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The Impact of Design-Build on Project Costs and Risks

Enhanced design-build strategies offer engineers, architects and contractors an opportunity to work together more cohesively to present the client with the best overall budget. According to Cindy McCree-Bodine, vice president of business development at McCree General Contractors & Architects in Orlando, Florida, this process includes being conscientious of the budget during design and construction.
By Lauren Pinch
May 6, 2019
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Enhanced design-build strategies offer engineers, architects and contractors an opportunity to work together more cohesively to present the client with the best overall budget.

According to Cindy McCree-Bodine, vice president of business development at McCree General Contractors & Architects in Orlando, Florida, this process includes being conscientious of the budget during design and construction, as well as providing solutions through value engineering to either enhance or look for more economical options during the design phase. It also includes maintaining and communicating the critical paths of the schedule throughout the life of the project.

With enhanced design-build, quality is not just evident on the construction jobsite; it is ingrained into all aspects of the project—from design, estimating and safety to craftsmanship and post-construction turnover. Below, McCree-Bodine shares additional insights on the impact of enhanced design-build on project costs, change orders and risks.

What are some key ways that enhanced design-build can improve project speed, quality and pricing?

The enhanced design-build delivery method significantly improves a project’s speed, quality and pricing because many steps are done simultaneously, such as estimating and designing along with permitting. Additionally, there is a single source of responsibility for the client, which means decisions are prompt, questions are answered faster and the overall process moves more flawlessly.

Quality is improved because the process enables the team to gather specifics and make informed decisions before the final working drawings are completed. Furthermore, the drawings are more than just permittable; they are buildable, and therefore fewer questions on the jobsite should occur.

How do construction-related change orders drive up project costs and heighten team frustration?

With enhanced design-build, no construction-related change orders should occur on projects unless there is an unforeseen condition that is either related to a renovation of an existing facility or on a site with subsurface issues. Owner-directed scope changes after an agreed-upon guaranteed maximum price do occur and would create a change order.

Many owners and clients are very concerned about change orders that lead to an unexpected cost increase. Who wouldn’t be frustrated being asked to pay more on a project?

Some change orders may occur to the benefit of an owner or client if they receive a credit or have an owner direct purchase, which provides sales tax savings for a nonprofit entity. These are common in public/municipal projects or in nonprofit organizations.

How are contractors uniquely qualified to help the entire project team reduce risk?

Seasoned contractors have seen a thing or two and know what to be on the lookout for. They also know what questions to ask the owner to reduce risk.
Preventing surprises is everyone’s goal; however, unforeseen circumstances may arise.

The level of value added by utilizing enhanced design-build for the owner is prevalent with the contractor being a part of the entire process—from understanding the project’s regulatory restrictions and opportunities to helping the designers create a buildable set of plans, to providing accurate pricing.

How can these solutions help contractors shift the overall cost of risk to the owner?

With enhanced design-build, project costs are constantly under a watchful eye throughout the life of the project. When handled correctly, the contractor (design-builder) should cover all its costs, provide a quality result to the client and, at the end of the day, build a project the entire team can be proud of.

by Lauren Pinch

Lauren Pinch was editor-in-chief of Construction Executive and serves as an editorial consultant to the construction industry.

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