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RICS APC > Design Economics and Cost Planning > Flashcards

Design Economics and Cost Planning Flashcards

1
Q

What are the factors affecting life cycle of a building?

A

Capital costs, renewal costs, operation costs, maintanance costs, end of life value

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2
Q

What is life cycle costing?

A

It is a methodology to asses the total cost of ownership of a built asset over its entire life

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3
Q

What are the design parameters commonly used?

A

-Wall/floor ratio
-GEA/Site Area
-GIA/GEA

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4
Q

What is cost planning and when does it commence?

A

It is a budget distribution technique during design development of building. Typically starts from RIBA 2-4

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5
Q

What is the difference between cost estimate and cost planning?

A

Cost estimate is determination of possible outturn of cost of a building at an early stage typically RIBA 0-1. Cost plan takes places during design development phase.

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6
Q

What are information to carry out cost plan/cost estimate?

A
  • Building location and type
  • floor Area/functional units
  • Storey height
  • Envisaged finishes
  • Initial floor plans, elevations, sections
  • Requirements for refurbishment
  • Indication of specs and quality
  • Indicative prgoramme, procurement, contract strategy
  • Budget and cashflow
    -Site condition
  • Details of professional fees, development costs, VAT and inflation
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7
Q

What is the difference between cost and price?

A

Cost is composed of material, labour and plant costs. Price includes material, labour and plant costs plus overhead and profit.

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8
Q

What are the typical components of a cost plan?

A

According to NRM, cost plan includes
- Facilitating works, substructure, superstructure, finishes, services, FFE, external works, works to existing buildings, prefabricated works, external works, MC Preliminaries and OH&P, consultant fees, risk allowances, contingency, tender and construction inflation

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9
Q

How would you prepare a cost plan on CD, SD or DD stage?

A
  • Gather information available such as design, programme
  • Prepare the cost plan based on NRM1 guidance.
  • Ensure all price are up to date to the current market/base date.
  • Allow for appropriate contingency whenever required.
  • Reconcile cost movements from design development stages
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10
Q

What is pre-tender estimate?

A

It is an estimate to forecast the expected outturns of tender returns.

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11
Q

What are the common sources of cost data?

A

Previous tender submission and contract sum analysis, benchmarks, BCIS, building cost models, published price books, specialist subcontractors and suppliers.

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12
Q

What are the published cost data available?

A

BCIS, SPONS

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13
Q

What are price indices? How does it affect your estimate?

A

These are factors considering the varying prices per different locations, as resource and supply chain might differ from one to the other.

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14
Q

What is base date? Why is it important?

A

Refers to the date on which the rates and prices are based on. This the starting point for considering inflation.

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15
Q

What are the development costs aside from construction costs?

A

Professional fees, client decant costs, financing, site acquisition/lease.

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16
Q

How would you determine risk or site allowances?

A
  • Coordination and allocation of risk responsbilities to stakeholders
  • Identify risks, assess, respond and monitor risk
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17
Q

What are the types of risk exposure?

A

Risk avoidance, risk transfer, risk reduction, risk retention

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18
Q

What are the risk allowances allowed in an cost plan?

A

According to NRM, construction risk, design risks, employer change risks, other employer risks.

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19
Q

How would you value risk allowances?

A

-If not yet established, I will put up a risk register to Identify and assess risk exposure.
- I will provide cost against each risk and include them in the cost plan.
- the risk allowance should be updated over the course of cost plan development.

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20
Q

What is the difference between contingency and risk?

A

Risk are potential occurrence that may affect the outturn of the project. Contingency is an allowance for any unforeseen works that may affect the outturn of the project.

21
Q

What are the types of estimate under DIN-276?

A

Budget, preliminary estimate, approximate estimate, cost estimate, estimated final cost, statement of final cost.

22
Q

What is value?

A

It is a measure of worth taking into account the usefulness and benefit that are delivered in relation to costs.

23
Q

What is value engineering? How would you conduct VE?

A

It is a process of optimizing value of components of a building by taking into account its costs, functionality and value to the client.
- Gather information
- Creative thinking
- Analysis evaluation and shortlising
- Development
- Presentation

24
Q

What techniques are usually used in VE exercises?

A
  • cost/Worth Analysis
  • functional Analysis
  • Creating thinking
25
Q

How would you ensure value for money is attained?

A
  • Understanding what value for money mean to the client.
  • Active particiticpation during design development meetings
  • Identify cost drivers and long lead items
  • Reconcile changes
  • Conduct VE whenever required
26
Q

What is value management? What is the difference between VM and VE?

A

It is a structured wholistic approach of defining what value means for the project.
VE is a process conducted under the VM.

27
Q

How did you prepare for cost plan in a mid-rise mixed hotel and service apartment buildings in Saudi?

A

During conceptual design estimate,
- Coordinate with design and project team to acquire information of works require for every stage.
- Conduct quantification of works (mostly space coordination) based on information available at that stage.
- Price the works based on previous benchmarks, rate per m2 of a function, special considerations as outline in design info.
- Conduct checks with colleague and senior member of firm
- Highlight design inefficiencies such as cost drivers, wall floor ratio, net/gross floor area
- Highlight cost movements from one stage to the other.
- Send cost plan report and update timely

28
Q

How did you consider the different themes into your cost plan?

