Construction Management near you

Washington's Department of Enterprise Services describes design-bid-build as a delivery method in which the owner contracts with separate entities for the design and construction of a project, and design-build as a system in which design and construction services are contracted by a single entity, used to minimize risks for the project owner and reduce the delivery schedule by overlapping the design phase and the construction phase. General contractor/construction manager sits between them: the contractor is selected early, usually on qualifications, and works alongside a designer who still reports to the owner.

For a house, that difference translates into something concrete. Design-bid-build gives you competitive pricing on a complete set of drawings and the least flexibility once the price is set. Design-build gives you one party to hold responsible and the least visibility into what the design is costing you along the way. Construction management gives you the builder's knowledge while the design is still changeable, at the cost of not having a firm number until later, and of paying for preconstruction work whether or not you proceed.

The two versions of the role look similar on a site and are completely different on paper. Under agency construction management, the manager acts as your representative: you hold the contracts with each trade, you pay each of them, and the manager coordinates. Under construction management at risk, the manager holds the trade contracts and takes on a commitment to deliver the work, usually for a guaranteed maximum price, which is why the arrangement carries the word risk in its name.

Public statutes show the machinery. Florida's construction management provision for public projects contemplates a governmental entity requiring the construction management entity, after competitive negotiations, to offer a guaranteed maximum price and a guaranteed completion date, or a lump-sum price and a guaranteed completion date, and requires the construction management entity to consist of or contract with licensed or registered professionals for the specific fields or areas of construction to be performed, as required by law. Those are the two questions worth importing into a residential negotiation: is there a guaranteed number and a guaranteed date, and who is licensed to do what.

It depends on the state and, more precisely, on whether the manager is contracting for construction or only advising while you contract. The statutes are worth reading on this point because they are broader than people expect. California defines a contractor as anyone who undertakes to, offers to undertake to, purports to have the capacity to undertake to, submits a bid to, or does himself or herself or by or through others, construct, alter, repair, add to, subtract from, improve, move, wreck or demolish any building or structure. The phrase by or through others is the one that matters: a manager who arranges for others to build is not automatically outside the definition just because they never pick up a tool.

Florida works the same way, defining a contractor as the person who, for compensation, undertakes to, submits a bid to, or does himself or herself or by others construct, repair, alter, remodel, add to, demolish, subtract from or improve any building or structure, and dividing licensed contractors into Division I and Division II categories. Its public construction management statute separately requires the construction management entity to consist of or contract with licensed or registered professionals for the specific fields or areas of construction to be performed, as required by law.

So ask two plain questions before signing. Will this firm hold any of the trade contracts, or will I? And what license does the firm hold in this state? Then check the answer with the state licensing authority rather than with the firm. A manager operating in the agency model in a state that licenses contracting may be perfectly legitimate, but the answer should come from the regulator, not from a brochure.

A construction management proposal generally separates into a preconstruction fee, a management fee, general conditions and the cost of the work, plus a contingency. Each of those is negotiable and each hides a different question. The preconstruction fee should say what it buys and how many estimates it includes. The management fee should say whether it is fixed or a percentage, and if a percentage, of what. General conditions should be an itemized list of site supervision, temporary facilities, protection and cleanup rather than a single lump. And the cost of the work should be defined in writing, because the argument at the end of a cost-reimbursable job is almost always about whether a particular expense belonged in the fee or in the cost.

Contingency deserves its own paragraph in the agreement. Ask whose contingency it is, what it may be spent on, whether you are told before it is drawn down, and what happens to whatever is left. On a guaranteed maximum price arrangement, ask what happens to savings below the ceiling. These are ordinary commercial terms on large projects and are frequently left vague on residential ones, which is precisely where the disputes come from.