Insulation Materials Rise 40%, Thinner Products Up to 80% in Price

The escalating tensions in the Middle East and the resulting turmoil in the Strait of Hormuz are not merely energy issues, but are having a significant impact on large-scale apartment building renovation projects, and the current situation can even be considered a "crisis."

The problem lies in the shortage of naphtha (crude gasoline), which is used as a raw material for approximately 80% of building materials. Against this backdrop of naphtha shortages, major manufacturers have announced price increases of 40% for insulation materials and up to 80% for thinner products. Some companies have even begun suspending orders for unit bathrooms and restricting shipments of repair materials.

Particularly serious is the impact on large-scale renovation projects for condominiums, which are causing distress among management associations.

At construction sites, the abnormal situation of "scaffolding has been erected, but the paint hasn't arrived" has become commonplace, leading to a vicious cycle of construction delays and further increases in labor costs.

Long-term repair plans formulated several years ago have become powerless in the face of estimates that have skyrocketed to 1.2 to 1.5 times their original value. Due to insufficient reserve funds for repairs, some unions have been forced to cut back on construction projects, and some have even begun to be compelled to collect one-time payments.

　It's no exaggeration to say that this situation has far exceeded the point where it can be resolved by the management association's efforts or the "self-help efforts" of the condominium renovation company.

What are the countermeasures against the "naphtha shock"?

One option is to postpone the large-scale renovation work itself until the situation stabilizes. However, in cases where construction has already begun, difficult decisions are being made, such as whether to keep the scaffolding in place until materials arrive, or to dismantle it and suspend the work.

Currently, we are in such a critical situation.

In response to the soaring material prices and unstable supply caused by the "naphtha shock," the countermeasures that management associations planning large-scale renovation work should consider can be summarized into three points: "review of construction plans and specifications," "updating of financial plans," and "scrutiny of contract details."

1. Review of Construction Plans and Specifications

It is necessary to make realistic decisions that are in line with the current material situation, rather than clinging to the previous plan.

In particular, it is advisable to consider switching from solvent-based paints such as thinner, whose supply is disrupted, to water-based paints. Also, if materials from a specific manufacturer are unavailable, it may be necessary to consider switching to other manufacturers.

To address budget shortfalls, one solution is to redefine "repairs that can be done now" by reducing and limiting the scope of work, such as limiting it to only painting the steel parts this time.

2. Updating the Funding Plan

Long-term repair plans created based on price levels from several years ago are no longer valid.

If a budget overrun is certain, it will be necessary to begin discussions at an extraordinary general meeting regarding the use of contingency funds, the collection of lump-sum payments, and an increase in repair reserve funds.

3. Scrutinizing Contract Details

Material prices fluctuate significantly, creating risks that cannot be adequately addressed with conventional methods.

To prevent shortages due to the time lag between contract signing and commencement of work, it is crucial to ensure that the construction company guarantees the early securing of materials. Clearly define in the contract how costs will be shared if further increases in material prices occur during the construction period, thereby clarifying the risks.

Finally

There has been criticism from those on the ground that the government's response is "too lenient," and resolving the supply shortage may take time.

Furthermore, in addition to material shortages, securing skilled workers (craftsmen) has become increasingly difficult these days. The environment surrounding condominium renovations is currently facing headwinds in every respect.

The Zenken Center offers consulting services by expert staff. It is necessary to obtain information from objective data provided by experts and to take measures to alleviate the concerns of residents.

The management association is required to make careful yet swift decisions, assuming that the current "bottleneck" will be prolonged.

<Zenken Center, Large-Scale Renovation Project Newspaper Editorial Committee, 2026-05-02>

大規模修繕工事新聞　2026-05　197号