Stacking the Deck: The Rise of Mass Timber in Modern Building
Could mass timber be the catalyst for the next era of construction efficiency and sustainability? Join Doug Kroll, Director of Business Development at Layton Construction, Pete Kobelt, Director of Mass Timber at STO Building Group, and James Litwin, Vice President of Construction at Harbor Bay, as they dissect how this groundbreaking material is streamlining project delivery, enhancing design flexibility, and reducing environmental impact.
HOST
Doug Kroll
Director of Business DevelopmentLayton Construction
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GUEST
Pete Kobelt
Director of Mass Timber SolutionsSTO Building Group
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GUEST
James Litwin
Vice President of ConstructionHarbor Bay Real Estate Advisors
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Doug Kroll (00:00):
Hello, and welcome to Building Conversations. I’m your host, Doug Kroll, Director of Business Development at Layton Construction. In today’s episode, we’re diving into a sustainable building approach that is here to stay: Mass Timber Construction. Joining me today is STOBG’s Director of Mass Timber, Pete Kobelt. Alongside Pete is Harbor Bay’s Vice President of Construction, James Litwin. Before we jump in, Pete, if you’d like to introduce yourself and then followed by James, introduce yourself, just a little synopsis, that would be fantastic.
Pete Kobelt (00:38):
Sure. Thanks, Doug. So, my name’s Pete Kobelt. I work for STO Building Group’s Mass Timber Construction Division, which helps fourteen of our family of companies—fourteen contractors around North America—work on mass timber projects and help clients navigate that process to successful project delivery.
James Litwin (01:02):
Good to meet you, Pete. Yeah, I’m James Litwin with Harbor Bay Ventures. I head up the construction department there. We were on a roll there right before the little downturn that we faced, but you know, about three quarters of a billion dollars a year. Right now we’re focused on trying to re-energize some timber projects for the pipeline. And things are looking good in a couple different markets: Atlanta, Columbus we’re looking at, and Cleveland again, too.
Doug Kroll (01:32):
Beautiful. Well, James and I have grown to become more familiar with each other over the last year as we’ve pursued projects with Harbor Bay and just developed a great friendship there. So I really appreciate you coming out to Utah and talking with us. And Pete, you’ve just been a wealth of knowledge for me, so I appreciate that. We’re going to start things off with James, why is Mass Timber becoming an increasingly attractive option for developers?
James Litwin (02:00):
Well, I think for us it was newness. And so it’s the new shiny object of everything that you can build. And I think it’ll continue to do that. Some people are driven on the environmental side, which we appreciate for sure. But the uniqueness of the product when you walk into a mass timber building, especially where you’re going to live, it’s just, there’s nothing like it and there’s nothing like it on the market. So, from a developer standpoint, being first to market is always a really good thing.
Doug Kroll (02:30):
Yeah. Speed is crucial. It sounds like it’s a huge benefit. Pete, what do you have to add to that?
Pete Kobelt (02:36):
Yeah, well, it’s an equation that we have to learn what matters for the developers because there’s so many—what I’ll call primary and secondary attributes to mass timber construction, design, and engineering. And so we have to work with the team to find out what’s compelling. Because as a contractor, it’s our job to make a really compelling business case for the system on top of maybe the more secondary attributes like sustainability carbon health and wellness, the biophilic response that we have to natural materials. So we have all these arrows in the quiver, but it’s our job to pull the right ones and respond to the project and do what’s right and best for the project.
Doug Kroll (03:24):
Yeah. The beauty to me with mass timber is flexibility, right? And there’s so many different advantages and compelling reasons why that product type is becoming more and more popular just within construction right now. So Pete, maybe share in more detail, how can stakeholders help developers create strong business models for mass timber?
Pete Kobelt (03:51):
Yeah. And that’s what has to happen is the whole AEC community architecture, engineering, construction, and to some extent the trades, the subtrades, the critical subtrades, have to really invest in education and learning. How does their trade respond to this new system? And how do architects design for efficiency, how do engineers design for efficiency as well. Right? We live in what we call this new buzzword: DFMA—designed for manufacturing and assembly. So that’s a different workflow paradigm. It’s a different process. And the partners in the process have to work with us on educating themselves so that we’re bringing best practices and, of course, lessons learned to the equation. But it really starts with education, which is, you know, what we were doing earlier today here in Salt Lake.
Doug Kroll (04:46):
Yeah. And Pete’s referencing our Mass Timber Summit that was hosted here by Layton Construction. And it was a great success. And we had James come out and Pete was a speaker as well. And James, just to echo, you know, and add anything more to what Pete just shared, what would you have to say? Stakeholders, their impact with developers is.
