The Tribune

* Supply shortages may leave projects ‘incomplete’

* Arawak Homes chief brands woe ‘unprecedented’

* Says many homes delayed on material availability

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

materials shortages and COVID-19 will combine to create “horror stories” for Bahamians in the process of building their own homes, a prominent developer predicted yesterday.

Franon Wilson, Arawak Homes president, told Tribune Business that some homeowners could be left with incomplete homes and significant cost overruns as a result of supply chain bottlenecks and pent-up construction demand stemming from COVID-19 lockdowns and restrictions imposed locally and abroad over the past 16 months.

While reassuring that the fixed-price nature of Arawak Homes’ contracts would protect its clients from these challenges, Mr Wilson described the post-lockdown challenges faced by his company and other developers as “unprecedented” during his 20-plus years with the firm.

He disclosed that shortages of critical materials - chiefly cement, concrete blocks and plywood - had been a consistent problem since The Bahamas emerged from last year’s COVID-19 lockdown, and were forcing Arawak Homes to constantly shift supplies around between homes it is building so that construction work can continue and delays are minimised.

Branding the impact as “huge”, Mr Wilson said that despite these efforts “a lot of home would be further along than they are if not for these issues”, and reiterated that - especially for construction and real estate development - time equals extra money and cost.

Disclosing that there has been “no cement on island for a couple of weeks”, the Arawak Homes president said he was “hopeful that issue corrects itself this week” but remained unsure if there would be sufficient supply for all who need this construction staple or if everyone would be rationed to just a portion of what they need.

“A lot of construction goes in order,” he told this newspaper. “If at any time you do not have materials for a particular step, while there are some steps you can move around and continue to work, there are some times when you need a specific material to get to the next stage and, if you cannot get that material everything comes to a grinding halt.

“That has a lot of serious implications. It’s unprecedented, and can truly lead to a lot of issues we do not need right now. This has never happened before. If you wanted it, you could get it, and we took it for granted. We work with local construction companies, and when they do not have certain things, whether it be cement or concrete blocks, the implications flow throughout.

“It’s definitely been a challenge for our company, no doubt about it. That’s a very real situation, a very live situation, and we have to continue to monitor that.” And Mr Wilson said supply shortages were being worsened by continued COVID-19 spread, which was forcing building materials manufacturers and merchants to either temporarily shut down or quarantine staff members in contact with infected persons.

Such disruptions were forcing suppliers to perform “gymnastics”, he added, and asserted: “It’s nothing short of wreaking havoc... These are just some of the issues the construction industry is working through but it’s definitely..... they use the term unprecedented a lot, but in this case it’s definitely fitting. Week by week it’s a different thing that pops up, and you don’t know what’s coming tomorrow.

“I have been in-house at Arawak Homes for more than 20 years and have never seen this before. Cement and plywood are normally things that you can go around and buy like bread on the shelf, and today you are literally scrambling. We have a lot of homes that should be further along but they aren’t because we need materials to move beyond a particular stage.

“It’s ongoing because maybe you can’t find four-inch blocks this week, or cement next week. Day-by-day, week-by-week, you’re not sure what’s available. There’s no doubt we would be further ahead if supplies were available. Any time there’s delays there’s a cost, and you have to put people on reduced work weeks. The impact is real, and it impacts a lot of people in the industry.”

While Arawak Homes fixed-price construction packages are “showing at a premium” as a result, Mr Wilson warned: “There are going to be horror stories coming out of this. People starting something new, and thought they had a good deal with an independent contractor, that person may not be able to finish as a result of delays and lack of materials.

“That will not come out until the end. Homes may be 90 percent, 95 percent finished. They may have started at a particular price, and never in their wildest dreams did they think it will come to the cost it has. Just when you think you have passed one issue another one pops up. In construction time is money, and if a project takes longer than it’s supposed to that’s a challenge

“This is huge; there’s no way to skirt around it. Week after week, depending on whether a home is at a particular stage and we can’t find materials, we have to move to another home at another stage. And, when the materials finally become available, go back to the previous house. It’s a huge impact.”

Two ex-Bahamian Contractors Association (BCA) presidents recently warned that construction costs will likely increase up to 20 percent this, and told project sponsors - ranging from multi-million dollar developers to residential home owners - to brace for a significant spike over the remainder of 2021 due to the post-COVID environment facing The Bahamas and rest of the world.

Stephen Wrinkle and Leonard Sands reiterated that increased construction activity and building materials demand had combined with post-COVID supply chain and shipping bottlenecks worldwide to generate a surge in costs, and corresponding shortage in materials, as the world continues to emerge from the pandemic.

Mr Wilson, meanwhile, said construction materials shortages were especially worrying given that The Bahamas is now in hurricane season, as an inability to secure and repair properties ahead of storms could result “in small issues becoming big issues”.