The new Affordable Housing Schemes analysed


Your right of course - developers just sit around together trying to figure out handout schemes…..and not one of them has said to themselves ever hey I can be the Michael O’leary/Ryanair of this lot of tossers and crush all these lazy handout loving developers by increasing efficiency and taking out costs and making a fortune for myself? Nope no real entrepreneur, in the most entrepreneurial of sectors, has ever thought of what you’ve suggested.

Likewise international capital markets are completely dumb………as they assign Ireland‘s publicly listed home builders Cairn Homes / Glenveagh effectively liquidation values to their businesses….Glenveagh trades regularly below the cost of the money they spent on acquiring land…….dont these asset managers/hedge fund managers/pension funds realize these business are directly plugged into handout gravy train?
 
Read .
This is the first point in their Summery;
Globally, construction sector labor-productivity growth averaged 1 percent a year over the past two decades, compared with 2.8 percent for the total world economy and 3.6 percent for manufacturing. In a sample of countries analyzed, less than 25 percent of construction firms matched the productivity growth achieved in the overall economies where they work over the past decade. Absent change, global need for infrastructure and housing will be hard to meet. If construction productivity were to catch up with the total economy, the industry’s value added could rise by $1.6 trillion a year. That would meet about half of the world’s annual infrastructure needs or boost global GDP by 2 percent. One third of the opportunity is in the United States, where, since 1945, productivity in manufacturing, retail, and agriculture has grown by as much as 1,500 percent, but productivity in construction has barely increased at all.

Being a chancer doesn't make you an entrepreneur. Calling construction entrepreneurial is a joke. Entrepreneurs disrupt the market, they innovate, they change. Developers are more like gamblers.
It is an industry dominated by risk, where hubris and stuffed brown envelopes masquerade as intellect and competence.

Being plugged into tax payer funded life support doesn't make for an attractive investment opportunity.

Why has productivity in construction lagged so far behind just about every other form of manufacturing?
Here's the second point of McKinsey's report;
Examples of innovative firms and regions suggest that acting in seven areas simultaneously could boost productivity by 50 to 60 percent. They are: reshape regulation; rewire the contractual framework to reshape industry dynamics; rethink design and engineering processes; improve procurement and supply-chain management; improve on-site execution; infuse digital technology, new materials, and advanced automation; and reskill the workforce. Parts of the industry could move toward a manufacturing-inspired mass-production system that would boost productivity up to tenfold. Industrial and infrastructure megaprojects need to instill holistic project-operating systems on-site and in design offices. The highly non-linear and challenging nature of megaprojects underscores the difficulty of, and necessity for, moving toward an industrialized project-operating system (my Bold)
 
Yeah Irish property developers have never heard of any of that you should email them the report

Creating A Connected Experience for the Expansion of Copenhagen's Metro with Autodesk Build

Copenhagen Metro is standardising and digitalising their construction processes with Autodesk Build within Autodesk Construction Cloud™
construction.autodesk.com

[broken link removed]

Glenveagh and Panda among firms eyeing €3.5m quarry as bid deadline looms

Glenveagh Properties and Panda Waste are among a number of parties who have expressed interest in buying a West Dublin quarry with a guide price of €3.5m.
m.independent.ie
Btw Glenveagh subsequently bought the quarry and vertically integrated the process

Glenveagh run their whole business infrastructure in the cloud.

Biometrics measure contractors coming on site and benchmark time to complete tasks across 17 different sites for contractor efficiency measurement.

Advanced drones measure the site topography with lidar and laser tech.

They contract labor on multi-year contracts.

They introduced virtual reality viewings during the pandemic.

Self guided viewings we’re introduced where the front door lock could be unlocked remotely and viewers greeted by a person remote beamed in on the TV in the living room

They buy building materials in bulk and have standardized their home product such that they have limited material SKU’s and can deliver where possible modular solutions

what else would you like them to do?

Oh and through all those jiggs and reels the stock market looks at the economics of being a technological advanced scale home builder in Ireland & says…..no thanks…..we’re going to value your company for no more than the money you spent on the land you hold and not a cent more than that. If it was such a great business to be in the profit truffle hounds that are the capital markets would have found Cairn & Glenveagh and gave them a valuation more than their liquidation value.
 
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So there's one or two builders trying to do it right, but given that their own labour costs are increasing they are failing.

