Design Build. What everyone ought to know about positioning their Design Build Projects for success
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1 Design Build What everyone ought to know about positioning their Design Build Projects for success San Francisco March 7, 2017
2 CMAA has met the standards and requirements of the Registered Continuing Education Program. Credit earned on completion of this program will be reported to RCEP at RCEP.net. A certificate of completion will be issued to each participant. As such, it does not include content that may be deemed or construed to be an approval or endorsement by the RCEP.
3 Learning Objectives Understand Best Practices in Design Build Review Lessons Learned in Design Build Discuss newest Trends in Design Build
4 AGENDA 09:30: Welcoming Remarks & Introductions 09:35: Presentations: Maximizing Success in Design Build by Greg Gidez Positioning your Design Build Project for Success by Michael Meredith Connecting and Transforming California by Terry Ogle SMCCCD s Migration to Progressive Design Build by Chris Strugar Fritsch The Construction Manager s Perspective by Dave Kirn Design Build Success by Patrick Crosby 10:40: Break (5 minutes) 10:45: Panel Discussion and Q&A 11:45: Closing Remarks After 11:45: Opportunity to meet with panel members/networking
5 WELCOMING REMARKS & INTRODUCTIONS
6 Presented by Co Presented by Owner Partners Corporate Sponsors
7 MAXIMIZING SUCCESS IN DESIGN BUILD Presented by Greg Gidez Director of Design Services, Hensel Phelps
8 Maximizing Success in Design Build Understand the Risk Shift Understand the Mental Shift Importance of the TEAM Understanding of the importance of the Owners Role Understand Design Build Best Practices
9 What are the Project Delivery Risks? Owner Architects General Contractor Design Builder Specialty trade Users. and how are they mitigated by the team structure?
10 What is the Project Delivery Strategy? Progressive Design Bid Build Design Build based on an understanding of the risk shift? How do I maximize an integrated solution?
11 Who Owns the Design Risk informs the level of team integration Owner Owner Owner Designer Architect Engineer Builder General Contractor Designer Architect Engineer Builder General Contractor Design Builder Design Bid Build Dual Responsibility Owner Owns the Risk Dual Responsibility Owner Owns the Risk Design Build Singular Responsibility Design Builder Owns the Risk
12 Who Owns the Design Risk informs the level of integration Owner P3 Entity Owner Finance Operations and Maintenance Designers Engineers Builder General Contractor Designer Architect Engineer Designers Specialty Consultants Trades Specialty Contractor Builder General Contractor Designers Specialty Consultants Public Private Partnership P3 Defined Risk Trades Specialty Contractor IPD IPD Multi party Responsibility Shared Risk
13 Variations of Design Build Owner Design Builder Design Build Singular Responsibility QBS Qualifications Based Selection BVS Best Value Selection 2 step selection process Progressive igmps, additive Technically Acceptable, Low Price
14 IPD OPPORTUNITY FOR TEAM INTEGRATION
15 WHAT DOES THE RESEARCH SAY ABOUT PROJECT DELIVERY?
16 Team Integration and Sustainability When sustainability is a goal The higher the level of team integration the higher the performance of the building The greater the Owner involvement, the better the opportunity to achieve sustainable goals center/documents/ CPF_ThrustII_ _Final.pdf
17 Project Delivery Research In the Construction Industry Institute in collaboration with Penn State University published seminal research indicating Design Build out performed CM at Risk or Design Bid Build in terms of o Lower cost, o Improved schedule o Better quality Metric DB vs. DBB CM@R vs. DBB DB vs. CM@R Unit Cost 6.1% lower 1.6% lower 4.5% lower Construction Speed 12% faster 5.8% faster 7% faster The more integrated, the better the performance Singular vs multiple contracts 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 1998 CII RT 133 Research
18 What has Changed? Is the previous research still relevant? What has changed? o Building Information Modeling o Parametric Design o IPD, Progressive DB, P3, DBOM s o Construction technologies o Economy What are the factors that improve outcomes in any project delivery strategy? How does an Owner influence team integration and mitigate risk?
