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APC - Quantity Surveying - Core Comps > Design Economics & Cost Planning > Flashcards

Design Economics & Cost Planning Flashcards

1
Q

Net and Gross Areas

A

Net Area – Sale or lettable area

Gross Area – Circulation, Plant, Entrance, Toilets (communal), Gym

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2
Q

Data Sources

A

In House Data / Tender returns
SPONS
BCIS

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3
Q

Composite Elemental Rate

A 
Ground floor slab represents as cumulative £/m2 to include:
excavate
compaction
harcdcore
blinding
DPM
Insulation
Concrete
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4
Q

Inflation

A

Tender Price Index; Cost Plan Date - Tender return date

Construction Price Index; Tender return date - Construction mid-point date

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5
Q

Cost Plan NRM1

A 
0 Facilitating works
1-8 Building Works
9 Preliminaries
10 OH&P 
WORKS COST ESTIMATE 
11 Project Design Team Fee
12 Other Project Costs 
BASE COST ESTIMATE 
13 Risk Allowances
COST LIMIT EXC. INFLATION 
14 Tender Inflation & Construction Inflation 
COST LIMIT INC INFLATION
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6
Q

Calculating unit rates from first principles

A 
Tiling 10m2
Labour; 16 hours @ £15ph= £240 
Materials; Tiles, grout, adhesive = £300 
Total £540 + 5% OHP= £567 
/ 10= £57/m2
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7
Q

Building Works

A

1 Substructure
Foundations, Ground Floor Slab, Piling
2 Superstructure
Frame, Roof, Upper Floors, External & Internal Walls, External & Internal Doors,
3 Finishes
Wall, Floor, Ceiling
4 Fittings, Furnishings and Equipment (FFE)
Kitchens, Bathrooms, Furniture
5 Services
Heating, Electrics, Ventilation, Lighting, Waste
6 Prefabricated Buildings
Guard House, bath pods (student resi/budget hotel)
7 Work to Existing Buildings
Support to adjacent buildings
8 External Works
Roads, Paving, Planting, External Services (Utilities), Drainage

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8
Q

Preliminaries

A 
Items that cannot be attributed to a specific element above e.g:
Staff
welfare
temp. services
security, safety
site records
completion requirements
cleaning
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9
Q

OH&P

A

Head office admin

Return on capital investment.

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10
Q

Design Team Fees

A 
PM
QS
CA/EA
Arch
M&E
C&S
CDM
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11
Q

Other Project Costs

A 
Land acquisition
finance
planning fees
oversailing
party wall
highway adoption
section 106
insurances
marketing
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12
Q

Design Development Risk

A

Risks associate with DD:
planning change
tender delays e.g. design novelty (untested)
inadequate/unclear info (site investigation)
use of provisional sums

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13
Q

Construction Risk

A 
Risks associated with:
site conditions
existing buildings
ground conditions
existing services
statutory delay
archaeological remains
underground obstructions
contaminated ground
asbestos
site access
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14
Q

Employer Change Risk

A 
Design and scope change during design and construction:
scope creep
quality increase
increased time
change of existing work when onsite
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15
Q

Employer Other Risk

A

Acceleration
postponement
funding issues

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16
Q

Typical Cost Plan Exclusion

A 
VAT
Land acquisition
Professional fees
insurances
finance costs
Planning costs
S106
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17
Q

New Rules of Measurement Series

A

NRM
1; Order of cost estimating and Cost Planning
2; Detailed measurement for building works
3; Building maintenance works

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18
Q

RIBA Stages & Costing Approach

A

0 Strategic
Identify Client requirements, feasibility (budget and risks)
Cost Model (£/m2)

1 Preparation
Project brief & outcomes, quality aspirations, further feasibility, site info and surveys, programme, project execution plan Order of Cost Estimate

2 Concept - Arch concept design, outline specification
Formal Cost Plan 1

3 Spatial - Developed design and costing
Formal Cost Plan 2

4 Technical - Developed arc, eng, civil design, building systems
PTE

5 Construction
6 Handover
7 In Use

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19
Q

Cost Plan Delivery

A 
Standard format
comp checked
peer review
emailed inc letter
phone call
review meeting
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20
Q