James Litwin (05:14):
I think for a project to be successful everybody needs to win. Again, the developer’s looking for fast lease up. So when you talk about speed and efficiency, if you’re talking about just the build you’re starting to get into a much more predictable way of building and predictability in investment is super important. You know, perhaps developers don’t pay a whole lot of attention to the built team. That’s where I think we’re a little unique there. Me being a builder myself I want to know that the players that are coming on site could be as efficient as they possibly can. And here’s where I think we’re only at the tip of the iceberg of what’s happening here. You know, the whole kit-of-parts notion that we discussed not being brand new was discussed in the, you know, 1908 and put into effect by Sears. That methodology is going to make its way into commercial building.
James Litwin (06:11):
It just has to. It’s so attractive from a predictability standpoint that you can’t not like it. And I think all of the following trades to acquire that kind of mentality that allows them to plan the limited resources they have mainly in, you know, human resource they could plan it better, it could be more predictable. What comes to my mind right away is the enclosure system. Well, if you know precisely within a day of where your building is going to be as you go vertical, well then you know exactly where your window installer can be. And if you know where your window installer can be, well then the electrician knows when he could start, right? And just so on and so on. So the more people grab onto a kit-of-parts mentality the better it is for everybody. I don’t know that developers are totally focused on that but I think certainly general contractors should be.
Doug Kroll (07:06):
Yeah. And you mentioned, you know predictability, right? And so I’m going to kind of piggyback off that thought. And obviously, developers need to have predictability to make projects work. Right? They create a proforma, they need to know that there’s going to be a return, and that if it’s a residential space, it’s going to be leased up. And they’re going to have success, right? The investment they’re making needs to have a return to it. So, kind of to piggyback off that, how important is early collaboration between developers, engineers, architects, and the construction team?
James Litwin (07:43):
We said it today. You know, again, I sit on, you know, 20 years of building in the field, 12 years of commercial construction management with premier players, two of them principally, and then eight years with a developer. If you do one thing, it’s hire your team right away. And if it were me, I said it today, I would have your builder with you when you were considering buying the piece of property, because as soon as he sees it, and as soon as he understands what you’re up to, then you hire a very good, either an architect that has an understanding of the importance of the frame the structural frame or you hire an engineer to come out and assess that property to optimize not only the property itself, but the size of the building that you could put on that building.
James Litwin (08:38):
So, to me, for a developer, it is absolutely essential this notion of you know, going through a lengthy RFI process that’s yesterday, right? Try to narrow that team down real quick. And I would propose that you would, you would have your RFP process focus more on the people, right? And how comfortable you are with the people, and how forward thinking that group is when you assess and get some help there, do some research, what, what are those metrics of measurement for a team? Because the metrics of for a team today is greatly different than it was way, way, you know, long ago or not, I should actually say not really long ago until timber starts coming, makes you think different, timing’s different. So early collaboration is the key. And, and I happen to think small agile teams ready to cycle through information and possibilities quicker is the way to go.
James Litwin (09:38):
So you could have a big company, but you have to have a really small agile team. And I guess the last point, and as I said today, I mean, you, you are blending kind of the old and wise people, you know, in my you know, generation with those young agile minds and that knowledge that is so, so cool that’s happening today. And the tools that are out there, your job is to find a team that blends that really, really well. And actually you have to help too, as a developer kind of instigate that kind of blending of collaboration early on. Yeah. That make sense? Yeah.
Pete Kobelt (10:16):
I mean, you can’t overstate everything James just said. And it’s a real advantage when you have someone with the depth of construction experience that James has on the development team. And then in the context of this whole new paradigm that says, well, we learned very quickly, it only took one job, right? May not have felt very quickly, but they figured it out on one job: this is the way to do it. And so we have to present a unified front and reinforce and amplify everything that James just said, so that the client, the owner, the university, whoever we’re talking to, is getting the same consistent message. And the mass timber is so unique in that you have a structural system that is also largely your finished system. And so it’s not just about the structure, it’s the implications that structure has on all the trades.
Pete Kobelt (11:13):
And as we talked about today, the difference in tolerance is that the incredible precision that the CNC machines deliver on the timber package are splitting millimeters in half. That has to tie in with concrete and steel. How do you deal with those tolerances? What is the impact on MEP, curtain wall? How fast can they chase? You know, we’re not racking and squaring a building at the end like we do with steel. We’re doing it bay by bay. So maybe a floor up curtain wall can start chasing adds to the accelerated schedule, which was part of us making a value proposition for the speed of build to bring back some of the potential premium associated with the timber. That’s where we bring that back. But we need all the trades to be doing that. And not having one guy throwing an anchor over the wall and saying, well, the curtain wall’s not here.
