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As a result, wages and the overall cost of building are increasing, forcing some developers to delay projects or, in some cases, not build at all.“There’s been several projects we declined to bid or just don’t even look at because we know we can’t man them,” said Walt Oxley, owner of Ciarra Construction, one of the builders of the Santana Row townhomes in San Jose in 2003.Some workers, exhausted from an early morning commute, sleep in their cars at construction sites before starting their shifts.
When he was underwriting the project, the economics worked.
Though rising construction costs can’t be blamed for the entire increase, the median price for a single-family home in the nine-county Bay Area climbed nearly 14 percent over the past year — hitting 5,000 in December, according to the most recent data from real estate data analytics company Core Logic.
“We’re just passing along the cost increase to our clients to maintain our gross profit and be able to be a business,” Vatani said. Pay construction workers even more, to entice them into the jobs the industry desperately needs filled, says Gary Painter, an economics professor who specializes in housing at the University of Southern California.
Some bring in employees from Southern California or even Seattle, putting them up in hotels.
Others hire workers from the Central Valley who spend hours driving to job sites in the wee hours of the morning only to arrive exhausted, forced to squeeze in quick naps before the workday starts.
To make ends meet, Heriberto Leon, a military veteran who began working as an electrician’s apprentice roughly six months ago, wakes up at 4 a.m.