The Stock Markets value the sector as a whole, not on the minutia of any individual. Cairn & Glenveagh have no intellectual property, no disruptive technology, no disruptive processes or systems and they aren't self financing. By international standards they are technological followers in their industry, in Ireland an industry which is grossly inefficient, traditionally rife with corruption, in a small country with a small market subject to the whims of governments, trade unions, banks and the weather.

I'm a tradesman in the engineering sector. When I started 30 years ago it was skilled men on manual machines. Now those men are sitting in CAD rooms, robots are loading automated machines and we are making more money, paying higher wages and producing the parts cheaper than we did 30 years ago. Yes, the same parts can be made and sold cheaper in this country than 30 years ago.

If total wage costs to construct a 120 square meter home were 80% lower than 30 years ago then I'd take the notion that Glenveagh or anyone else was really efficient but despite all the advances in technology, despite all the advances in manufacturing processes and material sciences, despite the revolutionization of purchasing and supply chain management due to IT, you guys have still managed to increase your total labour costs over that period.
You operate in a sector which is not open to real competition, i.e. international competition, so you will never really be efficient. The same goes for other sectors like the medical industry or farming (where most income comes in the form of handouts).
 
I think you have utopian vision of what technology is capable of doing - the easy stuff has been done………..like moving retail commerce inventory from a physical store to an online catalogue. Delivering banking services online. Repetitive simple tasks done by people on production lines another. It may have taken time to get where we are today but in the future we’ll look back at what was solved in the last twenty years by technology as kind of the easy peazy stuff.

What remains for technology to disrupt are the really really complex problems and they are the ones that must exist & remain in the world of atoms not bits (construction, medical, farming, transportation). I think your underestimating the complexity of the problems left to solve by software & automation. I note that Mr.Tech Utopian man himself Elon Musk pulled back very severely how much he thought could be automated in the production of Tesla cars……saying something to the effect that he’d completely overestimated robotics capability to do complex tasks and completely underestimated the complexity of tasks humans in the real world perform. Note this today on Elon/Tesla's issues scaling solar roof - https://www.bloomberg.com/news/arti...st-and-a-fixation-for-elon-musk?sref=7zqHEcxJ ..........the real real world outside of factories/the internet is complex, variable & unpredictable. Progress here is slow and incremental.

I’m also gleaning ,from your comments, that you attribute the slowness of automation and technological adoption in said industries to a somewhat conspiratorial cartel of “insiders” in those industries who are protected somehow by the status quo. I’m always wary when I hear such thoughts. Btw I’m also gleaning that you think I’m a construction industry shill (sticking inside the theme of your conspiratorial thinking). I dont, I work in finance and have studied the construction industry in Ireland/abroad.

In terms of not open to real global competition in the construction sector in Ireland - think your ill informed about the constituency & origin of the developers currently operating in Ireland.…...…

- Cairn Homes was setup and has its origins as a UK hedge fund & asset management backed startup to develope c.2,000 homes year….they’ve a land bank of ~17,000

- Glenveagh properties was established by Oaktree Capital a New York based asset manager that IPO’d it In 2018 - their land bank is ~18,000

- Lone Star, a Texas based private equity fund, has created a developer Quiatian / DRes to deliver home on its c.9,000 home landbank

- Balfour Beaty is UK contract construction provider here - that is delivering big public procurement led construction

AND thats without mentioning that the money men & capital thats forward funding much of what the construction industry in Ireland is delivering on the commercial & apartment side is backed by foreign capital. You think the folks in London and New York who have options on where to deploy their capital into construction projects are allowing Ireland’s lazy/stupid/inefficient developers to deliver a product that doesn’t benchmark well against construction projects in other countries . Dont think so.

Plenty of international participation and traffic coming through Ireland - it is after all by most measures one of the most open economies in the world.
 
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I've worked in manufacturing for 30 years and have seen the move from manual to automated manufacturing. It is painful and difficult and only happens when there is no alternative.

letitroll said:
What remains for technology to disrupt are the really really complex problems and they are the ones that must exist & remain in the world of atoms not bits (construction, medical, farming, transportation).
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Since 1945 productivity in Farming in the USA has increased 1500%. Construction has hardly improved at all. This is not an Ireland thing, it's an international thing.
A single AI can read brain scans faster and more accurately than every Neurologist in the world combined. Wearable tech and AI's are revolutionising medicine and that will only increase in the coming years. There will be no need for your GP to be in Ireland for most consultations. That closed shop is about to be opened up.
Within a few decades we'll have autonomous cars everywhere. Amazon are already making deliveries with drones.


