Melissa Mack
As the Town engages in its due diligence preparing for two large building projects in 2017, discussions are underway regarding the most appropriate contracting model to ensure the greatest success. Of the suggestions offered, the “Construction Manager (CM) at Risk” model appears to be the frontrunner to the “Lump Sum Bid General Contractor (GC)” model commonly employed by the Town. Given this is new ground for Suffield, I offer the following explanation.
In the past, our building projects have mostly engaged in the General Contractor model. In this scenario, the Town and Architect design the project and complete the drawings, then select a GC via a short competitive bid process. The selected GC signs a contract for construction and commences work. While this appears to be a straightforward approach, it is encumbered by a number of difficulties. When bidding, GCs must produce a final contract cost with no involvement during the design process, limited understanding of the existing building, and typically with just a few weeks to get multiple trade subcontractors up to speed. And, the Town has limited involvement in choosing subcontractors, which may be selected more on price than project understanding. This method can give rise to scope and price uncertainty, with little time for the GC to communicate potential misunderstandings prior to going to contract. Once selected, the GC is obligated to a fixed price and schedule and must fight to justify any changes to either. Increasingly, this causes change orders, schedule delays, and potentially, an adversarial team relationship.
The CM at Risk model replaces the GC with a Construction Manager selected by the Town in a similar timeframe as the Architect, creating a “three-legged stool” as the framework for the process. The CM is ultimately the builder (thus at risk) but shifts professional involvement into the design process, serving as an advisor to the design team and advocate for the Town. Such preconstruction services include cost estimating, scheduling, and detailed design review to best manage the project, understanding and forecasting any painful surprises. The CM solicits multiple bids for all components of the project and presents costs and subcontractor qualifications in a transparent “open book” fashion. The Town maintains competitive pricing, but with a deeper understanding of the capabilities of trade contractors. During construction, change orders are limited due to the builder’s early involvement. The CM’s early involvement does incur upfront fees not present in the GC method, but this is often offset by affording the Town greater flexibility, decreased cost overruns and less conflict.
Commercial building projects are complex, more so when renovating aging, ailing buildings like the Town Hall and Bridge Street School. We’ve come to understand such projects rely on stronger team relationships – between the Town as Owner, the Designer and the Builder. The CM at Risk model is intended to foster a partnership, a three-party team working toward shared goals. Ultimately, we must successfully deliver on the investments deemed worthy and voted on by our community; it seems the CM at Risk can help us do so.
Best wishes for a safe and happy holiday season!