Your Deliver Method...

…Pick it Early

http://www.caccfc.org/Events/Annual_Conference_03/Your%20Delivery%20Menthods%20Rev%203.ppt

Owner and General Contractor

Responsible for ESH compliance

Owner and Multiple Primesoption 1

A/E-Architect/EngineerCM- Construction Management CoPD-Project Development

Each responsible for ESH compliance

Owner and Multiple Primesoption 2

A/E-Architect/EngineerCM- Construction Management CoPD-Project Development

Make 1 Prime contractor responsible

for site ESH (lead)

Owner and Construction Mgmt

Construction Manager

Construction Manager

Construction Mgmt

CM is responsible for overall site ESH compliance

What is an Owner ControllerInsurance Program or OCIP

A centralized and controlled:• Insurance• Loss Control/Safety• Claims Management• program purchased by

Owner covering all contractors and subcontractors of every tier

Owner purchases the insurance for a specific construction project, as opposed to traditional method of contractors purchasing their ownCoverage for that single project. Coverage includes: Project Professional Liability, General Liability, ExcessLiability, Environmental Liability, Builder’s RiskWho’s covered? Owner, construction managers,general contractors, all subcontractors

Benefits include: Reduced insurance costs Broader and tailored coverage Uniformity and adequacy of coverage for allcontractors and subcontractors Remove barriers of insurance for smaller, DBE firms Higher limits of liability Insurance costs fixed for the term of the project

Overview

• Project Delivery Methods• Design–Bid–Build• CM At-Risk• Multi-Prime (Trade Contracting)• Design-Build

• Contractual Relationships• Scope, Cost & Time Impacts• Risk• Pros & Cons

Project Elements

SCOPE

TIMECOST

Project Success

Project Delivery Methods

• Design-Bid-Build

• CM At-Risk (CM/GC)

• Trade Contracting/Multiple Prime

• Design-Build

Traditional: Design-Bid-Build

Ownership

Management

Primes

Subs

OWNER

Designer Contractor

Subcontractors

Contracts Communication

Traditional: Design-Bid-Build

Ownership

Management

Primes

Subs

OWNER

Designer Contractor

Subcontractors

CM

Contracts Communication

Traditional: Design-Bid-Build

• Three sequential phases

• Four prime players• Owner • Construction Manager• Architect• Contractor

• Three separate prime contracts

Design Bid Build

Traditional: Design-Bid-Build

• Process• Owner selects CM & Architect• Architect designs project• CM provides management & support• Owner, CM & Architect publicly bid a

single prime contract• Contract awarded to low bidder• General Contractor constructs project• General Contractor manages sub-

contractors• CM & Architect provide oversight

CM at Risk (CM/GC)

Ownership

Management

Primes

Subs

OWNER

Designer

Subcontractors

CM@R

Contracts Communication

CM at Risk (CM/GC)

• Three sequential phases

• Three prime players• Owner• Architect• At-Risk CM (General Contractor)

• Two separate prime contracts• Price Guarantee Point Varies

Design Bid Build

CM at Risk (CM/GC)

• Process• Owner selects Architect & CM@R• Architect designs project• CM@R provides support• At some point GMP defined

(At-Risk relationship established)• Owner & CM@R publicly bid multiple

trade contracts (sub-contractors)• Contracts awarded to lowest bidders• Owner assigns contracts to CM@R• CM@R manages construction• Architect provides oversight

Multiple Prime (Trade Contracting)

Ownership

Management

Primes

Subs

Designer

CM

Trade/Multiple Prime Contractors

OWNER

Contracts Communication

Multiple Prime (Trade Contracting)

• Three sequential phases

• Three prime players• Owner• Architect• Construction Manager

• Multiple Prime Contracts• Architect & Construction Manager• Prime Trade Contracts (Sub-Contractors)• All contracts with Owner

Design Bid Build

Multiple Prime (Trade Contracting)

• Process• Owner selects CM & Architect• Architect designs project• CM provides management & support• Owner & CM publicly bid multiple

trade contracts (sub-contractors)• Contracts awarded to lowest bidders• CM manages construction• CM & Architect provide oversight

Design-Build

Ownership

Management

Primes

Subs

OWNER

ScopingArchitect

CM

Designer Builder

DesignBuildEntity

Contracts Communication

Design-Build

• Three continuous phases

• Four prime players• Owner• Construction Manager• Scoping Architect• Design- Build Contractor

• Three separate prime contracts

Scoping Documents

Select D/B Design Build

Design-Build

• Process• Owner selects CM & Scoping Architect• Owner, CM & Architect develop scoping

documents (Bridging Documents)• Selection of Design-Build Entity• D/B completes design of project• Owner approves design and authorizes

construction• D/B secures sub-contractors• D/B manages construction• CM provides oversight

Items for Consideration

• Change Orders• Price Confirmation• Risk for:

• Cost• Time• Quality

• Control of • Cost• Time• Quality

Questions?

Traditional: Design-Bid-Build

• Pros• Most common method• Best understood• Most well-established law• Considered best design quality• Considered lowest initial cost• Fairest to bidders, level playing field

• Cons• Low Bid Contractor• Generally slowest method• High change order costs• High litigation

CM at Risk (CM/GC)

• Pros• GC selected (as CM) on qualifications• Design assistance reduces E&O• GMP approach reduces COs• Reduces claims• Owner knows costs up front

• Cons• Not time tested in Public projects• Some jurisdictions not authorized• CM has normal GC conflict of interest• No CM advise during construction

Multiple Prime (Trade Contracting)

• Pros• CM remains in fiduciary role• More project control• Fast track by major trades• Clearly identifies sub costs• Encourages small local contractors• Reduces bid claim potential

• Cons• Multiple contracts are burdensome• Lacks a single point of responsibility• More control = more liability

Design/Build

• Pros• Single point responsibility• Tends to be fastest method• Avoids E&O liability issues• Maximum transfer of risk

• Cons• Requires increased owner

sophistication• No normal architect advocacy• Design quality may be compromised• Reduces design input by Owner

Your Deliver Method...

…Pick it Early

Doug Evans Vice President

Vanir Construction Management