Technical Design Detail Stage 4

A 
Building services (electric, heating, waste etc)
detailed foundation
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21
Q

Cost Planning Purpose

A

Feasibility - Proceed?
Facilitate Design Choice
Cost management (Budget limit each element)

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22
Q

Cost Plan Contents

A 
Executive Summary
Cost Reconciliation
Elemental Summary
Elemental Breakdown
Basis/Assumptions/Exclusions 
Inflation Statement
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23
Q 
Meole Brace - Cost Plan Overview
Overall cost inc £/m2
Site Costs
Site infrastructure
Programme
On Costs
A 
£1620/m2 - £4.3m 
Site Wide Costs; £1.4m 
£7m OVERALL 
12-month programme 
12% prelims 
5% OHP
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24
Q

Value Engineering vs Value Management

A

VE - Process that seeks to deliver the same requirements but at a lower cost.
VM - Clearly communicates the clients requirements by identifying what is a need and what is a want and aligning these with the budget. Needs first wants second.

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25
Q

VE Example

A

Façade Glazed Elements – Omit Glazed walling; curtain walling; unitised – (£900m2) E/O for stone banding; pre-cast concrete panels; reconstituted stone faced (£800m2)) ADD Double storey glazed units set in pre-cast concrete (acid etch finish) vertical / horizontal framing £650 = £1m saving (2700m2)

Windows - Omit Anodised aluminium framed (£700) – ADD PPC aluminium framed £450 = £200k (1260m2)

Juliet Balconies – Omit – Juliet Balconies £2000 ADD – Windows with top hung opening vents £1000 = £400k saving
Glazing to staircore

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26
Q 
Kings Tower Cost Overview
GIA
NIA
Net to gross
Units
Floors
A

£31m - £2100/m2
15k (GIA) 11k (NIA) Net to gross = 75%
Units 195
Floors = 36 inc. mezz. and basement

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27
Q

Building Height Increase Implications

A

More expensive due to:
Foundation capacity increases
M&E more complex
firefighting lifts & pressurised water for firefighting
resistance to wind (material quality increase)
working at height (cranes and difficulty of moving/storing materials)
adding several floors may require larger lifts and reception/circulation areas (reduces net/gross).

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28
Q
  1. How should cost planning be approached under NRM1?
A

Facilitating works, Building Works, Preliminaries, OH&P - WORKS COST ESTIMATE
Project Design Team Fee, Other Project Costs
BASE COST ESTIMATE - Design Development Risk, Construction Risk, Employer Change risk, Employer other risk
COST LIMIT EXC. INFLATION - Tender Inflation, Construction Inflation
COST LIMIT INC INFLATION

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29
Q
  1. What is the basis?
A

Drawings, specifications, surveys, email

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30
Q
  1. Assumptions?
A

e.g. type of frame, external wall build up, floor type, ground strength

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31
Q
  1. Exclusions?
A

VAT, Land acquisition, Land remediation tax relief, Professional fees, insurances, finance costs

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32
Q
  1. What is design economics?
A

Assesses the cost efficiency of the design

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33
Q
  1. What is the wall to floor ratio?
A

Compares the quantity of wall to floor. Floor is the key metric in identifying the size of a building. The less wall relative to floorspace makes the building more efficient.

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34
Q
  1. What could be a negative impact of having a very good wall to floor ratio?
A

If the building was too “efficient” i.e. it had little wall area relative to the floor area it might lack in natural light.

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35
Q
  1. What building types might this be an issue for and not?
A

This might be an issue for office space i.e. many desks would be far away from windows which would be less desirable.
For a warehouse this would might not be an issue

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36
Q
  1. What is the net to gross ratio?
A

Net Area – Sale or lettable area Gross Area – Circulation, Plant, Entrance, Toilets (communal), Gym

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37
Q
  1. What is site density?
A

Proportion of a site that is occupied by buildings. For example, a high-rise office in a city centre location would have a high site density as relative to the plot size there is a high gross floor area. At the other end of the spectrum a warehouse would have a lower site density with the building taking up typically 40% of the site with the service yard and car park taking up the rest of the site area.

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38
Q
  1. How does cost planning aid in financial control as design develops?
A

As the design changes cost planning enables an understanding of the associated cost implications.

