DESIGN ECONOMICS & COST PLANNING Flashcards
If you are producing a estimate or cost plan what rules do you follow?
New Rules of Measurement
What are apart of the NRM suite
NRM 1 - order of cost estimating and cost planning for capital building works
NRM 2 - Detailed measurement for building works
NRM 3 -Order of cost estimating and cost planning for maintenance works
Outline NRM1
Provides guidance on the quantification of building works for the purpose of preparing cost estimates and cost plans. It is the ‘cornerstone’ of good cost management of construction projects, enabling more effective and accurate cost advice to be given to clients and other project team members, as well as facilitating better cost control.
Outline NRM 2
Is written mainly for the preparation of bills of quantities and quantified schedules of works, although the rules will be invaluable for designing and developing standard or bespoke schedules of rates.
Outline NRM 3
Gives guidance on the quantification and description of maintenance works for the purpose of preparing initial order of cost estimates. The rules also aid the procurement and cost control of
maintenance works.
What is the structure of the NRM 1?
-Part 1 : General introduction
-Part 2: Measurement rules for order of cost estimate
-Part 3: Measurement rules for cost planning
-Part 4: Tabulated rules of measurement for elemental cost planning
-Appendices
What is the structure of the NRM 2?
-Part 1: General introduction
-Part 2: Rules for detailed measurement of buildings works
-Part 3: Tabulated rules of measurement for buildings works
- Appendices
What is the structure of the NRM 3?
-Part 1: General introduction
-Part 2: New rules of measurement for building maintenance works
-Part 3: Measurement rules for order of cost estimating (renewal and maintain)
-Part 4: Measurement rules for cost planning of renewal (R) and maintain (M) works
-Part 5: Calculation of annualised costs for renewal (R) and maintain (M) works
-Part 6: Tabulated rules of measurement for elemental cost planning
- Appendices
Why is it important to measure the works according to industry standards and best practice?
-To provide consistency and greater accuracy of pricing.
-To ensure that all parties price on the same basis and therefore reduce the risk of dispute.
Is it mandatory for chartered surveyors to follow the procedures set out in NRM?
No, However, when a allegation of professional negligence is made against a surveyor, the court is likely to take account of the contents of any relevant guidance notes published by RICS in deciding whether they had acted with
reasonable competence.
What 2 sub sections are set out in NRM 2 relating to Prelims
ERs and Contractor cost items
List some ER Prelims
-Site accommodation.
-Site records.
-Completion & post completion requirements.
List some Contractor Cost Items Prelims
-Management & staff.
-Site establishment.
- Temporary services.
-Safety and environmental protection.
-Control and protection.
-Mechanical plant.
- Temporary works.
-Site records.
-Completion & post-completion requirements.
-Cleaning.
-Fees & charges.
-Site services.
-Insurances, bonds, guarantees and warranties.
How is risk dealt with under NRM?
- Not a standard Percentage
-assessment of the risk, considering completeness of the design and other uncertainties such as the extent of site investigation undertaken.
Risk categories in NRM
-Employer Change Risk.
-Employer Other Risk.
-Design Development Risk.
-Construction Risk.
What is cost limit?
The maximum expenditure that the
employer is prepared to make in relation to the completed building
What is the base cost estimate and what should it include?
A evolving estimate of known factors without any allowances for risk and
uncertainty, or element of inflation.
The base cost estimate is the sum of the works cost estimate, the project/design team fees estimate and the other development/project costs estimate.
What is an order of cost estimate?
Term used in NRM, purpose to establish if the proposed project is affordable
How are professional fees presented in the order of cost estimate?
Fees can be presented as an item (if actual fees are known) or a percentage applied to the ‘works cost
estimate’.
Which RIBA Stage is the order of cost estimate typically produced?
RIBA Stage 1 - Preparation and Briefing
Name all RIBA Stages
Stage 0- Strategic Definition.
Stage 1 - Preparation and Briefing.
Stage 2 - Concept Design.
Stage 3 - Spatial Coordination.
Stage 4 - Technical Design.
Stage 5 - Manufacturing and Construction.
Stage 6 - Handover.
Stage 7 - Use
What additional information should accompany an order of cost estimate?
.
-Covering letter
-Executive summary.
-Cost limit.
-Specification notes.
-Assumptions.
-Exclusions.
-Drawings and other information upon which the estimate is based.
-A schedule of value enhancing options.
-Risk register.
-Cash flow information
What is a cost plan
-Estimate of actual project cost is likely to be
- Produced by cost consultant
-Identifies clients cost limit and how money is allocated
Benefits of cost plan
- predicts final cost
-Enables practicality and balance designs from designers as they can see how their designs influences cost
-Employer can make commercial decisions of info
Is a Programme needed to produce a cost plan?
Preliminaries are typically presented as a weekly rate in developed cost plans; therefore, a programme or at least some high-level dates will be required.
The key information usually required is:
-Design and tendering periods.
-Start on site date.
-Construction period.
-Completion date
Name sources of data
-BCIS
- Pricing Books like SPONS
- Previous market tested rates from legacy projects
- In house cost analysis and models
-Speaking direct to contractors
How do you take account of the project location and why?
A location factor is usually applied to recognise differences in construction prices. For example, a project in London is typically more expensive than a similar project in the midlands
What is a cost plan risk allowance?
A sum included to cover unknown costs or unmitigated risks during the project
What fees might be included in the fee estimate?
Consultant fees - project & design teams, surveys & specialist consultants
Contractor fees - management and staff, design management fees