Once the decision to build has been made, the next step is to determine the project delivery method that works best for the project. The method with which most owners are familiar is lump-sum general contracting. It is simple to administer and has served a useful purpose for many years.
The construction industry is changing, however. Today’s projects are larger and more complex. Sustainable design and “green” construction require more specialized building systems. And the building process—getting a building designed, built, and occupied—is changing. We use more technology now, and more consultants and specialists.
In this increasingly sophisticated world of construction, the traditional lump-sum general contracting method of delivering a building project is becoming less adequate by the day. Owners want more than just low bid; they want shorter schedules, lower costs, and greater value, which explains the popularity of team-based delivery methods such as GMP general contracting, construction management, and design build.
GMP general contracting (private sector) and construction management (public sector) maintain the competitive bidding process while affording opportunities to save both time and money, and realize increased value that lump-sum general contracting does not.
Design build takes it one step further, allowing for phased construction, early guaranteed pricing, and a shorter, more efficient overall process.
Regardless of the delivery format you choose, Stahl is committed to being a fully engaged partner and delivering quality, efficient, affordable projects on time and under budget.
Also called “hard bid”, the owner hires an architect who prepares the plans and specifications. The project is bid among several general contractors, exactly as designed, and a contract is awarded to the lowest bidder. If the project is over budget, the entire process is repeated with a reduced scope, but with no guarantee that the rebid will be in budget. While simple to administer, lump-sum general contracting ensures neither lowest price nor best value.
Used in the private sector.
We are engaged early in the building process to assist with planning, decision making, and feasibility studies; as the design is developed we monitor it for cost, content, and constructability and look for ways to make it more efficient and less costly; and once construction starts we hold all trade contracts in our name and guarantee quality, cost, and schedule.
If the final cost is less than the guaranteed maximum price (GMP) provided at the end of design, the owner gets 100% of the savings; if the final cost exceeds the GMP, we pay the overage. It’s the best of both worlds.
Used in the public sector.
Utilizing the team approach, construction management introduces a construction professional—the construction manager—who is engaged early in the project to represent the best interests of the owner throughout the building process.
With no vested financial stake in the project—in either its design or construction—we operate as an extension of the owner’s staff and advise on all issues effecting quality, cost, and schedule based solely on what’s best for the owner. During construction the owner holds all trade contracts while we manage the work of the trade contractors and monitor their performance for quality, cost, and schedule.
Because construction management is a service rather than a product, a public entity can choose a construction manager on the basis of qualifications and reputation rather than price alone; and because all trade contractors bid directly to and contract directly with the owner, construction management is in full compliance with public bidding laws.
The essence of design build is that one firm assumes responsibility to the owner for both design and construction of the project. Incorporating the two functions into one contract produces efficiencies which tend to reduce costs, shorten schedules, and improve overall project value. And with only one contract, the owner has a single source of responsibility. Design build is the “one-stop-shop” of the project delivery methods.