In the year ahead, we will be in the fortunate position of project managing the design and construction of two new libraries of very similar program (needs, size, and budget)for the Denver Public Library – one located in Green Valley Ranch and one in the Stapleton neighborhood. This will put us in a unique position as Green Valley Ranch is being delivered via the design-bid-build method and Stapleton by the Construction Manager/General Contractor (CM/GC) method. This scenario will allow a side-by-side comparison of these two delivery methods, and a great way to contrast them “real-time”. We’re calling it “The Tale of Two Libraries”.

For context, and to set the stage for our future blogs on this subject, the status of each project is as follows:

Green Valley Ranch – the project has been fully designed, and we are in the final stages of contractor selection; construction will likely begin within four to six weeks
Stapleton – the project is currently in concept design and the team is continuing to meet with the community to gain input on the design; the CM/GC will likely begin preconstruction services in two to four weeks

It should be pointed out that each of these libraries, while operating under a different style from the Library staff perspective, will be similar in size (26,000 to 28,000 square feet), and will contain many similar features. All the more reason to hold the two projects up against the same light of analysis.

Objectively, let’s review the basic “features” of each delivery method.

Design-Bid-Build
Design-bid-build, sometimes known as “hard-bid”, involves a compartmentalized approach, with the architect and engineers being hired to produce a complete a set of design documents prior to the involvement of the general contractor. The general contractor then takes this information and, after supplying the client with a lump-sum amount to accomplish the work, builds the project to the scope and specifications outlined by the documents.

When to use this approach (typically)

  1. Cost is more important than schedule.
  2. Opportunity to be open to all

What are the pros and cons of this approach?

Pros

  1. Usually provides a lower price for the owner
  2. Allows more contractors to bid the project

Cons

  1. Longer procurement process as bidding is done only after the drawings are completed
  2. Low bid has the tendency to increase change orders and be more adversarial
  3. Pricing done by estimators who may not use the sub market as much as a General Contractor
  4. No constructability review by a contractor. Staging and coordination issues may not be thought through.
  5. “White knuckled landing” on pricing in the open market.

Construction Manager/General Contractor
CM/GC involves the contractor at an earlier stage of the project, usually beginning in schematic design or early design development phase. This early involvement of the contractor is predicated on a collaborative approach, whereby the contractor is working side-by-side with the client and the architect to input best practices and value into the design. It relies on the expertise of each team member to inform the design of the facility so as to enhance its scope in a practical and value-conscious manner. Once the architect has produced complete design documents, the contractor typically provides the client with an overall price – otherwise known as a Guaranteed Maximum Price (GMP) – to construct the project.

When to use this approach (typically)

  1. Complex projects, ie. Staging issues, crane issues, move coordination phasing.
  2. Projects with significant site work that could be begun early (Grading and site package)
  3. Projects with tight timeframes

What are the pros and cons of this approach?

Pros

  1. Better experience as a Team approach is used. Open communication and “books” should be expected.
  2. Reduced quantity of change orders is common.
  3. General Contractor input on the schedule. Schedules can provide detail that allow owners to prepare for events that impact them.
  4. The GMP can be established prior to completion of the plans and specifications to allow for an earlier construction start.
  5. If the costs are less than the GMP, the Owner receives 100% of the savings benefit.
  6. Bid to subcontractor market which could allow for local involvement and hand picking of certain contractor

Cons

  1. General Contractors will bid to a smaller pool of contractors that they have relationships with. This reduces owner risk, and theirs, but may not produce the lowest price.
  2. Contractors may opt to self perform work which would not be bid in the market.

As the projects move forward we will benchmark against the pros and cons to determine what is true and what is not in regards to pricing, schedule, and experience. Please note that there certainly other delivery methods that are utilized such as design-build and Integrated Project Delivery, these will be discussed in future blogs.