FOUNDATIONS NEWSLTR FEBRUARY

FEBRUARY 2022

December 2021 September November October August June July 2021 2021 2021 2021 2021

ROCHESTER AREA BUILDERS, INC.

Job Shadow

Spring

Remodelers Rochester Area Builders

Networking Night

EDUCATION REGISTRATION OPEN

SHOWCASE OVERALL SPONSORSHIP AVAILABLE

SCHOLARSHIP APPLICATION

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16

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D C

DEVELOPMENT COUNCIL a division of the Rochester Area Builders, Inc.

C OMMERCIAL C B UILDERS

OUNCIL

a division of Rochester Area Builders, Inc.

2 | FEBRUARY 2022

STAFF EXECUTIVE DIRECTOR John Eischen,

John@RochesterAreaBuilders.com STAFF

Online Permit Submission

UPDATE!

Shelly Bahlmann,

Shelly@RochesterAreaBuilders.com Golf Outing, Sporting Clays, Home Show, Directory, Newsletter, RAB Update

Rebekah Fierst,

Rebekah@RochesterAreaBuilders.com Ambassadors, Awards, Builders, Bags & Brews, Commercial Builders Council, Community Relations,

Education, Membership, Fashion Show, Program, Remodelers Council, Executive & Remodelers Tour, 40 Below

Elizabeth Sullivan-Burton,

Elizabeth@RochesterAreaBuilders.com Builders Exchange Trustees and

Showcase Committee, Website GOVERNMENT & PUBLIC AFFAIRS CONSULTANT Rick Dold, Rick@GodwinDold.com

BOARD OF DIRECTORS PRESIDENT

Becky Holmen, Haley Lighting

VICE PRESIDENT

Jason Scrimshaw, Kimley-Horn & Associates, Inc.

SECRETARY

Jennifer Mitchell, Edina Realty

TREASURER

Jessica Markley, Elias Construction, LLC

PAST PRESIDENT

Luke Stier, Stier Construction, Inc.

DIRECTORS

Adam Giannini, Meyer Borgman Johnson Adam Kramer, Kramer Contracting Jarett Jones, Merchants Bank Aaron Thompson, The Design Connection Austin Ryan, Ryan Windows & Siding Charlie Sweeney, Kraus-Anderson Construction Melissa Barbour, TLS Companies, LLC Megan Gallagher, Solar Connection Jennifer Lawver, ERH Developing, Inc.

BUILDERS EXCHANGE COUNCIL CHAIR

Katie Reinhart, Kraus-Anderson Construction

COMMERCIAL BUILDERS COUNCIL CHAIR

Robbie Danko, The Boldt Company

When submitting your permit online doing the following will greatly improve your chances of acceptance, speedy processing, and approval.

1. Use your PDF software to optimize your plan before submitting a.

Optimizing the plan allows the city departments to more effectively process your submittal within the system.

b.

Optimizing the plan will also improve the City’s ability to efficiently review your plans.

2. Only submit one Drawing per permit that includes all building and site plan information a.

The drawing should include the mechanical and plumbing information.

b.

Any other plan information you submit should be submitted as additional information and not as a drawing.

c.

You are allowed as much information as you need for your submittal, but each submittal should only have one drawing.

d.

Submitting more than one drawing may cause the rejection of your submittal.

e.

In the event your submittal is not rejected with more than one drawing, having more than one drawing results in multiple approvals within each which delays the process and approval of your application.

Use the link below to check the status of permits filed with the City of Rochester Agency Counter: https://rochestermn.agencycounter.com/m/home

DEVELOPMENT COUNCIL CHAIR

Hal Henderson, HGA Architects & Engineers

REMODELERS COUNCIL CHAIR

Krista Weisz, Stier Construction, Inc.

40 BELOW CHAIR

Adam Giannini, Meyer Borgman Johnson, Inc.

NATIONAL LIFE DIRECTORS

Steve Buss, Cornerstone Builders & Real Estate, Inc. (Rep)

NATIONAL DIRECTORS

Dana Hlebichuk, Widseth Levi Kaiser, Benike Construction Todd Severson, TLS Companies, LLC

STATE DIRECTORS

Mike Allen, Mike Allen Homes, LLC Jean DeWitz, DeWitz Home Builders, Inc. Kathy Einck, Maplewood Homes.LLC (Rep) John McGuine, JM Consulting Dan Severson, Dan Severson Builders, Inc., Kenneth Bush, Bush Companies

MISSION STATEMENT The Rochester Area Builders, Inc, chartered in 1953, is a professional organization of commercial & residential builders, remodelers, developers and associated businesses dedicated to advancing the building industry in Southeast Minnesota.

We are the trusted voice of the industry, providing leadership, education, networking, and information resources to our members, community and government officials.

3 | FOUNDATIONS NEWSLTR

8 15 PERMIT REPORTS

11 UPDATE..............................................................2

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27

SPRING SHOWCASE......................................16-17

Online permit update

Ad Rate Sheet for Magazine

RAB CALENDAR...................................................4

HOME SHOW................................................18-19

February 2022

LETTER FROM RAB PRESIDENT............................5

Booth Registration Information

NAHB EYE ON HOUSING.....................................23

Becky Holmen, Haley Lighting, 2022 RAB President

Inflation Hits 39-Year High

MEMBER REPORT................................................6

GROWING AFFORDABLE INCLUSIVE NEIGHBORHOODS (GAIN) .............................24-25

Welcome New Members

2022 CALENDAR..................................................7

New Construction Incentive

LETTER FROM EXECUTIVE DIRECTOR....................8

Rochester, Byron & Pine Island

NAHB EYE ON HOUSING.....................................10

November 2021

EDUCATION.......................................................11

October 2021

RAB Events

Review of 2021

Residential Building Worker Wages Registration Information

CITY OF ROCHESTER..........................................12

Global Mayors Challenge

SCHOLARSHIPS.................................................15

Scholarship Form

BUILDING PERMITS...........................................26 OLMSTED BUILDING PERMITS ...........................27

SEMR HISTORICAL OVERVIEW............................27 NAHB EYE ON HOUSING.....................................30

Building Materials Prices Increase

4 | FEBRUARY 2022

February 2022 Sunday

Monday

Tuesday

Wednesday 1

8:00 AM Remodelers Council Exec.