19 Research Motivation To improve owner delivery decisions by providing practical guidance based upon empirical evidence Question 1998 CII RT CPF CII How do project delivery methods impact performance? How does the level of integration impact project delivery success? Scope Delivery DBB, CMR and DB Delivery, procurement, contracting, behaviors and environment Findings DB was faster than DBB and CMR Cost and schedule growth were highest for DBB Combined contracts were faster than split contracts Cost and quality were driven by procurement and contracting
20 Data Set Number of Projects Projects Public: 127 (62%) Private: 77 (38%) Completed: (4%) 8 (3%) 7 Facility Sizes > 700,000 ft 2 600, ,000 ft 2 (2%) 3 500, ,000 ft 2 (3%) 6 400, ,000 ft 2 (7%) , ,000 ft 2 (13%) , ,000 ft 2 (24%) , ,000 ft 2 (44%) ,000 ft 2 Facility Types Educational Office Health Care Lodging Commercial Sports & Recreation Manufacturing Correctional Transportation 56 (27%) 41 (20%) 32 (16%) 27 (13%) 20 (10%) 11 (5%) 11 (5%) 4 (2%) 2 (1%)
21 Team Integration Group Cohesion Integration Degree to which team members from separate organizations and disciplines are engaged in collaborative activities Participation in: Joint Goal Setting Cross Disciplinary design charrettes BIM Execution Planning Increased sharing of information and analysis through BIM Increased team interaction through colocation Higher levels of integration led to: Reduced schedule growth Enabled more intense schedules Led to more cohesive teams
22 Team Integration Group Cohesion Group Cohesion Degree to which team, as individuals, have shared, task commitment, group pride, and interpersonal alignment Commitment to shared goals High levels of team chemistry Communication is timely and effective Higher group cohesiveness led to: Reduced cost growth Higher system quality Improved turnover experience
23 Factor Value Group Cohesion Team Integration Team Integration
24 Factor Value Group Cohesion 70% of projects delivered late had below average levels of Team Integration Team Integration
25 Factor Value Group Cohesion 60% of on budget projects had above average levels of Group Cohesion Team Integration
26 Delivery Method Group Cohesion DBB Team Integration
27 Delivery Method Group Cohesion Team Integration
28 Delivery Method Group Cohesion Design Build Team Integration
29 Delivery Method IPD Group Cohesion Team Integration
30 Delivery Method IPD Group Cohesion DB We need to consider more than just delivery method DBB Large variance within each delivery method Team Integration
31 Delivery Method DESIGN BUILD done wrong Group Cohesion Design Build DESIGN BUILD done right Team Integration Design Build Done Wrong or Done Right?
32 Groupings GROUP COHISION Reduced cost growth Improved turnover experience Higher system quality Group Cohesion II III IV V I Team Integration TEAM INTERGRATION Reduced schedule growth Enabled more intense schedules Led to more group cohesion
33 Timing of Involvement Early Involvement of the Builder and/or Trades Primary Contractor / CM Trade Contractors Project Delivery Strategy Class I Class II Class III Class IV Class V PRE = Pre-Design CONC = Conceptual Design SD = Schematic Design Percentage of Projects DD = Design Development CD = Construction Documents BID = Bidding 100% 80% 60% 40% 20% 0% 100% 80% 60% 40% 20% 0% 100% 80% 60% 40% 20% 0% Class I (n=19) PRE PRE CONC SD DD CD BID Class III (n=54) PRE CONC SD DD CD BID Class V (n=36) PRE CONC SD DD CD BID PRE CONC SD DD CD BID Phase of Design
34 Selection Criteria Primary Contractor / CM Trade Contractors Qualification Based Selection Project Delivery Strategy Class I Class II Class III Class IV Class V CW = Cost of Work only CW+ = Best Value with Cost of Work FEE+ = Best Value with Fee QUAL = Qualifications only Percentage of Projects 100% 80% 60% 40% 20% 0% 100% 80% 60% 40% 20% 0% 100% 80% 60% 40% 20% 0% Class I (n=19) CW CW+ FEE+ Fee+ QUAL Qual Class III (n=54) CW CW+ Fee+ Qual CW FEE+ QUAL Class V (n=36) CW CW+ FEE+ Fee+ QUAL Qual Selection Criteria
35 Payment Terms Open Book Payment Terms Qualifications Based Project Delivery Strategy Class I Class II Class III Class IV Class V Percentage of Projects 100% 80% 60% 40% 20% 0% 100% 80% 60% 40% 20% 0% 100% 80% 60% 40% Class I (n=19) LS LS GMP CPF Class III (n=54) LS GMP CPF Class V (n=36) Primary Contractor / CM Trade Contractors LS = Lump Sum GMP = Guaranteed Maximum Prices CPF = Cost Plus a Fee 20% 0% LS LS GMP CPF Payment Terms
36 Underlying Themes Open Book Payment Terms Project Delivery Strategy Class I Class II Class III Class IV Class V Early Involvement of the Builder and Trades Qualification Based Selection
