The construction market back in 2006
Vitalis Consulting was born as a result of the market needs seen through the eyes of a young Project Manager. Back in 2006, the most important construction consultancy companies in Romania were owned by international players, who, regardless of the rich experience they had in the field, could not fully understand the needs of the Romanian construction market at that time on the rise.
If we were to briefly describe the Romanian Construction market in 2006, we can say it was defined by financial relaxation and it was on a growing path.
According to INS, in 2005 the volume of construction works reached approx. EUR 7,4 billion, with 9,8% more than in 2004 and in 2006 the volume of construction works registered almost 20% increase compared with the previous year. More and more local and international investors and developers were starting new projects in that period and the perspectives for a new local Project Management company were great, as it was proved over the years.
What we would have wanted to know about the Romanian Construction market 13 years ago?
Starting our activity in a market defined by a real estate “boom”, we had the chance to experience a healthy growth. However, there are things you only learn by facing, most of them unpredictable.
- An industry of change
Looking back to the construction sector from a historical point of view we can certainly say that for hundreds of years the industry was largely unchanged. Let’s remember now about plans drawn by hand, handwritten and physically filed notes and the way constructors were communicating in the days before the “technological revolution”.
In the last two decades and especially in the last 10 years the Romanian construction industry has seen more rapid changes and fluctuations than in any period in history. Besides the technological innovations that have made our life and work easier, we are talking about the real estate boom from 2006-2007, the crisis on the construction market from 2008-2009, the coming back market starting with 2010 – 2011 and a constant growing market nowadays.
We are also talking about the increase in overall construction costs, the workforce problem, the changes in developers and investors requirements and the constantly increasing demands of final clients as well. In times of such fluctuations, adaptability to change makes the difference for a local construction management company. Did we expect so many variations on the Romanian Construction market back in 2006? Definitely no. Can we make a forecast today for the following years? Now, after 13 years of experience, of course. In the end it is all about how fast are you able to react to change.
- A market crisis may bring advantages as well
A Construction market crisis is most often seen as a “black” period for all industry players, from constructors to project managers, developers and investors. With such an event we had the opportunity to cope in the early years of our activity. A period marked by radical management decisions, important projects placed on hold by developers, financing contracts rejected by banks and more. Have we seen then the benefits of the construction market crisis? No, but we focused all our resources on reducing costs, efficiently using resources and keeping close our Clients by developing our services portfolio and by adapting to market changes and requirements.
Looking back, the latest construction market crisis brought us a lot of advantages too. We learned how to survive in difficult times, what decisions are more important to make, how to improve our risk management tools, what people we should trust and many others. The market also benefit from a “general cleansing” after the crisis, as only the companies providing high quality services and professionalism could resist in such periods.
Moreover, in time of crisis, architects had more time to prepare concepts and the quality of constructions increased as the potential buyers or tenants will think twice before purchasing or renting a product. In time of crisis, feasibility studies based on new technologies can be carried out as well, leading to the lowering of the total construction process costs.
- Technologies, innovations and people
As the construction market is constantly changing and evolving, our best assets remain the people we work with and the technologies and innovations we embrace. By improving our working procedures, we manage to successfully achieve both our goals and our clients’ objectives.
- The government regulations may change the way we build
Along with the constantly changeable market demands and clients requirements, the legal regulations may influence the way and timing our work is done. The documentations, the legal papers, permits and authorizations, the new regulations regarding labour force in construction, all are changing the way we build or we manage building processes, sometimes making our job easier and other times making it more difficult than it used to be. Nevertheless, we need to be prepared for the unpredictable.
- With great power comes great responsibility
As Construction Managers, our responsibility is to complete in time and on budget the client’s project by supervising the project’s team which Initiates, Execute, Monitors, Controls and Closes the construction processes. We have though the power to make important decisions on client’s behalf on the construction site and not only, decisions that may influence the quality of the entire building process, having also in mind the client’s ultimate goal. Nonetheless we have also a responsibility towards the well-being of the final buyer, tenant or occupant of the buildings we coordinate. Our focus must be both on successfully completing the project and making the project a good environment for future occupants.