Project Delivery Methods

pathways to procurement

project delivery methods

DESIGN-BID-BUILD DESIGN-BUILD CM@RISK

Franklin’s Coffee Shop // Savannah, GA

Several delivery methods exist for selecting a contractor to build any project.

These include Design-Bid-Build,

LS3P is experienced in all of these of

Design-Build (both contractor-led and

delivery methods and can assist you

designer-led), Construction Manager as

with a comprehensive analysis and the

Constructor (Construction Manager at

decision for which delivery method is

Risk or CM@R). Invited Bid, Negotiated

most appropriate for your project based

Bid, and Multiple Prime (Multi-Prime).

on your priorities, schedule, and budget.

The three most frequently utilized

We have successfully delivered projects

project delivery methods are Design-Bid-

using each of these delivery methods,

Build, Design-Build, and CM@R. Each

and are very familiar with the pros, cons,

comes with pros and cons, and all can

and complexities of each.

work quite well for the right situation if all team members are aware of the inherent challenges and opportunities.

top image: MUSC - Brain Health NewCo; Modern Minds // Charleston, SC bottom image: Artillery Bar // Savannah, GA

design-bid-build Often referred to as “competitive bidding,” the Design-Bid-Build delivery method is organized into three discrete phases: the design phase, the bidding or procurement phase, and the construction phase. These phases are typically completed sequentially; the design phase (including preparation of construction documents) is completed before the bidding process begins, and once a bid has been awarded to a general contractor, the construction phase begins.

RELATIONSHIPS

The owner typically selects an architect based on qualifications. At the end of the design process and when construction documents are complete, the owner advertises to all prospective bidders the opportunity to submit a bid, at a predetermined time and location, to construct the project. The project is awarded to the lowest responsible bidder. The architect will be an owner’s representative during the construction phase and will administer the contract for construction between owner and contractor.

Wilson Center at Cape Fear Community College // Wilmington, NC // design-bid-build

design-bid-build

International Culinary Institute of Myrtle Beach; HGTC Culinary Institute of Myrtle Beach // Myrtle Beach, SC // design-bid-build

PROS

Owner Risk //

Budget //

Owner is intimately involved in design

Construction cost is a fixed sum at

and construction decisions

contract award.

Clear chain of command streamlines

Process encourages low bid cost with

communication

maximum competition, and is perceived as the most “competitive” means for

Owners, architects, and contractors

selecting a contractor

are familiar with and understand this frequently utilized delivery method

Process usually “begins” with the lowest cost of the work

Architecture team works directly for the client and is heavily involved in design through construction Process can utilize an invited bidder list or be open to all “responsible” bidders.

Owner has one construction contract with one entity to deal with for the entire project

Schedule // Linear process makes planning and scheduling straightforward

Quality // Bidding procedures promote equity in the selection process

Clemson University Energy Innovation Center // North Chareston, SC // design-bid-build

CONS

Owner Risk //

Schedule //

Owner risk is high

Linear process can lead to delays if any step of the process is off schedule

Process requires significant owner expertise

Potential for longer schedule

Communication issues can arise between architects and contractor due to separate contracts with owner

Quality //

Contractor selection based on cost NOT

Contractor involvement begins at

qualifications

bidding, and contractor does not offer advice on constructibility during design

Budget // Cost submitted on bid day is starting cost, but frequently NOT final cost.

Process may require value engineering and redesign if lowest responsible bid exceeds owner’s budget Change orders are guaranteed with this delivery method

Pressure to achieve a low bid may encourage economy over quality Contractor may be required to work with unfamiliar subcontractors based on lowest cost model

design-build Design-Build is a delivery method in which an owner signs a single contract, usually with a design-builder/contractor, that covers all aspects of design and construction.

RELATIONSHIPS

Design-Build is a collaboration between the design and construction teams.

The owner selects this team based on Design-Builder experience/qualifications to provide a building satisfying an owner-specific program, and the work is typically completed for a lump sum.

The architect/design team usually works for and is managed by the design-builder/contractor and therefore has limited involvement during the construction phase.

Duke Institute for Brain Science // Durham, NC // design-build

Richland School District Two ES #20; Jackson Creek Elementary // Columbia, SC // design-build

design-build

PROS

Owner Risk // Owner’s risk is reduced Single entity is responsible for design and construction

Construction can begin before design is complete Design/build eliminates the bidding process Delivery can move more quickly through early construction packages and reduced

Budget //

submittal review times.

Cost estimates are more reliable with contractor involved early Early communication between architects and contractor can help control cost and minimize conflicts

Quality // Architect/contractor selection is typically made on qualifications Subcontractor involvement during the design phase can reduce conflicts during

Schedule //

the construction phase.

Overall construction duration can be reduced due to subcontractor involvement during design phase

CONS

Owner Risk //

Quality //

Limited owner control of design and

Design-builder/contractor makes

construction

decisions on products incorporated to satisfy owner program based on Lump Sum approved

Budget // Design changes after construction begins are costly Costs can be higher without competitive bidding May be difficult to compare fees up front

Architects have little-to-no involvement during the construction phase

construction manager as constructor (CM @ Risk) Construction Manager as Constructor, also known as Construction Manager at Risk (CM@R), is a delivery method in which the basis of payment is the cost of the work plus a fee with a Guaranteed Maximum Price (GMP).

RELATIONSHIPS

In the CM@R delivery method, the owner selects the architect and constructor based on qualifications and experience.

The owner executes an agreement with the architect and a separate agreement with the constructor. The constructor is involved during the design phases, providing preconstruction services such as cost estimating, constructability reviews, project, and construction scheduling. The CM@R is responsible for engaging qualified subcontractors and performing the work for a Guaranteed Maximum Price (GMP).

CU ICAR Research One // Greenville, SC // CM@Risk

CM@Risk

CU ICAR Research One // Greenville, SC // CM@Risk

PROS

Owner Risk //

Schedule //

Potential for higher initial cost

Project schedule is shorter

Less risk associated with cost and

Transition from design to construction

constructability for the owner

is streamlined, as the constructor is involved during design phases

Owner still has control of design

Quality // Budget // Known cost control throughout the design process Overall cost shall NOT exceed GMP No change orders per contract if original scope is NOT altered after the GMP is accepted The total cost may be less than the GMP The CM@R fee can be negotiated prior to execution of GMP

Contractor selection is based on experience and qualifications, NOT lowest cost Contractor and architect work together throughout the entire project Contractor is knowledgeable of owner’s aesthetic and performance desires from contractor involvement during design and construction document preparation phases Involvement of CM@R construction team and subcontractors during design phases results in fewer conflicts during construction phase

NC State University Wolf Ridge Apartments at Centennial Campus // Raleigh, NC // CM@Risk

CONS

Owner Risk // Owner control during construction is reduced

Quality // Preconstruction services can be ineffective if not specifically identified in the Owner-CM@R agreement

Budget // Design changes after GMP is accepted results in increased GMP Difficulty of reducing costs from the original CM@R cost estimate as construction document preparation progresses.

Separate independent cost estimator is recommended, to be employed by owner as a CM@R cost estimate verification tool

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