Whether renovating a building, constructing a tenant improvement, or building a new headquarters from scratch, implementing the design and construction process is hard. An industry veteran offers seven tips to make it easier:
Tip One: Hire a Quality Consultant Team
Newbie construction clients often make the mistake of shopping for consultants based on price rather than on reputation and competency. Experience has shown time and again that clients generally get what they pay for. There is shockingly no bottom to quality (nor seemingly on price) whether upon ordering existing conditions reports for soils or environmental contaminants, hiring an architect to do the design, or hiring the engineering specialists who collaborate with the architect. The higher quality of design a client will get by paying adequately will translate to higher marketability for the sale or lease of commercial projects, higher morale for the end users, and a better civic environment overall. A higher quality of engineering will result in lean and efficient (rather than overdesigned and expensive) building systems. A higher clarity and accuracy of construction documents that a competent consultant team will produce will reduce expensive adjustments (change orders) during the construction process and facilitate a streamlined path to project completion. In contrast, hiring a bargain basement firm will typically translate to the project being produced by less experienced staff, reduced senior oversight, and fewer hours expended. When evaluating risk against benefit, one should factor in the likelihood of receiving sloppy work leading to more errors and haphazard results.
For laypeople, what building architects and engineers actually do behind the scenes is a bit of a black box. It is easy to assume the process involves pulling an existing work product out of a virtual file cabinet and reselling it as a commodity. This is not how the good firms produce work. A truly professional firm will expend often thousands of staff hours, producing a bespoke project designed and engineered expressly for a client’s unique mix of requirements.
Tip Two: Don’t Overload the Effort with Multiple Layers of Management
Bureaucracy is the enemy of efficiency but, less obviously, it is the enemy of quality as well. The best way to get great results is to make sure you are hiring the “A” team to execute your project. Installing management layers to oversee your way out of a “C” team’s mediocrity is like squeezing blood from a turnip. Once work is done wrong, the process of correcting it requires both identifying that a problem has occurred and then cycling through a costly sequence of steps to execute the fix.
The above vicious cycle also appears inside large architecture and engineering firms, often whom departmentalize their staff into project managers, aesthetic designers, technical designers, and sales-focused studio marketers overseeing a lot of burnt-out “B” and “C” team staff below. How many architects does it take to screw in a light bulb? Large firms dogpile their specialists and will tell you at least three. Don’t believe them. The slightly misaligned agendas between departments will not benefit your project. Offices carrying the overhead of an assembly line infrastructure (which departmental models try to emulate) neither facilitate personal attention, nor quality. These are more an attempt to push product out the door in volume through an arguably obsolete “in-the-box” idea of how it should be done.
Tip Three: Look for an Architect Whose Biases Match Your Own
In the roughest of measures, architectural firms fall into three camps: 1. High Design. 2. Service-oriented Corporate Firms, and 3. Hacks.
I get it, low ball fees are enticing, but never hire hacks who are in the business of “producing plans.” The work may be worth the paper it is printed on, but that might be about it. Service-oriented corporate firms themselves range in a spectrum between hack-ish and high design but the right one could be an excellent fit if the client is a corporation or institution. With large firms in this camp, a downside is arguably an excess of middle management and office overhead costs added to a project which will soak up the team’s allotment of project execution hours with few tangible results.
The stereotypical High Design firms are smaller practices filled with underpaid young interns, and led by experimentally-focused college professor types. This results in beautiful work for which it is not inconceivable the roof will leak or other defects might carry through that could be avoided with an experienced and reasonably compensated team. You may be shocked to hear it takes roughly 25 years of hands-on experience for an architect to gain mastery over the design, technical, and management aspects of producing buildings, which have a tremendous number of moving parts. I know of no good shortcuts available to a recent graduate nor a more purely academic and experimentally-focused one.
It is possible to address the shortcomings of high design firms and service-oriented corporate firms by hiring both in combination: the high design firm for the early phases of the project and the service-oriented firm for the latter phases. The problem with this model is the necessary overlap of services in the middle Design Development phase, which adds to overall costs, as well as potential communication disconnects that will result in the high design architect’s intent being mistranslated or compromised.
There is a actually a fourth camp and those are the rare architects who have experienced and understand the pitfalls of the other camps’ approaches and endeavor to strike a holistic blend between high design, client service orientation, and the requisite 25+ years of broad experience to gain mastery. If a client can find one, they should hire one of those. The result will be a thoughtful balance of budget, function, aesthetics, constructability, and responsive service.
