Deconstructing profits prove worthy by Mike Breslin
Demolition is all about speed, safety and maximizing
the use of equipment to level a structure and remove
the debris from the site as cost efficiently as possible
– recycling scrap metal, wood, or concrete is often
a secondary consideration and much is dumped in landfills.
Conversely, deconstruction or hand-dismantling involves
the slower, meticulous process of tearing down a building
to maximize material recovery for recycling or reuse.
With new home construction and the remodeling business
in the dumps, dismantling and the sales of recovered
building materials is holding its own, even prospering
in many areas of the country.
Gary Delp, the owner of Heritage Timber in Missoula,
Montana, has been dismantling buildings for 15 years
and has removed buildings as large as 50,000 sq. ft.
Delp said, “Over last year we’ve had a 10 to 15 percent
increase in our business.”
“Unbuilding”– a must read reference book
While researching the article Deconstructing Profits,
I interviewed Bob Falk, president of the Building Materials
Reuse Association. Falk’s full time job is research
engineer at the U.S. Forest Service, Forest Products
Laboratory. He’s authored a book about deconstruction.
We agreed to swap novels – one of mine for his book,
“Unbuilding”. Falk kindly mailed an autographed copy
along with his business card.
I was impressed to find a glossy, coffee-table sized
volume with hundreds of color photos and illustrations.
Falk holds a PhD and was a PE. After spending a few
hours with his book, I felt that readers of American
Recycler should know about it and our publisher, Esther
For anyone interested in dismantling, this is a must-have
reference – a step-by-step guide through the entire
process – from evaluating deconstruction opportunities
to an assessment of materials to safety and environmental
health to whole-house deconstruction. It’s complete
with checklists for tools needed and hands-on advice
on every aspect of dismantling. Falk and Brad Guy have
combined hard-won, real world deconstruction experience
and a thoroughly professional engineering approach
to the subject.
This book could be a time and money saver for anyone
contemplating even the smallest deconstruction project.
Virtually every material, fixture and appliance is
addressed with the best methods to remove, stage, store
and sell the items. The book is ideally suited to train
a workforce. Moreover, it is sprinkled with personal
stories of how and why people are drawn into this fascinating
It’s a comprehensive reference book with a detailed
index and other useful information.
Brian Alferman, a board member of the Building Materials
Reuse Association, and the associate director of Habitat
for Humanity’s ReStore in Kansas City, said, “We are
in a very low period of deconstruction right now. In
fact, we have only deconstructed one house this year
– last year and the year before we were doing about
25 a year. This economy and the housing market specifically
have taken a toll on our deconstruction opportunities.”
Reclaiming old growth wood is highly competitive simply
because it has become very profitable. Venerable grains
are highly prized and in strong demand by architects,
decorators and builders for their aesthetic qualities
they bring to projects. As the supply of treasured beams
and boards become scarcer, prices are climbing. “There’s
been a general trend in the kind of materials we deal
with, including antique lumber and large timers, where
there’s been greater value placed on them by high-end
home builders, homeowners trying to make more sustainable
choices, and even commercial builders. All of a sudden
the material is more valuable,” said Delp.
For the first job Heritage did, Delp didn’t have to buy
the building. He tore it down and sold the materials.
“But if I were looking at the same job today there’s
a good chance I would have to pay for the building. Back
then my wholesale price for timbers was $.50 a board
foot. My wholesale price for timbers now is $2.00 a foot.”
Generally speaking, older wood with aged patina and a
distressed look is much more expensive than new wood.
In Heritage’s market, the most in demand wood is Douglas
Fir due to the rich brown color it gains with age. “There’s
no way to compare the price of new wood to 80 to 100
hundred year old timbers that have rich, dark color because
you can’t buy it new.”
Of course, not all wood coming out of a deconstruction
is that desirable. “Newer lumber out of an older building
is cheaper than new wood by anywhere from 10 to 50 percent,
depending on condition,” said Delp.
Roof-down deconstruction requires heavy manual labor
supplemented by articulating cranes, forklifts, power
saws and pneumatic de-nailers. Heritage processes material
on-site, which involves de-nailing, cutting off split
ends, recording inventory, unitizing by grade and wrapping
and banding for shipment. “We’re getting more into retail
because the mark-up is better. On big jobs, it used get
loaded onto trucks and go directly to whoever was buying
it,” said Delp.
