Cost
limitations are an almost universal challenge in construction projects. Owners typically
have a predetermined budget for their project, so the realities of construction
costs force them to make difficult decisions about project scope, quality, or
even whether the project can proceed. To address cost limitations, owners may
need to work closely with their architects and contractors to identify effective
solutions.
While architects like to boast that creativity thrives within constraints and need not be compromised, my experience has taught me that successful cost management usually demands more than the architect alone can deliver. Open communication and collaboration between the owner, architect, and contractor from the project’s inception are clearly effective strategies for maximizing the value of construction projects. Consequently, the choice of project delivery method may be the single most impactful consideration influencing the outcome of a building project, particularly in terms of cost.
There are various project delivery methods in common usage today, each with its own advantages and disadvantages. The architect typically works closely with the owner to select the one that best aligns with the project budget and expectations.
Design-Bid-Build (DBB): In this traditional method, the architect completes the design before the project goes out for bid. While it provides a clear picture of the final design, it can be challenging to control costs once construction begins. The use of bid alternates—optional elements that can be added to or removed from the project—is a common practice for providing flexibility in the project pricing and decision-making processes. Including bid alternates means that some elements of the design are inherently uncertain until after bidding is complete.
Design-Build (DB): In the design-build approach, a single entity handles both design and construction, providing a “turnkey” service for the owner. This method can streamline the process but may limit the architect's control over the project's budget and design.
Construction Management (CM): Construction management involves hiring a construction manager to oversee the project. It can provide more control over costs and scheduling but requires architects to work closely with multiple parties. The CM often additionally functions as the General Contractor, in which instances the method is referred to as the CM/GC project delivery method.
Integrated Project Delivery (IPD): IPD promotes collaboration between all project stakeholders from the beginning and in its characteristic usage is applied on particularly large and complex projects with high sustainability goals. It can lead to better cost control and design outcomes but requires a high level of coordination.
According to a 2018 article in Construction Dive, design-bid-build remains the most widely used construction model; however, my anecdotal accounting suggests DB, CM, IPD and other alternative project delivery methods are since rapidly usurping the dominance of DBB.
The choice of which delivery method is best depends on a project’s specific needs and goals and requires a thorough understanding of the key attributes of the various methods. That said, design and construction are notoriously complex undertakings, more so with each passing year. Even seemingly modest projects can benefit from using DB, CM, or IPD instead of the conventional Design-Bid-Build process. This is particularly true when budget considerations are paramount.
Effective value engineering, risk assessment, regular cost monitoring, contingency planning, and transparency in financial matters and decisions likewise flourish when open communication and collaboration between owners, architects, and contractors exist. Regular and timely evaluation of a project’s scope and design help identify areas where cost savings can be achieved without compromising quality or safety. While not always effortless, such evaluations during the design process are far less painful than ones conducted only after a building’s plans are complete and the bid results are an unwelcome surprise.
Value engineering is a systematic and creative approach to improving the value of a project by optimizing its design, materials, and construction methods. One of the challenges of value engineering is striking the right balance between cost savings and design integrity. Careful assessment of which elements of the design can be modified or substituted without compromising the project's overall vision is necessary. This can be a delicate and often frustrating process as it requires letting go of some design elements that may be personally meaningful or artistically important. Value engineering should not be a one-time event and it should allow for adjustments as new information becomes available or project circumstances change.
By working collaboratively, project teams mutually share their expertise. I have a tremendous amount of respect for what contractors bring to the table. Their knowledge and experience are invaluable to the design process, bolstering the argument in favor of one of the delivery methods that is inherently collaborative in nature. Architects (and many owners) tend to be dreamers and visionaries, so bringing contractors—as well as the owner’s facility manager and maintenance team—on board from the beginning injects an often sobering and necessary dose of reality into the design or value engineering processes.
A
useful case study of a collaborative process is the new Lane Community College Health Professions Building, currently under construction. My firm,
Robertson/Sherwood/Architects, is the executive architect, while Mahlum Architects is the lead design firm. Fortis Construction is the
Construction Manager/General Contractor. From the outset, the 31,280 SF,
3-story project has been strapped by a tight budget. Addressing the cost
limitation challenges has truly been a team effort. Fortis provided critical
cost evaluation and constructability input throughout the design phase, which
ultimately resulted in a solution that is necessarily lean yet fulfills all
programmatic requirements. Once complete, the Health Professions Building will
provide LCC with the facility it originally envisioned, a new campus gateway
centered on equity and inclusion as core values for the college’s Medical Assistant,
Dental Assisting, Dental Hygiene, and Emergency Medical Services programs.