37 Summary of Findings Delivery methods alone do not predict success Lines between delivery methods are blurred Owners drive project success by selecting strategies that promote team integration and group cohesion Team Integration Reduced schedule growth Higher schedule intensity Cohesive teams Group Cohesion Reduced cost growth Higher system quality Better turnover
38 Summary of Findings Best performing delivery strategies maximize: 1. Early involvement of the core team 2. Qualification based team selection 3. Transparency in cost accounting Early Involvement Faster delivery speed Faster construction speed Improves integration QBS and Open Book Faster delivery speed Improves integration Improves cohesion
39 MAXIMIZING SUCCESS Best path to project success is through building a TEAM Teams are influenced through project delivery decisions early involvement open book qualifications driven Project Delivery needs to be developed as a strategy TEAM SELECTION matters!
40 DESIGN BUILD BEST PRACTICES Procuring Design Build Services Contracting for Design Build Services Executing the Delivery of Design Build Projects Making the Mental Shift to an integrated process
41 UCI Humanities Building BVS Cornerstone Concrete Excellence Award for Concrete Buildings/Institutional Sector DBIA Merit Award Best Project, Public Sector Building over $15 million Public Sector $25 50 million
42 San Jose IAP Progressive Design Build 2011 Category II Award of Merit ACEC 2011 Engineering Excellence Platinum Award AIA Citation Award Best of 2010 Overall Top Project Best of 2010 Transportation Constructor Award Excellence in Project Management IDEAS2 Les Grube Memorial Design Award
43 Benjamin P. Grogan and Jerry L. Dove Federal Building Awards 2015 DBIA National Award of Merit in Federal, County, State, Municipal category 2015 GSA Project Management Award ENR Southeast's 2015 Best Project Awards 2015 CMAA Project Achievement Award 2015 DBIA Florida Region - Best Overall in the Federal, State, County, and Municipal Category 2015 Best Overall Design-Build Project of the Year, DBIA Florida Chapter 2015 DBIA National Excellence in Process 2015 DBIA National Excellence in Architecture Design Award 2015 DBIA National Project of the Year 2015 Federal Project of the Year 2015 DBIA Florida Region - Project of the Year Award (Federal, State, County and Municipal) 2015 DBIA Florida Region - Best Overall Design-Build Project of the Year Award 2016 Alliant Build America Award ENR 2015 Best of the Best Project 2015 DBIA National Award of Excellence 2016 ABC East Coast Chapter Excellence in Construction - Eagle Award Divine Detail Honor Award 2016 ABC East Coast Chapter Excellence in Construction - Project of the Year
44 DESIGN BUILD SPORT WHEN DONE RIGHT IT IS POETRY IN MOTION
45 POSITIONING YOUR DESIGN BUILD PROJECT FOR SUCCESS Presented by Michael Meredith Project Director III, Project Management and Development Branch, Department of General Services
46 Design-Build Lessons Learned Project Overview Position Design-Build Projects for Success. Funding: State Projects Infrastructure Fund (SPIF) Senate Bill 836 Budget: $1.3billion for three projects Resources Building $596,000,000 O Street $275,000,000 Resources Building O Street East Annex of Capitol East Annex of Capitol $429,000,000
47 Design-Build Lessons Learned Resources Building Replacement Project 800,000 GSF Stipulated Sum: $490M Natural Resources Agency (CNRA) Dept. of Water Resources Dept. of Parks & Recreation Dept. of Fish & Wildlife Dept. of Forestry & Fire Protection Dept. of Conservation Dept. of Conservation Corp Wildlife Conservation Board
48 Design-Build Lessons Learned O Street Office Building Replacement 339,000 GSF Stipulated Sum: $215M California Health and Human Resources Agency Dept. of State Hospitals Dept. of Developmental Services
49 Design-Build Lessons Learned Critical Success Factors (CSFs) Zero Net Energy Modern Interior work space practices Best Value w/ Stipulated Sum Identification of CSF is very important What to identify as Performance vs. Prescriptive NSF $
50 Design-Build Lessons Learned Project Challenges and Opportunities Team Structure Separate vs. Single Criteria Architect and CM teams - Pro: Created opportunities for broader participation but - Con: Reduced opportunities for the Design-Build procurement Separate CAE + CM Single CAE + CM DGS DGS CAE 1 CM 1 CAE 2 CM 2 CAE CM Project 1 Project 2 Project 1 Project 2 Challenge: Determination of how best to procure Design-Build services.
