According to the “Commercial Property Remodeling US Market Research Report,” published in December by IBISWorld, there has been an increase in demand for remodeling services since 2012, which has led to an increase in revenue to $29 billion and 11.7 percent growth. The report also forecasts steady growth through 2022.
The 2018 ASHE/Health Facilities Management Hospital Construction Survey revealed that while funding for construction remained relatively flat, there were increases in budgets for renovations and infrastructure, as hospitals continue to focus on renovation versus new construction.
We’ve seen this same trend in our own work. Between what we’ve completed and are continuing to work on, we’ve renovated/restored 1.5 million SF to the tune of $218 million in 2017 alone. Those projects were across industries – healthcare, retail/mixed use, office, education, cultural/entertainment, and government.
IBIS says one reason we’re seeing more renovation work is the decreasing amount of available office space. Renovating often, though not always, can be a cost-effective option to building new space. And customers and clients like “new,” which can translate into higher confidence rates. Not only that, but new space can be effective for recruiting efforts too.
We also have clients that renovate to avoid maintenance headaches. For instance, aging HVAC and plumbing can wreak havoc on a budget. Plus, many times older systems and outdated technology are less efficient than new options and not as resilient. Many times efficiencies gained more than offset the renovation costs.
Finally renovating can help an organization use their space more wisely. They may find just by redesigning their office they have all the space they need to expand and add new features like a fully wired conference room that seats 25 people.
If you’re dreaming about new space, try and see the potential in the existing spaces around you. Engage a partner like Hoar Construction that can identify what are “solid bones” and what can be salvaged. Leverage the best technology and systems available to align efficiencies in your favor and increase your buying power. Look a little deeper and find the right value that may be closer to you than you are thinking.