7 12:00 PM Government Affairs Committee

13

8 3:00 PM Board Meeting

Saturday

2

3

4

5

9

10

11

12

16

17

18

19

25

26

7:30 AM Green Building Committee 12:00 PM Golf Outing Committee

14

15 3:30 PM Builders Exchange Board of Trustees

20

Friday

7:30 AM CBC General Membership Meeting

11:30 AM Executive Committee

6

Thursday

21 11:30 AM Fashion Show Committee

12:00 PM Ambassadors Committee

8:00 AM IN-PERSON

4:30 PM 40 Below Exec Committee

22 4:30 PM Networking Night

7:30 AM Membership Committee

Haley Comfort Systems

23 3:00 PM Development Services Advisory Committee

24

8:00 AM ONLINE ONLY 11:30 AM Community Relations Committee 1st Showcase Discount Deadline

27

28

MEETINGS ARE NOW BEING HELD IN PERSON UNLESS NOTIFIED DIFFERENTLY BY JOHN

5 | FOUNDATIONS NEWSLTR

FROM THE PRESIDENT Thank you for electing me as your 2022 Rochester Area Builders President. I look forward to a very prosperous year, along with continuing to make new and stronger connections with members. This is going to be a great year!

BECKY HOLMEN President

Rochester Area Builders, Inc

“Do what you do so well, That they will want to see you again, And tell their friends.”

-Walt Disney

When I started with Haley Lighting (formerly Bright Ideas) in 2014, I made it one of my goals to become an exceedingly active member of Rochester Area Builders. I wanted to grow my business contacts by developing relationships within the construction/remodeling industry.

It was hard for me at first; I had been out of the loop from the Rochester networking circle for nearly 6 years. So, I decided to join the Fashion Show Committee, “Studs, Struts and Stilettos” where I was later asked to be on the Remodelers Council Executive Committee. I soon worked my way up the ladder from Vice Chair in 2018 to Chair of the Remodelers Council in 2019. It was then that I was given a seat on the RAB Board, to represent the Remodelers Council. After my term was complete for the Remodelers Council, I was offered a regular seat on the RAB Board and served as Secretary in 2020.

Then in 2021, I was elected Vice President of Rochester Area Builders, knowing that in 2022 I could be elected President - which brings us to where we are now!

organization! They have been the best mentors and advisors, and have definitely been a huge influence in the strong independent woman I am today.

These women deserve to receive the recognition as being who they are: Marcia VonWald, Jean DeWitz, Karen Allen, and Diane Quinn.

About me: I’ve been a Professional Interior Designer since 1995, with an extensive background in residential design and remodeling, specializing in lighting. As a Lighting Specialist for over 25 years, this certification involves more in-depth training in technical knowledge like “light sources, lighting fixtures, residential lighting design, and effective selling techniques.” My full range of design skills both complement and enhance the lighting design process at Haley Lighting. I am a graduate of Minnesota State University, Mankato with a Bachelor of Science in Interior Design.

I’ve been married to my husband, Mark, for 20 years and am a mom to Ryan (19), Freshman at Black Hawk College in Illinois, and Carter (16), Sophomore at Lanesboro High School – (New Driver). We live in rural Lanesboro on the Holmen Family Farm (Sesquicentennial Farm – 150 years – Sixth Generation). We raise Certified Angus Beef and State Fair prize-winning pigs.

I feel humbled by all the encouragement and support I have received throughout my journey as a member of Rochester Area Builders. I have had the pleasure and privilege to know some very special people in this Becky Holmem organization, including the strong Haley Lighting 2022 RAB President independent women in this

6 | FEBRUARY 2022

ROCHESTER AREA BUILDERS, INC.

MEMBERSHIP REPORT December 2021 Membership Total: Retention rate:

398 90.2%

WELCOME

JANUARY 2022 MEMBERS

As of December 31, 2021 ONE TO FOUR YEARS ISG .................................................................................... 2020 WSE Massey Engineering & Surveying, Ltd................ 2020 Bimline Drafting and Design.......................................... 2019 Country Financial............................................................. 2019 PCL Construction Services, Inc..................................... 2019 Timber Ridge Exteriors, LLC.......................................... 2019 Compeer Financial........................................................... 2018 The Home Collective....................................................... 2018 Weller Brothers Landscaping........................................ 2018 Fillmore County EDA....................................................... 2017 Highmark Builders, Inc................................................... 2017

FIVE TO NINE YEARS Coulee Bank......................................................................................2016 Dickison Builders, LLC....................................................................2016 Zen Custom Homes........................................................................2016 Claremont EDA.................................................................................2015 ERH Developing, Inc........................................................................2015 Wells Concrete.................................................................................2014

TEN TO 19 YEARS First Alliance Credit Union............................................................2010

VERONICA KINGSTON

Architect (507) 535-3530

thedraftsource.com

MATT BROUILLARD

Bank (507) 289-9000 foresight.bank

Crescent Electric Supply Company............................................2007 Derby Builders..................................................................................2007 Franklin Energy................................................................................2007 Markham Homes, LLC....................................................................2007 W.L. Hall Company..........................................................................2007 Kruger Electric, Inc.........................................................................2006 Rochester Area Chamber of Commerce...................................2005 Bricewood, LLC.................................................................................2004 Powers Ventures.............................................................................2004 Space Concepts, Inc........................................................................2004 IntegraSpec Central/Jeff Mueller Construction.....................2002 Meier Companies, Inc.....................................................................2002

20 YEARS & MORE Associated Bank.............................................................. 2000 Brauer Roofing, Inc.......................................................... 1999 Construction Partnership, Inc........................................ 1997 TSP, Inc. | Architecture, Engineering, Planning........... 1997 Waste Management......................................................... 1997 CAPS Kitchen & Bath...................................................... 1992 Greg Speedling Contracting, Inc.................................... 1992 Summit Custom Homes, LLC......................................... 1991 Culligan of Rochester & Kasson.................................... 1987 Marvin............................................................................... 1987 Rochester Area Economic Development, Inc. (RAEDI)............................................. 1987 Tile Superstore & More.................................................. 1985 AB Systems, Inc............................................................... 1984 Wendland Utz................................................................... 1968 Wells Fargo Home Mortgage......................................... 1964 Minnesota Energy Resources Corporation.................. 1960 Briese Iron Works, Inc.................................................... 1959 Rochester Ready Mix Concrete Company.................... 1959 Home Federal Savings Bank.......................................... 1955 U.S. Bank.......................................................................... 1955 Kruse Lumber.................................................................. 1954

LUKE KREOFSKY

General Contractor (507) 534-3855 kbscompanies.com

SHAUN SCHMIDT

Residential Builder/Remodeler (507) 990-9150 schmidtcarpentry.com

7 | FOUNDATIONS NEWSLTR

Rochester Area Builders 2022 Calendar of Events

JANUARY POSTPONED

General Membership Meeting @ DoubleTree

FEBRUARY 4-6 8-10 18 22 24

Rochester Area Builders Home Show NAHB International Builders Show – Orlando, FL Continuing Education Classes (In-person) Networking Night @ J.F. Ahern Company Continuing Education Classes (ONLINE)