51 Design-Build Lessons Learned Challenge Separate teams = two separate packages DGS CAE 1 CM 1 CAE 2 CM 2 Project 1 Project 2 PMP RFQ Two sets of meetings, PMPs, etc. Consistent documents between projects PMP RFQ RFP RFP Design Guidelines Performance Criteria Design Guidelines Performance Criteria
52 Design-Build Lessons Learned How the challenge was met Split duties between the CM s One Project Director to guide DGS CAE 1 CM 1 CAE 2 CM 2 Project 1 Project 2 PMP PMP Create PMP Template RFQ Create RFQ Template RFQ RFP RFP Create RFP, Div 00 & Div 01 Templates Design Guidelines Performance Criteria Design Guidelines Performance Criteria
53 Design-Build Lessons Learned Future Opportunities Maximize Best Value with Stipulated Sum Build on Qualifications-Based Selection Process Promote advancements e.g. Progressive Design-Build (PDB) Benefits - Reduced Resources and Risk
54 CONNECTING AND TRANSFORMING CALIFORNIA Presented by Terry Ogle Director Of Design and Construction, California High Speed Rail
55 HIGH SPEED RAIL: Connecting California
56 VALLEY TO VALLEY AND BOOKENDS Silicon Valley to Central Valley Line Operational by 2025 San Jose North of Bakersfield $20.7 Billion Fully Funded Bookend and Connectivity Investments 15 Bookend and Connectivity Projects Extensions to San Francisco, Merced & Bakersfield Additional $2.9 Billion
57 STRATEGIES TO IMPLEMENT PROGRAM Initiate high speed rail passenger service as soon as possible. Demonstrate benefits Begin generating revenues Attract private sector participation Make strategic, concurrent investments throughout the system that will be linked together over time. Provide immediate mobility, environmental, economic and community benefits Position ourselves to construct additional segments as funding becomes available. Completing the required environmental analyses for every mile of the program Securing environmental approvals as soon as possible
58 DESIGN BUILD STRATEGY Central Valley Construction Packages CP 1, CP 2 3, CP 4 World Class Teams Competed for Three Separate Design Build Contracts Contract Values Approximately $500 Million to $2 Billion Each Request for Proposal (RFP) Included 30% Small Business Participation Included Community Benefits Agreement Promoting 30% National Hiring Target of Disadvantaged/Dislocated Workers Evaluated and Scored for Best Overall Value with Two Step Process Technical Evaluation Safety, Security, Project Approach, Constructability Meeting Deadlines Technical and Cost Evaluation 30% Technical and 70% Price $2 Million Stipend for Losing Bids to Increase Competition
59 INTERNATIONAL COLLABORATION: Lessons Learned Peer Review Group TAP Technical Advisory Panels Revenue and Ridership Seismic Tunneling International Union of Railways (UIC) Performance Based Standards Partnerships with Other Countries Allows for Open Discussion about Best Practices for Financing, Construction, Operation and Maintenance of High Speed Rail United Kingdom, Germany, China, Japan, France, Spain, Belgium, Italy, South Korea