Pete Kobelt (11:58):
So communication and coordination. And the secondary piece with the curtain wall is we really are trying to protect the timber package from the elements as fast as we can. So the quicker we can button it up, we don’t necessarily have to condition it, but the more quickly we can button it up, the better. And during, you know, the challenging periods you guys built during COVID, we built at the end, we had supply chain issues and we did not focus enough on the curtain wall. He got a whole bunch delivered and got off to a great start, and then it didn’t follow on. And we had a half curtain wall building that was getting pummeled in the Texas weather, right? So yeah, it’s an early team. Pick your team early, ferret out what matters, help them navigate the different vendors and what they do, who’s efficient at what. We talked about this a lot today. A lot of different variances in efficiencies in these factories. And if you’ve got a massive glue lam structure, you better be going to a factory that has that capacity and capability and fabrication work, which helps us deliver on the speed of build again. Because if they cut the beams and they didn’t do the fabrication work, which is the steel, well, who’s doing that? Whose scope was that? You didn’t have your team together? Was it the steel guys? Is it the timber guy?
James Litwin (13:07):
I just want to pick up on a few important pieces there. Early collaboration, once you have the design, which is something we could, we could talk hours on, because it’s a human nature study, right? You have people that are locked in careers, locked in a certain way of doing things. And this is requiring that you do something different. It’s only 305,000 square feet, but do that in the middle of a pandemic, do that when you’re not allowed to meet in person. Right? Everybody’s flipped upside down and you still have to go, right? And where we kind of fell off is the enclosure. I mean we wanted nonstop to the top, and we got stop everywhere. I mean, we just start and stop and start and stop. You go fast for one piece, and then you go slow.
James Litwin (13:53):
And our enclosure cost us the lack of enclosure. It wasn’t the leaking through, it was the blowing in of the weather cost us an extra half a million dollars, right. To mitigate that. So once you decide you’re going, now you have to, now you have to convince the build team that they also have to do something differently. And so, I don’t know what the answer is, a value proposition of performance metrics, but you know, you have one week to get the enclosure around the perimeter of the building. If you do that, you know, here’s a little spiff, right? And then you do the same. I mean, we are toyed with those ideas, but you got to bring that, otherwise you’re losing some of that advantage. You built the frame really fast. What good is it getting the frame up in, you know, two thirds, you know less the time or a third, less the time. And not in closing.
Pete Kobelt (14:43):
We saw it in the early days. We saw it a lot where we would, we started using time-lapse cameras specifically to track the timber. Yep. And the contractor came and said, this whole thing is taking way longer than you promised. And I said, Nope, let’s go to the video tape. I’m going to show you that the timber package went up on, or ahead of schedule and on budget. And the timber was there and done. And we proved it. And we used that as a lesson learned to say, this is what happens when you don’t do it. And this is what can happen when you do it the right way. Certainly. And that was a self-performing contractor on the timber package.
Doug Kroll (15:22):
A couple notes. Early collaboration equals predictability. And I think that’s what I took away from our summit today as, as all the speakers, right? We had structural engineers, we had Pete, we had James, we had, you know, Anna from Bender Holt, and an installer from Timber Builders. So we had, what would, I guess, kind of encompass a team, right? We had a developer, a general contractor, an installer, a supplier, and a structural engineer. Obviously, we, we didn’t have an architect speak, but early collaboration equals predictability. The whole team understands the goal. The whole team understands the time, the whole team understands the whole process. Right. And I think to your point, you know, one trade can fall behind and that could really put a screw in the whole project, right? As far as time and speed and predictability.
Pete Kobelt (16:17):
A lot of us have believed in an open-source approach. Open-source mentality, open-source methodology where, okay, we did something. But if we don’t share that, then it’s going to take us five times as long to get to the next tier. You know, Michael Green did a great speech on TED Talks years ago, and he just pulled the curtain back and it helps spawn a revolution. A lot of these guys, James, Tim Gockman and Boris at Newland have been very transparent and it has inspired people to collaborate and make these additions and changes and keep innovating on a daily basis. And so it’s the spirit of James’ analogy that I think we’re really seeing right now. And look at the turnout today. We had people from all walks of life there asking really good questions. And, you know, it’s also part of why we speak a lot at, at higher ed, because we really need to inspire the next generation to get into this industry. You know we can go on about the trades and the deficits and the McKinsey report, but we need young architects, young engineers, young construction science people, and even the kids studying forestry so that we can continue to promote the tree to key you know, mentality and grow this thing.
James Litwin (17:38):
Well, also, to your point and shift, like how we do things, how hard it is to go to a student housing builder and say, here, try this new thing. It’s impossible. You’re not going to do that. They’re not going to do that. They’re going to do what they have to do to deliver. Yet the answer in predictability is the timber. Yeah. You know, it’s almost like you want somebody to backstop a delivery date on a student housing project so that they, when once they see the predictability of the time, their time intensive, you have to be done. August one, you’re finished a hundred percent. People are moving in the building, certainly, oh, here’s this new, you know, we’ve got to put a new team together. They’re like, no, no time out. We’re going to go and build this project the same way we’ve built every other one.
