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RICS APC CB > Design Economics and Cost Planning > Flashcards

Design Economics and Cost Planning Flashcards

1
Q

What does BCIS stand for?

A

Building Cost Information Service

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2
Q

You mention you have knowledge of how net to gross ratios impact a cost estimate, please can you explain this to me?

A

Shell and core refurb – larger core area mean more WCs which would increase the costs to that area.

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3
Q

How would wall to floor ratio be used in a benchmarking exercise?

A

Shows how efficient a design is, by comparing to similar projects you can benchmark a cost.

Another example is net to gross.

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4
Q

What are the key differences between a stage 3 and a stage 4 cost plan?

A

Increased design detail.
A stage 4 cost plan uses the stage 3 as a basis and then includes the additions and omission below the line.

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5
Q

Note your commentary on Hopton Street - What have been the biggest events that have affected material/ labour prices recently?

A
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6
Q

What was the cost of the lift on SMT? What can cause variances in the cost of lifts?

A
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7
Q

What is nrm 1? How did you split the nrm1 into work packages? Were there differences between the nrm1 and work packages? Where did you get the work package list from?

A
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8
Q

What is the difference between an order of cost estimate and a cost plan?

A
  • A cost estimate is prepared earlier on in the design process typically between RIBA Work Stages 0 to Stage 2
  • This is when the level of design information is more limited and allows a cost estimate to be prepared on a cost per m2 basis or cost per functional unit basis.
  • A cost plan is produced typically at each RIBA Work stage from Stage 2 onwards.
  • As the design progresses more information can be included to eventually breakdown the estimated cost of the development elementally into each of the components parts such as sub structure, superstructure, services & professional fess into an elemental cost plan format.
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9
Q

what is the difference between cost and price?

A
  • The cost is the total cost of labour plant, materials and management deployed for a certain activity
  • The price is the amount a purchaser or client will pay for an item or product and is made up of the cost plus the main contractors profit margin.
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10
Q

How do you proceed if the cost plan exceeds the project budget?

A
  • I would analyse the costs to assess the source of the increase and identify whether any element of work is abnormally high against the order of cost estimate.
  • When the reason for the overspend is identified I would then look to propose value engineering options to my client and design team to being the forecast back in line with the project budget.
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11
Q

What is buildability?

A

Buildability is harnessing the contractors expertise and knowledge during the design stage to generate ideas for effective and efficient methods of constructions.

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12
Q

What are the advantages of buildability?

A
  • Buildability can result in better programming, sequencing and construction methods.
  • A quicker more efficient programme can be acheived.
  • Reduced capital and life cycle costs of the building can be obtained
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13
Q

What is wall to floor ratio?

A
  • this shows the relationship between the wall area and the floor area.
  • It is used to show the cost efficiency of the building
  • The lower the ratio, the cheaper the building is to construct as there is less external envelope to construct in comparison to floor area.
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14
Q

What is the most efficient shape?

A
  • In theory a building with a circular floor plate would offer the most efficient design as there is less wall to floor area
  • However a circular floorplate has poor lettable floor area and is difficult to fit out therefore a square floorplate is considered to be the most efficient.
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15
Q

How would you prepare an estimate for M&E works?

A

I would ask an M&E specialist surveyor to undertake the estimate.
For feasibility estimates the M&E amount would be included in the m2 rate or functional unit rate.

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16
Q

What is a section 106 agreement?

A

S106s are agreemetn between local authorities and developers that are negotiated in the context of granting planning consent

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17
Q

What is construction to shell and core?

A
  • Shell and core is the basic structure, services and envelope of the building
  • This normally includes the fit out of landlord and common areas for example the reception toilets, lifts and stair cores.
  • Base services are typically terminated at entry points to each of the lettable floor plates however life safety services infrastructure is normally provided.
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18
Q

What is a CAT A fit out?

A
  • CAT A is also known as developers fit out
  • This provides generic fit out items to suit most developers for example life safety elements and basic fittings such as suspended ceiling tiles, raised floors, carpets, lighting and power distribution to floor plates.
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19
Q

What is a CAT B fit out?

A
  • A cat B fit out overlays the CAT A provision with bespoke elements that are specific to the needs of the buildings user to enable the tenant to occupy and use the space.
  • This would typically include partitions, power distribution to floor boxes, data cabling, artwork and branding, upgrading CAT A finishes and toilet finishes.
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20
Q

Who provides the definitions for CAT-A & CATB?

A

The British Council of Offices - BCO - Fit out guide

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21
Q

How does NRM define the “Base cost estimate”?

