5 quantity surveying & cost planning ag

American University in Cairo Architectural Engineering Programme Ayman El-Ghazzawi

BSc MSc FRICS

11 October 2016

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 Introduction

– terminology

 Benchmarking  Cost

Planning

 Building Economics  Conclusion  Q&A © ValueMetric Consultants LLC (2016)

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Introduction

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 Cost

is a significant, if not essential part of a project  decides if the scheme is viable….. No Money  No Project  QS is responsible for all matters financial and commercial on a construction project Quantity  Triangle of Duties on a Project: Surveyor

Architect (Designer)

COST QUALITY

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TIME

Project Manager

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US Approach to Cost Management

UK Approach to Cost Management

Traditionally called a “Cost Estimator”

Previously called a Quantity Surveyor, now more common to call Cost Manager

Approach is led by Programme

Led by Design Stages (e.g. RIBA)

Use of cost-loaded programmes

Use of Bills of Quantities to package works

Method of Measurement: CSI Masterformat

Method of Measurement: POMI, NRM

Professional association: AACE

Professional association: RICS

Combine Cost & Time  Project Controls

Separate Cost & Time: QS and PM

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 Provides

an early, approximate vision of construction costs  Helps in setting a project’s budget  Used to commercially manage the pre-contract design Concept  Schematic  Detailed Design  Provides an early warning of scope creep, monitors changes  Can assist with setting sale prices  Informs the financial P&L of a developer company  Captures entire development costs  helps form package BOQs © ValueMetric Consultants LLC (2016)

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Term

Definition

Cost

actual price to be paid

Value

how much it is desired, price of what it’s worth

Feasibility Estimate

Establishes the overall viability of the project, return on investment

Order of Magnitude Estimate

Reflects a particular design stage, e.g. concept, schematic, detailed

Cost Plan

Reflects a particular design stage, e.g. concept, schematic, detailed

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Term Cost Model

Cost Analysis Cost Report

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Definition Cost-led, does not reflect a particular design, allows for varying elements Estimates the cost of construction of particular elements or portion of the works Tracks the overall project costs monthly, monitors commercial performance

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Benchmarking and Order of Cost Estimates (OCE)

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 Highest

level of cost estimating, lowest accuracy  Usually based on functional units or built-up area  Examples of functional units: › Hospitals › Hotels

› Schools › Residential › Office Buildings

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EGP / EGP / EGP / EGP / EGP /

bed key student m2 (or per habitable room) gross lettable area

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 OCE:  Must

Order of Cost Estimate – most preliminary cost plan find out:

› Type of building to be built (e.g. hotel)

› Expected number of functional units (e.g. nr of keys) › When it is expected to be built (e.g. two years from now) › Outline specification level (e.g. high/med/low quality, 4*, 5*)

› Location where it is to be built © ValueMetric Consultants LLC (2016)

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Source: Spon’s Architects’ and Builders’ Price Book 2009 © ValueMetric Consultants LLC (2016)

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 Begin

with a high level benchmark estimate by function  Adjust your estimate by: › Geographical variation › Inflation indices  Multiply

by number of functional units  Add contingency, VAT, etc.  Emphasise that Tolerance / accuracy is low  Use an estimating resource – your own project database or price book © ValueMetric Consultants LLC (2016)

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Source: Spon’s Architects’ and Builders’ Price Book (2009) © ValueMetric Consultants LLC (2016)

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Cost Planning

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A

document that details costs, usually developed from a preliminary benchmark estimate, based on elemental or functional units that reflects the Design Team’s intentions

 Follows the

project’s design stages, e.g. RIBA Work Stages

 Sets

a plan to spend costs, helps with purchasing and cost control

 As

cost plan develops, accuracy is improved:

LE/function  LE/m2  Detailed LE costs based on qtys © ValueMetric Consultants LLC (2016)

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RIBA Work Work Stage Description Stage A