James Litwin (18:21):
So, to your point, raising the, that younger group that comes in that recognizes that, and also the point of women that play in this business, my comments about Anna were heartfelt because she was there. She was real—that woman grew up a good thing with a great dad who in the business, but she’s in a male dominated, think German engineering environment, right? And just think about her day to day. And she’s here alone today representing a company. That’s a change. That’s a change. And if, and if you would get her to go into the university with you and, and see the, and the new students, I guarantee the women will get attracted to her very quickly and want to hear what she has to say. Because she has courage, right? To do those things.
Pete Kobelt (19:09):
And you can’t be what you can’t see. That’s right. I just heard a piece on this in construction, getting women into the trades and these kids can’t be what they can’t see. That’s so getting them in there. And I think at STO Building Group, we do a really good job of recruiting across, you know, all sectors. And inspiring the next generation. Because we need ’em. We need ’em. We’re, we’re still going to be moving off site because we have to, but we’re still going to need the people that are the collaborators in the industry, or we’re not going to grow at the clip—we’re not going to be able to sustain this growth.
Doug Kroll (19:43):
Certainly. No. All, all great talking points. And they all tie together so well. And so kind of to carry the momentum on, right? You talked briefly, Pete, about the momentum within the U.S. with mass timber. Right? Mass timber’s been around a lot longer than people realize. And that’s something as I’ve learned a lot more about mass timber, you know gain an understanding that this is something that’s not new over in Europe or in the U.S. Right? But we’ve almost created this block in our mind that it’s like something so new and something so innovating. Well, really the innovating aspect of it is, is kind of the process, right? It’s in the team. And you reiterated that over and over and you did as well, Pete. So, you know, kind of talk about the momentum, STOBG and Layton, you know, the reason we put on this summit today is because we feel like there’s so much innovation and we feel like there’s so much growth within this, you know, building type and product type. Can you share with us a little bit, Pete, about some of the projects that you’re working on? I know you talked about higher education. I know that there’s, you know, projects going on within mass timber and that and other sectors. So share a little bit about that.
Pete Kobelt (21:04):
Well, that’s one of the exciting parts is that we’re seeing all these sectors that we never were able to predict are coming to the table. And part of that is the manifestation of these hybrids where we’re using a lot more steel and mixing and matching. Steel loves to do long spans, glue, lam doesn’t. So if we need a long span grid for the programming, well let’s build a hybrid. We can still put 500,000 square feet of CLT deck into a data center, but it’s going to be a steel structure, but it’s a hybrid and it helps that client check the box. 15,000 metric tons of carbon sequestered in one data center. It’s a nice box to check, right? Operational carbon data center. Different story, right? But, you know, you got to start somewhere. So, higher ed office my years back at Katerra where we were trying to productize some of these systems and do replicable grids and chassis, we spent a lot of time on office because we recognized very quickly that there’s just not that many grids that work really efficiently, right?
Pete Kobelt (22:04):
So 20 by 25, 20 by 20, 20 by 30. In Greg’s case today with PLA 15, I think it’s a 30 by 30, but that was just really driven by the, the developer. And so, be it, you’re going to have a little bit more fiber, here’s your penalty for that. But if you’re driven by that program, then it is what it is. So office was where we got started. Higher Ed for so many reasons is attracted to mass timber and now corporate campuses being also driven by the fact that how are we going to get all these employees back in our post-COVID world? How do we differentiate? Do they really care about health and wellness? Well, the answer is yes. So all these different sectors are the healthcare life sciences in biotech, the first wet lab, mass timber building in Seattle was installed.
Pete Kobelt (22:58):
Then we had to grapple with heavy vibration requirements you know that we learned about how tricky that can be today. So I think the excitement is all these new sectors coming in and the opportunities for different developers to participate. And then I think just the higher ed is never going to go away. Those campuses are competitive and many of them have legitimate, tangible climate scorecards sustainability initiatives. And those projects become the jewel box of the campuses. They finish their student tours at the timber buildings. The parents say, yeah, I want my kid to go to this dorm. And the kid says, yeah, I want to live in this dorm. You know, the day of me and James living in a cinder block jail cell dorm room, those days are over. There’s a much higher expectation on higher ed and in and in office settings. Yeah.
Doug Kroll (23:48):
I went to a junior college, right my first two years, and I remember we stayed in a dorm that was, it was pretty close to just cinder blocks, you know? And you talked about it today, that these community colleges are looking to possibly drop the community college, right? To create more of I guess a feeling of connection instead of just like: Hey, this is just a two year pit stop, right? This is a college; this is where you can learn trades. This is where you can learn skills. And they’re looking at doing these types of projects.