A

The base cost estimate is built up of:
- Construction cost
- Prelims
- OH&P
- project and design team fees and other project costs estimates

Does not include
- Inflation
- Vat

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22
Q

What is CESMM?

A

Civil Engineering Standard Measurement Method
For civils and infrastructure e.g. roads, railways etc

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23
Q

What is the purpose of an OCE?

A

To forecast of project outturn costs

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24
Q

What is the purpose of an Elemental Cost Plan?

A

Elemental is based on NRM 1 where the client is spending the money on which elements.

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25
Q

What is BWIC?

A
  • Builders Work in Connection and is usually set as a percentage of the services cost.
  • BWIC accounts for the Main Contractor to perform any drilling, fixing, cutting and penetrations to enable the services installations.
26
Q

What is an order of cost estimate?

A

-Under NRM this is described as the determination of the possible cost of a building early in the design stage in relation to the employers fundamental requirements.
- This takes place prior to the preparation of a full set of working drawings or bills of quantities and forms the initial build-up to the cost planning process.

27
Q

What is the purpose of an OCE?

A
  • To establish if the proposed building project is affordable and, if affordable, to establish a realistic cost limit.
  • The cost limit is the maximum expenditure that the client is prepared to spend on the proposed building project.
28
Q

What is the format of a feasability estimate or OCE?

A
  • This can be presented on a cost per m2, functional unit or elemental basis.
  • it may also be presented as a range for example £700-£850/m2
  • This may consist of element rates for the main elements of the building such as substructure, Frame, External Walls, Upper Floors & roof.
  • Any site abnormal costs or enabling works are also considered
  • Other inclusions are Preliminaries, Contingency, Inflation and location factor adjustments.
29
Q

What is a functional unit?

A
  • A functional unit is a unit of measurement that considers the prime use of the building.
  • For example in the construction of a hotel or hospital the functional unit may be presented as a cost per bedroom or cost per bed.
  • In a retail estimate the functional unit would be presented as the net lettable retail space.
30
Q

Where would you get your rates from for a preliminary estimate?

A
  • Previous similar projects and historical cost data such as previous tender submissions or a contract sum analysis.
  • Other sources may include estimating price books such as SPONS, the BCIS or specialist contractors.
31
Q

What information do you need to be able to carry out an order of cost estimate?

A
  • Building Location
  • The type of building
  • Floor area or number of functional units
  • Storey height
  • Whether raised access floors or deep suspended ceilings are envisaged.
  • Indication of specification and quality
  • indicative programme, procurement and contract strategy
  • budget and cashflow constraints
  • site and ground conditions
32
Q

What is a cost plan?

A

The cost plan presents the estimated cost of the development into an elemental or functional format.
It shows how the design team proposes to distribute the funds available on the different elements of the proposed building.

33
Q

What is the purpose of a cost plan?

A
  • It is used by the cost consultant to control the development of the design.
  • It identifies the clients agreed cost limit and how the money is to be allocated to the different elements of the building.
34
Q

when would you do a cost plan?

A
  • A formal cost plan is typically issued between RIBA Work Stage 2 (concept design) to Stage 4 (Technical design)
35
Q

What would a cost plan at RIBA stage 2 (concept design) contain?

A

At stage 2 the concept design is made availabel wand the cost plan may be produced at a fairly high level. The cost PLan may be broken down into the different elements of the building based on an outline specification and architectural concept drawings.

36
Q

What would a cost plan at RIBA stage 3 (Spatial co-ordination) contain?

A

At stage 3 the spatial co-ordination of the building is undertaken, the schedule of accommodation may be adjusted and the cost plan is updated to reflect this accordingly.

37
Q

What would a cost plan at RIBA stage 4 (Technical design) contain?

A
  • At stage 4 the technical design is made available and cost plan updated to reflect the architect and engineering technical designs. Specialist subcontractor designs may also be made available to support with refinement of the project costs.
  • The cost plan at stage 4 will typically form the basis of a pre tender estimate to compare tender submission against although this is no longer referenced in the RIBA Plan of Work.
38
Q

What are the principal components of a cost plan?

A
  • Construction costs
  • Preliminaries
  • Contractors OH&P
  • Contingency
  • Inflation
  • Assumptions
  • Exclusions
  • Area Schedule
  • List of Drawings & Specifications adopted.
39
Q

Name the main elements of an elemental estimate

A
  • Substructure
    1. Excavation
    2. Disposal
    3. Foundations
  • superstructure
    1. Frame
    2. Upper Floors
    3. External Walls
    4. Roof
    5. Internal Finishes
    6. Services
    7. External Works
40
Q

What is usually excluded from a cost estimate?

