Contracting Methods

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  • 1. Topics of Discussion l Contracting Methods l Advantages and Disadvantages l Design/Build Subcontractors l Terminology
  • 2. Types of Contracting Methods l Design/Build l Traditional (Design – Bid – Build) l Construction Manager (CM)
  • 3. Contractual Relationships  Design/Build Owner Design/Builder Contractors / A/E Subcontractors
  • 4. Design/Build Definition l Design/Build  Method 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.  Thisform of construction services has become more popular in the last 5-10 years; however, Duke has been doing this for 25 years.
  • 5. 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.
  • 6. Contractual Relationships l Traditional  Design – Bid – Build Owner A/E General Contractor Subcontractors
  • 7. Traditional Definition l Design – Bid – Build  Architect 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.
  • 8. Traditional Process l Traditional  Design – 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
  • 9. Contractual Relationships l Construction Manager Owner A/E Construction Contractors Manager
  • 10. 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 Owner l This term did not exist 25 years ago. l In purest form does not hold contracts. l Usually used on larger projects.
  • 11. Construction Manager Process l Owner conceives project l Owner hires an Architect l Owner hires Construction Manager, fee based l Architect designs, Construction Manager monitors design l Construction Manager manages bidding process l Construction Manager administers contracts l Contractors (subcontractors) contract with Owner l Prime Contractors manage construction day to day l Construction Manager oversees construction