contracting methods

Topics of Discussion

l Contracting Methodsl Advantages and Disadvantagesl Design/Build Subcontractorsl Terminology

Types of Contracting Methods

l Design/Build

l Traditional (Design – Bid – Build)

l Construction Manager (CM)

Contractual Relationships

Design/Build

Owner

Design/Builder

A/E Contractors /Subcontractors

Design/Build Definition

l Design/BuildMethod where design and construction are a

single source of responsibility for one entity.Design/Builder may or may not self perform

some or all of the design and construction work.Design/Builder accountable from the earliest

stages of the project. This form of construction services has become

more popular in the last 5-10 years; however, Duke has been doing this for 25 years.

Design/Build Process

l Owner conceives Project.l Owner receives price/budget for design and

construction from single entity, up front, prior to full design.

l Owner contracts directly with the Design/Builder.l Design/Builder has full responsibility for design and

construction.l Design/Builder contracts with all A/E Firms and

subcontractors.l Design/Builder then works with Owner to design

project and create construction documents.l Design/Builder hires subcontractors, manages

construction.

Contractual Relationships

l TraditionalDesign – Bid – Build

Owner

A/E General Contractor

Subcontractors

Traditional Definition

l Design – Bid – BuildArchitect is responsible for design.General Contractor is responsible for

construction.General Contractor is obligated to perform

exactly what is indicated or inferred by contract drawings and specifications.

Method is oldest way to buy construction services.

Normally General Contractor is not involved in the design or preconstruction phase - builds only.

Traditional Process

l TraditionalDesign – Bid – Build

– Owner conceives project– Owner hires architect– Architect provides budget / feasibility– Architect designs project– General Contractor bids project– Owner hires General Contractor– General Contractor hires subcontractors,

manages construction

Contractual Relationships

l Construction Manager

Owner

A/E Construction Manager Contractors

Construction Manager Definition

l The Construction Manager (CM) is a professional management team with focus on construction. Many CM firms are also GC’s or used to be a GC.

l Specialize in organizing and buying the various components of the Project and administer the work on behalf of the Owner.

l Preconstruction phase likely to involve interface with Architect, but no control of Architect.

l Architect control is left up to the Ownerl This term did not exist 25 years ago.l In purest form does not hold contracts.l Usually used on larger projects.

Construction Manager Process

l Owner conceives projectl Owner hires an Architectl Owner hires Construction Manager, fee basedl Architect designs, Construction Manager monitors

designl Construction Manager manages bidding processl Construction Manager administers contractsl Contractors (subcontractors) contract with Ownerl Prime Contractors manage construction day to dayl Construction Manager oversees construction