MARCH 29 Networking Night @ ISG APRIL

MAY

JUNE

JULY

TBD 23-24 30 26

BAM Building Industry Day at the Capitol Spring Showcase of Homes Spring Showcase of Homes Networking Night @ Premier Bank

1 30

Spring Showcase of Homes Office Closed – Memorial Day

2 28

RAB Golf Outing @ Willow Creek Golf Course Networking Night @ Knutson Construction

4 TBD 26

Office Closed for Independence Day NAHB Mid-Year Board Meeting – TBD Member Appreciation Night @ Mayowood Stone Barn

AUGUST 13 30

Builders, Bags & Brews @ LTS Brewing Company Networking Night @ TBD

SEPTEMBER 5 Office Closed – Labor Day 15 Sporting Clay Shoot 17 Sporting Clay Youth Shoot 17-18 Remodelers Tour 17-18, 24-25 Fall Showcase of Homes 27 General Membership Meeting @ DoubleTree OCTOBER 13 25

Studs, Struts & Stilettos @ Mayo Civic Center Networking Night @ Elias Construction

NOVEMBER TBD 24-25

Past Presidents Dinner Office Closed – Thanksgiving Holiday

DECEMBER 2 23-26

Holiday Party @ The Hilton Office Closed – Christmas Holiday

FUTURE DATES International Builders Show RAB Home Show

January 31 – February 2, 2023 @ Las Vegas, NV February 3-5, 2023 @ Mayo Civic Center

8 | FEBRUARY 2022

FROM THE EXECUTIVE DIRECTOR In the past, I managed retail lumber yards. I always wanted to know the market share that I had—that is, how many builders we had as customers. Now, in my current role, I review our members’ market share in our largest city. In reviewing Rochester 2021:

JOHN EISCHEN Executive Director

Rochester Area Builders, Inc

• Our members performed 89% of the permitted work of the Mayo Clinic. When I deduct the work completed by Mayo staff that percentage increases to 99%. The world’s largest hospital, who is also one of the largest commercial developers in our community, does a great job of hiring local contractors and the economic ripple effects are large!

• 64% of the remaining non-Mayo commercial projects were completed by our members.

• Excluding mobile homes, 74% of the new single family homes were built by our members.

• Excluding homeowner completed remodeling projects, 42% of the permits were done by our members.

It’s great to see so much work done by our members. Hopefully, our conversations with the Community Development Department and some the changes they have implemented have made a difference in improving that process. Rick and I have found the department’s staff to be very open to the suggestions we get from our members, so please keep sending them our way! We continue to improve our involvement in surrounding communities. We always strive to remember the “area” in Rochester Area Builders, whether in advocacy or student involvement.

The last year was challenging for everyone and our industry was no different. From labor and supply issues to historical material pricing volatility, every segment of our industry had to face greater challenges than ever before. Even with all those challenges, our association ended 2021 with over a 90% retention rate! Thank you for your membership.

Thank you to all those serving on committees. Thank you to all those serving in leadership positions. RAB would not accomplish anything without the hard work of our members and volunteers. May your 2022 be successful.

JOHN EISCHEN Executive Director

Rochester Area Builders, Inc

9 | FOUNDATIONS NEWSLTR

FOX BLOCKS® ICF TECHNOLOGY SEMINAR & HANDS-ON TRAINING

Join us for a presentation by Fox Blocks Regional Advisor, Darryl Ulrich and Cemstone Product Company’s Brad Scholl, Proposal Development Analyst. RSVP at a Cemstone Supply Location below.

SCHEDULE • Product Overview • Performance Overview • Technical Resource

• Installer Technics/Detailing • Estimating • Hands-on mockup

LUNCH PROVIDED

January 27, 2022

March 1, 2022

RIVER FALLS, WI W9341 830th Ave 715-425-1119

ST. CLOUD, MN 1153 Hwy 10 S 320-251-6031

TIME: 9:00-3:00 RSVP BY: January 24, 2022 RSVP TO: Mike Ferguson 612-462-3015 mferguson@cemstone.com

TIME: 9:00-3:00 RSVP BY: February 21, 2022 RSVP TO: Dennis Menke 320-251-6031 or Jason Jarveis 320-241-8613

March 2, 2022

March 3, 2022

MANKATO, MN 1316 North Broad St 507-345-7773

ROCHESTER, MN 3705 Enterprise Dr SW 507-252-1129

TIME: 9:00-3:00 RSVP BY: February 21, 2022 TO: Ryan Sanders 507-345-7773 rsanders@cemstone.com

TIME: 9:00-3:00 RSVP BY: February 21, 2022 RSVP TO: Chad Grande 507-252-1129 cgrande@cemstone.com

CemstoneSupply.com

10 | FEBRUARY 2022

Residential Building Worker Wages Grow Rapidly

BY JING FU on JANUARY 10, 2022

Average hourly earnings for residential building workers have been growing fast recently, driven by the tightening construction labor market.

Last Friday, the Bureau of Labor Statistics (BLS) reported that the unemployment rate declined to 3.9% in December, the lowest rate since the pandemic. As the labor market remains tight, wages have increased rapidly, particularly in residential building sector. According to last Friday’s BLS report, average hourly earnings for residential building workers were $28.74 in November 2021, increasing 7% from $26.87 a year ago.

During the COVID-19 pandemic recession in March and April 2020, average hourly earnings for residential building workers rose about 2%, compared to a year ago. Since June 2020, average hourly earnings’ yearover-year growth rates for residential building workers have trended up and reached 8% in October 2021, the highest year-over-year gain since February 2019.

11 | FOUNDATIONS NEWSLTR

2022 CONTINUING EDUCATION Residential Building Contractors & Building Officials

FEBRUARY 18TH IN-PERSON ONLY 8AM-4PM

Haley Comfort Systems 3708 N Broadway Ave, Rochester MN

FEBRUARY 24TH ONLINE ONLY 8AM-4PM

DEADLINE FOR REGISTRATION: FEBRUARY 21, 2022

DEADLINE FOR REGISTRATION: FEBRUARY 15, 2022

REGISTRATION INFORMATION AVAILABLE HERE EDUCATION SPONSORS:

RAB MEMBERS $89 / 7 Hour Course

NON MEMBERS $109 / 7 Hour Course

Questions Contact Rebekah 507.282.7698 Rebekah@RochesterAreaBuilders.com

LOCATION SPONSOR:

12 | FEBRUARY 2022

Media Contact Jenna Bowman, Strategic Communications & Engagement Director Direct: 507-328-2913 | E-mail: jbowman@rochestermn.gov FOR IMMEDIATE RELEASE

Rochester, MN Wins Bloomberg Philanthropies Global Mayors Challenge and Awarded $1 Million Dollars January 18, 2022 – ROCHESTER, MINN. – Bloomberg Philanthropies today announced the 15 winning cities of the 2021-2022 Global Mayors Challenge, a worldwide innovation competition that supports and spreads cities’ most promising ideas. Rochester has the opportunity to enter a three-year implementation period with a $1 million grant and robust technical assistance.

