The Trades

Today takes on a personal note from several perspectives. First, on my industrial deals, I’ve worked with general contractors and their sub contractors for over four decades. Secondly, my neighbor Rudy - my biggest fan and occasional column critic - made a great living working for Arciero Brothers. Their specialty was concrete work for massive tilt ups, multi family buildings and office towers. Rudy managed projects for them until his retirement. And finally, my wife and I are on the home stretch of completing a remodel of our house - a much needed freshening of a forty year old structure. Freshening is a bit like saying - some moisture recently - to describe the deluge of rain we’ve received this month in California. Yeah. We took the exterior down to the studs and replaced aging siding, drafty windows and cracking doors. We added square footage and remodeled interior finishes. The end result is amazing - but oh what a journey! Rudy suggested I write a column about the contractors - trades - that brought the completion forward. Jobs such as ours - tiny in comparison to the construction of a project of new logistics buildings - employs so many people. Allow me to elaborate.

Let’s take one of the new developments in the Inland Empire as an example. First, a land owner must be willing to sell. Then a developer must be willing to buy. Their dance is choreographed by folks in my profession - commercial real estate brokers. Generally, both seller and buyer have representation.
Once the points of the transaction are hammered out, an attorney or two enters the fray to insure the writings match the letter of intent and any verbal agreements.

A fully signed contract now transfers to an escrow company for execution. Title is involved to issue a preliminary report of things such as loans, liens, and easements affecting the ground.

So far, I’ve counted four professions in addition to a buyer and seller who’ve touched this deal - and it’s just underway.

Architects, soils engineers, civil and structural engineers, environmental people, city personnel in planning, building, police, fire, and council members all have a part in the opening acts. Six more professions and city employees are involved and the property hasn’t changed hands.
Someone must be willing to finance said project during its acquisition, construction, and hold period if leased. Loan brokers, banks, insurance companies, and lenders complete the encumbrances. Another profession gets a taste.

Once escrow closes, entitlements are completed and a building permit is issued. Now the fun begins as our project can go vertical. A general contractor is engaged to build and he deploys legions of sub-contractors including concrete, electricians, plumbers, carpenters, structural steel erectors, crane drivers, pavement, glass, roofers, heating ventilating and air conditioning, framers, drywall, landscapers, flooring, and many more. The number of jobs created by just one new industrial project is in the dozens. And that’s just one example.

Imagine the number of families supported by new construction. Thousands! And I’ve not mentioned the trades needed for day to day repairs and installations.

By the way, these are good jobs - capable of options for those employed such as saving for retirement, purchasing homes, sending their kids to great schools, and sponsoring awesome vacations. Many are unaware of the career opportunities available in the trades. It seems some believe college and management positions are the way. Certainly nothing against that path as it rings a familiar tone. But, you’ll know I’m right next time you need a plumber on Sunday or that faulty breaker trips. The helpless feeling of “whatever it costs - just restore my electricity” will resound. We once were a society that built stuff and lauded those who swung the hammers. I for one would enjoy a return to those days.

Allen C. Buchanan, SIOR, is a principal with Lee & Associates Commercial Real Estate Services in Orange. He can be reached at abuchanan@lee-associates.com or 714.564.7104. His website is allencbuchanan.blogspot.com.