The disappointments and design compromises that do result from budget constraints can be disheartening, but they are an inevitable part of the design and construction process. Ultimately, the goal is to strike a balance between creativity and fiscal responsibility. While cost limitations may necessitate concessions, they also present opportunities for innovative and collaborative problem-solving in the creation of designs that are both functional and budget friendly.
While architects like to boast that creativity thrives within constraints and need not be compromised, my experience has taught me that successful cost management usually demands more than the architect alone can deliver. Open communication and collaboration between the owner, architect, and contractor from the project’s inception are clearly effective strategies for maximizing the value of construction projects. Consequently, the choice of project delivery method may be the single most impactful consideration influencing the outcome of a building project, particularly in terms of cost.
There are various project delivery methods in common usage today, each with its own advantages and disadvantages. The architect typically works closely with the owner to select the one that best aligns with the project budget and expectations.
Design-Bid-Build (DBB): In this traditional method, the architect completes the design before the project goes out for bid. While it provides a clear picture of the final design, it can be challenging to control costs once construction begins. The use of bid alternates—optional elements that can be added to or removed from the project—is a common practice for providing flexibility in the project pricing and decision-making processes. Including bid alternates means that some elements of the design are inherently uncertain until after bidding is complete.
Design-Build (DB): In the design-build approach, a single entity handles both design and construction, providing a “turnkey” service for the owner. This method can streamline the process but may limit the architect's control over the project's budget and design.
Construction Management (CM): Construction management involves hiring a construction manager to oversee the project. It can provide more control over costs and scheduling but requires architects to work closely with multiple parties. The CM often additionally functions as the General Contractor, in which instances the method is referred to as the CM/GC project delivery method.
Integrated Project Delivery (IPD): IPD promotes collaboration between all project stakeholders from the beginning and in its characteristic usage is applied on particularly large and complex projects with high sustainability goals. It can lead to better cost control and design outcomes but requires a high level of coordination.
According to a 2018 article in Construction Dive, design-bid-build remains the most widely used construction model; however, my anecdotal accounting suggests DB, CM, IPD and other alternative project delivery methods are since rapidly usurping the dominance of DBB.
The choice of which delivery method is best depends on a project’s specific needs and goals and requires a thorough understanding of the key attributes of the various methods. That said, design and construction are notoriously complex undertakings, more so with each passing year. Even seemingly modest projects can benefit from using DB, CM, or IPD instead of the conventional Design-Bid-Build process. This is particularly true when budget considerations are paramount.
Effective value engineering, risk assessment, regular cost monitoring, contingency planning, and transparency in financial matters and decisions likewise flourish when open communication and collaboration between owners, architects, and contractors exist. Regular and timely evaluation of a project’s scope and design help identify areas where cost savings can be achieved without compromising quality or safety. While not always effortless, such evaluations during the design process are far less painful than ones conducted only after a building’s plans are complete and the bid results are an unwelcome surprise.
Value engineering is a systematic and creative approach to improving the value of a project by optimizing its design, materials, and construction methods. One of the challenges of value engineering is striking the right balance between cost savings and design integrity. Careful assessment of which elements of the design can be modified or substituted without compromising the project's overall vision is necessary. This can be a delicate and often frustrating process as it requires letting go of some design elements that may be personally meaningful or artistically important. Value engineering should not be a one-time event and it should allow for adjustments as new information becomes available or project circumstances change.
By working collaboratively, project teams mutually share their expertise. I have a tremendous amount of respect for what contractors bring to the table. Their knowledge and experience are invaluable to the design process, bolstering the argument in favor of one of the delivery methods that is inherently collaborative in nature. Architects (and many owners) tend to be dreamers and visionaries, so bringing contractors—as well as the owner’s facility manager and maintenance team—on board from the beginning injects an often sobering and necessary dose of reality into the design or value engineering processes.
LCC Health Professions Building under construction (my photo)
The disappointments and design compromises that do result from budget constraints can be disheartening, but they are an inevitable part of the design and construction process. Ultimately, the goal is to strike a balance between creativity and fiscal responsibility. While cost limitations may necessitate concessions, they also present opportunities for innovative and collaborative problem-solving in the creation of designs that are both functional and budget friendly.
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