The 15 winning cities named today hail from 13 nations on six continents and collectively represent more than 30 million residents. They were selected from among 50 Champion Cities that spent the past four months rigorously testing and refining their projects. When the competition launched in January 2021, mayors from 631 cities in 99 countries submitted their boldest ideas to the competition.

“Our co-designers and project partners were essential to the development of the project proposal and are key to our community’s future success. Collectively, we are committed to creating a model that can be effective here and also replicated across the country and globe. Our focus is on building community all people at a time,” highlights Chao Mwatela, Diversity, Equity & Inclusion Director.

The Rochester project focuses on the economic mobility of Black, Indigenous, and People of Color (BIPOC) women through careers in all-phases of the built environment and construction. Construction is a key pathway to economic recovery and sustainable job growth, as Rochester’s $6 billion Destination Medical Center (DMC) economic development initiative is expected to generate new construction jobs over 20 years.

Mayor Kim Norton shares, “We are so very honored and excited to be selected as one of the top 15 cities selected. Advancing the work in our proposal will allow us to address the marked disparities that exist for BIPOC women in Rochester. It will also help meet the needs of the construction and built environment industries that are vital to our growing community and in advancing the new federal infrastructure investment.”

“As the world works to address the profound public health and economic effects of the ongoing pandemic, cities can implement innovative ideas at a pace that national governments simply can’t match,” said Michael R. Bloomberg, founder of Bloomberg Philanthropies and Bloomberg L.P. and 108th Mayor of New York City. “Our fifteen winners offer bold, achievable plans to improve health, reduce unemployment, empower women, and more. Collectively, they have the potential to improve millions of their residents' lives – and the most successful solutions will inspire cities around the world to embrace them.”

“The Mayors Challenge shows that there can be a positive legacy to emerge from all the hardship of the past two years – and that it’s happening in our cities,” said James Anderson, who leads the Government Innovation program at Bloomberg Philanthropies. "Now we turn to help these mayors implement their ideas, evaluate, and spread the ideas that produce big impact.”

Additional information about Rochester’s project can be found here. ###

13 | FOUNDATIONS NEWSLTR

Join Us!

Coordinated by your Southeast MN Chapter 346

Monday

Open House Breakfast Networking

7:00 - 8:30 am

Mayor Kim Norton to read Proclamation at 7am.

Tuesday

United Way Drive: Schools Food Drive

4:00 - 5:30 pm

Wednesday 11:30 am - 1:00 pm

Thursday 5:00 - 9:00 pm

Friday

11:30 am- 1:00 pm

Haley Comfort Systems Training Room

Follow Us for more information on WIC Week and our other chapter events!

@NAWICSEMN

Kraus-Anderson

City of Rochester Bloomberg Mayors Challenge Speaker: Chao Mwatela, DE&I Director

Wood Lake Meeting Center Lunch provided $15 | Email info@nawicsemn.org to register

Iron Side Axe Throwing |

27 9th Street SE, Rochester

Free event for NAWIC Members

$35 for Non-Members | Email info@nawicsemn.org for more info

Equity Challenge Virtual Recap Email info@nawicsemn.org for virtual meeting link

Scholarships Available!

Help for students pursuing a career in construction Are you or someone you know pursuing a degree related to the construction industry?

Are you a female enrolled in a trade apprentice program?

If so, apply today for one of eight scholarships.

NAWIC SE MN Chapter 346 is awarding four $1,000 scholarships to undergraduate students pursuing a degree/enrolled in a program related to the construction industry AND awarding four $1,000 scholarships to females enrolled in a trade apprentice program.

Deadline to Apply: February 28 Find the scholarship that fits your career plans! Nawicsemn.org/scholarships

14 | FEBRUARY 2022

Rochester, Minnesota - January 7, 2022 CRW architecture + design group is proud to announce that Erin Schambureck, MFA has been promoted to the position of partner/shareholder with the firm.

Erin has been practicing Interior Design for over 15 years and specializes in corporate, senior housing, retail and housing projects.

Erin holds a Bachelor of Fine Arts from Iowa State University and a Master of Fine Arts in Design Studies from the University of Wisconsin-Madison. Her thesis, research Design for Sight, was published in the Journal of Interior Design and has been translated to an award winning website: www.designforsight.com. It highlights the necessity for design that is sensitive to the visual needs of older adults and those with vision loss in the built environment. For this project, Schambureck won the 2015 Excellence in Design for Academic Research award from the IIDA Texas/Oklahoma Chapter. In addition she was presented with the 2015 Interior Design Educators Council award for Best Presentation Scholarship of Design Research.

Following graduate studies, Erin served on the faculty at Texas Tech University teaching studios and lectures for Design department students in the undergraduate and graduate programs.

Originally a Rochester native, she and her family moved back to Minnesota in 2017 where Erin joined the team at CRW. She currently serves as the vice-chair for the IES Committee on Lighting for Seniors and the Visually Impaired, and is a frequent speaker at Environments for Aging, a conference focused on design for Senior Living. She is also on the board for Vision for Chicago, a non-profit providing vision services to previously incarcerated adults reentering society, and advocates for quality lighting and interior environments for all.

Erin has also enjoyed spending time closer to home volunteering her time as a girl scout leader for her daughter's troop and channeling her design skills to some of CRWs most recent education projects as part of the design team for both Harriet Bishop Elementary School, currently under construction in Rochester, and Cotter Elementary School in Winona.

211 11th Ave. NW - Rochester, MN 55901 507.206.6201

15 | FOUNDATIONS NEWSLTR

SCHOLARSHIP

OPPORTUNITY

GRADUATING HIGH SCHOOL STUDENTS POST-SECONDARY SCHOLARSHIPS

Rochester Area Builders, Inc. is proud to announce their 2022 scholarship program.

Either $1000 or $500 non-renewable scholarships are available for graduating high school seniors and college freshmen. Scholarships are made available through the Commercial Builders Council, the Builders Exchange of Rochester, and the Youth Sporting Clay Shoot.

Scholarships are for attendance in a post-secondary CRITERIA: program in a construction-related 1. Applicant must be a resident of Dodge, Fillmore, Goodhue, field including technical school, Houston, Mower, Olmsted, Steele, Wabasha, Winona trade school, apprenticeship, or counties; be recommended by a RAB or BER member; or college. Scholarship recipients will participated in the RAB Youth Sporting Clay Shoot. be announced in June 2022. To 2. Applicant must be accepted by a post-secondary program in a construction related field including technical school, trade be eligible for any scholarships, school, apprenticeship, or college. applications must be postmarked 3. Applicant must have a 2.5 or better G.P.A. – High School

by May 2, 2022.