Tip Four: Avoid Negotiating Your Way Into a “Nickle and Dime” Services Contract
Life in the trenches has taught me so many things. With regard to design fee negotiations, it’s that it is commonplace for the service-oriented design firms to fall over themselves to undercut one another on lump sum fees in order to win a contract, at least one that is high profile and strategic. On the inside of the “black box,” the end result is that all internal contingencies have been squeezed out and this becomes a setup for repeated “nickel and diming,” i.e. charging for small extras, to avoid unprofitability. A savvy client should ask what percentage of hours contingency is being held, if it’s 0%, the client should either hold their own contingency, fully expecting to be “nickel and dimed,” or require the design firm to hold one. About a 12% internal design budget contingency is a good practice.
Tip Five: Don’t Procure Construction Contracts By Low Bid, Unless You Have to (or You Really Trust the Awarded Contractor)
Understanding that publicly-funded institutions may have no option but to procure construction contracts based on lowest initial cost as the prime metric for award, the pitfalls of this approach are many. Because the construction industry commonly treats the low bid price as a foot in the door rather than the final price, post award change orders are the name of the game. And a game it is, exacerbated further when low quality construction documents enter the mix. Any ambiguities, inconsistencies or, heaven forbid, mistakes in the construction documents become added costs at double or triple the market price. Potential stop work claims become a key leverage point to pick up nearly extortionate added costs. If you are a public agency forced to procure work in this manner, plan to spend at least 7% of the cost of construction at the front-end in order for the architecture and engineering team to produce accurate, and highly detailed construction documents structured specifically to reduce the quantity of change orders to a minimum. Shaving costs at the front end (by cheapening the quality of the construction documents) merely makes costs pop up in even higher amounts at the back end.
Architecture and engineering fees on privately-funded projects are normally vastly lower, roughly half that of public projects, but the end result, by the nature of spending less money, is a lighter set of construction documents with more interpretation required of the builder. One sad phenomenon that works against a client’s interest is a broad movement toward general contractors acting more like brokers rather than builders. Part of this dynamic is the Request for Information (RFI) process occurring during construction, in which the interpretation of missing information is pushed back to the architecture and engineering team, but not always innocently so. The RFI becomes the first step toward an upward cost adjustment (change order) when a self-serving contractor is paired with an inexperienced architect or one who has produced sloppy work.
Tip Six: To Reduce Heartache, Consider “Cost Plus” or Design Build Construction Contracts
Arguably the fairest method to secure a construction contract is on the basis of Cost Plus. In this mode a client finds the most qualified builder they can, bringing excellent client referrals, and negotiates a fee both parties can live with. The fee will be the markup (the “plus” of Cost Plus), similar to a brokers fee. The builder’s subcontract costs are “open book” and transparent to the client. Expect these general contractor fees to be in the range of about 2.2% of the construction contract for large projects to 10% for the smallest projects. In addition, the construction industry typically passes through General Conditions, i.e., the costs of salaries, equipment, and overhead for the on-site construction management team which on large projects can be in the six figures every month.
There are instances, especially on commercial development projects when plans are being resolved and completed in parallel with the construction progress, for example, because of an urgent completion deadline tied to the start of a commercial lease. A Cost Plus arrangement is absolutely essential in this delivery arrangement and it is not a playground for the faint of heart. Normal cost controls have essentially gone out the window when time and quality have become the priority concerns. Professional project managers will be familiar with the so-called Cost Quality Time Triangle in which Nature dictates only two of the three priorities may be held firm and the other is always sacrificed no matter how smart the manager may think they are.
Design Build has become a popular construction contract arrangement in which the builder hires the architect and engineer team under their umbrella. This arrangement insures that post-award change orders will be limited to what are called unforeseen conditions which are physically obscured elements which would not reasonably be uncovered before construction starts. Examples of these are underground archeological finds or undocumented underground utilities. The downside is the potential to hire the wrong builder to lead the team. A builder who isn’t sensitive to design quality and is used to producing low quality work, will stifle the ability of architects and engineers under them to enforce best practices. This is never the case when the architects and engineers are third parties and retained by a client to administer the construction works against the work defined in the construction documents.
Tip Seven: Keep the Architects and Engineers Fully Involved Through Construction
Having worked with many highly regarded general contractors who have an industry reputation they wish to maintain and protect, I am still occasionally shocked on projects when a lesser-known general contractor wins a project and convinces a client to keep the architects and engineers out the full loop during construction. The administration of the construction contract is described in the industry standard American Institute of Architects A201 General Conditions of the Contract for Construction. I highly recommend these be included by reference, in a construction contract of any significance, as these terms will provide reasonable assurance that the construction work you paid for is what you receive in exchange. Clients should be wary of offers to build a project under budget by eliminating “unnecessary” architectural requirements. This will trigger an implicit release from the contract requirements and the contractor will always be the greater beneficiary, not the client, of any so-called cost savings. Such a self-serving attitude often carries through to poor performance in finishing up the work or in correcting problems after occupancy.
