Ep 110 - Setting Projects up for Success

Adam Jones (00:15):

All right. Well, thanks for coming on the podcast Rob. I'd like to start with a question a little bit different. So usually, well this will be a scenario, so you're in a building and sorry, you're in a project meeting and they're looking to do a mass timber building. What are the first signs where you think this is going to be a big failure or this is going to be a big success?

Robert De Brincat (00:34):

Really good question. I think the first thing I look at is why are they considering timber? And you can ask that question directly or you can ask it subtly. But my first aim is to try to learn in that meeting why they're considering looking at these alternative solutions. If it's purely considered to be or hoping the timber solution is a silver bullet to solve their financial issues on the job, it may be over budget or whatnot. It never results in a good positive outcome for timber if they're purely looking at it from a sustainability perspective and not really considering the commercial outcomes. Again, it's very rare that they eventuate. So it's about getting that balance between the two and to try to work out why their main aim is to look at timber and why they're ringing us in the first place.

Adam Jones (01:36):

So let's say if they're coming in from a cost point of view and they've heard maybe even a wood solution seminar from four years ago that it's cheaper or maybe one of my podcasts from back in today and they come in purely on that point of view. So why would that attitude and mindset maybe actually paradoxically yield to the opposite outcomes of cost effectiveness?

Robert De Brincat (01:56):

The majority of the time those projects have gone through the runner, they've done plenty of laps, they've looked at certain types of builders and maybe the second or third or fourth builder are looking at it. And there's a huge drive to look for, as I said before, a silver bullet from a cost perspective to try to get it down to the rate that the developer or the client wants. And generally when we look at those projects, the layouts are wrong. They wrong, they're, they're not efficient, there's lots of low transfers, there's big spans. The backend is inefficient, the wet area locations are inefficient. And what's really interesting is when we sit down with them we're finding this a lot now they're willing to go back to the drawing board and do a certain section change through their planning to rearrange the layouts. And the irony of it is that by doing it and making efficient in timber, it would be more efficient in traditional construction as well.

(02:48):

So what is really confusing to me is how these projects got there in the first place. If they were designed efficiently for traditional construction then they are ultimately an efficient solution for timber as well. Not always, but a lot of the time. And the reverse is true where if you design it efficiently in timber, and we said this years ago Adam, when we were looking at certain presentations about design it, so it could be timber rather than designing it to say it has to be timber design it, so it could be timber because if you would do achieve that, it's going to be efficient in traditional construction as well. So it's about giving the timber the opportunity to be specified or considered at a cost-effective rate early on in the design process, which gives you an efficient design in the long run anyway.

Adam Jones (03:41):

So do you reckon, Rob, that you can say have both options running for how long at the very start or do you almost advise you to back a horse and whether it's concrete or timber and just purely design it from that perspective or can you, I mean some coming in new for the first time, it's kind of attractive to have that backup all along that you can just fall back on concrete?

Robert De Brincat (04:03):

Yeah, I think a lot of people in the timber industry will disagree with this, but I think you need to have that attitude when we're trying to move a timber solution that there needs to be that option to bail and go conventional. There is always an opportunity, there's always a point in time during the development of a designer or a project where you have to commit, you have to make that decision. It's up until that point you need to give them an opportunity, not an opportunity to get out but make them comfortable that they're not committing yet. And in all the jobs I've worked in, we've always attempted to do that and it's about giving a concept design some pricing that's got some validity to it. It's linked to the concept design generated and gives them enough information so they can make that educated decision and help them guide them through that process. But there is a point when you got to commit, there is always on a job. However, when you're looking at traditional construction that point, it exists throughout the development of the design. When you're looking at something alternative, there is a point you need to commit, but it's about giving them that comfort that they can go traditional up until that point rather than saying right from the start, you need to start designing it exactly as timber because ultimately it's really hard to firm up those prices that early. You need to get a reasonable distance down the process before you really need them to commit to the system.

Adam Jones (05:40):

Yeah. What sort of comments have you got on the importance of having the right people in the room at the start and the idea of the old model applying to this model and coming from that from a project dynamic and team sort of point of view?

Robert De Brincat (05:54):

What do you mean by the old model?

 

 

Adam Jones (05:57):

Well in construction, so the design and D&C sort of traditional whereas this could say is more bringing designs upfront and doing things differently from a manufacturing and assembly point of view.

