Project Delivery Options

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While you are finalizing the design of your new facility, start working on pre-construction activities that will lead you to the launch of construction.

Before you select your general contractor (GC), examine your project delivery options. Three approaches to project delivery are traditional (or design-bid-build), design-build, and construction management. All three involve the charter school (owner), architect, and contractor (or builder), but are distinguished by cost, scheduling, level of control over the project, and owner capabilities and preferences.

Traditional (Design-Bid-Build)

The most common approach is the traditional method, also known as design-bid-build. In this traditional method, the owner (the charter school) engages an architect to develop the building design and prepare construction documents that lay out building requirements. The owner uses these to bid out the construction contract and to select a general contractor. Usually, the qualified GC with the best and lowest bid in response to the construction documents is hired.

The primary distinguishing characteristic of the traditional design-bid-build method is the clear separation between design and construction. This “separation of powers” is evidenced by individual contracts that you, the owner, negotiate and manage between two principal team players: architect and GC. Since there is no direct contractual relationship between the architect and GC, both parties report to you, and you are responsible for resolving any issues between them that may arise during construction.

Many charter schools rely on the traditional approach because they directly and actively participate in the entire design and construction process. Also, if the charter school decides to make changes during the design phase, the changes are accomplished between architect and owner only, and with relatively minimal cost. The design is then finalized prior to the construction bidding process so that results are fairly predictable.

A variation on the traditional design-bid-build method is the negotiated select team approach, also sometimes called design-assist. In this approach, the architect and contractor are selected at the same time and work collaboratively from the early stages of the design process. This approach usually produces an earlier cost estimate for the entire project. Since the architect and GC work hand in hand during the design stage, this approach can ease the entire process.

Related link in Essential Resources: Design-Bid-Build Pros and Cons

Design-Build

The design-build approach is very different from the traditional approach and is appropriate for charter schools that prefer a single point of accountability for design and construction. In design-build, the charter school contracts with an entity (e.g., firm, joint venture, or consortium) that includes both architect and contractor, rather than separately contracting with each. Thus, one single source administers both design and construction. When a project is complex and necessitates close coordination between design and construction expertise, owners may prefer the design-build approach.

The design-build method has gained popularity due to concerns about tensions between architect and GC that often exist in the traditional approach. Owners may find themselves in the challenging position of mediating between architect and GC during the construction process. In design-build, the number of change orders can be substantially reduced since the architect and GC work hand in hand. Change orders usually lead to construction delays and increased costs, so the ability to control the potential for these setbacks is crucial.

Unlike the traditional design-bid-build method, there is no direct relationship between the owner and the architect in a design-build: The architect is working for the GC, not for you, the facility’s owner. A possible disadvantage is the design-build team may push for cost and timesaving strategies that may be in their interest, not yours, and which could compromise design and construction quality.

Related link in Essential Resources: Design-Build Pros and Cons

Construction Management

Construction management is a term used when a construction manager (CM) oversees the project delivery methods already discussed. The CM is added to the building team to oversee variables such as scheduling, cost, project management, or building technology. CMs usually have training as architects, engineers, or builders. The three most common roles for the CM are advisor, agent, and contractor.

CM as Advisor

This is the most common CM arrangement and is usually paired with the traditional design-bid-build approach. The CM is contracted to advise the owner about the scope of the project (e.g., cost, scheduling, and construction issues), but does not construct the building. This role can be crucial. The CM is considered the owner’s representative (or project manager), and is usually added to the team at the project outset or, at the latest, once the design phase is completed. The development team consists of four major players (owner, architect, GC, and CM), and communication and coordination among all four parties is critical. You will have separate contracts with the architect and GC, and each looks out for his or her own interest. The CM should always focus on your best interest.

CM as Agent

As agent, the CM acts on the owner’s behalf, so you can stay out of the project to a large extent. The CM is hired at the project’s beginning, oversees all activities through construction completion, and has broad fiduciary powers throughout the project. This approach is not utilized as often as CM as advisor or CM as contractor.

CM as Contractor

In this case, the CM fills dual roles as both GC and CM. He or she assumes all responsibility and liability for project construction. The CM as contractor method combines several aspects of other approaches. The CM is hired early in the design process, and thus provides an early cost commitment and potentially better management over construction scheduling. The owner retains control of, and responsibility for, the design process, since the architect is hired independently of the CM.

Related link in Essential Resources: Construction Management Pros and Cons

Related link in Essential Resources: Project Delivery Options: Pros and Cons

Related link in Essential Resources: Managing Construction Risks

Legal Disclaimer:

Nothing in this material should be construed as investment, financial, brokerage, or legal advice. Moreover, the facts and circumstances relating to your particular project may result in material changes in the processes, outcomes, and expenses described herein. Consult with your own professional advisors, including your financial advisors, accountants, and attorneys, before attempting to consummate any transaction described in this material.