2020 has been a very interesting year. Who would’ve thought that we would be living through a pandemic of the magnitude of COVID-19? Yes, there have been other outbreaks such as SARS in 2003, MERS in 2012, Ebola in 2014, but they were mostly contained within a certain region of the globe, which allowed the rest of the world functioning with certain normality. Unfortunately, COVID-19 disrupted every aspect of our lives.

COVID-19 has had a huge impact in the manner businesses have operated. When the US President declared a national emergency, some states and businesses had already started taking measures to protect their employees, clients and the public in general. By this time, other countries had shut down schools, universities, businesses and any public gathering that could cause the virus to spread. Small and medium size businesses are financially fragile since many have cash reserves of two weeks to continue operating. How has this affected the North Texas commercial remodeling businesses?

Construction businesses in the state of Texas have felt the impact of COVID-19. Local county officials were having to make the decision as to what was considered an essential business. In Dallas County, they did fall under that category and were allowed to continue working with certain precautions put in place. But did this mean everything else ran smoothly? Well, not necessarily.

Permitting processes has been one of the impacts in the construction industry. Dallas city transitioned most of its permitting process online as a precaution to protect people from the virus. Builders have complained that before the pandemic they could go to the permit office and leave within a couple of hours. With the process now being online, it could take much longer or up to two months without action from the city as one builder stated. This is not typical of all Texas, but the city of Dallas has been adjusting to having most of their processes online and working to process these applications within 7 to 10 business days after submission.

Another area of impact has been a shortage of building materials and the rise of their cost. There has been scarcity of materials and products available to the public. How to forget the toilet paper frenzy? Well, the construction industry has seen a shortage of materials such as lumber and steel products. Many in the business mostly relied on China to import these items, but Chinese suppliers had shut down operations and began working on backlogged orders once they resumed operations. Prices have also risen due to this scarcity, such as lumber, which has seen an increase of 170% since April. It is estimated that overall costs have gone up at around 30% due to the virus’ effects on the economy. How can you work with these issues?

There are ways to counteract and subside these challenges. For the issues regarding the permitting process, it is recommended that you revise all documents required and any other specifications by the permit office. This allows you to have your documents verified and have a prompt response when they are complete and correct. Otherwise, this would require taking additional time to review. A possible solution to the increases in costs, is considering an escalation clause. This is a percentage increase in costs of materials beyond what was agreed, that the customer would have to cover. This way, all parties involved in the transaction are aware of these rising costs, which are out of the construction company’s control. Consult an attorney for further guidance.

We are living through unique times. As I stated before, 2020 has been an interesting year, one full of challenges and adaptation. We learn, we adapt, we grow and we move forward.

For further information, please contact us at antonio@nortexgcinc.com and we would be happy to assist you with your commercial remodeling needs.

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