webpage: https://ledgerwoodusa.com/
- Online Training & Events: https://ledgerwoodusa.com/upcoming-events-calendar/
- To schedule a Sage Certified Consultant: https://ledgerwoodusa.com/ledgerwood-professional-services/. Click on the “Contact LAI’s Professional Services Group” button to send us an email.
Want help from a Certified Sage Consultant with your Year End?
Advancing 5D BIM
Reprinted with permission from Sage | Written by Walt Davis, Sage North America Estimating Manager; Curtis Peltz, CEO eTakeoff, LLC; and Stacy Scopano, Senior Industry Strategy Manager, Building Construction, AutoDesk
It’s easy to hope for no construction-cost overruns, but much harder to achieve. Yet, that’s exactly what a growing number of construction and AEC companies are aiming to do. These firms are involving their estimators much earlier in the project planning process to inject a higher degree of cost analysis into critical decision-making discussions.
What makes this kind of collaboration possible? For many companies, model-based cost estimating (also known as 5D BIM) is helping their estimating team provide the value engineering feedback needed for greater cost predictability—and cost savings.
Overall interest in using BIM processes and tools to improve project delivery is rising among construction companies. In fact, 32 percent of contractors expect an increase in the amount of projects involving BIM this year, according to the 2016 Construction Hiring and Business Outlook conducted by AGC of America and Sage. Communication, collaboration and a contractor’s ability to impact the design process are some of the main reasons why contractors are increasing their use of building information models, says Dmitri Alferieff, AGC senior director of virtual construction.
Kevin Miller, professor at Brigham Young University, also sees growth specifically in the use of model-based cost estimating. “5-D BIM is being adopted on all fronts,” he says, indicating that it’s not just firms with design and construction under one roof that are seeking the benefits of models. “Where you have a relationship between the contractor and the designer — more of a design-build approach — we see bigger strides being made than the traditional design-bid-build delivery method. But all fronts are advancing, just at different paces,” he adds.
5D BIM limits
The relationship between the design and estimating teams as well as the quality of the 3D model are important factors in executing successful 5D BIM processes. And this is where there is still room for improvement. From an estimating standpoint, for example, no two 3D models are alike. “Designers differ in their knowledge of 3D modeling and the amount of estimating-related information they include in the model also varies,” Miller says.
AEC firm STV, a member of AGC of Metropolitan Washington DC and AGC of New York State LLC, knows that difference all too well. “Where the quality of the design information permits, the quantities are dervived from the 3D geometry and embedded nomenclature of the objects in the model,” explains Carl “Ozzie” Mest, senior cost estimator and systems administrator at STV. “Where a reduced level of design maturity is evident, the team resorts to 2D takeoff.”
There lies the current challenge with 5D BIM. Building information models today typically don’t contain all the information required by estimators. For example, a 3D model may contain a pipe schematic with lengths, but estimators still need to refer to 2D drawings to take off the hangers.
Miller, who specializes in estimating from building models, acknowledges that many 3D modeling tools will generate 2D information from the model, including floor plans, specifications and notes. However, the workflow to extract that 2D information from the model isn’t an easy process. “It’s much quicker for estimators to use the 2D takeoff tools they’re used to,” he says. Consequently, estimators currently have to use multiple, unconnected 2D and 3D takeoff systems, complicating the process and increasing the chances for error.
Even companies like STV, known for its innovative use of technology to improve the building process, would like to see a solution to this problem. STV has developed an interoperable platform that transfers intelligent data directly from the 3D model into the company’s estimating database through custom applications developed in-house. But even with this sophistication, they still have to deal with missing information from the model.
The reality is the majority of estimating takeoff is still done from 2D plans, and that isn’t expected to change anytime soon, if ever. “Estimators don’t yet trust the 3D models,” says Miller, explaining that the models today are mostly used to double check a 2D takeoff.
Another concern with 3D models is the lack of specifications. From a design perspective — particularly for independent architects — there’s often little value to putting specs into the model. In fact, it may not be possible to build a model containing all the job specifications without impacting model size and performance. Designers could attempt to resolve this issue by creating links in the model to external specification documents. However, these links, which must be maintained by different team members, can easily break as specifications change throughout the project.
Addressing the gap
“The industry is still figuring out how to work with BIM to carry out projects more effectively,” says Alferieff. “Greater communication is still needed so downstream users — such as estimators — better understand the usability and limitations of the models they are receiving.”
But strides are being made. Alferieff points to the Level of Development (LOD) Specification, created by the BIMForum, which helps to specify and communicate the content and reliability of building information models at various stages in the design and construction process. The specification allows model authors to define models for specific information exchange, milestones in a design work plan, and deliverables for specific functions. Quantity takeoff is one of those functions.
Advances in estimating technology are also helping to tackle 5D BIM issues. “We are always looking at technologies to enhance and improve our BIM processes,” says Mest. “Currently there are new takeoff products emerging that will accumulate information from the 3D model and allow the estimators to complete the 2D drawing takeoffs within the same suite of tools.”
The ability for estimators to do production estimating work concurrently with 2D and 3D content will streamline the now fragmented takeoff process and improve accuracy. Also with the right technology tools in place, construction objects in a model can be directly linked to assemblies in a customized estimating database. These assemblies contain the necessary specification variables used by estimators.
“Technology is continuously advancing and the future will be driven by the quality of data that estimators are provided to work with as much as the tools available to process it,” says Mest.
Today’s contractors are looking for better ways to collaboratively work with owners and other project team members to find the most cost-effective way to complete complex projects. 5D BIM processes, made more realistic with new technology, set the stage for reaching that goal.