Robert De Brincat (06:11):

So there's two parts to that. It's the right people, having the right people, I can't stress enough how important that is it. It's a frustrating process like yourself. We've been in this game for a fair bit of time. I was trying to do the math before I jumped on here. I think it's approaching 12 years or so since got into the timber game and were

Adam Jones (06:35):

There. Just cut you off there you for people listening, I think you were the first at Xam, you first employee at XLam?

Robert De Brincat (06:40):

Yeah, yeah, yeah. And I started, there you go. I was their first Australian Australian employee. They had a New Zealand business at the time, but I was, oh gee, three to four years at Tilling Timber prior to that working with KLH in the European. So from day one there was always an education process and then even whatever day it is now, when you multiply as say 12 years, it still is an education process and it's really frustrating when you're walking into one of these meetings and there's very few people in there who know what they're talking about when it comes to timber and probably more dangerous for people who think they know what they're talking about and driving a certain outcome in those meetings. So to try to get the right people in the room who have done it, who are experienced in it is so important.

(07:29):

It allows you to identify whether this is a genuine opportunity. It allows you to prolong that commitment duration as well because they can kind of walk that bike road a bit more and that's across all disciplines. Fire is probably paramount now. Fire's become really front and center in all of this and fire engineers are getting their time in the limelight at the moment when it comes to timber buildings, their front and center, and you got to get the good fire engineer on who gets it acoustic structure, architecture builders, builders are really, really important. So getting the right team in and what we've become really good at, when I say anyone who's been involved in this game for as long as we have it's identifying that early and getting the right people in the room for the right opportunity. Now the second part of that, you talk about what is the best design procurement model DNC bringing design front and the Australian markets done a pretty good job I think, of taking timber through to the DNC market, a lot of these big jobs that come out that they've been able to specify enough on the drawings that you can go to the whole market you can go to Europe, you can go to the local suppliers.

 

(08:53):

Even us at greed, we we're still putting timber concrete composite systems forward on these as an alternative solution and the builder can pick and choose. I think the Aussies have done a really good job in, I don't say good job, it's best if it's designed upfront, but that they've been able to adapt the way we do it here in Australia with timber. So I think they've done a really good job of doing that. However, trying to design it upfront is always the best way. And we've spoken about ECI's, I'm still a huge fan of them when it comes to timber buildings, getting the right people in the room, getting the point where you're putting some decent concept designs and genuine pricing on the table for people to make decisions and then getting to detailed design with that same team and take that forward for the duration of the job.

Adam Jones (09:47):

A couple of things on that, so look why it does. It's one of those things like a lot of things in timber, everyone's been saying it for five years that this is the best way, this is the best way, but then nothing really changes and maybe that early supplier involvement or early contractor involvement, it seems to happen just sometimes and not just across the board locked in sort of thing. What are your thoughts on what mean, do you agree with that premise and what are the thoughts if you agree that this is the case?

Robert De Brincat (10:14):

Yeah, look I think that if an ECI process was genuine, a lot of people, it's interesting since I've been in Sydney, what they define what the market sees an ECI to compared to Melbourne is very different. It's almost in Melbourne. I honestly felt where the people get offended by this is that Melbourne took it as a genuine eci. There was a genuine budget put forward where the builder would go up with price it, here's what we want to target and they'll work together to get with that result. A lot of the ECIs I got involved in really early here in Sydney was it was almost like a low ball to get in the door. And then the ECI was this fight to walk it up and get it to where the price should be. It just ultimately led to a pretty awkward situation during the ECI throughout the job.

(11:09):

And there's a lot of situations where people bail in the ECI and go out the tender afterwards. There's always an outcome. But I think if people were doing in a genuine ACI from both the client side as well as the builder side and everyone else involved, I think that timber would be more prominent in the Australian market than it is now. Even though it is, it's getting there. There's timber building's getting up. We've got a second CLT in next timber being coming to the market really soon down in South Australia. So the market's growing. Europeans are starting to get back into the game here and there's some local people involved. So it's definitely growing. But if we were to adopt an ECI process in a genuine framework with genuine targets and realistic targets both time and money, I think that timber would be going a bit better than it is at the moment.

