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Another Brick in the Wall Understanding Construction Management By: John Knox, Vice President The Chamberlain Companies Presentation Process Explain the differences Discuss how these differences affect clients Examine the benefits/challenges of Construction Management

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Another Brick in the Wall Understanding Construction Management

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Another Brick in the Wall

Understanding Construction Management

By:

John Knox, Vice President

The Chamberlain Companies


Presentation Process

  • Explain the differences

  • Discuss how these differences affect clients

  • Examine the benefits/challenges of Construction Management

  • 15-20 minutes for question/answer period at end of presentation


Construction Management

Construction Management is a concept which integrates the design and construction processes. It joins the Owner, Architect, and Builder into a team to produce a facility which best meets the functional requirements and aesthetic needs of the Owner within the authorized budget and occupancy schedule.


Construction Management (CM)

  • Not Project Management

  • A contractual agreement for the construction of a project

  • Unlike General Contracting and Design/Build, CM is an “open book” method

  • GC’s profit and overhead are included in his “stipulated sum” price

  • Construction Manager paid a negotiated fixed fee or percentage of construction cost

  • Team Approach - CM hired early in the process to develop schedule and cost estimates, and provide input during design process


Stipulated Sum vs. Open Book

  • Stipulated Sum

    • Lump sum amount quoted for the construction of a project

    • Examples are General Contracting and Design/Build

  • Open Book

    • All construction costs are disclosed openly to the Owner

    • Transparent process with Owner actively involved in award of contracts


Div. 1 – General Requirements (Site Super, Labour, Fencing, Insurance, etc.)

Div. 2 – Site Work

Div. 3 – Concrete

Div, 4 – Masonry

Div. 5 – Structural Steel

Div. 6 – Wood & Plastics

Div. 7 – Thermal & Moisture Protection

Div. 8 – Doors & Windows

Div. 9 – Finishes

Div. 10 – Specialties

Div. 11 – Equipment

Div. 12 – Furnishings

Div. 13 – Special Construction

Div. 14 – Conveying Systems

Div. 15 – Mechanical

Div. 16 - Electrical

Construction Divisions


So, While there is no difference in Construction Means and Methods

The difference lies in ..

  • Philosophy

  • Contract

  • Control


Philosophy - CM

  • A portion of his fee is for pre-construction services during the design phase

  • Questions architectural decisions along the way with the focus on value

  • The Construction Manager – Advisor during design stage and the Owner’s Representative during the construction stage

  • Less chance of dispute with Owner or Architect as CM involved in design process, and does not profit from omissions or changes


Philosophy - GC

  • Design – Bid – Build Process. GC not involved until design process completed

  • His only responsibility is to build what was tendered

  • GC will price and produce exactly what is shown on drawings. Grey areas, omissions, or changes are all opportunities for profit

  • Relationship between Owner, Architect, and GC can become confrontational when problems occur


General Contracting

Contract

Control

Control of

the Site

  • Working drawings and specifications completed and all divisions tendered as one package to General Contractors

  • Contract between Owner and General Contractor

  • General Contractor has contracts with each of the Trade Contractors

  • GC’s Site Super manages Site and Trade Contractors


Construction Management

Control of

the Site

Contract

Control

  • Divisions divided into tender packages, drawings & specifications for each package completed, and tendered individually and sequentially

  • Owner contracts directly with Trade Contractors

  • CM’s Site Super manages Site and Trade Contractors


Contract

Control

Construction Management by Architect

Chamberlain regularly

performs both roles –

Architect and

Construction Manager


Greatest Risks on aConstruction Project are …

  • Unknown conditions

  • Facility not meeting expectations

  • Bankruptcy of Constructor

  • Exceeding the budget or schedule

  • Inclement weather


Client Concerns

  • Risk Exposure

    • Control over Site, Costs, and Schedule

  • Flexibility

    • Deal with unexpected situations

    • Ability to make changes without paying a premium

  • Image

  • Value

  • Cooperative Team Relationship


Risk is Minimized by Maximizing Control and Flexibilityduring the Construction Process


Control

  • Owner contracts and is dealing directly with the Trade Contractors

  • He who pays the piper calls the tune


Flexibility

  • Possible to start construction before design finalized

    • Owner has a longer time to determine specific requirements because packages sequentially tendered

    • Good for fast tracking a project

  • Establishes project cost early

  • Owner doesn’t pay a premium for changes

  • Allows for continued operation during construction

  • Allows for incorporation of donated materials/labour

  • Allows for inclusion of local trades/suppliers


Reality of Stipulated Sum Contracts

  • Price is indicative of the opportunity at that moment in time

  • Price only fixed if absolutely nothing changes during construction

  • Generally, the GC is forced to use lowest trade/supplier prices to get the job

  • 100% price driven


The Bottom Line

The price shown on a Stipulated Sum Contract is the least you are going to pay for your building not the most.


Value

Div

Sub Trades

GC #1

GC #2

GC #3

Lowest

CM

1

GENERAL

132,318

133,400

132,600

132,318

2

SITE WORK

306,334

272,585

304,384

272,585

3

CONCRETE

37,508

42,775

26,594

26,594

4

MASONRY

44,261

42,000

41,099

41,099

5

METALS

72,522

77,049

107,099

72,522

6

WOOD & PLASTICS

47,015

42,244

53,681

42,244

7

THERMAL/MOISTURE

56,768

64,798

68,186

56,768

8

DOORS/WINDOWS

88,275

88,905

85,462

85,462

9

FINISHES

141,916

135,016

133,974

133,974

10

SPECIALITIES

27,508

28,682

36,411

27,508

14

CONVEYING

28,261

27,535

29,274

27,535

15

MECHANICAL

176,606

215,959

188,847

176,606

16

ELECTRICAL

173,394

177,699

180,811

173,394

TOTAL:

1,332,686

1,348,647

1,388,422

1,268,609


Savings Accrue to Owner


Challenges of Construction Management

  • Owner more involved in construction process

  • More paperwork – construction draws to be approved under guidance of Construction Manager

  • Upside – complete paper trail for all monies spent on the project and an excellent opportunity to learn about the design and construction process


Projects built under Construction Management

Canadian Warplane Heritage Museum

Air Traffic Control Tower, Toronto Pearson Int’l Airport


Lincoln Public Library, Rittenhouse Branch

Shelburne Public Library Addition & Restoration


Niagara-on-the-Lake

Public Library


Quinte West

City Hall/

Public Library


Other Projects


To Re-cap…


Wrap Up…

  • Able to fast track, if necessary

  • Early establishment of project costs

  • Cooperative relationship – less stressful for Owner

  • Provides Owner with more Control and Flexibility during construction

  • Realizes best Value for Owner


Another Brick in the Wall

Understanding Construction Management

By:

John Knox, Vice President

The Chamberlain Companies


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