1. Robert L. Moultrie Chairman & CEO
What You Need to Know Before Embarking on a New Building Program: What Really Happens on Bid Day?
Presented by:
Robert L. Moultrie
Chairman & CEO

2. Discussion Points
Trends in the Design and Construction Industry
Research Findings
Evaluation of Alternative Delivery
The Evolution of Project Delivery Systems Factors Leading to Alternative Delivery Methods
Critical Success Factors

3. 1st Design-Build Project - Macedonia

4. Design-Build Timeline

5. Trends in the Design and Construction Industry
A growing number of public and private owners faced with large construction projects and tighter schedules are using outside program managers to deliver projects. (ENR Magazine)
A greater acceptance of Alternative/Total Responsibility at Risk
All states, with the exception of two, allow alternative delivery
“Volume of turn-key projects expected to increase from 40% to 60% over the next two years” (Design-Build Magazine)

6. Research Findings from the Construction Industry Institute
Regardless of delivery method, research showed that cost increases by the contractor were due to:
Lack of early planning participation by the contractor (constructibility reviews and value engineering suggestions)
Lack of previous working relations of the architect/engineer and the contractor
Contractor’s recognition of engineering errors during the bidding process, but there was no intercommunication

7. Factors Leading to Alternative Delivery Methods
Changes in Owner staff makeup
A focus on the Owner’s “core business” (and it’s usually not building large capital programs)
A need to downsize in-house capabilities
The business client and Owners have changed

8. Design-Bid-Build (aka, Traditional Approach)
Your Choices
Design-Bid-Build (aka, Traditional Approach)
Construction Management at-Risk
Design-Build
The project delivery method defines the relationships, roles, responsibilities, and risks of all parties involved.

9. Traditional Approach: Design-Bid-Build
Architecture /
Engineering
General Contractor
Owner
Owner
General Contractor
BIDS OUT TO
HIRES
HIRES
Architecture /
Engineering S

10. Traditional Approach: Design-Bid-Build
Owner holds separate A/E & Construction contracts
Potential for adversarial relationships
Qualifications are rarely considered in contractor selection on public work projects
No assurance that design is within budget
No benefit of contractor input during design
No ability to accelerate project delivery
Owner has no input in subcontractor selection
Increased change orders
Owner does not share in savings: Contractor awarded Lump Sum
Architecture /
Engineering
General Contractor
Owner
Key:
Contract Responsibility
Communication

11. Bidding Timeline Nothing happening, WHY?
1 Month Before Bid: (In Today’s Market)
Nothing happening, WHY?
Too busy on other bids
Plenty of time
Casual sub contact
All you are accomplishing is getting on the bid schedule
Manufacturers check specs to see if they are protected
2 Weeks Before Bid:
Sub contact begins in earnest
Good contractors begin quantity survey or take-off
Bad contractors rely on subs for this and change order owner if quantities are wrong

12. Bidding Timeline Week of The Bid Implications?
Project execution planning and general conditions formulation
Alliances may be formed between subs and GC’s
Subs begin to look at the job and decide to bid or pass
Final Addenda is issued – subs begin take-off
Calls to subs from the GC get frantic
Manufacturers begin to look at the job
Bid packages are broken down
Implications?
GC’s & subs are trolling for the right circumstances:
Holes in drawings
Weak / little competition
Good subs interest from their cadre
Where are the Owner’s interests in this process?

13. Bidding Timeline Bid Day – Bid Time is 2:00pm Why?
A good contractor will have a “box run” total price
Sub budgets + pricing + self-pricing + SWAGS
Before computers, this is where the cut & add sheet began
General Conditions & fees are set
Sub & supplier quotes start to trickle in
By lunch, should have a quote for each bid package except for mech. elect. & other specialties
Why?
Subs “shop” prices

14. Bidding Timeline 1:30pm – CHAOS!
Bid Day
1:30pm – CHAOS!
½ price number is out that contains an alternate material
Should we carry it and hope we get it approved?
We only have 1 elect & 1 mech number out of 20 subs in each trade
Where are the sub quotations?
The low mason only has 85% of the block & brick in our take-off -- and he can’t bond the job!

15. Bidding Timeline 1:45pm – PANDAMONIUM!!
Bid Day
1:45pm – PANDAMONIUM!!
All the mech and elect numbers have come in – including the 10 you have never heard of
You can not carry the low number – you can only shop it to someone you know
Do you have enough phone lines and people to get all the numbers?
We won’t use him again, unless he’s low!

16. Bidding Timeline How much do we “discount” the project?
Bid Day
1:55pm – DECISION TIME
How much do we “discount” the project?
Getting all the sub quote numbers & tabulating them
Adding up all the numbers and addressing all the alternates and proposal technicalities
1/3 Skill
It is difficult to win against “cheaters” / “shoppers”
How can we get unspec’d materials approved?
How will you buy-out your discount?
1/3 Ethics
Did you get most of the right numbers?
Did you discount enough?
How “hungry” was the competition?
1/3 Luck

17. What Really Happens on Bid Day? Traditional Approach with GC Bid
What the Owner does NOT see.
**Indicates lowest bid
General Conditions, Site Supervision, Insurance, Fee and Bond costs are in addition to the above bids and included in the overall Lump Sum.

