Does the PRICE of the square meter go up?

The requirements demanded by the complicated health scenario that Argentina is going through keep the calculators of red hot developers and construction actors. It happens that guidelines and protocols required by health authorities to neutralize infections with Covid-19 they force investors to add strong numbers to costs in themselves triggered from the current inflationary context.

Although it remains to define the total scope of the postulates that must be respected in the works in progress, in the segment already recognize that the changes will in themselves imply a additional outlay important. This, in order to readjust the activity as soon as the Buenos Aires government gives the green light to the development of enterprises.

Referents consulted by iProfessional They detailed what are the guidelines to implement in the face of a return to works. They recognize that, along with a rise in investment in tools for prevention, employers must also face a decreased productivity from the same distance between individuals that forces to impose the coronavirus.

Among other aspects, areas must be defined in the enterprises so that the personnel can change their clothes, disinfect completely and control the temperature. Also, in each project the installation of chemical baths and pauses will also be set between activities to disinfect tools.

In the field of construction, they point out that, along with these measures, there will also be a very limited return to activity in terms of Schedule: specifically, the labor regime will be a single shift during a first stage.

To this we must add another important cost, corresponding to the way in which the workers will get to the jobs. In this sense, developers consulted by iProfessional They indicated that they have already started discussions with private transport companies In this way, prevent workers from using public options.

“The alternative of using private transport is one aspect that we present to the city ​​government Because we share your concern with the infections that can be generated in buses, trains or subways. It remains to be defined whether it will be carried out through combis or through, precisely, buses. The option would also be of great help to carriers, that today they are totally stopped, “he told iProfessional Flavio Galli, CEO of Tueroc Group.

The developer and also a construction agent maintained that the City has just established sanitary criteria for these types of transfer alternatives.

“Operators should travel with a distance of at least two meters from each other, with permanent disinfection and other care. The drawback is to establish what the encounter with the workers will be like, who in most cases live in the Buenos Aires conurbation“he commented.

“Thinking about picking them up one by one is impractical. Maybe you can organize by zones. Of course, all this change in operations will have a significant effect on costs. It will imply a change and disbursements that not all construction actors are in a position to face in financial terms“he assured.

Effect on the price of the square meter

Galli, along with other players in the field, explained that the change that involves adapting the projects in development will result in a general increase in labor costs. And that this variable will have a direct effect on the final value of the constructed square meter.

The expert put his forecast in percentages: “Before the coronavirus broke out, the workforce it represented 45 percent of the cost in a developing venture. With the modifications that must be carried out this indicator will go to at least 60 percent“

“When we talk about labor, moreover, it is not only referring to the workers who work daily in construction. You also have to think of painters, plumbers, electricians. All of them will also have to apply a protocol, guarantee them safe transportation in health terms, “he explained.

Galli took it for granted that this 15 percent increase will be transferred directly to the final price of the square meter.

“The investment in health it must be done, and it must also be sustained. They are guidelines that require an investment and you have to see who can afford it. So it is not illogical to say that there will be projects that will not start at this stage. And because of a lack of funds for these changes they will probably remain paralyzed for a long time, “he said.

“You have to be aware that this is not an issue on which we can discuss. The protocols must be applied and adjusted to the health scenario. Because if they are not respected, the consequences may be worse: if there are infections, construction will stop again indefinitely, “he reasoned.

José Rozados, CEO of Real Estate Report, argued before iProfessional that the equation will become very uphill for builders and developers as the context “will now be divided between higher health costs and a drop in productivity”

Regarding the latter, the specialist maintained that the rate of progress of the works will be less due to the limited return of the workers. And that attention should also be paid to the reaction of material suppliers for construction, which also face great logistical and financial difficulties.

Invest against contagion

“Separating employees to cancel the possibility of contagion, placing them in a single work shift, everything will have an effect on cost. Whoever does the work will have to face safety and hygiene expenses, install more chemical toilets, generate disinfected spaces for the changing room. Then there will be until the tools are separated. The pace will be very slow, “he said.

Rozados agreed that the disbursements to be made by builders and developers will later be reflected in the square meter constructed.

“Quietly, it may be in the order of 15 percent the rise in the cost of labor. But keep in mind that it is a variation that occurs in pesos in a context of high volatility of the dollar. The final numbers of that cost just they will be known as soon as the activity returns to a certain sustained rhythm, “he clarified.

From the Central Society of Architects (SCA), its president, Darío López, said to iProfessional that the increase in costs will hit harder in the evolution of smaller works.

Moving to the workplace is one of the keys to solve for construction.

He explained that guaranteeing the transfer of the operators will represent one of the biggest challenges for the construction companies and also pointed out that there is still a need to define the time slot in which the works would be reactivated, although the emphasis will be placed on avoiding crowds outside work.

“There is discussion about whether to set a shift in the morning or, the same, but in the afternoon. The intention is to avoid ‘peak’ hours on the street. Returning with fewer people is also necessary to generate better health control. Case On the contrary, we should have a extra staffing observing that the protocol“he commented.

To conclude later: “The costs outside of labor are still a great mystery. Today we can say that there are no reference prices. It is an unprecedented situation from which we will have confirmation of how serious it is only when we have permission to resume the works. “

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