L13: Project Delivery Methods Flashcards
What are they typical project stages?
A. Planning and definition
B. Design
C. Procurement and Construction
D. Commissioning
What happens during stage A. planning and definition?
Need for new building, project defined, budget, conceptual design
What happens during stage B. design?
Arch/Eng design of project; working drawings and specs
What happens during stage C. procurement and construction?
Got materials and equipment and erection of building
What happens during stage D. commissioning?
Fine tune building services
Which parties are involved in project delivery?
Owner Architect-Engineer General Contractor Construction Manager Project Manager
Who is the owner?
Instigating party behind the project
Who is the Architect-Engineer?
Typically a third party who design and produce compliance documents (simple projects have civil and MEP; more complex also have structural and geotech)
Who is the general contractor?
Firm in contract for construction (majority of construction done by subcontractors)
Who is the construction manager?
Professional rep of owner with construction expertise - manages design and construction to achieve quality/cost
Who is the project manager?
Organises, plans, schedules and controls construction and responsible for completing project on time/budget
What is the hierarchy from project manager?
Project manager
Superintendent
Foreman
Labourers
What are they types of project delivery methods?
Traditional:
DBB - single prime, multiple primes, DNB
Alternatives:
CMA
CMR
DB
What is DBB?
Design-Bid-Build
Architect prepares design and construction documents and is responsible for keeping project on schedule/budget; contractors bid on work and build
What are the advantages of DBB?
Proven method
Single point of responsibility (single)
Competition
Owners have more control
What are the disadvantages of DBB?
Time consuming; whole design must be done before bidding (no overlap)
Designers have limited skill in keeping budget/time
Owner faces contractor claims over design and constructibility
More adversarial relationships
What are the types and variation of DBB?
Single prime - owner contracts with arch and GC only
Multiple primes - owner contracts with arch, GC and subs
Design/Negotiate-Build
What is design/negotiate-build?
Pre-selected GC works with owner and arch to advise them (private sector projects)
What are the advantages of DNB?
More constructible
More able to meet time/budget
What are the disadvantages of DNB?
May be higher cost because not competitively bid
What is CMA?
Construction Manager as Advisor
Owner contracts with CM, arch and subs
CM has contractual obligation to advise and prepare cost/schedule and bid packages; received fixed fee
No GC - numerous contractors
What are the advantages of CMA?
Competition
More constructibility and ability to meet time/budget
Non adversarial relationships
Can fast track
What are the disadvantages of CMA?
Numerous contracts - more complex
No single point of contractual responsibility
What is CMR?
Construction Manager at risk
Same as CMA but CM contracts with subcontractors and acts as GC after advising
Advantages of CMR?
Single point of responsibility
Strong, early interaction between arch and builder
Construction can begin before the design is completed
Disadvantages of CMR?
Adversarial relationships can develop as CMR shifts to GC (GC trying to make own profit)
What is DB?
Design-Build
Newest method where owner contracts with contract to provide design and construction
What are the advantages of DB?
Simplicity of having one contract
Save most time/cost
What are the disadvantages of DB?
Owner has low control
Limited design as architect works for constructor
Often requires bridging
No checks and balances system
What is bridging?
Another architect is hired before the design-build company, to produce program and prelim design
What did the Penn State US study find about project delivery methods?
DB (significant benefits)
DBB
CMR
What is the % of improvement on delivery speed from DBB to DB?
33%
What does the UK The Forum study show?
That the evidence from Penn State is international (nearly identical findings)
What is Fast and Flash Tracking?
Phased construction where elements are built before design is completed; all methods except DBB
What are turnkey projects?
Design and construction of project made from set of owner requirements; financing done by fee developer (received fixed payment)
What is BOT
Build-Operate-Transfer (version of turnkey projects for revenue-producing facilities)
Builder finances and receives return on investment through collecting profits over long operational period
What are four common commercial construction contract types?
Fixed price
Cost reimbursable
Guaranteed maximum price
Unit rate
What is the fixed price contract type?
Most info, latest start, highest contractor risk, lowest client risk
Used in DBB (not fast track)
Suitable for projects with well-defined scopes and minimal changes
What is the cost reimbursable contract type?
Least info, earliest start, lowest contractor risk, highest client risk
Contractor reimbursed for actual costs plus given fixed/percentage fee
Common for small projects with early contractor involvement
Typically converts to fixed sum contract once scope is defined
What is the GMP contract type?
Cost reimbursable but with a maximum ceiling price
Typically converts to fixed sum
What is the unit rate contract type?
Contract quotes based on area of product used
Uncommon; more suitable for civil works
What do bonds do?
Mitigate some of owner’s exposure to risk from high-risk nature of construction industry
What are the bonds commonly referred to and why?
Surety bonds - three party agreement where surety company guarantees to second party the performance of first party
What are the three basic types of bonds?
Bid
Payment
Performance
What are bid bonds?
Aim to ensure lowest bidder is able and willing to enter into contract
Typically 10% of bid amount
What are payment bonds?
Aim to ensure contractors pay subcontractors and suppliers (within 90 days) to avoid worker’s lien; bond used to pay workers; bond used to cover losses and award contract to other bidder
Typically contract amount
What is the workers’ lien?
Remedy for workers not being paid; undesirable as can impact saleability
What are performance bonds?
Aim to ensure contractor will promptly perform contract; bond used to employ new contractor
Typically contract amount
Who typically holds construction policies and who do they cover?
General contractors covering all of their subs
What are the various insurance policies?
Builder’s Risk Insurance - covers accidental damage to building (not builder’s equipment)
General Liability Insurance - covers accidental damage to adjoining property caused by negligence
Workers Compensation Insurance - covers costs related to physical injuries to construction workers (NOT in NZ because of ACC)