Pete Kobelt (24:23):
Yeah. That was a really exciting discovery. After a recent higher ed tour, we got invited by someone who attended that, who happened to be the facilities guy. I think we were in Austin at ACC, Austin Community College. And he said, by the way, we’re dropping the community. Because It’s just got a bad connotation, right? I mean, we just, we’re not trying to knock community colleges. They’re sure they’re so important and more so now than ever, so why we’re talking about it. But they’re just dropping it because it doesn’t add value to the title of the school. And he came to us and said, “I want you to come to ACC and do the same presentation. And then he said, and by the way, don’t overlook for one minute the renaissance that community colleges are going through around the country for various socioeconomic reasons and vocational training.”
Pete Kobelt (25:09):
We did a study with, with this, the mayor of Miami, when he came to the construction industry and said, what’s your biggest problem? We said, trades, who wants to be in Miami Mortaring CMU block together when it’s 115 degrees out and there’s ocean water coming out the storm drains at you. And, and he said, okay. And he went and did a study. He picked welding, which was really smart because you can advance in welding and you can get certainly higher certification stainless aluminum aerospace. He did a quick study. Long story short, if we had the, the economy could absorb 250,000 certified welders tomorrow across the country. And if they went on to get those advanced certifications, they’d be making low six figure jobs. Or the same as what they called the median income of a mid-tier lawyer in the United States. And that’s in a school district getting off on a tangent, but this really brings it home.
Pete Kobelt (26:02):
And it was an important discovery for me. That’s the largest school district, fourth largest school district in the United States. Miami-Dade could take 75% of those kids and train ’em in, in trades and give him a shot. Yeah. And the mayor picked it up and nailed it with, with welding. So, yeah. But again, this is in the context of us embracing offsite prefabrication and manufacturing. Because that’s where it’s going. And guys like James and I and Layton and STO Building Group all believe this and we’re investing in this because we’re convinced that’s where it’s going.
Doug Kroll (26:33):
Certainly. Absolutely. James, tell, you’ve briefly highlighted your Cleveland intro project which is a beautiful project. If you want to talk a little bit more about that project and then maybe some of your other projects that are picking up momentum or picking up speed. I know you guys are constantly looking to be innovators and to be ahead of the, the curve per se. Yeah. If you could dive into that.
James Litwin (27:01):
I’ll just intro Cleveland 530,000 square foot building, three hundred-plus of mass timber I think we’ve said it a few times, built in a pandemic, actually. We closed the loan on the day. The banking institutions throughout the world closed down. So that spoke to the strength of the Bell family and their commitment to the project. We closed the loan and then, you know, all looked at one another and said, now what? Right. So the very first thing up, of course, was digging a very large hole. We’ve got a two story below grade parking lot and we used sheet pile. And they were trying to—certain aspects of the society in general were trying to shut the project down. And fortunately the governor stepped in and said, “Look, this is critical infrastructure housing.”
James Litwin (27:58):
We’re going to keep on going. And the storyline that I sold to the city was accurate. And, again, objective, the people that would be working on the job for the first five months were going to be in their own cabs, isolated from everybody else or in a dump truck, right? That was it. So we drove pile very few guys, you know, and gals mingling. The excavators started there. You know, we had three main excavators on the project. And hundreds of dump trucks, everybody isolated. So, so that’s the way the project, you know, got out of the ground, no pun intended. But there was everything involved in that project. There was acquisition of material, there was overseas transportation, there was licensing that hadn’t been obtained to import the mass timber. There were incentive programs to make the project go.
James Litwin (28:51):
Ultimately to not make it go, but to enhance returns. You know, there were just so many different factors and so many different facets. And then in the end, you know, we, right before we started, we tried to do two projects at once. And a certain sector of the community shut that idea down, thinking they were going to lose money for the schools, which wasn’t really the case at all. But think about the great blessing that was because the second building was an office building. So just imagine we’d have an office building sitting there that’d probably still be empty today. Right. So that happened. But what happened when that happened is we put our entertainment center on the top of the apartment building.
James Litwin (29:38):
And so that was on the ninth floor. And now right below the ninth floor, of course, is the penthouse units. So, you know, now all of a sudden, we’re into a spring floor system to create air separation so that the penthouse units that are below don’t hear the band. And we had one heck of a test. We had the great blessing of having a great building official that supported us along with the fire department. I said, “I have got a problem. We have an NBA all-star party that wants to happen here.” And I could still hear him, you know, he said, “You’re kidding me.” He goes, “I said, no and we need to say yes.” And he said, “Okay, well let’s figure it out.” You know? And so we opened the building months before scheduled to open, and we had the NBA All-Star party there. It was stunning. Right? Stunning. And then, you know, I mean, it had everything in it. And, you know, from a build standpoint assembling different teams and having people plug in and plug out it was a heck of an experience.