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39
Q
  1. What are the RIBA cost planning stages?
A

RIBA stages -
0; Strategic
1; Preparation
2; Concept
3; Spatial
4; Technical
5; Construction
6; Handover
7; In-use.
0 Strategic - Identify Client requirements, feasibility (budget and risks) Cost Model (£/m2)
1 Preparation - Project brief & outcomes, quality aspirations, further feasibility, site info and surveys, programme, project execution plan Order of Cost Estimate
2 Concept - Arch concept design, outline specification Formal Cost Plan 1
3 Spatial - Developed design and costing Formal Cost Plan 2
4 Technical - Developed arc, eng, civil design, building systems PTE
5 Construction
6 Handover
7 In Use

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40
Q
  1. Why would a traditional procurement cost plan vary to a D&B cost plan? (at tender stage)
A

Traditional procurement route fully develops the design to stage 4. D&B is typically developed to stage 3/4 so is less detailed.

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41
Q
  1. How would you use internal cost data?
A

Internal cost data can be used to inform the cost of similar schemes at early stages.

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42
Q
  1. What is SPONS?
A

Wide range of construction cost data; sector cost models, material & labour cost

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43
Q
  1. What is BCIS?
A

Building Cost Information (RICS) collated, analysed, modelled to facilitate accurate Cost Planning

44
Q
  1. Why would you adjust costs for time?
A

Overtime the cost of consutrction changes in line with the economy i.e. inflation, interest rates etc. Costs can be adjusted from say Q1 2020 to Q4 2022 using indices provides by BCIS.
TPI - Cost Plan Date - Tender return date. CPI - Tender return date - Construction mid-point date

45
Q
  1. Why would you adjust for location?
A

Location factor by BCIS which reflects differing material and labour cost e.g. London vs Blackpool

46
Q
  1. How would you make time and location adjustments in a cost plan?
A

Inflation indices is applied at the end of a cost plan.
TPI then CPI
Location adjustments are typically used in conjunction with benchmarking exercises at early project stages where limited information is avaible to break rates down.

47
Q
  1. What cost plans did you complete for Meole Brace?
A

OoCE

Formal CP1

48
Q
  1. Why did you compile multiple cost plans?
A

As the design developed I completed cost plans in line with new design information

49
Q
  1. What are the stages of cost plan called?
A 
0 – Cost Model
1 – OoCE
2 – Formal CP 1
3 – Formal CP 2
4 - PTE
50
Q
  1. How did you compile your rates?
A

I used in house data where a similar scheme had recently been completed. I adjusted the rates for time and location to the current date before making any adjusted based on the intended tender and construction dates.

51
Q
  1. What were the key assumptions you made on the retail project?
A

For the OoCE little information was available so I assumed the type of frame. External wall build up, roof type, floor.
I confirmed the type of foundation with the structural engineer along with the frame.

52
Q
  1. What was in your basis?
A

Site plan
Floorplans
Elevations
Several emails from designers as a basis for the design elements that were included in the cost plan.

53
Q
  1. What did you exclude?
A

VAT, land acquisition, professional fees, finance costs

54
Q
  1. How did you split the costings for the retail units?
A 
The upper floor, 
upper wall area, 
lift, 
finishes to the gym were removed.
The remaining aspects inc. roof were split relative to the size of the unit.
55
Q
  1. Why was this required?
A

Outside role of QS but:

The client wanted to understand the respective costs so this could form part of a calculation onreturn on investment.

56
Q
  1. Was this relevant to you?
A

From a construction perspective th units would be built togehher so this exercise was only to aid the client in their own calculations.

57
Q
  1. What risk allowances are there?
A

Employer Change Risk – Largely dependent on the type of Client. For example; are they a commercial developer who is unlikely to make significant post contract changes or are they an occupier who may not have much construction experience and may decide to make significant post contract changes (UPS). A commercial developer might allow 2%

Employer Other – Similarly to the last point it depends on the client. However, the risk refers to postponement, acceleration and funding issues so can’t readily be foreseen. Again, a commercial developer might allow 2%.

Construction Risk - Construction risk should be allowed for dependent on the unknown elements of the project. Is there an abundance of information for the project or are there still unknown elements of the work or how it is to be carried out? Allowances can vary greatly depending on the risk of a project. Typically an allowance would be in the region of 5-10%.