Car manufacturing is already one of the most streamlined and automated production processes in the world. The real cost a car now is a fraction of what its equivalent cost 50 years ago and cars are vastly better now.
No, I'm basing it on the factors that were outlined in the report I lined to.
letitroll said:
I’m always wary when I hear such thoughts.
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So have I.
letitroll said:
Btw I’m also gleaning that you think I’m a construction industry shill (sticking inside the theme of your conspiratorial thinking). I dont,
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Fair enough.
letitroll said:
I work in finance and have studied the construction industry in Ireland/abroad.
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So what's your opinion on the report?
There's plenty of competition on the finance side but they are all chasing the pool of actual builders. That means they can pick and choose and there is even less incentive for the building sector to become more efficient. International traffic is coming here because they are chasing higher returns due to the shortcomings of the system that delivers housing. That goes from Department of the Environment, the Courts and planning appeals process and the construction sector itself. The fact that developers can sit on massive land banks for so long, and it takes so long to develop them when they do get moving, shows how rotten the whole thing is.

We have companies here who make factory built homes but our regulations are designed for traditional build homes. That results in factory built homes in Mayo being sold in the USA but not being sold here.
 
Purple said:
Ah, okay. 'nuff said.
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reading your posts I can't stop thinking of the Grenfell towers mess and the prefabricated hostel's mess in direct provisions, the quick manufacturing
won the argument,
I looked at pre-manufacturing units some years ago l come from an engineering background I can tell you it's not like it says on the tin,
 
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(pre-fabs). Proper regulations are all that is needed to ensure quality.
A big part of the problem in this country is the lack of skills, competence and work ethic within the department of the environment housing enforcement division.
 
Purple said:
(pre-fabs). Proper regulations are all that is needed to ensure quality.
A big part of the problem in this country is the lack of skills, competence and work ethic within the department of the environment housing enforcement division.
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new House prices in Sweden increased on average by15% in the last year, they are predicted to go up by a larger % this year, if you check it out most is driven by regulations and Government policy,

A little research and you can see all is not as it seems,
 
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The State is certainly a major factor, possibly the biggest factor in house price inflation. My comments on the construction sector relate specifically to the hard construction itself and the related supply chain though their inefficiency has a knock on impact on the total cost of financing.

House prices and the cost of supply are not necessary linked.
 
I owned 5 houses so far in my lifetime 3 were self-builds and built to a high standard even by today's standards,

First self build in 1980 two of us bought the site and built together we did a lot of the work on it myself you may not realize I could buy a lot already prefabricated back then you could buy door frames already made up just put them in ready for plastering roof trusses kitchens stairs fireplaces EET, you could get all windows and doors supplied and fitted ready for plastering, windowsills were precast to a standard size everything was to a standard size, labor was not a big issue,
foundations were poured using Readymix,
block laying for 2 semi-detached houses took around 2 weeks 2 people, plastering finished in less than 2 weeks
We roofed it ourselves we did most of the plumbing laying gardening, chased walls for the electrician, we had a carpenter in for a few days to do bits and pieces,

most items for a new house are prefabricated or supplied in such a state as to require minimum labor once you build/work to standard sizes,
We started around April and were living in it by the end of August,

Labour is not a big issue by the time I got to build my second house a few years later roof guttering was fabricated on-site and fitted in a few hrs,
Built my last self-build in 1999 labor was not a major cost, built in a few months, I made sure everything where possible was off the shelf and to standard sizes and good quality,

I bought 2 houses for small money after the crash I would have lived in them while I was getting them ready for renting,, one is an old Irish land commission two-story house built around 1905 you would not believe how airtight and warm it is,
The other is a timber frame house built around 2007 the coldest house I ever lived in,
 
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I read the blog I would agree with almost all of it,
When you look at The standard prefabricated Items going into a new build like Windows Doors, window lintels, window sills, roof trusses, roof rainwater guttering, sanity Items, downpipes they are all sourced and manufactured in a cost-effectively way without major overheads,
I talked to people in the know/business who built using a very well known modular housing system cost was not an issue at the same time know how to drive a hard bargain,

They could have an Irish build for a lot lower price but they liked the idea of modular build, 'Money was not an Issue,

I would go so far as to say because money was not an Issue The built Modular to be different,

I get the feeling when talking to them they would not do it again because what was flexible when building becomes very inflexible and costly afterward,

Having said all of the above do people realize there were lots of hotels and apartments including private hospitals built in Ireland using modular designs before the crash,

In fact
There are leftover modular units being offered for sale on donedeal as a result of 2008 downturn still,
 
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Protocol said:
@Purple

A blog post that might be of interest:
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One theme running through the blog was the industry’s resistance to adopting new technologies. I think that the educational levels and general intelligence of a good proportion of the people working on building sites is a major factor in why that is the case, particularly in this country. That’s a reflection of our broader educational snobbery.

it’s an amazing thing when I have senior guys working with me asking that we don’t hire Irish trades people because the Eastern European guys are smarter and better trained.