A
  • Professional fees
  • VAT
  • Client decant costs
  • Loose fixtures and fittings
  • Inflation
  • Site Acquisition costs
  • Section 106 agreements
  • Removal of asbestos
41
Q

Why is VAT excluded?

A
  • Because different client will incur different levels of VAT, for example charities may not be subject to VAT.
  • We would not be in a postion to know the correct rate unless informed of it.
42
Q

What is contingency?

A

A sum included within the estimate to cover unknown expenses or unmitigated risks during the project.

43
Q

How is contingency assessed?

A
  • The amount included should relfect the risks and unknown specific items associated with the project.
  • During the early design stage a contingency allowance can be included as an overall percentage of the cost estimate around 5-10%
  • As more design information becomes available a risk register can be compiled and each item assigned a probability and cost impact. The total cost of a risk register items can then be included as the project contingency.
44
Q

What are the stages of the RIBA Plan of Work?

A

0 - Strategic Definition
1 - Preparation and brief
2 - concept Design
3 - Spatial Coordination
4 - Technical Design
5 - Manufacturing and construction
6 - Handover
7 - Use

45
Q

How do you take account for inflation when preparing a cost estimate?

A

I take into account inflation through the use of tender price indices and include adjustments for Construction Inflation and Tender Price Inflation

46
Q

What time period would CONSTRUCTION INFLATION be included for?

A

I would allow for Construction Inflation from the anticipated start of the project to the mid way point of the project

47
Q

What time period would TENDER INFLATION be included for?

A

I would allow for tender inflation from the estimate base date to the the anticipated tender return date.

48
Q

What is meant by the BASE DATE within a cost estimate?

A
  • The base date refers to the date on which rates and prices contained within a cost estimate are based on.
  • These are included for the basis of calculations, for example if adjusting the rates for inflation in the future, the base date ban be used as the starting point from which inflation would be adjusted.
49
Q

How is the BASE DATE relevant within a JCT contract?

A

The Base Date is relevant (inter alia) to clause 2·15·2·1 (changes in Statutory Requirements) and the JCT Fluctuations Options
and it helps to determine the edition/issue and/or version of documents relevant to this Contract, e.g. definitions of the prime cost of daywork (clause 5·5).

50
Q

What does TPI stand for?

A

Tender Price Indices

51
Q

What do TPIs show?

A
  • They reflect changes in the level of tender prices over a period of time.
  • The price adjustments take into account the level of inflation depending on current and forecast market conditions.
52
Q

Where can you obtain Tender Price Index information from?

A
  • The service I use to obtain TPI information is the Building Cost Information Service
  • Larger cost consultancies also produce their own in-house tender price forecasts.
53
Q

Why do you need to take account of location?

A
  • Inflation needs to be accounted for to anticipate the changes in the prices of labour, plant and materials.
  • We need to account for inflation from the date the cost estimate is produced to the anticipated start date of the project.
  • This is to ensure accuracy of the estimate for the client and to ensure the project remains within the cost limit that has been established.
54
Q

What does BCIS stand fofr?

A

Building Cost Information Service

55
Q

what is the BCIS?

A

The BCIS provides construction cost and price information through publications, online services and price books.

56
Q

Where do you get cost information from?

A
  • Previous Tender Submissions
  • Previous CSA’s
  • Benchmarks
  • BCIS
  • Building Cost Models
  • SPONS
  • Specialist Sub-Contractors and suppliers
57
Q

What do you understand by the term VE?

A
  • Value Engineering
  • VE is an organised approach aimed at providing the necessary functions of the building taking into account the clients objectives at the lowest cost, without detrimental affects to quality, reliability, performance or delivery.
58
Q

What do you understand by the term VM?

A
  • Value Management is the proactive process of defining what value means to a client and putting procedures in place to ensure maximum value is delivered for the client, first time.
  • In comparison, Value Engineering forms one of the processes under Value Management and is a reactive procedure to bring the anticipated cost of the development back in line with the project budget when a potential overspend is identified.
59
Q

What is Value, what does Value mean?

A

-Value is a measure of worth taking into account the overall usefulness and benefits that are delivered in relation to the cost being paid for it.
- Value is a complex concept and means different things to different clients.
- For example a short term developer looking to sell a a building on completion will place greater value on a cheaper out-turn cost whereas a developer occupier may place more importance on a higher quality building with lower operating costs.

60
Q
A

RICS APC CB (26 decks)

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