58
Q
  1. Are there any issues with having large Risk Allowances?
A

If risk allowances go significantly over 20/25% then it might communicate to the project team that there is a generous allowance for costs to escalate. If there is a large risk allowance on the project it should ideally be managed by the client and should not be communicated to the contractor.

59
Q
  1. How would you apply a risk allowance?
A

The base cost estimate would be adjusted by adding any risk allowances to form the cost limit exc inflation. For example if a 5% Design Development risk was applied and the base cost was £1m then the DD risk factor would equate to £50k.

60
Q
  1. How might a DD risk vary?
A

Design Development Risk Allowance Guide - Stage 0/1 – 20%, 2 – 15%, 3 – 10%, 4 – 5%

61
Q
  1. What did you allow? Meole Brace
A

I included a Design Development risk at 10%.

62
Q
  1. What might this allowance account for?
A

Risks associate with DD;
stat reqs,
tender delays e.g. design novelty (untested), inadequate/unclear info (site investigation), use of provisional sums

63
Q
  1. What other risk allowances did you include?
A

Employer Change – Whilst it is always possible that the client will make changes post contract it is less likely when the client is a developer undertaking regular work. I confirmed with the client that they were happy for no risk allowance to be included.
Employer Other – Again this allowance is possible but unlikely for a regular developer.
Construction – I recommended that a 2.5% allowance was included even though the contractor was to hold the majority of risk on the project.

64
Q
  1. When might you have included a higher risk allowance?
A

If the project was traditionally procured I would have recommended an allowance closer to 10% as the client holds the risk for the adequacy of the design.

65
Q
  1. What would you change if the project was closer to tender/stage 4?
A

If the project was fully developed / procured at stage 4 I would have reduced the design development risk to 5%.

66
Q
  1. What risk allowance did you include on the high rise residential scheme?
A

I undertook a Formal Cost Plan 1 (stage 3) so I included a DD allowance of 10%

67
Q
  1. How did you compile the concrete frame rate?
A

TBC

68
Q
  1. How did you compile the upper floor rate?
A

TBC

69
Q
  1. How would you submit cost data into the in-house programme?
A 
State procurement route
Location
Time programme duration
Overview of scope of work
Contract CSA
70
Q
  1. Would it not be better to submit costs at the end of the contract?
A

Arguably yes, however final account are often agreed by negotiation and may account for differing factors i.e. combination of claims that have influenced the negotiation. Comparing costs in a uniform way makes comparison easier.

71
Q
  1. Why do costs need to be presented in a uniform way?
A

Presenting the costs in a consistent manner (NRM1) allows comparison between projects.

72
Q
  1. Give an example of when a scheme has appeared significantly different (cost wise) to similar schemes?
A

MWL apartment scheme was more expensive than other apartments as it was being built off a podium with a car park underneath. It was important have the pricing document in order isolate and remove the car park elements in order to compare the costs on a like for like basis.

73
Q
  1. Why does it need to be consistent?
A

If cost information was not all presented in NRM1 you would have to review the costs and this can be challenging when you don’t have all of the information or were involved in the scheme. By providing cost info in an NRM1 format makes it quick and easy to compare schemes.

74
Q

Outline the process of sending the cost plan to the client?

A

After internal comp check and peer review I emailed the client inclueing the cost plan in a pdf format.

75
Q
  1. How had the costs changed from the previous cost plan? Meole Brace
A

GIA’a for the various unitshad changed. The floor to ceiling height of the First Floor gym had reduced . Overall the cost had stayed similar.

76
Q
  1. Why would the client want to know this? MB
A

Primarily to confirm that the project costs were still within the budget.

77
Q
  1. What was the key risk of the project? Meole Brace - Existing Building…
A

Existing building with asbestos.
Programme uncertainty. #
Recommended that these works were completed prior to the main contract. #
Type of building - small office

78
Q
  1. Why did you recommend they were completed separately?
A

The works could have been a risk to the programme and the works could be completed whilst the design was being developed.
52. Contract type / info demolition works?

79
Q
  1. How did the chosen procurement route relate to time? vs traditional vs MC
A

D&B was not the quickest route but was quicker than traditional and passed the most risk to the contractor.