Adam Jones (12:08):

Do you see, I mean, trust as being an issue upfront because there is that idea that you could get squeezed out later down the track or from a previous experience at land? I won't say what job for obvious reasons, but well, it happens all the time actually. You put loads of effort into a design, hold the hand of the developer, get it to a point where, and then you just get kicked off the job and it means the work you've done Upham to that point is just pointless. I mean that's from a supplier's point of view. Yeah, I mean that's What are your thoughts on trust and relationships and can the construction industry sort of facilitated or is it just too Machiavelli out there?

Robert De Brincat (12:44):

Oh, it's pretty rough trust. I'm a big survivor fan and I've been watching the Aussie survivor recently and one of the contestants said, if you want loyalty, get a dog. And I thought it was pretty funny, but

Adam Jones (13:01):

That's brilliant.

Robert De Brincat (13:02):

Probably quite relevant to the question too, I've been doing the timber game for 12 years, but I was in general construction prior to that. So it's only now I'm starting to realize I'm getting a bit longing the tooth and getting a bit of experience behind me with all the younger people coming through. But there used to be a lot more loyalty and trust in the construction industry. And I think that's just the framework of the D&C contract. The risk profile builders are going into having worked on the other side for head contractors, it's a huge risk profile and it's something that doesn't encourage trust and doesn't encourage loyalty moving forward. I think a lot of builders and subcontractors would love to have that, but the framework, it's really hard to nurture that type of relationship throughout your subcontractor suppliers and consultants and the like.

(14:01):

So it is important when you're trying to sell a timber solution, there needs to be an element of trust in there. And I think the only thing you can really rely on is your experience and be able to go with the confidence and the right people, do those clients, be it developers or builders, and show them that you've done it. And that's one of the benefits of us as a team here at is we've got a pretty good team of people, lot of experience, and we've got the confidence to be able to go in from a consultant, builder, manufacturer, a supplier, install perspective and go, guys, we've done this before. And it tends to make people listen a bit better and that develops a bit of trust, but from a commercial perspective it's not a done deal until it's signed. And there's been plenty examples of what you've explained, Adam, when you were at XLam.

 

(14:57):

We've been doing it for long enough that it's happened over and over again and probably don't get as upset Adam anymore than I used to. There's been plenty of jobs that I worked on for goodness 3, 4, 5 years and didn't get any of it in someone else's sort of reaping the rewards of some of the hard work that was done by others. But that's the nature and I think we need to work as a unified group of people within the timber industry. It's not huge. So let's work together against work together rather than against each other. Yeah,

Adam Jones (15:29):

That's great. If I've put my devil's advocate hat on and let's say if you're a client or a builder and someone brings it up in a design meeting and the usual issues against it come up like costs and fire and compliance and durability and moisture and things like that, where does all those devil's advocate ideas have a lot of merit and which ones are just perception and not reality?

Robert De Brincat (15:57):

Yeah, it's a good question. I always treat them as all having a degree of reality. However, a lot of them are based on experience and the biggest downfall or the biggest issue that people encounter are the unknown unknowns. And out of all of those, I think that moisture is probably one of the biggest. And it's because it's not really measurable, hard to control costs. You can analyze, you can look at that, you can bring experts in from a costing perspective as well as fire and acoustics. There's enough information out there. Fire has kind of gone a bit on a tangent with certain opinions and fire is something that's very difficult to predict. And because there's not a lot of fire testing on huge timber buildings, it's hard to see how it would actually, not hard, but there's an opportunity there for the theory to get a fair way out of practice.

(17:03):

So I can understand that. But there's experts out there, there's plenty of experts in Australia and around the world who have dealt with that. But when it comes to moisture, I've done jobs that have just been fantastic from a moisture perspective and I've done been hell and back with moisture on certain timber jobs as well. And I think the key thing is that in all of those scenarios there, it was always resolved. It was always resolved. And it's something that we need to consider, you need to know about. You need to respect it. You can't just be covering it up and kind of imagine it didn't happen because it'll stick its head up later, you've got to fix it. But every single job has always been resolved. So there are methodologies out there to manage it during construction. You might have a job where it hardly rains and there might be a job where it just keeps raining or it could rain lately a hundred million one day or in a matter of hours.

 

 

(18:03):

So they're all different scenarios but I think out of all of those, the one thing that is still popping its head up that needs to be considered. And it's almost like every time a builder does a timber building for the first time, they learn the moisture lesson. And rather than actually probably listening to others that have been there done that to learn from it and just make sure you've got the allowances in there. But I think all the other ones are achievable. Cost is a really interesting one. Is it cheaper, isn't it? There's been reports from different organizations over many, many years that timber's more cost effective. We haven't bottomed it out yet, we just simply haven't bottomed it out. It's as simple as that. And I think, what

Adam Jones (18:49):

Do you mean by Biden Bridge out, Rob?