Doug Kroll (30:38):
If you could take away and give us one lessons learned from that project. Just one, I know that might be a daunting task because I’m sure you had a lot, but what would you say your number one lesson learned from that project was?
James Litwin (30:57):
Trust young people.
Doug Kroll (30:59):
Interesting. Can you, can you expand on that, since I’m younger than both of you? Trust,
James Litwin (31:05):
Trust, trust young people.
Doug Kroll (31:07):
You trust me now, James?
James Litwin (31:08):
Yes, I do, always did. You’ve got to affirm your young people. They are smarter, they’re more handsome, they have more energy. And they just need direction. And fortunately for me, I said it earlier, you know, the old and the wise and the new and the, and able mind. I mean, you combine that with the tools that we have today, that is the win trust and affirm young people. That would be my biggest lesson.
Pete Kobelt (31:34):
I think that’s an, it’s an interesting one because the, when you look at the factories, that may be older guys like me and James running these, but when you get into project support and who’s modeling these buildings, we talked about some really talented modelers and how important that is. It’s these tech savvy, younger generation that are really passionate about this. And were smart enough to say the way these old guys have been doing it forever is garbage. And they jumped in many of them on their own accord and ferret it out opportunities to support the industry, but they can’t do it without us. And now we can’t do it without them. So it’s a great perfect storm of knowledge transfer. And it needs to happen now. You know, there’s a whole wave. Somebody had a stat, maybe you from McKinsey’s report of how many people are leaving construction in the next few short years. And it’s alarming. So that transfer needs to happen. And then, and then the curriculum development that I was referring to earlier, that’s happening. We have master’s level degree, University of Arkansas, Fay Jones School of Design and Architecture, one year, three semester master’s level programs in integrated wood design that include a whole bunch of curriculums on mass timber. And they’ve put people through it and have that now.
James Litwin (32:55):
I really should expand just a little bit more presentation to Kent State was to the architecture college and the construction management college. And the title of the presentation was Foreman in the Rye. All right. So, you know, Holden and, you know, Catcher in the Rye was trying to keep the kids from running off the cliff. And that was my message. The answers that you need are with the old guys and the old girls in the field. The blending of the old and the new, the people who know with the people who don’t. You could, a young person could tell me that there’s something in the way of a design that we’re doing, but they won’t know that you could move it. Or that if, if you change the timing of when it comes in, it won’t be an issue. They don’t know that part, but we know that we know what we can do with that. Right. But now they’re giving you that foresight into the building and it’s amazing. And that’s why I go right back. It’s the trust the children, trust the kids. Not children, but.
Doug Kroll (33:56):
And I’ve always hearing both of you talk about how much you guys are involved in higher education. Right? To me, that just kind of shows how much you’re wanting to give back. And I think history plus innovation: history, you’re taking lessons learned from years of doing this. Right? Plus involving innovation to where those two kinds of co-mingle and coexist. To me, that’s collaboration. And it’s early collaboration. And that’s again another form of helping us be predictable, helping us to, you know, solve problems. Think like innovators, think, you know, collaboratively. And so I’m going to kind of wrap it up with just one more question for both of you. This has been an awesome conversation, so I appreciate both of your time. So what advice would you give to a developer who is considering a first-time mass timber project? Pete, what would you give?
Pete Kobelt (34:54):
I was hoping you’d give that to the developer first. So it’s, it’s reinforcing and amplifying much of what we’ve been saying. Okay. I think Greg Kingsley today, who spoke, said it best when people come up to him and say: “Oh, we want to do a mass timber building. It’s so exciting.” And he just goes: “Why?”
Doug Kroll (35:23):
Yeah.
Pete Kobelt (35:24):
And then you figure out what, what do they, what conceptions do they have? What misconceptions? Well, it’s wood, it’s cheaper. I think that was his first analogy. So we had to work through that for years. I do that now. Now I come up through more of a biz dev, you know, progression. And so I’m a yes guy. You know, we want to do mass timber. Yes. Let’s go. But now I do the same thing. I say, why? And they say, well, you know, it’s cool, it’s fast. And you got to figure out what are they bringing to this conversation? And then where do I pick up the education from there? And so it’s, and then you can come back and help educate them in a manner commensurate with their needs. Right? Find out why did Harbor Bay ever in a million years, get on a path to mass timber and pull off, you know, one of the three most notable projects in North America in recent memory under grade adversity.