80
Q
  1. How did quality relate to the procurement route?
A

Traditional would have maximised quality by developing the design in line with the clients requirements however as the scheme’s design was not complex and the client was building in order to let to tenants the scheme just needed to achieve the developer’s specification. The fit out would then be completed by tenants.

81
Q
  1. How did you confirm if the floor to ceiling height was required?
A

Firstly I reviewed the developer’s specification to establish if there were any floor height requirements. Nothing was stated so I suggested the option to the client who confirmed he would check with the tenant if this was the case.

82
Q
  1. How did this reduce costs? What quantities were reduced?
A

Walls area reduced.

Wall finishes reduced.

83
Q
  1. What is value engineering?

.

A

Value engineering is a reactive process when there is a requirement to reduce costs so consideration is given on how the design can be changed to reduce costs

84
Q
  1. How did you change the glazed façade?
A

Omit glazedwalling unitised £900/m2
Omit stone banding
Add Double storey glazed unit set in precast conrete £650/m2

£1m saving 2724m2 area

85
Q

VE for Windows?

A

Omit anodised aluminium frame 1261 @ £700
Add PPC aluminium frame 1261 @ £500

£200k saving

86
Q

VE for Juliet Balcony

A

Omit Balcony

Add Top hung opening vents to windows

87
Q
  1. What was the state of the construction market? (Whitwell Train Station)
A

Labour and labour increases caused by a lack of supply. Various factors – pent up demand caused over lockdown.

Covid/Brexit – loss of labour. Material price caused by shutdown of production over lockdown then exacerbated by increase in energy prices due to constraint in supply (Ukraine onflict

88
Q
  1. What were the key market factors/trends? (Whitwell)
A

Pent up demand / ceasing of trade over lockdown

89
Q
  1. What was the state of the economy? Interest rates
A

Economy was performing well. Certainty property market was good which was enabling construction works to continue despute price increases and supply issues impacting on programme.

90
Q
  1. How did you undertake the benchmarking exercise? Whitwell
A

I used an existing in-house residential housing database for the midlands comprising of developments from units of 10-25 houses.

91
Q
  1. What elements were excluded from cost comparisom? Whitwell Benchmarking
A

Abnormals
Facilitating Works
External Works

92
Q
  1. What was the overall cost of the scheme?

Per unit

A

£817/m2
£90k unit
£1.7m
2104m2

93
Q
  1. How did you conclude that the costs were considered low? Whitwell
A

TBC

94
Q
  1. Why do you prefer to use in house data?
A

You are able to fully understand the scheme by reviewing the scope of works and looking at the CSA to establish if there is anything abnormal about the scheme which may impact price. By being able to confirm that schemes are comparable allows gives confidence that costs for the proposed scheme are appropriate.

95
Q
  1. How can procurement route impact price?
A

CM – cheapest as trade contractors are engaged directly
D&B – Contractor takes risk for coordination of work and adequacy of design which attracts a premium.
Traditional - Cheaper than D&B as design is fully developed so development is more transparent allowing more accurate trade contractor pricing.

96
Q
  1. Why does the scope of work impact price?
A
97
Q
  1. Why is BCIS limited?
A
98
Q
  1. What is value management?
A
99
Q
  1. Why is VM best implemented early on in a project?
A

Effective communication of clients requirements to avoid over specification

100
Q
  1. What is a development specification?
A
101
Q
  1. Give examples of typical a typical spec on one of your projects?
A
102
Q
  1. Why did the development specification need to be circulated?
A
103
Q
  1. How does client risk vary between traditional and D&B?
A
104
Q
  1. Why would being an ownder occupier change the risk profile of a project?
A
105
Q
  1. What risk allowance did you include?
A
106
Q
  1. What were the key assumptions you made on the retail project?
A

OoCE info available s
Frame – steel frame inc. 12% for fittings, 30 min intumescent paint
External wall build up – composite cladding panels
roof type – single ply roof inc insulation
GFS – 175
Windows – aluminium framed
upper floor – 200mm hollowcore
I confirmed the type of foundation with the structural engineer.

APC - Quantity Surveying - Core Comps (10 decks)

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