Top-notch science buildings, epitomizing the success of the design-build approach, are evident around the campus. One example is Hewitt Hall, a 78,000-sf medical research facility, featuring a general clinical research center and BSL-3 laboratory. Being able to complete complex building projects in a timely fashion and within budget is especially important to a university dedicated to cutting-edge research. A rapidly growing campus that accommodates more than 25,000 students, 1,800 faculty members, and 8,600 staff employees requires the most modern research facilities, teaching resources, office buildings, student housing, and infrastructure.

Currently, numerous projects totaling $1.3 billion are in development, including the UCI Medical Center Hospital, a $400-million acute care teaching facility. Construction of the hospital, which is 70 percent complete and below anticipated budget, began in June 2005. The schedule calls for the construction to be completed at the end of 2008 with training and move-in to be completed by May 2009.

Other projects under way are research laboratories and vivariums at a cost of $285 million; student housing, $190 million; office buildings, $130 million; parking structures, $88 million; student center expansion, $71 million; central plant expansion, $60 million; seismic retrofit, $30 million; and roads, $10 million.

“There isn’t too much that we don’t do as an integrated delivery or design-build on the Irvine campus,” says Rebekah Gladson, associate vice chancellor and campus architect. “The most difficult aspect of transitioning to a design-build process was getting the team 1,000 percent committed to this approach. It represented a cultural shift because we had to educate the administration, the deans, the faculty, and the students about the design-build process.”

Decision Metrics

Deciding to utilize design-build was the brainchild of Gladson when she began working at the University in 1992. There were many factors that figured prominently in the decision. Prior to her becoming campus architect, almost 70 percent of the construction projects at UCI were in litigation as a direct result of improperly administered contracts, poorly coordinated drawings, and a general lack of a cohesive team approach.

“The decision metrics that went into this included the need for an integrated team delivery that would move us into a partnership rather than an adversarial, low-bid relationship, which is what the University had been experiencing,” says Gladson. “We also wanted to have a partnership on the performance outcomes in order to align the entire team with common goals and values as to the final project.”

Design-build facilitates value-based selection, eliminating the problematic awarding of contracts based solely upon the lowest bid. In addition, this integrated project delivery can result in an annual savings in cost escalation of between 10 and 12 percent by reducing the overall schedule duration.

Measurable Benefits of Design-Build

According to Gladson, the overall project duration can be reduced by 25 to 35 percent, depending on the type of design-build utilization that is implemented. This means that if a $20-million, four-year project is reduced by just 25 percent, it could slash a year off the schedule and result in a $2-million savings, assuming an annual escalation of 10 percent.

The decision to start using design-build was also driven by the University’s desire to reduce legal claims and to reallocate potential project risks. Using design-build translates to a more efficient coordination of drawings and a subsequent decrease in the likelihood of legal claims. Therefore, a five percent construction contingency on a normal project that does not result in litigation drops as low as 1.5 to 2 percent, producing additional savings.

The integrated team delivery supported by design-build creates not only savings, but also new ideas, the development of an integrated team, and enhanced problem solving. While these benefits may be a bit difficult to quantify, they are an important part of the equation for successful project completion. The University typically saves between five and 10 percent in incremental innovations.

The integrated team approach has resulted in improved staff retention and the absence of any new lawsuit being filed since 1992. The University has realized substantial savings by not having to pay claims and legal fees. Project concerns are resolved using a team approach where all key players are focused on the central goal of achieving a successful resolution in the best interest of all parties.

The design-build team owns the project coordination and can easily and effectively handle change orders without causing substantial project delays or budget overruns. One staggering example shows that 11,000 potential changes or concerns on the UCI Medical Center Hospital project were resolved using a 3D modeling system on paper rather than hindering production in the field.

Industry Trends Driving Design-Build

A study conducted by Pennsylvania State University and the University of Texas at Austin shows a decline in the use of the traditional design-bid-build delivery model from about 82 percent of projects in 1985 to about 41 percent in 2007. Construction management has remained flat at approximately 10 to 15 percent during that same time period. However, the number of projects completed using design-build has climbed significantly from one percent in 1985 to nearly 50 percent today.

A historical perspective of construction projects completed many decades ago reveals that there was no separation between the architect and contractor for most of recorded history. The Taj Mahal and the Egyptian Pyramids represent examples of design-build, but specialization of roles began during the Industrial Revolution with the formation of guilds and the separation of trades. This separation results in many different perspectives and the lack of both a team effort and integrated project delivery.

Design-build began to re-emerge in the 1970s on a limited basis. Using this approach requires the merging of cultures and philosophies, while addressing legal issues, cost accountability, risk transfer/management, and separate agendas of many stakeholders, including the owners, regulatory agencies, contractors, and design professionals. Owners typically want to transfer risks, regulatory agencies demand adequate time for review, contractors are motivated by profit and calculated risks, and design professionals shy away from risk.

