METALCONLive! made a robust return this week with a peek into the “future.” Normally we would be gathering for the annual, in-person event this month — METALCONLive! makes it possible to be together “virtually.” As Director Judy Geller said in her opening remarks, “We can’t have our live event as usual, but that doesn’t mean we have abandoned our mission of bringing together buyers, sellers, manufacturers and suppliers of metal for use in design and construction.”
Moderator, Frank Stasiowski, FAIA and METALCON Co-Founder in partnership with the Metal Construction Association, along with a “blue-ribbon” panel of experts, tackled the issues surrounding market changes for the construction and metal construction industry, and what to expect heading into next year.
Panelists included Tony Bouquot, General Manager, Metal Building Manufacturers Association (MBMA), Paul Giovannoni, Managing Director, FMI Corporation, and Alan Scott, FAIA, LEED Fellow, Senior Consultant, Building Science Solutions at Intertek. Unfortunately Dr. Sarah Skidmore, Leadership Development Consultant and Executive Coach with Skidmore Consulting, had to cancel due to illness. We wish her well and hope to welcome her on a future MCLive! program.
Kicking off the event, Frank took the opportunity to highlight what he “feels good about and what he is worried about.” While he worries about a winter resurgence of the virus, Frank feels, “the metal construction industry on a whole has performed very well compared to many other industries.” While many unknown factors will continue to positively and negatively influence the industry, he still “feels good about the ‘roaring twenties’ paving the way to a strong decade ahead.” Change means new business and new opportunities to take advantage of. He then dove in with the panelists and uncovered the economic and market changes for metal construction and design decision-makers, and how to grab these once-in-a-business-cycle opportunities.
Market Influencers & Predictors
Speaking on behalf of FMI, Paul Giovannoni said “their focus is on economic research, so they are constantly monitoring the market and predicting trends.” He commented, “When we look at the market, we are still seeing companies in our industry remain busy and the impact of the recession has not been felt.” He attributed this to “burning through the back-log” caused by the record high numbers of 2019. Looking toward 2021, Paul advised, “There is reason to be concerned as he is starting to see a gap in project pipelines.“ This will continue to decrease into next year and cause a contraction in the market based on underlying issues with the current boom in single-family residences. As more and more blue-collar workers start to feel the economic crunch, foreclosures will increase and negatively impact the market.”
All was not as “rosy” for the metal construction manufacturers this year. Tony Bouquot, with MBMA, said, “We saw the numbers dip in Q2, down 13%, and new orders were down 29%. This carried over into Q3 causing numbers to be flat and the prediction for Q4 forecast is looking down. We typically see a drop off in Q4 but we predict an extra 10% this year due to lack of pipeline projects.”
On the design side, Alan Scott, a consultant to architects and designers, said he is seeing similar trends this year as with the contractor and manufacturing segments and planning for the market to contract in 2021. He commented, “While there was a small number of layoffs this year, design work has been steady and architects are busy, but I’m fearful we are seeing the “cliff” coming.”
Managing the Uncertainties for 2021
All agreed uncertainties lie ahead and believe the industry’s future performance will not necessarily be tied to the election results. Tony went on record to share his personal “Hot Take” saying he does not think the election is going to have any effect on what’s in store for 2021 and the biggest thing affecting the economy right now is the pandemic. Paul agreed but believes the election’s impact will at least give the country some direction.
Looking into his “crystal ball,” Paul said, “My advice is based on risk aversion. Manufacturers — get close with your customers and help them mitigate their risks. Focus on innovation and invest in R&D; manufacturers who did this during last recession came out on top once the recession was over.” Paul also sees an opportunity in the rehabilitation/restoration building segment versus new building over the next year. Tony concurred and added he’s seen an increase in the “repurposing of metal buildings,” along with warehouse/storage, utilities, and sports facilities as the biggest growth area for his manufacturing members.
Alan commented, “A bright spot for designers is potential new opportunities with commercial real estate.” Since remote working is not perfect, offices won’t go away but they will need to be redesigned and reconfigured to create hybrid solutions. He said, “There will also need to be solutions for the empty ground floor retail space available as a result of the small business closings.” He added, “Use of steel and coatings for interior spaces may increase since these materials are proving better for cleaning and less transference of illness.” Answering an audience question about adding COVID-related adjustments to building designs, Alan said, “I am seeing changes in mechanical systems such as ventilation and the addition of smart phone apps to call the elevator so you don’t have to touch the buttons.”
Other topics discussed included the status of the stimulus package, greater use of technology in the construction industry, the status of available capital and the growing trend of climate change influencing decision-making. All areas to keep an eye on in the coming year.
Please submit any questions or comments to: info@metalcon.com.
JOIN US AGAIN ON OCTOBER 21, 2020 @ 1PM EST
Brought to you by MCA, this webinar will explore how to use a structural standing seam system in recover applications on an existing building with a sloped roof. The course will cover 6 ways to do a metal over metal recover, how to put metal over single ply or modified Bitumen roof as well as metal over shingle application, including advantages and pit falls in each application.
And mark your calendar for October 6-8, 2021 when the METALCON community will once again meet in person. First round of drinks is on Frank! 😉