Appraisal / Feasibility

B

Strategic Briefing

C

Outline Proposals

D

Detailed Proposals

E

Final Proposals

F

Production Information

G

Tender Documentation

H

Tender Action

J

Mobilisation

K

Construction ďƒ Practical Completion

L

After Practical Completion

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COST PLANNING STAGES SET BUDGET

Concept 30%

Schematic 60%

Detailed 90%

COST PLAN

COST PLAN

COST PLAN

Confirm Budget, Cost Limits

Set Cost Targets on Schematic

Set Cost Targets on Detailed

Proceed to Tender BOQ

Pro-active Change Control

Remedial Action: Value Engineering © ValueMetric Consultants LLC (2016)

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 Similar

to OCE, but on an elemental level  Uses previous projects from a database, or pricing book such as Spons  Adjust elements to suit the project being priced › E.g. EGP/m2 will differ whether it is steel or concrete frame  Ensure

it is a like-for-like benchmark comparison:

› Use same area types (BUA, NIA, etc.)

› Exclude sub-structure, earth work, external works › Preliminaries (indirect costs), taxes and the like © ValueMetric Consultants LLC (2016)

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 OCE

or preliminary cost plan

± 25% to 30% tolerance

› EGP / functional unit  Concept

Cost Plan

± 15% to 25% tolerance

› EGP / m2, based on floor areas  Schematic

Cost Plan

± 10% to 15% tolerance

› EGP / m2, based on floor areas, with some systems allowed for based on evolving design (e.g. district cooling v split units)  Detailed

Cost Plan

± 5% to 10% tolerance

› EGP / m2, based on quantities and unit rates © ValueMetric Consultants LLC (2016)

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7,000

EGP/m2 6,000

5,000

4,000

3,000

2,000

1,000

0

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Electrical Engineering Works Mechanical Engineering Works Conveying Systems Special Construction Furnishings Equipment Specialties Finishes Doors and Windows Thermal and Moisture Protection Wood and Plastics Metal Works Masonry Concrete Works Site Construction General Requirements 25

Building Economics

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

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For the following two projects, A and B, calculate: 1.

Floor Area

2.

Perimeter length

3.

Wall Area

4.

Wall-to-floor ratio

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For the following two projects, A and B, calculate: 1.

Floor Area

2.

Perimeter length

3.

Wall Area

4.

Wall-to-floor ratio

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 Efficiency comes

form plan shapes that are square (or circle)

 Consider whether it

is better internal division (e.g. triangular plan)

 Less efficient shapes require  Consider a  Core and  Short

more structure

better enclosing wall to area ratio

circulation affected by choice of plan shape

assessment

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For the following three Plan Shapes A, B and C, calculate: 1. Floor Area

3. Wall Area

2. Perimeter length

4. Wall-to-floor ratio

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For the following three Plan Shapes A, B and C, calculate: 1. Floor Area

3. Wall Area

2. Perimeter length

4. Wall-to-floor ratio

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

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

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

Tall structures are more costly – step changes in height mean it is not a uniform relationship of height to cost



Storey heights can be cost sensitive



VT costs to be considered



More engineering costs for FP, services performance



Wider and more circulation space needed



Temporary works, lifting, etc. more expensive



Wind load will affect structural design

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

Building arrangement affects the cost of construction



Consider: › Sharing elements between buildings › Cost and of constructing › Ability to construct: Buildability



For the four arrangements shown, 1.

Which is most desirable?

2.

Which is most efficient?

3.

Which has least “buildability”?

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Conclusion

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 Benchmarking

is important to compare projects

› Expect differences and variation – explain them › Separate abnormals (sub-structure, external works, infra, etc.)  Cost

Plans are approximate, and not accurate by nature  Accuracy improves as design develops (± % tolerance reduces)  Building shape, size and arrangement all affect costs  understand how these affect your cost plan  Look at other efficiency parameters (net : gross area) © ValueMetric Consultants LLC (2016)

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