18. Construction Management At-Risk
Owner holds separate A/E and construction contracts
Higher degree of teamwork between architect and contractor
Qualifications based selection; negotiated fees
Pre-construction services during design to verify budget and constructability
Project acceleration may be implemented
Subcontractors may be competitively bid
Open reporting to owner
GMP late in design
Owner may share in savings
Owner
Architecture /
Engineering
Construction
Manager S
Key:
Contract Responsibility
Communication

19. What Really Happens on Bid Day? CM At-Risk Pricing
What the Owner Does See

20. Design-Build: General Contractor Led Team
Owner holds single contract for total Design-Build delivery
Architect is subcontracted to CM because CM provides the bond
Contractor (costs) driven approach
Bid or Qualifications based on selection
Pre-Construction Services during Design to control budget and constructability
Subcontractors may be competitively bid
Enables “Fast-track” construction scheduling
Well defined program is essential to define scope
Owner may participate in savings
Owner
HIRES
Contractor S
STAFF or
HIRES
Architecture
Engineering
BUILDING PHASE
DESIGN PHASE

21. Design-Build: Integrated Firm
Owner holds single contract for Program Management, A/E & Construction
Highest Degree of Teamwork
Qualifications Based Selection; negotiated fees
Integrated design and pre-construction from the start
Subcontractors typically are competitively bid
Enables fast-track construction
GMP early in the design process
100% savings returned to Owner

22. What Really Happens on Bid Day? Design-Build Approach
What the Owner Does See
D/B
* Value Engineering suggestions can discount bids by 5%

23. Traditional vs. Alternative
Design-Bid-Build
Lump sum amount established
Planning
Architecture / Engineering
Bid
Construction
CM at Risk
80% Complete documents; GMP established
Planning
Architecture / Engineering
Bid individual trade packages
Construction
13.3% Faster
OneSource
Integrated
60% complete documents; GMP established
Contractor Led
80% complete documents; GMP established
Planning
Architecture / Engineering
“Faster Fast-Track”
Bid individual trade packages
Realistic budget or confirmation of cost limitation
Construction
33.5% Faster

24. Delivery Method Matrix
Project Delivery Options
(with basis for selection)
# of CONTRACTS
Designer & Contractor
(2 separate contracts)
Design/Builder
(1 combined contract)
SELECTION TYPES
Competitive Sealed Bid
(Low Bid)
Total Construction Cost is sole
criteria for final selection
Design-Bid-Build
Design-Build
Competitive Sealed Bid
Competitive Cost Proposal
(Best Value)
Total Construction Cost and other
criteria are weighted factors in the final selection
CM/GC
Competitive Cost
Proposal
Design-Build
Competitive Cost
Proposal
Competitive Qualifications
Proposal
(Qualifications Based Selection)
Total Construction Cost are not a
factor in the final selection criteria
CM / GC
Competitive Qualifications
Proposal
OneSource
Competitive Qualifications
Proposal

25. Delivery Method Comparison
Comparisons
OneSource vs.
Design-Bid-Build
vs.
Design-Bid-Build
OneSource vs.
6.1% lower
1.6% lower
4.5% lower
Unit Cost
Construction Speed
12% faster
5.8% faster
7% faster
Delivery Speed
33.5% faster
13.3% faster
23.5% faster
Cost Growth
5.2% less
7.8% more
12.6% less
Schedule Growth
11.4% less
9.2% less
2.2% less
Table shows average differences between project delivery systems

26. Making the Right Choice
No one method is perfect for every project!
Selecting a delivery method depends on factors such as level of quality desired, budget, and schedule
Regardless of delivery method there are other tools that can help you meet your quality, cost and schedule goals.

27. The use of Building Information Modeling (BIM)
Industry Tools
A well-defined plan
The use of Building Information Modeling (BIM)
Early Cost, Schedule & Constructability Input

28. Critical Success Factors
Two critical success factors for any project, regardless of delivery method, are:
1. A well thought out, comprehensive facility plan that addresses all of the client’s objectives and all of the necessary requirements of the project, and
2. A competent and skilled manager, knowledgeable in the project’s niche market, to manage the program and implement the plan - from start to finish

29. Manage Move-In & Commissioning
Approach
Planning
Implementation
DECISIONS
BOND APPROVAL
Ed Specs
Guide Specs
Manage Architects
Master Plan
Manage Bid Process
Master Schedule
Manage Construction
Cost
Planning
Manage Cash Flow
PUBLIC
Program
Manage Information
Master Budget
Re-Allocate Savings
Enrollment
Projections
Manage Move-In & Commissioning
Concept Design
COSTS
Time

30. Building Information Modeling
PLANNING
New approach to building design, construction, and management
Virtual three dimensional model that offers continuous and immediate information
Parametric building modeling technology
Dynamic … uses a relational database together with a behavior model to capture and present building cost and schedule information.
CONTINUOUS
IMPROVEMENT
DESIGN
Parametric Change Engine
Views
Annotations
Components
IMPLEMENTATION
ANALYSIS

31. South Paulding High School Dallas, GA
Part of an overall Program Management At-Risk program, which includes construction of a new 100,000 SF elementary school as well.
240,000 SF, 1,600 students
Auxiliary facilities: gymnasium, dining hall, 500-seat auditorium
Athletic facilities: 3,000-seat football stadium, practice fields, eight-lane synthetic track, and baseball/softball complex