Transcript Required Scan QR Code or go to https://qrco. de/ScholarshipApp for Scholarship application.

Rochester Area Builders 108 Elton Hills LN NW Rochester, MN 55901 507-282-7698 Rab@rochesterareabuilders.com

4.

Applicant must demonstrate financial need.

5.

Scholarship will be paid directly to the school.

16 | FEBRUARY 2022

Spring Showcase Of Homes Overall Sponsorship Available!

Contact Elizabeth For More Information!

2022 SPRING SHOWCASE OF HOMES MAGAZINE ADVERTISING INVESTMENT Sixth Page Quarter Page Half Page Half Page Back Page Full Page Inside Front Page

2.333 x 4.875 ......................................... $500 3.625 x 4.875 ......................................... $700 (v) 3.625 x10 .......................................... $900 (h) 7.5 x 4.875 ........................................ $900 8.5x11 (bleed size 8.75 x 11.25) ............. $1000 8.5x11 (bleed size 8.75 x 11.25) ............. $1200 8.5x11 (bleed size 8.75 x 11.25) ............. $1500

The 2022 Spring Showcase of Homes features new homes, townhomes, and subdivision. The Rochester Area Buildersproduced magazine is the official program that includes details, descriptions, and photos for each home/subdivisions.

Participation is exclusive to RAB members, and members of the community are invited to enjoy the event.

The digital magazine produces over 10,000 impressions, and the RAB Events app receives over 33,000 views during the event weekends. Limited printed copies will be available at showcase entries during showcase hours. RAB will promote the

Spring Showcase of

digital magazine across multiple digital platforms with over 500,000 impressions. RAB has contracted with Tulip Tree Studios for ad sales and design services. For more information on how to advertise in our digital magazine, contact Crystal at 507-218-8401 or at Crystal@tuliptree-studios.com.

Spring Showcase Weekends April 23-24 & April 30-May 1, 2022 Advertising Deadline: Thursday, March 10, 2022 Publication Date: Thursday, April 21, 2022

17 | FOUNDATIONS NEWSLTR

Registration Forms can be found HERE Discount Deadline February 24th - $100 off Final Deadline March 24th Contact Elizabeth with questions

18 | FEBRUARY 2022

ROCHESTER AREA BUILDERS HOME SHOW

FEBRUARY 4, 5, & 6, 2022

Remodelers

TO THE

FaShowll of

case

SIGN

AT EVE URE SPO NT NSO R

Sprin Sh of owcase

g

RU TS S, ST TO S ST UDST ET &

ALL BOOTHS ON ONE FLOOR!

Date Night!

FRIDAY

2 for 1 Admission Cooking Demo with Celebrity Chef Shari Mukherjee

FAMILY FUN DAY SUNDAY

The first 250 Children will have the opportunity to put together a birdhouse to take home, sponsored in part by Kruse Lumber.

CASH BAR FRIDAY • SATURDAY • SUNDAY SUNDAY • BLOODY MARY BAR

RESERVE YOUR BOOTH TODAY! Registra�on and Exhibitor Informa�on can be found HERE.

Contact Shelly with ques�ons

Event Sponsor

19 | FOUNDATIONS NEWSLTR

ROCHESTER AREA BUILDERS HOME SHOW 2022

RAFFLE TICKETS $10 EACH OR 3 FOR $20

Tickets can be purchase at the Jermemiah Program campus, January 25th - February 3rd and at the Home Show February 4th - 6th.

Drawing at Kitchens for Kids in the Mayo Civic Center Ballroom 30 Civic Center Dr. SE, Rochester, MN February 6, 2022 at approximately 3:30 PM

February 4-5-6, 2022 Mayo Civic Center

Presented by

Benefit For

Need NOT be present to win.

Must be 18 or older to purchase ticket or win prize.

Winner responsible for any applicable fees or taxes and pickup.

20 | FEBRUARY 2022

B:9.25" T:9" S:8"

GET UP TO $5,400 TO GET THE JOB DONE Shown with equipment from independent suppliers which is not covered by the GM New Vehicle Limited Warranty.

GM is not responsible for the safety or quality of independent supplier alterations.

USING THE PRIVATE OFFERS1 FOR NAHB MEMBERS IS EASY:

1. Get your NAHB proof of membership.

2. Visit your local Chevrolet, Buick or GMC dealer and mention this Private Offer.

3. Select an eligible vehicle(s) to purchase or lease and present your NAHB proof of membership.

For even more value, combine this offer with the National Fleet Purchase Program and Business Choice Offers. For full details on the Private Offer, NAHB members should visit nahb.org/gm.

Example offer for NAHB members who are business owners purchasing a 2021 Chevrolet Silverado 2500 HD Crew Cab 1LT 4WD. Up to

Up to

Up to

$1,000 + $3,400 + $1,000 = $5,400 Private Offer 1

National Fleet Purchase Program (FVX)2

Eligible Accessory Cash Allowance3, 4

In Potential Value

1 Private offer amount varies by model; up to $500 offer for retail delivery and up to $1,000 offer for fleet deliveries. Valid toward the purchase or lease of eligible new 2020, 2021 and 2022 model year vehicles. Customer must take delivery by 1/3/2022. Not compatible with some other offers. Not valid on prior purchases. Excludes all Cadillac vehicles; 2020 Buick Cascada, LaCrosse, Regal and Verano; Chevrolet Colorado 2SA, Sonic, Trax, Volt and GMC Canyon 2SA; 2020-2021 Encore 1SV; Chevrolet Blazer, Camaro, Corvette, Equinox 1SM, Malibu 1VL, Traverse 1L0; GMC Acadia 1SV and Terrain 2SA. Additional GM models may be excluded at GM’s sole discretion. See dealer for details. 2Offer available to qualified fleet customers through 1/3/2022. Not compatible with some other offers. Take delivery 1/3/2022. See dealer for details. 3To qualify, vehicle must be used in the day-to-day operations of your business and not solely for personal/ non-business-related transportation purposes. Must provide proof of business ownership. For complete program requirements, including information regarding offers, vehicles, equipment, options, warranties and ordering, consult your dealer or visit gmbusinesschoice.com. 4Eligible purchases must be equal to or greater than the amount of the cash allowance. Accessory Cash Allowance requires purchase of the eligible accessories from your dealer.

©2021 General Motors, LLC. All rights reserved. The marks appearing in this ad are the trademarks or service marks of GM, its subsidiaries, affiliates or licensors.

360 West Maple Road • Birmingham • MI • 48009 • 248-203-8000

21 | FOUNDATIONS NEWSLTR

22 | FEBRUARY 2022

BEFORE DIGGING INTO YOUR CONSTRUCTION PROJECT, START WITH ONB BANK FINANCING!

