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New Construction Methods

For many years, the standard design/bid/build approach has dominated the construction industry. More recently, however, new construction methods have been developed that are starting to make a greater impact around the world. These new construction methods allow for greater flexibility for the owner and, possibly, greater efficiency and cost savings.

One of the new construction methods is the design-build process. Largely unheard of a decade ago, design-build is becoming one of the fastest-growing new construction methods. In the traditional design/bid/build approach, the property owner hires an architect to come up with a building design, then trusts the architect to work with them as they put the project out for bid. The lowest bid offered by a construction company gets them the job, whether or not they have any experience working with the owner or the architect.

The design-build process is used by those who believe an architect-contactor team with a past history of working together would be more efficient and, as a result, cheaper than an architect and contractor working together for the first time. The owner simply knows they want a project completed and leave the design up to the bidders. When the bids are delivered, the owner has the opportunity to pick the team with the best design and price combination--or, the best design.

The construction manager at-risk (CM at-risk) method is another one of the new construction methods taking hold in the industry. The CM at-risk method falls somewhere in between the design/bid/build and design-build methods in terms of the relationship between the contractor and the architect. While the owner does hire the architect, the role of the contractor is expanded in comparison to the design/bid/build approach. The contractor is involved with the project during the pre-construction process and serves as the owner's representative during the period between initial design and construction begins. The contractor's fee comes in the form of the Guaranteed Maximum Price (GMP), which covers pre-construction and building services. The owner has the option to accept the contractor with the lowest GMP or one that they feel offers the most complete proposal.

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