December 25, 1920





RECORD   AND   GUIDE





861







New Conditions Which Favor Building

Prospective builders, who have structural projects in
mind but who have held them in abeyance because times
have not been propitious for building, would do well to
carefully analyze the new conditions existing today. In
many instances the result would be an immediate start on
these long-delayed operations.

Numerous reasons obtain why prospective builders
should plan an early start on delayed construction. Pros¬
pects of an open winter, with more actual working days
than have been known for the past few years, are excel¬
lent. Building material markets are now in a better posi¬
tion to supply required structural commodities than they
have been for many months. Real price concessions are
to be had in order to stimulate buying activity and, as
stocks on hand are generally plentiful, immediate deliveries
are to be had. If all projected construction should wait
for a concerted start there would be the same congestion
of orders and long waits for materials that marked the
early part of 1920.

Material markets are more fully stabilized as to prices
and assurance of deliveries than they have been tor many
months. It is believed throughout the industry that the
recession of material prices probably is ended. Manufac¬
turers have cut both production costs and profit margins to
the limit in the hope of influencing purchasers to come into
tlie market, but just as soon as the demand increases to
any great extent building material prices are bound to
advance above the levels that now maintain. Labor for
construction is plentiful and, what is more important, is
willing to give better value in the form of work accom¬
plished than has been knowns during the years since the
start of the war. This factor in itself makes possible a
considerable saving over former building costs.

During the past two weeks have come announcements
of substantial reductions in important building commodity
lines. Makers of cast iron pipe are ofifering their product
at a recession of about $14 a ton in order to influence
prospective purchasers to place orders. Hollow tile manu¬
facturers offer significant concessions on definite orders.
The railroads, by removing their charges for harbor
lighterage, have been responsible for reductions in hydrated
lime, plaster boards, plaster and other essential building
materials, which, while in themselves not important, do
affect the completed cost of a structure. Reduced fuel
costs and a better supply of coal to manufacturers have
brought down the price of Portland cement, and other
lines will be similarly affected.

The prospective builder who takes early advantage of
this combination of favorable factors will obtain a finished
structure at a cost considerably lower than that possible
only a relatively short time since. There is no great hope
for a further lowering of building commodity prices to
any extent, although .some slight reductions may be an¬
nounced, but, on the other hand, with the concerted rush
for building materials and supplies that is sure to come
with any revival  of  structural  activity, the  markets  will





be offered more business than they can absorb and prices
will stiffen perceptibly. There may then be the same
scramble for preference in deliveries, the same delays, and
the consequent advance in prices that have been experienced
ill the past.





Restoring Open Competition

The authority of the Lockwood Investigating Com¬
mitte, as delegated by the Legislature of 1920, will expire
in a few days. It is taken for granted, however, that upon
the organization of the Legislature of 1921 Senator Lock-
wood and his associates will be authorized to continue
their work where it is left oft' at the expiration of the
closing year.

In one respect, developments of the last few days in¬
dicate, the committee practically has completed the most
vital phase of its work. Due to the persistent and deter¬
mined efforts of its chief counsel, Mr. Untermyer, the com¬
mittee already has broken up the practice of combinations
among the different factors in the building industry. The
Association of Cut Stone Dealers is as good as ended, the
Stone Mason Contractors' Association has abandoned its
organization, the Composition Roo/ers' and Water
Proofers' Association is taking steps to comply with the
new order of things, and the indications are that numerous
other associations of similar character will follow suit.

Thus, no matter how the courts may deal with the
various individuals who have been indicted as a result of
the investigation, definite benefits of far-reaching conse¬
quence in the building industr>- in the metropolis already
have been obtained.

This is reflected in the prices at which contracts for
new construction and for rebuilding are being let. It is
beyond question that the excessive cost of building had
almost completely put an end to operations unless excep-
I ional circumstances, such as excessive rentals or the abso¬
lute necessity for space, led those interested to discard
general conditions and build at any cost and at any hazard
of competition at a later period.

Such building as has been done during the period since
{he armistice has not been on a healthy basis, nor for the
lasting benefit of the allied industries engaged in it. There
may not be as much profit in individual operations in the
future as under the system of "matched bids" that had
grown up under the tutelage, often, of men who had no
real knowledge of the building business nnr any real
interest in it except to get a percentage rake off on the
amount of money involved, which it was to their interest
to make as big as possible, even if the business as a whole
was inevitably made to suffer.

There is so much building to be done that there is no
longer any need, if there ever was, for associations to
see that "no mistakes were made" in bids. There is more
construction work needed in Greater New York than can
Ik done by all the builders, big and little, in this vicinity
ill the next ten years.    It is a certainty that fair profits