CRYSTAL HUGHLEY

ASSISTANT VICE PRESIDENT Personal and Real Estate Lending

Rochester Location 975 34th Ave NW (507) 424-1571

NMLS ID#1389898 crystal.hughley@bankononb.com

bankonONB.com

23 | FOUNDATIONS NEWSLTR

Inflation Hits 39-Year High

BY FAN-YU KUO on JANUARY 12, 2022 Led by higher prices for shelter and used vehicles, consumer prices soared by 7.0% in December from a year ago. It was the largest year-over-year gain since June 1982. However, energy prices fell in December, ending a long series of increases. Supply-chain constraints and strong consumer demand related to the pandemic and the reopening of the economy have contributed to recent price increases in some sectors. Government stimulus efforts have also contributed to recent gains in inflation.

The Bureau of Labor Statistics (BLS) reported that the Consumer Price Index (CPI) rose by 0.5% in December on a seasonally adjusted basis, following an increase of 0.8% in November. Excluding the volatile food and energy components, the “core” CPI increased by 0.6% in December, after a 0.5% increase in November.

In December, the indexes for shelter (0.4%) and for used cars and trucks (3.5%) were the largest contributors to the increase in the headline CPI. The index for shelter increased as the indexes for owners’ equivalent rent (OER) and rent of primary residence (RPR) both rose by 0.4%, same increases as in November and October. The food index also contributed, though it increased less (0.5%) than in recent months.

Additionally, the price index for a broad set of energy sources fell by 0.4% in December, after a 3.5% increase in November. It was the first decrease since April 2021. Gasoline (all type) declined by 0.5% in December, after a 6.1% increase in November.

During the past twelve months, on a not seasonally adjusted basis, the CPI rose by 7.0% in December, following a 6.8% increase in November. The “core” CPI increased by 5.5% over the past twelve months, following a 4.9% increase in November. It was the largest annual growth since February 1991. The food index rose by 6.3% and the energy index rose by 29.3% over the past twelve months.

NAHB constructs a “real” rent index to indicate whether inflation in rents is faster or slower than overall inflation. It provides insight into the supply and demand conditions for rental housing. When inflation in rents is rising faster (slower) than overall inflation, the real rent index rises (declines). The real rent index is calculated by dividing the price index for rent by the core CPI (to exclude the volatile food and energy components).

The Real Rent Index decreased by 0.2% in December, after a decrease of 0.1% in November. Over the twelve months of 2021, the monthly change of the Real Rent Index was -0.2%, on average.

24 | FEBRUARY 2022

Growing Affordable Inclusive Neighborhoods (GAIN) Information Sheet The Olmsted County Growing Affordable Inclusive Neighborhoods (GAIN) program provides a forgivable, 0% interest down payment assistance loan to households in Olmsted County.

Completed applications will be processed and reviewed in the order they are received.

Assistance through the GAIN program is dependent on the availably of funding.

Application Process

Buyers should apply for GAIN down payment assistance once they have a signed contract with a builder or have executed a purchase agreement for new construction. Eligibility will be determined upon receipt of completed and signed GAIN application and all requested supporting documentation.

Signed contract with GAIN program Funds released at builder or signed purchase Apply for GAIN eligiblity closing to financial agreement decision institution

Eligible Households

Households eligible for the GAIN program must have gross annual income less than 80% of the area median income (AMI), as set by the U.S. Department of Housing and Urban Development (HUD), adjusted for household size. All sources of income must be reported for all household members even if they are not on the mortgage.

Olmsted County 80% AMI Effective April 1, 2021 1 Person 2 Person 3 Person 4 Person 5 Person 55,850

63,800

71,800

79,800

86,150

6 Person

7 Person

8 Person

92,550

98,900

105,300

Eligible Properties

The property must be located within Olmsted County and be an owner-occupied homesteaded residence. Eligible properties include single family homes, duplexes, modular and manufactured homes. The anticipated cost to construct the residence must not exceed $300,000.

Application Requirements

Complete all pages of the application and provide requested information for all household members that will consider the property their primary residence. The following is a list of required documents needed in order to determine program eligibility and guarantee funding.

Completed GAIN program application Affidavit from the builder certifying construction costs to not exceed $300,000 or an executed purchase agreement for new construction Copies of 4 weeks of current paystubs and/or other proof of earned and unearned income for all household members over the age of 18 Submit your application package to:

WEBSITE MORE INFORMATION

Olmsted County HRA: ATTN GAIN Program 2117 Campus Dr SE, Rochester, MN 55904 Or email it to olmstedhra@olmstedcounty.gov

25 | FOUNDATIONS NEWSLTR

26 | FEBRUARY 2022

ROCHESTER BUILDING PERMITS NEW RESIDENTIAL

2021

Single Family Dwelling

8

VALUATION 2020 4,721,000

19

VALUATION 6,493,491

DECEMBER 2021

2012 2013 2014 2015 2016 2017 2018

2019 2020 2021

January

6

19

11

20

25

15

19

6

17

23

February

20

15

14

19

15

20

16

5

13

8

Townhome Dwelling

0

0

2

380,481

Two-Family Houses

0

0

0

0

March

32

29

28

30

31

44

25

27

32

35

Manufactured Home

0

0

0

0

April

29

39

25

22

33

45

40

23

19

19

Multi-Family Bldgs (Units)

0

0

0

0

May

22

27

35

19

56

43

28

27

19

26

June

32

33

47

51

41

52

38

31

21

30

July

39

39

38

29

44

45

36

26

26

25

August

38

21

60

33

47

30

31

24

17

24

September

22

22

23

27

52

35

39

12

30

20

October

23

34

35

49

25

36

29

27

28

16

November

22

26

26

23

12

41

21

47

23

19

December

14

22

27

42

37

33

25

34

21

8

TOTAL

299

326

369

369

418

429

347

289

266

253

EXISTING RESIDENTIAL Deck Addition

11

88,930

10

56,890

Room Addition

2

198,000

2

155,000

Porch Additions

2

28,500

2

76,075

Other Additions

0

0

3

120,500

Basement Finish

11

180,188

22

336,453

Alterations

54

1,052,251

57

910,945

Multi-Family Addition

0

0

0

0

Multi-Family Alterations

0

0

1

380,000 *Total may differ as permits may have been voided.

NEW COMMERCIAL Assembly (Church)

0

0

0

0

YEAR TO DATE STATISTICS

Assembly (General)

0

0

0

0

NO.

Assembly (Restaurant/Bar)

0

0

0

0

Business

1

2,500,000

2

550,000

Education

0

0

1

16,000,000

Factory/Industrial

0

0

0

0

Institution

0

0

0

0

Mercantile

0

0

0

0

Miscellaneous

0

0

0

Residential (Apartment)

0

0

Residential (Care/Assisted Living)

0

Residential (Care/Hotel/Motel)

0

Storage (General)

0

BUILDING PERMITS ISSUED TO DATE

2021 VALUATION

2020 VALUATION

NO.

