As home builders from across the world were checking out the newest product offerings spread across the showroom floor at the International Builders' Show (IBS) last week, one level below them, the industry's future was busily demonstrating what it was made of.
Each year in conjunction with IBS, the NAHB Student Chapters put high school–, college-, and university-level students studying residential construction to the test with the Residential Construction Management Competition, which presents a development scenario and asks students to find the best solution.
This year's challenge for students in four-year programs involved a 22-acre tract in Huntsville, Ala., part of which was in a flood zone. Students were required to come up with a plan that outlines how they would obtain the necessary financing, develop the land, and build homes, including outlining construction schedules, cash flow projections, project management, marketing and risk analysis, project site and land development, and green building initiatives.
And the effort they put in is substantial. Spencer Blaylock, who competed with this year's BYU-Idaho four-year team, estimates he spent around 400 hours between September and February working on the team's submission, a development that included a mix of condos and row houses, offering five styles ranging in price from $63,000 to $132,000.
During the process Blaylock was exposed to aspects of the industry he hadn't had the chance to experience before. "I worked on the finances—construction financing, etc.—and got to experience managing a company day to day to make sure it's profitable, and I found that I really enjoyed that," he says.
Duncan Tyler, also a member of the BYU-Idaho team, says he had been headed toward a career in comercial construction before participating in the competition last year. "Because of the experience I had [participating in the student competition], it gave me the boost that I needed to go residential," he says. Since then, Tyler has launched his own residential remodeling company, D&R Renovations, and he wants to eventually become a member of the NAHB.
"These students are doing something that a lot of other people have never done," says Steve Nellis, director of construction operations at Meritage Homes and a previous vice president at Centex. "It gives them an overall view of operating a home building business. ... The competition combines everything [they’re learning in construction courses] and even things they're not taking classes on, like marketing, sales, business."
And that exposure it exactly what they'll need to succeed in the industry, Nellis says, pointing to his own experience in obtaining financing for projects. "When I left Centex, I went to the bank, and they said, 'I've never seen this level of detail [in a proposal]!' These students have that now."
But the program's benefits can also be seen on an industry-wide level, says Steve Kramer, vice president of the Home Builders Institute's Residential Construction Academy, which oversees the NAHB's student chapters. "We're trying to get the next generation interested in our industry so that they come into our industry," rather than watch home building lose the best and brightest to commercial construction or other industries that have offered better hiring rates during the downturn.
Despite its wide-ranging benefits, however, the program is facing challenges on two fronts: jeopardized funding and a lack of recruiting builders.
In recent years, the NAHB has been reassessing its sponsorship of the program due to a lack of concrete evidence that it produces NAHB members once students graduate. "Many former students are now presidents of their local home builders' associations," Kramer says, but adds that "it's very hard to track students after graduation," especially given that many students work for other building companies for several years before setting up businesses of their own and registering as members.
And while the students advertise significant dedication and understanding of the industry in their presentations, their audience rarely includes builders offering internships or jobs. Several years ago, the competition was accompanied by a job fair, so builders could watch students perform and then court talent that caught their eye. But that has all dried up, says Bill Faulk, who oversees the two-year student competition.
He and many others involved with the competition lamented the lack of builder participation, seeing it both as detrimental for students and the industry at large. "As we start building more houses, we're going to need more manpower," Nellis says. "This is the source. Students have the technology skills that we need to go to the next level. There will be choices in hiring new employees. Do you hire someone with 30 years of experience or the new person coming out of college? You need both: one to train the new guy and the new person to bring technology."
Claire Easley is a senior editor at Builder.
Learn more about markets featured in this article: Greenville, SC.