Robert De Brincat (18:51):

Oh, got to the bottom level or the bottom tier of where the cost could get to. I think there are some companies out there that have run it several times. They've refined it and they're getting to a really good model and they're delivering something at a really good price where others will do it once and go, it was too expensive, all nonsense. It was Cause you did it once and you probably didn't have enough contingency in there and you learn your mistake, you learnt some lessons, there was mistakes. But if you refine it like the concrete industry, they just refined it in design and manufacture and supply and contracting and all of that. The commercial elements of it, they've refined it down to the nth degree. It's really efficient. Everyone knows how to do it. It's almost a cut paste. Timber hasn't got there yet, and I have absolutely no doubt if it gets there. I think when it gets there, yes. How long it, I'm not sure yet, but if it gets there it is will be without doubt, more cost effective. It's just getting there. Yeah.

Adam Jones (19:56):

Yeah. I might just follow on from one question on that. So if you're an architect listening right now, what sort of thing if we're going for a triple bottom line, so the sustainability, which is inherently timber and biophilia, but cost. Yeah. So what's on the chopping block and sort of needs to be sacrificed from architectural point of view if we're actually going to optimize for cost. Because I mean some projects it might be you think you get the best of both worlds and maybe not. What do you think?

Robert De Brincat (20:25):

Yeah, look, it's not so much compromise. I don't think there is much to compromise it. It's the layout. You've got to design it to the layer. And anytime I get a, it happens, I wouldn't say daily, but it's at least a few times a week that someone sends a drawing to me and says, can we do this in timber? And it's the first things you look at. It's the layout, it's the span. It's how the layout lines up structurally between the levels. It's the facade and it's your four to four heights and your balconies. They're all vets and checklist. Now, if a designer can review those and make them efficient in timber, and as I've said earlier on, if it's efficient in timber, it'll be efficient and conventional. So if you can tick those boxes and understand what is efficient in timber and achieve that, then you're going to get a cost effective outcome.

(21:22):

The next thing is the architect. The QS can look at price, but the only price that matters is the price. You're getting to sign the contract to build the building. That's ultimately the only price that matters in my view, because that's what the going to cost you. So it's about how do you achieve that? And that comes from the builder. So is it under an ECI? Is it under a competitive tender? How is that? How do you attack that to get the best ultimate price? Because we've priced exact same job. I won't name the job, but this happened numerous times where we've won it and we went with three builders and the feedback back from the builders there was $2,000 a square meter difference, which is impossible, which is impossible. The builder that won the job, smashed it, really got committed to it, sometimes they don't.

(22:21):

Some of it, there's some issues and whatnot. There's always issues. But this job, for example, since I've been at really doing really, really successful and the builder did really, really well out of it, so they made more money than they projected in their contingency margin. So how on earth is a builder at two odd thousand dollars more and how are they tackling that entire pricing process? And that's my vendetta at the moment is try to understand what's going on there, get into the heads of the builder and understand why that's the case. It's not always, the gap isn't always that big, but there's always a gap and it's just understanding how they interpret that information and what risk profile they're willing to take to go in. So I think design's one thing, but then getting the right price, you could have strategies that align, but somewhat independent on every job.

Adam Jones (23:11):

Yeah, no, it's awesome. I might risk running old ground here, but let's say if we got some drivers for towards timber, which are obvious for everyone listening probably, what are some of the blockers? Why isn't it things going mainstream at the moment, at the macro level, things really to stop and the industry moving forward at the moment? Or maybe not necessarily macro micro as well.

Robert De Brincat (23:36):

I think it hasn't yet aligned properly with the procurement model in Australia, that D&C. Yeah we looked at a job recently where we went in with an alternative solution as a supply install contractor. We were up against the traditional in timber, which is a installer and a supplier. We packaged it all up during the negotiations with the builder. It was us and others involved as competitors. It then suddenly moved to the other company, had to do a supply and install as well. Then it moved into a DNC. This is during negotiation. And the builder ultimately said, it has to be a D&C. You have to design it and you have to construct it. And the risk profile suddenly went from if you had a scale of one to 10, it was sitting at three and went to 10 after one phone call, we still put an offer in, we didn't get the job.