Pete Kobelt (36:21):
Why, why would you do that? And so it’s, it’s particularly important if you kind of know your audience. So let’s take it very hardcore developer driven thing. Well, we want to do it. It’s faster and we need you to make it cheaper. And, you know, we’re lowest first cost and we’re going to flip it. It’s not a good candidate. You know we often will push them back and that does one of two things. They either say, thank you for not wasting my time, or it’s reverse psychology. And they go, whoa, whoa, whoa. Wait a minute. We’re the developer here we’re, we’ll decide what’s good for us. And then I can give, I can help them navigate the process and what they need to think about and what really matters. Because We’ve also learned, and I’ll turn it over, that we talk a lot about sustainability and carbon and regional sourcing and forestry and FSC and SFI and PEFC, all of which are wonderful things.
Pete Kobelt (37:11):
But I’ve seen more of those conversations go out the window when I come with a lower first cost that doesn’t have those attributes. If I pick up a timber package, let’s just say for today’s discussion, since the conditions are favorable for the Austrians and the Europeans, they tell me all that stuff about Southern Pine, and we want to get some of our fiber from our state over to this state and put it in and tell that story. And I come in with a, a lower cost than that conversation goes away. So you got to, you got to play hardball and you got to ferret out what really matters so you don’t waste time. Because If I can figure that out upfront, I’m going to, I’m going to make the case for who we need to navigate towards early, pick the team early, ride that horse, and focus on designing that project for this company’s system.
Pete Kobelt (38:02):
We used to keep an open spec for months and months and months and grind three manufacturers against each other in the old-fashioned way, grind them in GCs, grind them down, lowest common denominator. Now we’re designing three different buildings with three different systems and three different species and three different connection recommendations. Some proprietary, some aftermarket, some off the shelf. And now it’s like, look, we’re going to throw it all into the algorithm pot, into the calculus, and we’re going to do a SWOT analysis for you. Here’s the lay of the land, and then here’s our best recommendation. Here’s a, as a, as our group. And again, this is where a unified front really helps. Architect agrees, engineer agrees. And, you know, there’s usually some massaging, I don’t know why it has to come from Canada when we’re in Houston, or, you know, whatever. Well, it’s because we’re going to use the rail and it’s actually going to be cheaper.
Pete Kobelt (38:51):
It’s less risky. So it’s, it’s all of those things that I have to do at the front end and have to find a guy like James who can preferably, you know, the more sophisticated our audience is now, the better off we are. Because we can just hit the ground running. You saw the model they developed. You know, we have the generate model that’s available now, generate design. People hadn’t seen it. We can, we can build a digital twin in 48 hours off of a massing diagram and hand it to a vendor who can come back and say, you’re doing this off of a massing diagram. I mean, concept level, pre-schematic, and I can have a detailed twin built off of this new platform. That’s a game changer. And it’s a game changer for the factory who all they have to do is put it into their library because that program pulled from their library initially.
Pete Kobelt (39:42):
And it’s their components there. And then they just took it out and we’re done. And that’s been a huge leapfrog. And so again, letting us bring all of that wealth of technology and knowledge into the discussion to get a more well-informed decision. Hey, it’s, if it’s a go, it’s a go. If it’s a no go fine. But we saved six months of time or longer. Some of these have been such a slow burn as interest rates change and then the commodity lumber changes. If we can get to that faster. It’s a huge advantage for everybody.
Doug Kroll (40:13):
Yeah. I, before I get to you James, I just, I feel like the why is massive. Right? Actually, a couple different speakers today brought that up. Why do you want to build mass timber? Why? And if there they’re a first-time developer, maybe they don’t know why. So do you feel like you can help them get to understand the different whys?
Pete Kobelt (40:39):
And I tell people like that are in James’s position, but not nearly as sophisticated. I say this exact phrase all the time, often in an interview setting, you know. Which is pretty rigid and strenuous. And I say, look, okay, it’s my turn to speak. I’m going to tell you some things you probably already know. I’m going to tell you some things I’m guessing you probably don’t know. But most importantly, I’m going to tell you some things that you don’t want to hear. But it’s my job to tell you that. Because if you’re going down the wrong path, I got to correct course and tell you you’re going down the wrong path. It doesn’t work that way. And some of them are, they’re very appreciative of that, that frankness, that transparency. And some, you know, don’t care for it. But there’s no, there’s an abundance of work right now.
Pete Kobelt (41:26):
Right. So we, we as contractors, have to work with the right developers on the right projects. We don’t have the bandwidth, you know, STO Building Group is what, a $12 billion company with 45 offices. Yeah. We don’t have the bandwidth to be Chase. That’s part of why after we landed our first big projects, we said we got to invest in this process because nobody’s, we’re getting calls left and right from mass timber. And nobody knows. We’ll do, is this a good one? California is seismic. Florida’s hurricane it’s Pensacola. What about its hurricane season? So we came to this business unit by virtue of the market need and demand. And it’s being very well received. And that’s how we educate. And again, the more sophisticated the client, the faster we’re off to the races. Because we’re just, we’re preaching to the choir.
