CONSTRUCTION UPDATEIndustry Market Trends

FEDERAL SECTOR

Who attended this event last year?

Who “broke into” the Federal market in 2010?

Who expanded their Federal portfolio in 2010?

WHAT WILL YOU DISCOVER THIS MORNING

FUNDING: WHERE the Federal Dollars are

TRENDS: WHAT matters to the Government (matters to us)

FUTURE: HOW we position ourselves for success

WHERE THE FEDERAL DOLLAR$ ARE

DEPARTMENT OF DEFENSE (DoD) accounts for +-75% of FEDERAL $

FY 2009 $27.5 BBFY 2010 $18.5 BBFY 2011 $12.5 BBFY 2012 $10.0 BBFY 2013 $10.0 BB

Previous average DoD budgets ranged from $4 BB to $6 BB

FY 2012 budgets and beyond do not include prior years “carry overs” / are dependent upon political changes

Look for increased opportunities with:

The Department of Defense Education Activity (DoDEA)

The Department of Homeland Security (DHS)

TRENDS TO BE AWARE OF

USACE ACCOUNTS FOR 75% OF THE DOD BUDGET

FY 2011 MILCON Program includes +400 Projects @ +$9B

Design / Bid / Build: Continues to decline

Design Build (DB): Continues to run at 70% or greater

Multiple Award Task Order Contracts (MATOC’s): Continues to be primary contract delivery method (80% - 90%)

65% Energy Savings Goal: Best Value Points will be focused on improved mechanical systems ILO bike racks

LEED: Beginning FY 2013 all new facilities will be “certified” at the LEED silver or higher level

Building Information Modeling (BIM): Yes but…..

TRENDS TO BE AWARE OF

Centers of Standardization (CoS): Standard designs have been completed for 44 facility types, the first step towards implementing ABAccess Control Point (ACP) Advanced Individual Training (AIT) Complex Aircraft Rinse FacilityAirfield Headquarters (Afeld HQ) - Air Traffic Control Facility (ATC)Airfield Operations BuildingAir Traffic Control TowerArmy Community Service Center (ACSC) Army Family Housing (AFH)Attack Assault Cavalry Hangar (AAC)Automated Record Fire Range (ARF)Aviation Support Battalion Hangar (ASB)Basic 10M - 25M Firing Range (Zero)Basic Training (BT) and One Station Unit Training (OSUT) Complex Battalion/Brigade Headquarters (BN/BDE HQ) Battle Command Training Center (BCTC) Central Issue Facility (CIF) ChapelsChild Development Center (CDC) Infant/Toddler Child Development Center (CDC) School Age Classroom 21 (CR XXI) Command Control Facility (C2F) - General Purpose Headquarters (GPH)Combat Pistol - MP Firearms Qualification Course (CPQC)Company Operations Facility (COF)Consolidated Fire, Safety and Security Facility (CFS) Criminal Investigation Facility Drill Sergeant Barracks Enlisted Personnel Dining Facility (EPDF)

Family Life CenterFire Station (FS) Fixed Wing HangarGeneral Instruction Building (GIB) General Purpose Warehouse (GPW) General Support Aviation Battalion Hangar (GSAB)Information Systems Facility Initial Entry Training FacilityJudicial Centers Live Fire Exercise ShoothouseMilitary Entrance Processing Station (MEPS) Modified Record Fire Range (MRF)Museums Operational Readiness Training Complex (ORTC)Outdoor Sports Facility (OSF) Physical Fitness Facility (PFF) Reception Barracks Religious Education FacilitySoldier Family Support Center (SFSC) Starship Renovation Supply Support Activity (SSA) WarehouseTactical Equipment Maintenance Facility (TEMF) Training Support Center (TSC) Transient Training Officers Quarters Unaccompanied Enlisted Personnel Housing (UEPH) Unaccompanied Officers Quarters Unmanned Aircraft System Hangar (UAS)Urban Assault Complex (UAC)Warriors in Transition (WT) Complex Youth Activity Center (YAC)

TRENDS TO BE AWARE OF

Adapt Build (AB): Anticipated to primarily deliver designated Centers of Standardization (CoS) projects with FY 2012 goal of mostly AB

Currently 14 facility types with AB models in place:

Company Operations Facilities (COF)

Tactical Equipment Maintenance Facilities (TEMF)

Dining Facilities (DFAC’s)

Barracks – 7 anticipated AB projects in FY 11 & 12

Questions:

Has anyone actually done this yet?

Will you still need an A/E?

TRENDS TO BE AWARE OF

USACE TO IMPLEMENT IN 2011 “ADAPT BUILD”

USACE is building a library of Building Information Models (BIM) from the COS Programs

Theory: Bid projects from previous BIM’s – 95% Complete Documents

Reality: Great Idea with lots of challenges

Loss of Design-Build creativityHow many 0-5 y/o CDC’s will be built on a single installationEvery Installation has a different Design Guide & they changeEvery site has different environmental conditions:

Climate (HVAC)Existing Utility InfrastructureSeismic / Geotechnical / Topography

TRENDS TO BE AWARE OF

NAVFAC ACCOUNTS FOR 25% OF THE DOD BUDGET

Design / Bid / Build: Continues to decline

Design Build (DB): Continues to increase at 75% or greater

Early Contractor Involvement (ECI): Is on the rise

Energy: FY 2015 will require 30% reduction in Energy Cost

Energy: FY 2025 will require renewable resources

Safety: Ratings will become a strong differentiator in selection process

Betterments: Returning to getting as much in the budget as possible

Building Information Modeling (BIM): No but…..

POSITIONING FOR SUCCESS

MATOC’s / MACC’s: Get into the mix

ENERGY: Start focusing on how to save it then prove it

TARGET: Do your homework & find your sweet spot(s)

TEAMING: Remains a critical component for success

Mentor-Protégé’s are mutually beneficial to “break in”

Two of the Three require DoD experience (but always the A/E prime)

Maintain as much consistency in the team as possible

Be quick about it – the best teaming partners go fast