Everything You Need to Know About Healthcare Construction Part 3
In parts one and two of this three-part series, attorneys from our Orlando construction law firm discussed important considerations for contractors looking to provide provisions of labor and materials for healthcare construction projects. After explaining the importance of planning ahead, performing a thorough assessment of any existing medical facilities, and paying close attention to the owner’s demands for new facilities, we discussed the cost of healthcare construction and the value of an initial financial assessment. Now, we will bring this series to a close by discussing the effect of tariffs on health care construction.
New Tariffs, New Problems
The price of imported building materials like lumber and concrete increased sharply following a 10 percent tariff on 5,745 items from China worth over $200 billion in September of 2018. However, this is the only beginning as this tariff is planned to reach 25 percent to encourage builders to seek the help of materials suppliers based in the U.S. Shortly before the September tariff, in August, the price of imported steel was slapped with a 25 percent tariff. A 10 percent tariff on imported aluminum was also established around this time. The resulting increase in building costs has created a logistical nightmare for contractors who are scrambling to find ways to cut costs and meet their budgets.
Changing the Approach to Healthcare Construction
Healthcare providers who are looking to invest in new facilities are discovering that their plans might not be feasible anymore. As a result healthcare providers and construction professionals are considering alternatives such as:
- Delaying projects
- Submitting pre-emptive orders for building materials before another tariff spike
- Changing design plans to reduce costs
- Moving to the capital market
Unfortunately, with huge sums of money already invested in design plans and partially constructed facilities nationwide, there’s no win-win solution for contractors and owners at this time.
As it stands, healthcare construction is a potentially lucrative and highly specialized field of the construction industry that is struggling to maintain profitability through wave after wave of tariffs. Still, if you are interested in learning more about healthcare construction, an Orlando construction law attorney can tell you everything you need to know.
If you would like to speak with an Orlando construction law attorney, please contact us today.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.