3590

529,662,640

1970

366,671,424

Single Family Dwelling

221

917,000

224

69,654,058

Multi-Family Buildings Total Units: 575

4

48,440,000

4

17,910,000

0

TRADE PERMITS ISSUED TO DATE

9000

121,811,812

9747

95,189,674

0

0

Electrical

3997

56,518,992

3767

41,318,288

0

0

0

Electrical (Temp. Service)

0

0

0

Mechanical (HVAC)

0

5

1,903,309

249

102,855

271

90,825

2859

36,019,712

2591

27,736,525

Mechanical (Gas Piping)

646

1,073,594

678

915,942

319

1,575,992

311

1,327,826

173

8,315,748

171

5,686,973

2091

22,451,146

1958

18,113,296

12590

651,474,272

11717

461,861,098

Storage (Parking Garage)

0

0

0

0

Mechanical (Fireplace)

Storage (Warehouse)

0

0

0

0

Mechanical (Hydronic)

Utility (General)

1

150,000

0

0

Plumbing

Utility (Private Garage)

0

0

0

0

1

110,392

0

0

23

2,551,838

2

10,949,100

Structural Shell

0

0

0

0

“White Box”

0

0

0

0

Interior Demolition Only

0

0

0

0

Other Phased Permits

0

0

0

0

TOTAL PERMITS YTD

EXISTING COMMERCIAL Addition Alterations

OTHER CONSTRUCTION Business Signs

36

509,837

22

149,130

Advertising Signs

0

0

0

0

Footings & Foundations

2

14,100,000

0

0

Demolition

1

0

2

0

Information and downloads available at Rochester Building Safety Department’s website: https://www.rochestermn.gov/government/departments/building-safety/reports-building-permits/building-permits-2021

DECEMBER 2021

PINE ISLAND

BUILDING PERMITS

NEW RESIDENTIAL

NUMBER

VALUATION

Single Family Detached

5

1,132,000

Single Family Attached

0

0

10

35,000

0

0

Existing Residential Basement Finish Deck Addition

27 | FOUNDATIONS NEWSLTR

OLMSTED COUNTY PERMITS YTD 2021

VALUATION

2020

VALUATION

2021

NEW RESIDENTIAL

VALUATION

2020

VALUATION

COMMERCIAL/INDUSTRIAL

Single Family-Detached

58

20,036,424

24

6,770,279

Single Family-Attached

46

10,075,750

5

887,826

Garage

DECEMBER 2021

29

1,580,259

Addition

1

121,056

1

422,867

Alterations

15

368,850

12

824,366

Re-roofing

1

3,900

2

8,250

20

1,509,240

Deck

39

277,574

30

161,438

Pool, Retaining Wall, etc.

24

589,773

14

600,584

Addition

14

656,532

8

438,566

Manufactured Homes

41

0

37

3,430

176

2,518,313

98

1,704,941

6

156,679

3

73,005

Mechanical

244

1,792,272

205

2,207,852

Plumbing

127

1,121,298

123

1,360,028

823

45,888,373

596

24,306,706

RESIDENTIAL

OTHER STRUCTURES

Alterations Garage Addition

NEW COMMERCIAL/INDUSTRIAL Recreational

0

0

0

0

Church/Religious

1

235,440

0

0

Industrial/Warehouse

5

4,814,239

1

236,059

Service/Repair Station

0

0

0

0

Store/Restaurant

1

336,786

1

227,304

Nonresidential Building

3

1,154,159

2

454,023

2021

2020

VALUATION $1,381,460 PERMITS 22

VALUATION $0 PERMITS 1

VALUATION $0 PERMITS 0

BYRON

VALUATION $0 PERMITS 1

VALUATION $440,824 PERMITS 8

EYOTA

VALUATION $88,175 PERMITS 16

MISCELLANEOUS PERMITS

TOTAL PERMITS

BYRON NOW INCLUDED IN OLMSTED COUNTY PERMITS

OLMSTED COUNTY PERMITS DECEMBER

VALUATION $50,168 PERMITS 8

MARION

VALUATION $319,899 PERMITS 5

ORONOCO TWP

VALUATION VALUATION $0 $0 PERMITS PERMITS 0 0

VALUATION VALUATION $53,897 $96,621 PERMITS PERMITS 8 15

QUINCY

STEWARTVILLE

Activity Overview Key metrics by report month and for year-to-date (YTD) starting from the first of the year.

Key Metrics

Historical Sparkbars

New Listings 12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

12-2018

12-2019

12-2020

12-2021

Pending Sales

Closed Sales

Days on Market

Median Sales Price

Avg. Sales Price

Pct. of Orig. Price Received

Affordability Index

Homes for Sale

Months Supply

12-2020

12-2021

Percent Change

YTD 2020 YTD 2021

256

286

+ 11.7%

6,797

6,958

+ 2.4%

374

369

- 1.3%

6,660

6,554

- 1.6%

538

532

- 1.1%

6,611

6,549

- 0.9%

52

37

- 28.8%

53

32

- 39.6%

$224,700

$250,000

+ 11.3%

$223,000

$245,000

+ 9.9%

$245,951

$284,072

+ 15.5%

$247,281

$277,011

+ 12.0%

96.8%

97.6%

+ 0.8%

97.7%

99.8%

+ 2.1%

197

166

- 15.7%

198

169

- 14.6%

584

520

- 11.0%

--

--

--

1.1

1.0

- 9.1%

--

--

--

Percent Change

Current as of January 4, 2022. All data from Southeast Minnesota REALTORS® and NorthstarMLS®. Provided by the Minnesota Association of REALTORS®. Report © 2022 ShowingTime. | 2

28 | FEBRUARY 2022

FOUNDATIONS NEWSLETTER ADVERTISING Rochester Area Builders Newsletter is an unbeatable opportunity to advertise to members and individuals associated with RAB. It is a source of valuable association and industry information, and is published and emailed monthly. Foundations is sent to over 1600 connected industry professionals.

Ad sizes are listed under Display Ad Dimensions, and prices are located above.

Ads may be changed from month to month.

Our prices are for full color ads. We will gladly work with you to design your ad.

Please send digital files for all ad copy, logos, and artwork. We use PC format.

We accept Illustrator and Photoshop files.

Convert all fonts to outlines. We also accept the following high resolution file types: .tif, .eps and .pdf (with all graphics and fonts embedded). If you have any other formats please contact us.