“The best time to manage the process with integrated delivery is at the beginning of a project during planning and conceptual design because that is where you will have the biggest impact,” says Gladson. “As you move through design, bidding, fabrication, and installation, your influence decreases and your costs increase.”

UCI’s Approach to Project Delivery and Proposal Selection

UCI uses two variations of design-build to achieve integrated project delivery. The first model is a bridged design-build and the other is the design-build criteria process. During the bridged design-build process, the owner develops an initial concept and a program with budget specifications, then creates a schematic design, and some percentage of the design of development drawings. Design-build teams submit a technical proposal plus total cost of their proposal. Proposals are evaluated based on merit and part one of the contract is awarded for the completion of design development documents with the second part of the contract being for the actual construction. In the design-build criteria process, the owner develops the program and pre-qualifies the design-build teams that create the proposal, which is evaluated, and then moves to the construction drawings and actual construction. The difference between the two models is how many drawings are developed prior to seeking bids.

The contractual relationships vary slightly between the models. With the bridged design-build, the owner can develop the pre-bid documents using a design team of architects and engineers. The documents can then be put out to bid to the pre-qualified teams, consisting of specialty contractors and architects/engineers who work for the design-build team. There is a single source of responsibility with a peer review in the bridged model. In the design-build criteria model, the owner contracts directly with the design-build team members based on their criteria. The team is comprised of design consultants, specialty contractors, and suppliers.

Using bridged design-build can result in a 25-percent reduction in the entire project duration because time is needed to develop the preliminary documents. A 35-percent reduction can be achieved when the single source team develops the entire project and the specifications are put out for proposal through the design-build criteria method. The Pennsylvania State University study shows that the delivery speed is more than 33 percent faster using design-build rather than design-bid-build. Using design-build vs. design-bid-build also equates to a unit cost that is 6.1 percent lower, construction speed that is 12 percent faster, cost growth that is 5.2 percent less, and schedule growth that is 11.4 percent less.

UCI’s design-build concept proposal is structured with two components. The technical component includes schematic design drawings, outline specifications, model of project, renderings, and a statement that the program and design standards have been met. The cost component consists of the lump sum cost, specified alternatives, and the cost breakdown.

“The two components are submitted separately and at different times,” says Gladson. “The cost component would come in two or three days after the technical component, so that the design-build team can actually give the appropriate price for the design they are submitting.”

The successful bidder is determined by dividing the cost proposal by the points in the technical proposal. The bidder with the lowest dollar amount per point is successful. The important corollary is that a stipend is paid to all responsive design-build teams and the lowest dollar amount is not the determining factor in the proposal selection.

UCI’s bidding process begins with the issuance of a request for proposals stating the maximum allowable contract amount and then pre-bid conferences are held with pre-qualified teams. Confidential discussions are held to talk about proprietary information in the proposal. An addendum is issued to specify any changes to the program, scope, or performance.

A proposal is submitted and evaluated as part of a blind technical review. The technical evaluation team, comprised of between 10 and 12 people with varying backgrounds, develops the technical score of the project. A public bid opening is held, but numbers and points are not discussed at the bid opening. If the project is not within the maximum allowable contract amount, the criteria are revised and persuasive discussions are later held before the best and final offer is submitted.

“Although we hit very high escalation in 2004, 2005, and 2006, we have not put any projects on hold,” says Gladson. “We have been able to move forward with every project, which is not true for many owners that are not using an alternative delivery method such as design-build.”

A two-part contract is always used to provide an option-out in cases where the service, quality, or relationship is not consistent with the proposal. In such cases, the submittal process comes to a halt. Part one is the development of five to 10 packages featuring design development drawings and specifications. If things go well in the first part, the second part commences with the construction drawings/specifications and actual construction.

Making Design-Build Work

Certain management principles and values must exist in order for the design-build method to be successful. There must be clear leadership with defined goals and responsibilities, as well as a communication plan, a commitment to teamwork by all stakeholders, ongoing training for in-house staff, the ability to draw upon the expertise of others, a refusal to compromise on quality or function, and an appropriate allocation of risk. The owner must assume risk for the program, site information, design criteria, quality standards, and post-bid program changes. Meanwhile, the design-build team carries the risks related to performance, schedule, cost, and quality.

UCI has developed core documents and contracts that define design standards. Quality control is achieved by utilizing many tools, including full-size mockups that are incorporated into documents to convey a clear understanding of expectations. It is also critical to be clear and concise regarding expectations on proposal compliance, program compliance, future building flexibility, team management, and field management.

Challenges related to the design-build process include the experience of the owner’s staff, the contractor’s ability to manage and work with design professionals, and a mutual alignment of goals and values. It is important to have a mutual understanding of quality by the contractor, architects, and engineers. There should also be provisions for the buy-out of specialty contracts. Drawing development, risk management, and schedule management must be considered within the confines of limited budgets and market conditions.

“UCI has built a team where we are all committed to one goal and one outcome,” says Gladson. “It takes a team effort to make the design-build delivery process work.”

By Tracy Carbasho

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