The Weekly Take from CBRE Brick: Commercial construction risks and opportunities
12 snips
May 12, 2025 Lisa Russo, Head of Construction at the Community Preservation Corporation, and Damian Watch, Vice President at PGM Real Estate, share their insights on commercial construction risks. They discuss the impact of volatile interest rates and tariffs, emphasizing the need for detailed contract reviews. Strategies for risk mitigation, such as early material procurement and increased contingencies, are explored. Labor challenges are highlighted, especially in affordable housing, amidst ongoing market volatility and innovative financing solutions.
AI Snips
Chapters
Transcript
Episode notes
Construction Cost Volatility
- Construction costs are highly volatile due to tariffs, interest rates, and supply chain issues.
- The market is nervous but adjusting, with some relief seen recently.
Scrutinize Contracts for Risk
- Evaluate construction contracts carefully, focusing on contract type, buyout status, and materials.
- Understanding these factors helps assess risk related to tariffs and cost exposures.
Early Material Procurement Strategy
- Developers often hedge by procuring materials early and storing them to mitigate cost uncertainties.
- Smart procurement strategies help manage price volatility and potential supply delays.