Thursday, July 7, 2016

California Construction July 2016: One Year After the Berkeley Balcony Collapse + Net Zero Construction Efforts in Silicon Valley

The construction industry isn’t a solid, uniform mass but rather a constantly evolving entity. On this blog, I have tracked technological and environmental trends transforming the industry, as well as, of course, legal updates. The construction industry in California, and in the larger United States is affected by a variety of events and fluctuations. Taking a look at current events, as well as what’s around the bend, is one way construction business owners and others involved with the industry could prepare, where possible, for coming changes. In this post, I’m looking at three things that are shaping the construction industry as we head further into the summer of 2016, with an emphasis on California construction issues.

One development taking shape now originated a year ago, when a balcony collapse in Berkeley led to 6 fatalities.  Criminal charges were not filed in connection with the incident, but the owner, builder and management company of the property were named in a civil lawsuit. Since that incident, government authorities have been taking steps to potentially address any future issues that could arise from similar circumstances. For example, following a determination that wood rot was the cause of the collapse, the City of Berkeley released a report which found that omissions in the Building Code itself could have contributed to the collapse. Immediately after the incident, a bill was introduced that would have required California contractors to officially report certain civil lawsuit settlements. Senate Bill 465 failed to move forward in the California Assembly. Then, last month, the California legislature advanced an amended bill that would mandate contractors to notify the California State License Board (“CSLB”) of felony or work-related criminal convictions .The bill put forward last year caused a stir among California contractors. A trade association representing the interests of contractors argued that a civil litigation settlement may not provide an accurate representation of the quality of work performed.  

Some big news recently came from the other side of the Atlantic, the departure of Great Britain from the European Union, what has been called “Brexit”. Americans immediately began to wonder if economic or other effects of the move would be felt in the United States. The housing market may have responded quickly to this development, which some see as a positive.  The logic is that America could receive a possible financial boost due to Brexit causing real estate investors to move their interests out of England . Others believe that the long term effects may not be so beneficial, as the overall consequences of Britain’s decision could slow down the US economy and therefore, the housing market.

Finally, a growing demand for green construction has taken what could be an important turn in Northern California. In the coming  years, California contractors will be required to meet certain standards in the building of new homes, set forth by the California Energy Commission. In an attempt to create a pathway for meeting these standards, a Canadian firm is now working on a net-zero residential project, the first of its kind. In Silicon Valley, a newly constructed home could mark the beginning of a new trend in residential construction, the use of steel instead of wood as building material. A company called BONE Structure is working on a custom home in Palo Alto that differs from the standard approach to construction in several ways – in addition to the steel frame, the building method consists of the off-site manufacture of custom made components, that are then shipped and put together at the location of the property. The objective of BONE Structure’s model appears to build energy efficient homes, which are also protected from natural events and other types of damage, and allow for less waste during construction, in a way that’s potentially feasible on a larger scale for California builders and homeowners.