LOS ANGELES-Poor communication between developers and contractors is a principal cause of budget and timeline issues, according to panelists at RealShare Apartments 2013 in Los Angeles. While discussing cost management strategies for development and renovation projects, the panel said transparency is a necessity in managing construction costs.

“The earlier that [developers] give real logistics on time frame, that is where you will see the best project,” said Mike Rovner, president of Mike Rovner Construction and one of the four speakers on the panel moderated by Greg Sadick, VP of Residential for Snyder Langston. After the panel, Rovner added that developers often want to discuss projects through email, but a face-to-face interview is essential to the project's success.

Jeff Bunker, president of Wermers Construction, suggested that “contractors [should] sit in on meetings with architects to better understand costs.” This way, contractors would know details about the project that may have been left out and can adjust cost expectations.

The panel, which also included Mark Montoya, VP at Morley Builders, and David Senden, principal at KTGY, covered the shortage of subcontractors and the importance of subcontractor credit checks. Since the recession several subcontractors went out of business or extended their credit lines. The panel warned that a laborer who had sufficient credit a few years ago might not now. Double checking liquidity will ensure there are no surprises mid-construction.

The shortage is also due to the multifamily development boom. GlobeSt.com has recently reported several properties breaking ground in the multifamily sector, including multiple high-rise buildings in downtown Los Angeles on six-acres purchased by Mack Urban and AECOM Capital.

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

Development
Los Angeles
Multifamily
National