Group Project: Create a New Project Delivery Method Prepared by
Hevelyn Baer Nick Tanner Josh Weber Arch 6710 Construction Management Kyle Taft University of Utah College of Architecture and Planning Salt Lake City, Utah 2011 (Submitted 1 August 2011)
Description of the Assignment:
The class will be divided into three categories (equally if possible) owners, architects, and contractors. Each team will have at least one owner, one architect, and one contractor. Each team will evaluate the possible project delivery methods as discussed in class and found through readings and research. You will work together to develop a new project delivery method that maximizes the value to each participant. You will justify your delivery method and present it in a paper that summarizes the benefits and risks to each participant. Project assignment and due date are to be determined. Summaries of your system may be required to be presented to the entire class as a short 3 minute oral presentation. Due date to be determined. Group Project: Scenario: For this group discussion a hypothetical scenario was elaborated based on the real market and business in order to provide the ground setting for the proposed discussion. The Owner, Mr. Tanner, is interested in purchasing a property located in the Historical District in Ogden Utah, it requires an initial investment of U$ 30,000.00 which the owner has saved. In addition to the cash on hand, and in order to make the purchase the owner‐client must commit to investing 2,500,000.00 in improvement and rehabilitation expenses in the project in order to sell it. The owner’s idea is to design and build as fast as possible in order to lower the financing interest rates and selling it fast so that he can purchase more units in that same situation for future projects. Information about the property: Located at 207 Historic 25th Street, Ogden, UT 84401
1
‐ Price: Price Not Disclosed ‐ Property Type: Retail ‐ Property Sub‐type: Street Retail ‐ Property Use Type: Vacant/Owner‐User Description -Ornate Historic Helena Hotel ‐ Multiple Street Retail Units suitable for Retail and Restaurant ‐ 2nd and 3rd level could make great Condos ‐ 3 Story building plus large basement ‐ Needs Renovation
With that in mind and with previous experience in integrated project delivery Mr. Tanner is looking for a qualified design and trustful contractor that will make his dream possible. HBV Architects is an international Architecture Firm that has been in the Market for the past 10 years, although they are well‐established in the design world, with the market crises HBV realized the incredible potential of Adaptive Reuse projects and they have been working towards establishing an niche type of image, focusing their design work in Habilitation Projects with the main goal creating an image based on specificity. In that case, HBV is very interested in this project and the possibility of a future relationship with Mr. Tanner. A continuity of work with Mr. Tanner would allow HBV to establish and reinforce their image in Utah’s market. With the Architecture Firm in mind Mr. Tanner started to look for a competent and efficient Contractor Firm, he remembered an old friend that he met at the University of Utah during a construction management class 20 years ago, Mr. Weber had become a very successful builder in Ogden but due to illness he was struggling to keep the business running, his son Joshua was now the director of the business, a brilliant young man that wanted to innovate the Delivery process and update his dad’s firm combining tradition with innovation and technology. For Joshua this opportunity represented a life‐saving chance for his decadent business plus it offered the possibility of a new beginning into the integrated project delivery. Individual interests: Nick ‐ Owner’s Interest ‐ Quality construction with reasonably cost.
Hevelyn ‐ Architect’s Interest Josh ‐ Contractor’s Interest ‐ Reestablishment in the ‐ Quality Design Satisfaction Market. ‐ Marketing tool – goal of creating a Niche image of ‐ More Participation in the ‐ Construction Quality – in order to gain the Client’s Design Process. Rehabilitation projects. trust and respect. ‐ Fast process of design and ‐ Firm might grow – will need ‐ Earlier involvement in the construction. more employees. design process. ‐ Buy other properties – same ‐ Payment based on percentage, compensation Opportunity of innovation to type of project. based on team performance. their firm with the use of BIM. ‐ Fast money return. ‐ Sustainable Design – another key element in their ‐ Possibility of future projects ‐ Low‐operating cost based together. marketing plan. on sustainability strategies. ‐ Contractor on board since early design decisions – less change in the project.
2
The possibility of working together in the future inspired architect and contractor to fully engage and commit with this project. Their personal goals were combined and aligned with the Client’s interest allowing him to envision success and continuity. The individual pursuits became common goals and interests. Quality in Design and Construction will help the group as a team to establish a trust‐based relationship that might work together in the future. Sustainability may become a key element in this relationship and vision. The team then became partners as each member had their interested placed together and aligned with the same ideals. The profit and risks would be divided equally and based on mutual trust and respect. A similar structure of a Level 3 Integrated Project Delivery method brought them together to create the Accelerated Project Delivery Method™ (APD™): ‐ ‐ ‐ ‐ ‐ ‐ ‐
Willingness to collaborate resulted in mutual interests for profit and success. Open communication envisioning project and construction efficiency. Shared Risk & Reward. Early involvement of key participants Multi‐party contracts and liability waiver. Shared working‐space. Intensified Design through Building Information Modeling.
With the economy back in full force, interest rates had risen dramatically. Therefore, it became necessary to shorten the length of the loan and project schedule to reduce the interest paid. Other important factors were the long lead time for key systems in the building. This issue was able to be resolved through stepping the drawing packages similarly to the Construction management, CM‐at Risk delivery type. This fast track approach cuts the document production by 50% compared to traditional Design‐Bid‐Build. It also reduced construction time by 35% compared to DBB. Another great aspect of the APD™ is the important factors that are decided at the beginning of the project. This takes the benefits of the Design‐Build delivery system including Guaranteed Maximum Price at the start of the project as well as establishing the Contractor,
3
Subs, and Construction Manager at the onset of the project. This also removed the procurement and quality abatement phase that is common in other bid‐type delivery methods. This qualification and quality based system benefits the three major stakeholders in the following ways: ‐Architect: Gain input from other professionals, reduce error, create more detailed and accurate documents quickly. Working with the contractor in the same office reduces the time for information exchange where they can return answers quickly. ‐Owner: Increase project communication, better control costs, and quality. Shares the risk and reward with each team member. Keeps financial books open to share progress of expenses. The owner received a virtual BIM “As‐Built” model at project completion and uses it for the Facility Manager. ‐Contractor: Reduce errors and have questions answered earlier. Be familiar with the project from conception. Establish sequencing, and costs early. Construction wastes are greatly reduced by using accurate and detailed quantity take off.
4