There’s more in old buildings than wood, however: “If
the fixtures are in some way unique, or antique, or just
cool, we store and sell them. Otherwise we donate them
to our local reuse center. I think dismantling could
be a growth industry,” said Delp. Many building codes
are ambiguous about using reclaimed wood. In theory,
each piece of used wood should be inspected by a lumber
grader, but in most cases it’s not enforced. Heritage
sells scrap metal, I-beams as structural steel and sprinkler
pipe is recycled by a company that makes cattle feeders.
“For now, most of the money we make is with the decorative
wood. Whether or not that continues would have a big
impact on our business. A year ago we hired a marketing
manager and that’s where our growth is coming from. We
are creating opportunities to develop our relationships
with different owners of larger industrial buildings,”
For materials that cannot be easily monetized, many dismantlers
and homeowners sell or donate to the growing number of
material reuse retailers, or donate to non-profits like
ReStores, the retail recycling arm of Habitat for Humanity.
Founded in 1976 by Millard and Linda Fuller, Habitat
has built over 300,000 houses around the world for 1.5
million people. By using volunteer labor and donations
of money and materials, it builds and rehabilitates houses
for partnering families. In addition to a down payment
and monthly mortgage payments, homeowners invest sweat
equity in their house and the houses of others. Houses
are sold to partners at no profit and financed with affordable
loans. Mortgage payments are used to build more houses.
In 2008, Habitat built 5,495 houses in the United States,
all made with new materials, but the recycled building
materials, appliances and fixtures sold at ReStores make
an important contribution to the overall objective –
raising money to build new houses and supplying new materials
for projects. In doing so, ReStore has grown to become
by far the largest North American retailer of used building
materials. From the first store in Winnipeg in 1994,
Habitat affiliates now have 550 United States outlets
and 50 in Canada. And, it’s growing. Between January
2008 and May 2009, 53 new Restores stores were opened.
The majority of ReStores report that 85 percent of inventory
is used building materials. All ReStores are local affiliates
of Habitat for Humanity, are not-for profit, and are
open to the public with all proceeds going to Habitat.
Mark Little, manager of support services for ReStore
in Lexington, Kentucky, provided insight into a typical
mid-sized operation. “We have two locations, one of 6,000
square feet and another of 9,000. We sell furniture,
home accessories, building materials and appliances.
Anything that can be used to build, remodel or decorate
Lexington builds about 20 new homes every year, all of
new materials, but also has an active deconstruction
program that supplies a large portion of Restore inventory.
If a property owner is demolishing or remodeling a home,
Restore dismantles and takes the material away, salvaging
from 75 to 85 percent of the structure for resale and
reuse. For kitchen or bath remodels, it takes out cabinets,
appliance and fixtures, usually in a half-day or day.
An entire structure takes four to six weeks. Generally,
they do not charge for kitchen and bath salvage, but
for a full structure hand-dismantle they submit a bid
and charge. ReStore encourages prospects to get comparative
estimates from demolition companies and for-profit dismantlers
to establish fair value for a possible charitable tax
deduction. That’s because there is a conflict of interest
for ReStore to value a donation as well as receive it.
Otherwise, they provide the building owner with a list
of materials salvaged and the deduction can be based
on the actual sales price of the items as they occur,
which may be of greater value than an estimate.
ReStore’s estimate includes staff labor and disposal
costs for the unsalvageable. It does not charge for volunteers
who may work on a deconstruction. “In the span of a year
we generally deconstruct 10 to 12 full structures, but
we are averaging 4 projects or more per month when you
include kitchen and bath removals, “said Little.
Prices at the Lexington outlets for used and new materials,
appliances and fixtures are pegged at 50 percent of retail,
or lower depending on condition. Donations of new items
comprise approximately 15 percent of inventory. “Local
retailers don’t have the red tape to donate new items
that the big box retailers have, but Lowe’s donates materials
and appliances on a national scale and has been one the
bigger partners for Habitat,” Little mentioned.
ReStore looks for higher value on some goods, 100 year
old barn wood for example. “We still want to go lower
than fair market value because we want to be competitive
and want people to get a bargain here,” Little added.