4C — March 18 - April 21, 2022 — Owners, Developers & Managers — M id A tlantic Real Estate Journal


O wners , D evelopers & M anagers

By Richard Manners, Garden State Sealing Did you know that the price of asphalt cement has risen 69% since the end of 2020?

n less than 16 months, the cost of asphalt cement has risen from $354 per ton to $600 per ton. Now $600 per ton of cement is not unprecedented; the NJDOT asphalt index broke $600 in September of 2014. So, what is different now, and why is it affecting the cost of asphalt and concrete projects so much? I believe the compounding effect of increasing asphalt cement prices combined with the si- multaneous rise in every other cost associated with completing a project. Health insurance for employ- ees, wages, and workers comp insurance continue to rise on I

of 2021; the cost was $252,000. When we ordered it in Decem- ber, that same truck had risen to $307,000. 21% increase in 9 months? To make matters worse, we were supposed to have that truck this month, but we were recently informed that parts are missing and cannot give us a reliable delivery date. I’m sure everyone buys fuel, so you know what has hap- pened with fuel prices in the last six months. Did you know fuel is a high cost in producing asphalt and concrete? Fuel is also a factor in the production of the sand and stone that is required as

and direct work orders to the correct facilities teammembers. Often these applications can be used on a mobile device, which is ideal when the team is on the go. HF Planners, LLC, designs with mainte- nance in mind. With the right information, low preservation equipment and fixtures, and easy upkeep materials, the Facility Manager’s burden can be alleviated, which we could all use right now. Casey Murphy, CID is senior interior designer & project manager with HF Planners. MAREJ continued from page 3C Designing with maintenance in . . . well. Let’s not forget the equip- ment needed to mine the sand and gravel or heat the asphalt plant. These big machines don’t run on smiles. These costs must be promptly communicated from the bottom to the top of the supply chain. No one wants to be the bearer of bad news, but your custom- ers cannot adequately plan or make informed decisions with- out good information. Finding out that the parking lot paving project you budgeted $500,000 for will now cost you $600,000 is disappointing but finding out the week before it is scheduled to start will leave many people angry and upset. If these in- creased costs were communi- cated three or four months prior, there might have been time to adjust budgets or change project parameters to mitigate some or all the price increases and still achieve the desired outcomes. Some strategies can be uti- lized. Maybe change the scope from a traditional 2” mill and pave to a thin bonded overlay. This will reduce the amount of asphalt required and reduce the number of millings to be disposed of. Applying an asphalt sealer/rejuvenator and sealing any cracks could extend the serviceability of your pavement 3-5 years before the need to mill and pave, or maybe the budget can just be adjusted. Regardless of what decisions are made or strategies employed, it is essen- tial to have open lines of commu- nication so that cost increases do not blindside customers. Richard Manners is a real estate investor, com- mercial property owner, and president of Garden State Sealing. MAREJ

the labor side. Qualified labor is tough to find. As a result, in addition to higher salaries, companies are spending more to see, retain

and attract potential employees. The cost of equipment, if you can get your hands on it, is soaring. I received a quote for a new concrete truck in March

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