Building Information Modeling Risks and Why it Works for WeWork
Updated: Apr 21, 2020
As I’ve mentioned before, pen and paper, similar to a computer system, are technical tools we’ve used for centuries. They help to relieve us of our need to memorize while assisting us in the stages of planning through visualization. For centuries, technical tools have been used to ease communication between investors, architects, designers.
Our focus today is on Building Information Modeling (BIM). It’s nothing new; however, the CRE industry isn’t adopting this technology as fast as it should. We are consistently reminded to “unlearn” our old ways, but are consistently failing to do so. Leave it to the 6-year-old company WeWork to pick up on BIM faster than the veterans of our industry. Change is scary, but you must be willing to learn how to unlearn old habits.
What is BIM? According to the National BIM Standard — U.S., BIM is defined as:
“a digital representation of physical and functional characteristics of a facility. As such it serves as a shared knowledge resource for information about a facility forming a reliable bases for decisions during its life-cycle from inception onward.”
Essentially, it helps people plan, design, organize, distribute, mine and communicate all information related to a project. It is used by planners, owners, developers, designers, bankers, operators, and more in the CRE world and behaves in structural, functional and behavioral ways.
Structurally, it is a representation of a building in terms of design and real life items or objects.
Functionally, like most technology today, it serves as a method of communication and a source of information that can be accessed easily. You can update models and make alterations and much faster paces via BIM.
Behaviorally, BIM shows us how a building will interact with its environment, promoting transparency and sustainability.
A notable benefit of BIM is the fact that it saves costs. How so? By reducing the need for paper planning through the use of exact and accurate 3-D replicas, planners are able to save time and eliminate waste. According to EVO Real Estate Group, waste can account for up to 57% of all construction costs.
Not Without Risks
All sounds good, right? Well, technology is not without its skeptics. Law firm Pepper Hamilton LLP points out a few risks associated with BIM, noting specifically the Spearin Doctrine. This Doctrine lays out a set of plans and specifications for a contractor to build in accordance with. If done so, it is not liable for any deficiency in the finished building and may be entitled to be compensated for any additional costs associated with construction. However, advancements in construction and building technology has blurred the lines between design and construction.
Another area of risk associated with BIM is the differentiation in liability of owner, contractor, and architect. If a conflict or issue is found at the end of a project, who is to blame? The architect? The contractor? The BIM software? It’s still pretty unclear.
It Works for WeWork
But, these concerns didn’t stop co-working top dog WeWork. Back in 2015, WeWork made a big move when it acquired Case, a building information modeling and consultancy firm. The acquisition is simply part of the company’s overall plan to become a vertically-integrated real estate venture.
According to Case Founder David Fano, WeWork likes to work in-house and has its own design, construction team, architects, and so on. Now it has a high-tech building and information system to compliment its rapid growth. According to WIRED, the company is looking to even create and build its own furniture in the future. Fano comments:
“I use the analogy often that Apple historically worked with a processor company, and then one day they bought a processor, because it’s so key to their technology they needed it. In the future, could we have our own company that does aluminum extruding, makes furniture, or our own custom wallpaper company?”
Since WeWork likes to work in-house, the complications associated with liability in terms of outside contractors, architects, and BIM information system is condensed. Who is responsible for any slip-ups? WeWork. The perks of consolidation.
BIM is pratical and highly beneficial throughout the lifecycle of certain projects. Perhaps, though, associated risks in terms of liability are less murky when used by a fully-integrated such as WeWork. BIM requires more initial capital investment from investors and developers, but cuts those high costs stemming from waste. Additionally, BIM puts more control into the hands of the developers and architects spearheading each project. It allows us to see conflicts ahead of the construction phase through 3-D BIM models. And if something doesn’t fit, the team can fix it on the spot.
In the same article published by WIRED, Dennis Shelden, an associate professor at MIT Architecture and co-founder of Gehry Technologies, points out the obvious functionality of BIM when it comes to CRE: “It’s kind of obvious. If you’re going to build a 3-D thing and the 3-D media is available, why wouldn’t you use those, rather than turning everything in 2-D slices?”