60 IT S HAPPENING!
61 STAY INVOLVED Terry Ogle, Director of Design and Construction (559) instagram.com/cahsra Central Valley California High Speed Rail Authority 1401 Fulton St Suite 200 Fresno, CA facebook.com/californiahighspeedrail twitter.com/cahsra youtube.com/user/cahighspeedrail
62 SAN MATEO COUNTY COMMUNITY COLLEGE DISTRICT S MIGRATION TO PROGRESSIVE DESIGN BUILD Presented by Chris Strugar Fritsch, Director of Capital Projects, San Mateo County Community College District
63 SMCCD History with Design Build SMCCD first California CCD to use Design Build AB 1000: Enacted in September Allowed Design Build to be used by five CCDs as pilot programs until December 2007 José Nuñez, SMCCD Vice Chancellor for Facilities and Jeff Gee, Swinerton Management Consultants lobbied legislature to approve AB 1000 Current California Education Code allows CCDs to use Design Build for project > $2.5M through 2020 SMCCD two previous Bond Measure Programs has constructed ~$400M of capital projects using Design Build Current Bond Measure Program using Design Build ~$250M
64 SMCCCD Practices Past District Two Step Practice Architect Develops Bridging Documents RFSOQ and RFP Process to Select Design Build Entity Design Competition Guaranteed Maximum Price (GMP) Established at Contract Award Current District Practice Migrating to Progressive Design Build RFP Qualifications/Best Value Selection Process No Bridging Documents No Design Competition Design Completed with College/District Input GMP Established After Design is Fully Developed, Agencies Permit Processes and Buyout Completed
65 Design Build Procurement Process Best Value Qualifications + Cost Request for Statement of Qualifications Employs evaluation criteria traditionally used for qualifications based selection along with a prequalification questionnaire based on the Department of Industrial Relations guidelines Allows for a larger pool of qualified firms to participate Request for Proposals Three highest ranked Design Build Entities are invited to participate Employs objective evaluation criteria as required per Education Code 81700; price, technical expertise, life cycle costs, skilled labor force availability, and acceptable safety record Allows for price or costs to be considered with qualifications
66 Reasons for Implementing Current Practice District Has More Influence on Design After Contract Award District Can Hire DBE Team that is Best Fit for College Improved Integrated Design Process Leverage IPD and Lean Construction Practices Improved Speed to Market Open Book/Transparent Cost Management Improved Competition
67 Proposal Renderings By Blach Construction/ELS Cañada College Building 1N Kinesiology and Wellness By Sundt/ELS By XL Construction/DES Skyline College Building 12N Environmental Science By Blach/Ratcliff
68 Thank You Chris Strugar Fritsch Director of Capital Projects (650)
69 THE CONSTRUCTION MANAGER S PERSPECTIVE Presented by David Kirn, Regional Executive/Justice Market Lead, Kitchell
70 The Construction Manager s Perspective Trends: Owner s are looking for better ways to deliver projects Do more with less Get more value than they expected Earlier understanding and control of cost and schedule Reduce risk and stress
71 The Construction Manager s Perspective Issues: Training and Education Consistency of Implementation Cost and Risk of Participation Industry Development and Expansion Team Consistency
72 The Construction Manager s Perspective Role of CM/Owner s Representative/Advisor in Design Build: Process Development to Implementation Developing Industry Interest Fair and Objective Administration Defining Project Criteria Value and Risk Management Stakeholder Coordination Project Acceptance
73 DESIGN BUILD SUCCESS Presented by Patrick Crosby, President and Managing Principal, Crosby Group
74 Design Build Success Procurement Method vs Cost One Step: Best Value Two Step: Quals Based - Best Value Progressive Design: Quals Based
75 Design Build Success Procurement Method vs Cost Sample Stipend: $100M is $250,000 (1/4%) Team Rate: $175/hr Team: Arch: 3 FTE, Struct: 2 FTE MEP: 4 FTE Team Cost: $273,000 / month
76 Design Build Success Keys to Success Do your homework Just say no Team early Surgically spend your time and money Develop a process to win
77 Design Build Success Winning Process Team Meeting after RFP issuance Each discipline presents their SOW Listen and Learn Develop the Design Team Meeting before final submission Listen and Learn
78 BREAK
79 PANEL DISCUSSION AND Q&A
80 CLOSING REMARKS
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