RETURN TO: ROCHESTER AREA BUILDERS

Shelly Bahlmann Shelly@RochesterAreaBuilders.com 108 Elton Hills Ln NW Rochester, MN 55901 507-282-7698

Newsletter Advertising Rates

Per Issue

12 Issues

New Member 12 Issues

Full color 1/2 Horizontal

c $70.00

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Newsletter Display Ad Dimensions 1/2 Horizontal Full

8-1/2 x 5-1/2 8-1/2 x 11

Send artwork to Shelly@RochesterAreaBuilders.com by the 15th of the month to be included in the upcoming Foundation Newsletter.

29 | FOUNDATIONS NEWSLTR

Goodin Company carries a full complement of products for the markets we serve.

Are you in need of products for plumbing, HVAC, industrial, or pump and well applications?

We are your Source of Supply, serving the industry since 1937.

PLUMBING

HVAC

Goodin Company maintains a complete inventory in a wide range of major brand plumbing products for both residential and commercial plumbing contractors.

To support our plumbing inventory, we maintain showrooms in many of our branch locations.

Our HVAC division encompasses both hydronic and warm air heating as well as central and split system air conditioning equipment for residential and commercial systems. We also provide technical support in design and layout.

INDUSTRIAL

PUMP AND WELL

We supply a wide range of industrial pipe, valves, and fittings. To compliment our pipe inventory, we offer a complete in-house pipe fabrication service in which we are able to cut, thread and groove pipe to our customers’ specifications.

Goodin Company’s pump and well division maintains a complete inventory of pumps and repair parts for the residential water well drilling contractor, as well as the large commercial or municipal driller.

MINNEAPOLIS (612) 588-7811 ST. PAUL (651) 489-8831 DULUTH (218) 727-6670 DETROIT LAKES (218) 847-9211 ST. CLOUD (320) 259-6086

BRAINERD (218) 828-4242 ROCHESTER (507) 529-1284 FARGO (701) 298-3210 SIOUX FALLS (605) 332-3444 OMAHA (402) 331-6813 www.goodinco.com

EAU CLAIRE (715) 830-1800 WAUSAU (715) 675-2513 MADISON (608) 663-0331 MILWAUKEE (262) 781-1770 GREEN BAY (920) 884-9494

30 | FEBRUARY 2022

Building Materials Prices Increase 1.5% in December, Lumber Volatility at 75-Year High

BY DAVID LOGAN on JANUARY 14, 2022 The prices of goods used in residential construction ex-energy climbed 1.5% in December (not seasonally adjusted), according to the latest Producer Price Index (PPI) report released by the Bureau of Labor Statistics. The index was driven higher by large price increases for wood products.

Building materials prices increased 15.9% in 2021 and have risen 18.6% since December 2020. Since declining 1.8% between July and August 2021, the index has climbed 4.5%.

highest 24-month average since data first became available 1947 and nearly triple the previous record.

Gypsum Products

Professional Services

In December, the PPI for gypsum products decreased 0.5%–the second consecutive monthly decline. Gypsum products prices ended the year 18.2% higher than they were in January.

The category of professional services carries the third most weight among those that make up the service inputs to residential construction PPI. The prices of legal, architectural, and engineering services changed 0.5%, 0.0%, and -0.1%, respectively, in December.

Although the year-to-date increase in prices of professional services used in residential construction are quite modest compared to that of materials, prices have increased more in 2021 than they had by December 2020; the difference is especially striking for architectural services.

Paint

Steel Products Steel mill products prices rose 0.2% in December, the smallest monthly increase since September 2020. Monthly price increases have slowed in each of the past five months.

The PPIs for exterior architectural coatings (i.e., paint) increased 1.6% in December while the price of interior paint was unchanged.

Neither index has declined since January 2021 and the Januaryto-December price increases of architectural coatings is unprecedented–exterior and interior paint prices climbed 19.8% and 10.9%, respectively, in 2021.

Other Building Materials

The price index of services inputs to residential construction increased 0.4% in December following a fivemonth period over which the index declined 13.6%. The index is 9.6% higher than it was 12 months prior and 19.6% higher than the January 2020 reading.

Softwood Lumber The PPI for softwood lumber (seasonally adjusted) increased 24.4% in December and has gained 44.5% since September. According to Random Lengths data, the “mill price” of framing lumber has roughly tripled since late August.

The chart below shows the 12-month and year-to-date price changes of other price indices relevant to the residential construction industry.

The last monthly price decrease in steel mill products occurred in August 2020, and the index has climbed 152.2% in the months since–with more than 80% of that increase taking place in 2021.

Building Materials Wholesaling and Retailing

Ready-Mix Concrete

The PPI of most durable goods for a given month is largely based on prices paid for goods shipped, not ordered, in the survey month. This can result in lags relative to cash market prices, suggesting another sizable increase in the softwood lumber producer price index may be in the next PPI report.

Record-high volatility of softwood lumber prices continues to be as problematic as high prices. The monthly change in softwood lumber prices averaged 0.3% between 1947 and 2019. In contrast, the percent change of the index has averaged 12.0% since January 2020—the

The PPI for ready-mix concrete (RMC) gained 0.9% in December after increasing 1.1% in November.

The index for RMC increased 6.5% between January and December 2021 and is 9.3% higher than the January 2020 level.

At the regional level, prices increased in the South (+1.0%) and West (+1.1%) as prices declined in the Midwest (-0.1%). The price of RMC held steady in the Northeast.

In contrast to the PPI for building materials retailing—which increased 0.4% in December— the Producer Price Index for building materials wholesaling decreased 1.3% over the month.

The wholesale and retail services indices measure changes in the nominal gross margins for goods sold by retailers and wholesalers.

Gross profit margins of retailers, in dollar terms, have declined 25.7% since reaching an all-time high in June 2021 but remain 27.3% higher than the January 2020 level.

Building materials wholesale and retail indexes account for roughly two-thirds of the PPI for “inputs to residential construction, services.”

Though the difference in price changes for legal services is small, the percentage increases are large relative to engineering and architectural. This follows with a trend in recent years. Since December 2018, the price of legal services has risen 13.6%–much more than the three-year increase in architectural (+1.1%) and engineering services (+5.8%).

Metal Treatment Services Prices of metal treatment services increased 1.2%, on average, in December. The subset of these services used to calculate the services inputs to residential construction includes plating and polishing, coating and allied services, and heat treating.

Metal coating and allied services increased the most over the course of 2021 (+14.9%, NSA). Metal heat treating and plating and polishing services climbed 6.2% and 3.8%, respectively, between January and December. The average monthly price increase of the three services was just 0.1% over the course of 2020.

31 | FOUNDATIONS NEWSLTR

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CONTACT: Elizabeth Sullivan-Burton Elizabeth@RochesterAreaBuilders.com

WEBSITE BROCHURE

32 | FEBRUARY 2022

Members Save Millions Put Your NAHB Membership to Work Now. Money-saving discounts that benefit you, your business and your family

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33 | FOUNDATIONS NEWSLTR