Design-build contracting, where a single design-build contractor provides both architectural design and construction services under one contract, is an increasingly popular project delivery method. However, as with any approach, owners need to go in with eyes open to both the potential benefits and drawbacks of using a design-build contractor.
When executed well, hiring a design-build contractor can result in a single point of accountability, cost and time savings, reduced risks, and enhanced collaboration. Yet, owners also sacrifice a degree of control, may face design compromises, run into issues of responsibility ambiguity, struggle to evaluate complex bids, and potentially pay a price premium.
Awareness of the pros and cons allows owners to make informed decisions and craft design-build contracts that maximize the advantages of this innovative project delivery approach.
Pros of Using a Design-Build Contractor
Design-build contracting offers several significant benefits to owners. Firstly, there is only one contract for both the design and construction of a project. This means the entire delivery process, from concept to completion, is the sole responsibility of the design-build contractor.
The owner has a single point of contact for any queries or concerns, streamlining project administration and addressing issues promptly.
Secondly, due to the high level of collaboration between the designers and builders on a design-build team, there are greater opportunities to cut costs by discovering efficiencies.
The early involvement of contractors in the design stage allows them to provide valuable input on the selection of materials and building systems that can meet aggressive cost targets without sacrificing quality. They are able to integrate cost-saving measures into the final design that the owner benefits from.
Thirdly, the concurrency of design and construction under a design-build approach significantly accelerates project delivery. With the overlapping phases, schedules can be condensed up to 30-40% compared to traditional bid-build methods. This time savings appeals to many owners facing tight deadlines or end dates.
Fourthly, the majority of risks related to budget, performance, and schedule compliance are transferred to the design-build contractor. They ensure the project is delivered on time and on budget in order to avoid penalties, making owners less vulnerable to cost overruns or errors.
Finally, the seamless collaboration between architects, engineers, and contractors early on results in a final product reflecting a shared vision and purpose. A tightly integrated design-build team develops a cohesive solution that serves the owner’s needs most effectively at each stage of development. Collective problem-solving and innovation lead to optimal outcomes.
In summary, the pros of engaging a design-build contractor include single-point accountability, potential cost savings, accelerated schedules, reduced risks, and enhanced collaboration. For the right projects, these benefits may far outweigh any disadvantages.
Cons of Using a Design-Build Contractor
give up a degree of control and may face additional risks. Firstly, with a design-build team responsible for both design and construction decisions, there are fewer opportunities for owner input at the detail level. Most choices around how to execute the work and meet the performance criteria are left to the discretion of the contractor. For some owners, this loss of control can be difficult to accept.
Secondly, an emphasis on accelerated schedules and strict cost controls under the design-build model could negatively impact design quality. In an effort to maximize the benefits of a streamlined process, some contractors may compromise on certain design elements to achieve speed or budget requirements, even if owners notice a resulting decline in standards or aesthetics. Design excellence may be secondary to other priorities.
Thirdly, there is potential for ambiguity in assigning responsibility for mistakes or omissions. Unclear roles and accountabilities between designers and builders can lead to finger-pointing over who is at fault for flaws in either the design or the construction. The owner can get caught in the middle of such disputes.
Fourthly, the technical and financial aspects contained within design-build proposals are often quite complex. Owners without specialized knowledge of this delivery method may struggle to objectively determine which bid offers the best value based on evaluating both design and cost factors. They risk awarding the contract to a contractor that will not ultimately serve them well.
Finally, while cost savings are possible, some design-build firms charge a premium by marking up their prices to account for additional risks they absorb. In the end, certain owners may not achieve lower overall costs by choosing design-build over other approaches. Premiums can reduce the cost efficiency of the method, diminishing a key benefit.
Owners can take several precautions to maximize the benefits of using a design-build contractor while avoiding common downfalls. Firstly, they should conduct thorough research into design-build firms, checking references and qualifications, especially experience on similar projects. Choosing a knowledgeable contractor with a proven track record is key.
Secondly, developing detailed design and performance criteria for bidding sets the standard of expectation. It allows for evaluating both the cost and quality of bids and selecting a contractor able to optimally fulfill specified goals. Criteria might include energy efficiency standards, space requirements, materials guidelines, and test/inspection procedures.
Thirdly, incorporating safeguards into the actual contract with the selected design-build firm provides opportunities to avoid issues going forward. This could include stipulating approval rights at key points like the schematic/detailed design stage or phase completions, requiring the ability to inspect work, mandating performance guarantees related to schedule or budget, etc. Such controls allow for oversight without fully taking on the risks.
Finally, while a collaborative relationship with the design-build team is important, owners should never relinquish total responsibility for reviewing and monitoring project performance. Maintaining visibility over the contractor’s work through consistent progress meetings, site visits, budget reports, and quality audits keep owners informed and aware of any need for corrective action.
With diligent upfront research, clear performance criteria, contractual safeguards, and sufficient oversight, owners can feel at ease handing over project delivery to a design-build contractor, knowing that proactive measures have been taken to protect themselves when embracing an innovative approach. Careful planning is key to success.
In summary, design-build contracting offers appealing benefits like single-point accountability, potential cost and time savings, and risk transfer, while also posing disadvantages such as loss of control, risks to design quality, ambiguous responsibility, bid award challenges, and possibly higher prices. For projects where an accelerated schedule or cost certainty is a high priority and the owner goes in with realistic expectations about sacrificing a degree of control, the pros of using a design-build contractor likely far outweigh the cons. With thorough planning, oversight, and evaluation from the outset, owners can craft design-build agreements that maximize the advantages of this forward-thinking project delivery approach.