AGENCY CONSTRUCTION MANAGEMENT :CM NOT AT-RISK

DOES THE DESIGN/BUILD PROCESS ALWAYS WORK?

So, what happens if an Owner DOES NOT have the knowledge or experience necessary to make construction related decisions?

SOLUTION: Hire a Construction Management firm to act as “owner’s agent”

AGENCY CONSTRUCTION MANAGEMENT

“CONSTRUCTION MANAGEMENT FOR FEE”(CONTRACTUAL RELATIONSHIPS: CM NOT AT RISK)

AGENCY CONSTRUCTION MANAGEMENT

• Agency construction management (ACM) encompasses a range of services provided by a CM on behalf of an Owner.

• This method can been used successfully regardless of the type of formal contract.

WHY AN OWNER CHOOSES ACM?

Owners who:

Doesn’t have the experience/knowledge to make sound decisions during the construction process

--OR--

Does ‘t maintain the staff necessary to deal with responsibilities involved in the management of major projects. 

WHAT DOES THE ACM DO?

CM as owner’s agent may provide professional services on behalf of Owner throughout the project, including:

Pre-design & Design phase Construction phase

CM maintains “fiduciary duty” to act on Owner’s behalf & provide impartial advice concerning the project.

WHAT IS “FIDUCIARY DUTY”?FIDUCIARY DUTY - An obligation to act

in the best interest of another party.

A fiduciary obligation exists when one person places special confidence in another person and relies upon that person to exercise his expertise in acting for the client.

WHAT IS “FIDUCIARY DUTY”?

• The fiduciary knowingly accepts that trust and confidence.

• Thereafter undertakes to act in behalf of the client by exercising his own discretion and expertise with concern of the interest of the client.

The Agency Construction Management firm has no vested interest in the project.

They are to simply act as the “owner’s agent”.

LET’S REVIEW THE SERVICES OFFERED BY AN AGENCY

CONSTRUCTION MANAGEMENT FIRM

PRE-DESIGN AND DESIGN PHASESelection Of The Design Team

ACM will often have historical experience in the market and can assist owner in selecting the most qualified A/E (architect/engineer)

Budget & Cost Estimating

Based on historical data for similar projects, ACM will assist owner in determining feasibility of initial scope.

Refined estimates are done later in the design phase to pinpoint the construction budget.

PRE-DESIGN AND DESIGN PHASE

Constructability Review

A review of plans to verify that the design presented poses no construction conflicts and is economical to build.

Contract Bidding

Development of bid package and bidding procedures

CONSTRUCTION PHASE SERVICES

Construction Inspection & SurveillanceExamine contractor performance, compliance with specs, safety, etc.

Project ControlsCorrespondence, progress meetings, submittals & requests for information, documentation of progress schedule, review of pay requests

CONSTRUCTION PHASE SERVICES

Change Order Review

Coordinating design changes with A/E Negotiating change orders Determining responsibility for changed conditions & coordination

conflicts

CONSTRUCTION PHASE SERVICES

Project Closeout

Develop punch list Resolution of outstanding issues Review & analysis of claims or disputes

PROJECT MANAGER MAY DELEGATE RESPONSIBILITY TO A RESIDENT FIELD ENGINEER

• On site on a regular basis.• Works closely with contractor• Inspection & quality control/assurance• Accepts/rejects materials • Oversees field testing• Prepares “as-built” drawings• Involved in change order process• Provides status reports to PM

• **Must keep PM informed on a daily basis of project issues

OPTIONS

Some owners are equipped with A/E services Need assistance with bidding Need assistance in finding qualified contractors to perform

work.

When an owner has the ability to handle certain aspects, he may tailor the use of ACM services to meet specific project needs:

Project cost control services Project scheduling services Construction Phase Work