Doug Kroll (42:20):
James.
James Litwin (42:22):
Yeah. I you know, Pete, to, to hear of your experience and the depth of your experience. I mean, we have so many, we have a lot of similarities, but I think chiefly is that we’ve been around a while, right? And you could see the things that come and go and so really appreciate listening to you and understanding where you’ve come from. One quick thing when you have STO sitting there, I was talking to Tom, you guys need to talk to Tom. You need to get on the phone with Tom Pope. He’s very much like generate, he’s not going to give you the engineering, but he’s going to give you the ability to, and this is what I was telling him, you need to package ideas and thoughts up and bring ’em to developers and send, there’s this inversion of what’s going on.
James Litwin (43:10):
That’s what needs to happen right now. Right now. And guys like you with your level of experience could really help that. And then I’m thinking about, I’m thinking about university, right? And I’m thinking about the response I got and I delivered it very calmly and very soft. And it wasn’t like in your face, architects you don’t matter. Of course you matter, of course they matter. They’re very important. But the ego part of it needs to be tempered so that you could see the solutions more clearly with the parts and pieces we have inter generate enter these softwares. These softwares are ahead of university right now, right this minute. Yeah, that’s true. And just the way that things are accelerating in the development of those tools, you’re going to see either the university is going to step up and into the, into this breach that, or they’re going to lose out because you’re not going to, you’re just not going to need ’em as much as you do.
James Litwin (44:07)
They’re, they’re outpacing you, you’ve taught them. Well, I was with dinner with an 82-year-old guy from controlled data. He was an engineer who was hired into the marketing department. And he was 26 years old or 27 years old. I can’t remember the exact date. But they were looking for young students. Now imagine this, he hits his stride and he’s in the eighties, okay? And he’s looking, and this is controlled data. They were talking and doing things that had never been done before. And they knew the kids had some ability that they needed, but they didn’t exactly know what they wanted from them. Right? And so he, he went out and he rushed them, right? And he brought these kids in. So, you know, college needs to be really careful back to simply the question. From my standpoint, a developer has to ask themselves, and this is where I was blessed with the bells.
James Litwin (45:01):
How competitive do you want to be? How competitive do you want to be? Do you really understand the depth of first to market? And then if you do the how competitive do you want to be, needs to be coupled with how much do you want to lead? How much do you want to show your leadership in your business? Because if you just want to build, to build, go build to build, that’s great. But if you’re looking for impact that’s beyond just the building, you got to ask yourself how competitive do you want to be? And I think right now, guys like Mark, you know, Mark played ball for Barry Alvarez. He’s very competitive. The very reason that he wanted to build with mass timbers because He thought it was cool. He’s like, that’s, there’s nothing like that. I want to do that; very competitive guy, D1 athlete.
James Litwin (45:51):
I want to go; I want to do it. And that’s what we did. Yeah. And everything else fell into place from a leadership standpoint. He got out of our way. He said, go do it. And we went and did it, and we went and did it. So guys like the Layton team. And then you go to a developer and you say, here, here’s a package. Where do you want to build? Oh, you want to build in this town, that town, that town. Okay, well here’s a package, here’s a project. We’ve got it all packed up for you. And what that means is that you’ve done your study, you’ve done your optimization of property for them on their behalf. Give them some ideas, bring them solutions before they even know what the questions are. Yeah, that makes sense?
Doug Kroll (46:30):
Absolutely. I think that’s fantastic advice. Not only just for developers, but just for all aspects of the construction industry. Right? I think some of the key words that I took from you guys talking both today and right now during this podcast is unified front trust, early collaboration, predictability, innovative, efficiency, speed, sustainability. Mass Timber really kind of encompasses all of this. And so when you asked me the question why I just gave you, you know, nine words of why. And I think, Pete, to your point, I think it’s our job to continue to, at least that’s kind of why I got the idea to do this Mass Timber summit is because I feel like so many people were asking me about mass timber, mass timber, mass timber. Well, let’s educate, let’s do our part right to collaborate, bring talent together, be an innovator in the industry.
Doug Kroll (47:37):
I don’t know of any other general contractor in Utah that has put a mass timber summit on. But to me, I want to be at the forefront. I want to collaborate with these developers and these architects and these engineers and these key players in this market that are only going to make the market stronger, which only, you know, betters all of our chances at succeeding. So with that we come to a conclusion and appreciate your guys’ time and thoughts and thank you. Thanks for having me.
Pete Kobelt (48:09):
Yeah. Let’s do it again. Let’s keep it going.
Doug Kroll (48:11):
Beautiful. Thanks guys.