(24:36):

But it shows how it shifted in a very short period of time from your traditional supply and then an install to a supply install to a DNC. I think if the market offered a full D&C for this, I think it would be going significantly further than it. It would accelerate it because the risk suddenly shifts to somebody else. The challenge with that is are there companies out there willing to do full D&C packages and take that risk? A lot of the timber industry are still from the old school. It's fed up through the saws and the wholesalers and they've evolved their businesses, they've expanded their businesses and got involved in prefabrication, mass timber and the like, but at their core, they really just want to cut wood and sell it. So they've evolved from that. Their business divisions have evolved from that, but they haven't evolved anywhere near a full d c offer to the market with a tier one, tier two builder.

(25:42):

They look at that and they go, mate, the risk, it's not 10, it's a thousand. I'm out. So I think that if was the offering, then the market would've definitely taken it on. It's really interesting. We get compared to post-tension a lot concrete and we're moving a new timber concrete composite line we're or product offering and service offering where we're combining the two as a product suite and people are, we're out there doing market research and people are constantly comparing us to post-tensioning going, just why don't you offer what post-tension people did back in the day, which was they started off with this technology of post-tensioning and it very quickly got into D&C and they offered full d c package and then look at post-tensioning. Now it is, it's refined. We're probably one of the best in the world of doing it because it went down that D&C route. So I think that's one of the biggest hurdles. Are there people out there, but we're considering it? Well, I think we've got the people who have the experience and risk profile to be able to look at it and go, we can qualify that risk, modify that risk and put a submission in. I say that, but it's not our primary business model at the moment. As a tackler it may evolve into that, but I think that's one of the whole D&C trying along with that procurement is what's been the major difference.

Adam Jones (27:15):

All right, so moving on to the last questionnaire now, Rob. So what do you see as the future of mass timber construction in five and 10 years now, considering maybe what we've spoken about, but technological change and just general shifts and trends and everything like that?

Robert De Brincat (27:31):

Yeah, I think the timber concrete composite market's going to be big. It's something we've mentioned that we're in that space. We've kind of preempted that with all these towers coming online. I genuinely think that there's going to be external forces coming into play in the construction industry about sustainability to say that you need to start building more sustainable just away from greenstar or in addition to greenstar looking at building materials going to happen. I think it's a reality now. We're living it day by day. People out there may not agree. There's still some people out there who think global warming's nonsense, but why not do things more sustainable? I think we'll end up with a better result anyway rather than taking the risk and taking the punt to say it isn't real. I think we we're experiencing that and it's going to be forced onto the market when I'm not sure, but to start looking more sustainably and timber is at the front of the line in my opinion for that.

(28:36):

But there's limitations with the solid mass timber solution in spans by acoustics height and the like. And you see these towers now, they're going to go hybrid. So I think TCC's, timber concrete composite's a big market. I think that's one of the big ticks. I think the D&C model, I think there's got to be some big investment in this space where some of the contractors will get involved in D&C I think if that will really allow the market to take the next step. And I also think that the hybrid between timber framing stick bill in a prefab, so your traditional studs marrying with Mass timber is also a big market. It's something that haven't seen a lot of. Then the PeeWee's do it a fair bit, not a huge market, but they do it over there. I remember when I was at xLam was their first priority was like, why can't we just get CLT in a floor of a house because we build pretty cheap over here. And CLT was always a bit more expensive. But I think there's a big market there too, in that space of bringing new traditional timber framing we do really well here in Australia and bringing mass timber into that and creating a hybrid solution, whether it's a TCC or CLT or Glulam. I think that's where the three areas I see the future is as evolving in the timber industry here in Australia.

Adam Jones (30:10):

Awesome. Well it's been great chatting to you today, Rob. So the first chat we had was two or three years ago on 55 Southbank Boulevard. If people interested, want to go back to that? If people want to find out more about yourself and some of the things we've been speaking about, where should everybody be going?

Robert De Brincat (30:25):

Oh, look for Viridi group. viridigroup.com.au as a website and for me, look, just if you want drop me a message on LinkedIn, more than happy to give you a call back or shoot your message back and have a chat. That's probably the best way to get in contact with us.

Adam Jones (30:44):

Great. Thanks mate. We'll leave you there.