A

In this project, I referred to the design usage of area and apply rate/m2 per asset such as BOH, FOH areas based on previous internal records with same themes such as luxury, lifestyle and business type buildings.

29
Q

What is NRM? What is the structure of a cost plan under NRM?

A

NRM is an SMM published by RICS. For cost plan the structure is:
- Facilitating works, substructure, superstructure, finishes, services, FFE, external works, works to existing buildings, prefabricated works, external works, MC Preliminaries and OH&P, consultant fees, risk allowances, contingency, tender and construction inflation

30
Q

What is facilitating works? What is the difference between facilitating works and enabling works?

A

It is the works required to be executed prior to commence of building works. Enabling works is commonly work package that include facilitating works, temporary works, etc.

31
Q

What are the value of the estimates in mid-rise mixed hotel and service apartment buildings? What is the GFA? Where is it located?

A

Diyar al Muharraq, 35k m2, 16.4M Dinars

32
Q

Is VAT typically included in a cost report? And Why?

A

Each client has their own level of VAT and QS in not in a position to determine these levels.

33
Q

What are the typical assumptions, exclusions and abnormals allowed/caveated on a cost plan?

A

Exclusions: VAT, client decant cost, financing, land acquisition, permitting fees
Assumptions: based on design info available. Allowances maybe allocated for risk identified but need further assessments.
Abnormals: Unforeseen ground conditions, access constraints, statutory desicions

34
Q

What are the typical inflations included in a cost plan?

A

Pre-tender inflation, Construction inflation

35
Q

How many building blocks are there in DGDA Diriyah Square P3?

A

36 Blocks

36
Q

How much is the value of DGDA Diriyah Square P3?

A

1.6B SAR 500k m2

37
Q

What the assumptions and exclusions?

A

Exclusions: VAT, client decant cost, financing, land acquisition, permitting fees, works covered by other phases.
Assumptions: based on design info available. Allowances maybe allocated for risk identified but need further assessments.
Abnormals: Unforeseen ground conditions, access constraints, statutory desicions

38
Q

How did you consider the historical look and feel theme in your estimate?

A

In this project, I referred previous internal records with same historical themes and apply price indices to suit Riyadh market.

39
Q

How would you determine the breakdown or structure of a cost plan/estimate?

A
  • I would coordinate with the design and project team regarding phasing requirement or structure Requirements
  • I will consider separating them per assets for better Analysis on assets
  • Present the proposed structure to client and project team to Ensure deliveries and Understanding are aligned.
40
Q

What are the typical fitout components of an office development?

A
  • typical finishes are, suspended ceilings, and raised floorings, themed finishes to suit tenant Requirements
41
Q

In general, how would you proceed if the client exceeds the budget?

A
  • Identify and analyse cost drivers
  • Conduct VE with client, design and project team to Ensure project is on track
42
Q

How did you prepare VE cost exercises in office development project in Germany?

A
  • I valued the proposed VE options put forward by the project team based on tender return rates and extent of works outlined by the design team
43
Q

In office development project in Germany, how much is the overrun? How much is the cost saving?

A

Budget overrun +344k and +418k EUR from two tenderers.
Savings after VE: -33k and -52k from EUR two tenderers

44
Q

How did you prepare a cost plan for DGDA Diriyah Square P3?

A

During schematic design estimate,
- Coordinate with design and project team to acquire information of work scope.
- Conduct quantification of works (schematic design) based on information available at that stage.
- Price the works based on previous benchmarks, rate per m2 of a function, special considerations as outline in design info.
- Conduct checks with colleague and senior member of firm
- Highlight design inefficiencies such as cost drivers, wall floor ratio, net/gross floor area
- Highlight cost movements from one stage to the other.
- Send cost plan report and update timely

45
Q

In DGDA Diriyah Square P3, how did you consider the luxurious look and feel theme in your cost plan with limited design information?

A

To accommodate luxury facade upgrade, I referred to previous contract sum analyses with facade types and acquired rate per facade area m2, and applied this rate to facade areas affected by the upgrade to obtain an order of magnitude price of the luxurious upgrade.

46
Q

How did you prepare pre-tender estimates in Marassi Vista serviced apartments?

A
  • I review the scope of works shown in the tender inofrmations and cross checked them with the drafted BoQ to Ensure everything is captured
  • I priced the works based on the recent tender submission, contract sum analyses and estimates in our internal data and applied indices whenver required.
  • I conducted market testing whenever required.
47
Q

How were you able to identify design changes from design phases?

A
  • Due to difference of BoQ and cost plan structure, I arranged the work items to enable elemental comparison.
  • I analysed the elements and subelements with big differences and reported it to the client and design team, to verify and acknowledge those changes.
48
Q

How did you advise the cost drivers in the PTE? What are these elements?

A

I assessed by reviewing the elemental breakdown and noticed that in the external envelope, it covered 15% of the total cost. I highlighted the additional perforated cladding screens amounting circa 900k dinars and addressed the requirement to the designers and client in terms of cost/value.

49
Q

How did the client treated these changes?

A

Client acknowledged the design changes and provided no objection to proceed with the tender process.

RICS APC (17 decks)

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