I started off by saying that the whole sector globally was inefficient for multiple reasons, many of which were outlined again in that blog. I said that when houses could be fit into shipping containers it would revolutionise the industry. The blog points out that the cost per square foot for a house is low relative to other products but it fails to mention that most of the house is empty space so the actual square footage of the materials is much lower.
 
Purple said:
it’s an amazing thing when I have senior guys working with me asking that we don’t hire Irish trades people because the Eastern European guys are smarter and better trained
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Tell them they are doing something wrong the Irish went all over the world with little or no education and excelled they are talking muck,
Irish tradespeople built thousands and thousands of well-built houses in Ireland long before Eastern European tradespeople Arrived, I am not saying there is a connection around the time they arrived we started building substandard housing and taking shortcuts, The golden age of Irish social housing and slum clearance was between 1932 and 1956

I worked for a very well respected Engineering Company until I retired supplying parts to all the leading OEMs In the world, We supply the top five worldwide in our field,
we are the go-to company used by startups breaking into niche Markets in our field,

Chinese Manufacturers in an effort to break into both the European USA and first world markets fit out their machines using our parts,

We have several plants worldwide that use a one World supply bid system in other words whichever plant can best work with OEMs design teams get to work designing new parts,

once a design is confirmed and signed off all plants can bid to Manufacture Item,

When it comes to building great products It is Irish tradesmen and tradeswomen who came up through the company
That set the Irish company apart from the other plants and gave it a real edge over competitors,

Now to house building I self-built my first house in 1980 I hired one Irish tradesman and his brother as a helper to lay the blocks paying them by the block, including fitting window precast lintels including putting barge on roof two-story house, I put in the first-floor joists in once they reach the first floor, everything was level and fitted like a glove all spacings perfect,I put the roof trusses on the barge was left perfect for the factory trusses precast window sills door openings ESB box wall insulating everything was left as expected, lovely clean job no mortar mix left on block ties to allow dampness to cross the thermal barrier,
carpenter electrician plaster all Irish tradesmen everything as it should be,
Same for another two builds I did,

I take a keen interest in house building I have seen the None nationals and Irish tradesmen at work in Construction like Engineering
It is all down to how the company is run, no point in waiting around and wasting effort until the muck talkers finally sink the company,

several tradespeople I worked with went on to become metalwork teachers, others are now lecturing in collages I talk to them and know there are Issues but again it is the muck talkers that have it that way,

So what are ye doing wrong,

I know you posted you are a tradesman and the one thing you should know by now is a good Irish tradesperson no matter how well you pay him/her will not stay around if they have to listen to muck,

NO1 when recruiting good Irish tradespersons in engineering always recruit locally even more so in your case,

NO 2 if you hire a good Irish tradesperson into an engineering company and they are from the surrounding area They might live with the attitude posted above about them and stay,

NO3 It is well known in the trade good Irish tradesmen who find themself out of work will always travel within Ireland for work,

NO4 In lots of cases they will be looking out or be offered jobs close to their home again where they will be respected If any were unfortunate enough to find themselves employed, in a company described by you they would just glide until they could get to hell out of there as soon as they can,

NO 5 Eastern Europe guys are smarter and better trained,

NO 6 Eastern Europe guys may look smarter and better trained But I suspect the real reason is that the money they are on against what they can earn in their own country makes it worth their time to stay,


NO7 the people looking down on the Irish tradesperson are not as smart as he/she thinks so the Eastern European looks good against them, When it comes to engineering, Ireland is a very small place their views would be well-known through the grapevine only the scrapings of the barrel would bother applying for a job there

NO8 I have worked with tradespeople Irish and none nationals in different plants same company It is all down to how the Company is run nothing to do with where they were born, more got to do with recruiting local when you want to retain enhance skills long term,

Having reread the post I want to make one thing quite clear it is the senior guys who work with the poster that are talking muck,
 
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