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Design & Build

 

Design Ė Build concept:

Design-Build means hiring a single entity for final design and construction, in lieu of the standard and proven practice of keeping the design process separate from construction contracting (design/bid/build). Design-Build is one of many innovative contracting methods. Itís been successful for many years in Europe on some types of transportation projects and is widely used in US and in Europe on plant and facility construction projects.

Design-Buildís attractiveness lies mainly in the promise of innovation stemming from the Designer/Builder collaboration. Traditionally, designers design the product the public wants, using their knowledge of construction methods and practices. Builders then take the plans and build accordingly. Possible design improvements during construction can become somewhat costly and time consuming since changes require change orders, new specifications, etc., and the designer's work is typically over with when construction begins. With the ideal Design-Build project, initial design takes place, designers obtain feedback from their builder partner, design proceeds further, construction begins, feedback continues, design is completed, and then construction is completed. If the process is applied to the right project with the right controls in place, the public gets a quality product in a shorter time.

The Advantages of Design - Build:

Saves money - A modified design-build approach can improve bidding process and decrease the amount of design needed.

Saves time - In projects where completion time is extremely important, and when other factors are present, Design-Build may be a viable alternative.

Provides creative solutions - Design-build approaches have enabled to use an innovative contract procurement method to obtain financing for projects.

Firm price at a very early stage - Another advantage of a design-build approach is that it provides you with a firm price for a custom-tailored program at a very early stage. This not only meets your needs, but the needs of the organization financing your facility.

 

Build-Operate-Transfer:

The build-transfer-operate (BTO) model was pioneered in the 1991 development franchise agreement for the SR91 Express Lanes in California (Euritt et al.. 1994, 24). Adapted from the more common build-operate-transfer model, it was designed to provide additional protection to the private sector from tort liability during the operation phase. In the litigious United States, concerns that inevitable accidents on the toll road during its 35-year franchise would expose the private sector to unacceptable risk prompted the state to assume ownership of the facility immediately after construction. Sovereign protections from liability protect governments from tort claims on public property, but do not apply to private developers (Lockwood 1995, 16). Instead of owning the facility during operations, the private sector enters into an operating lease before the facility opens to traffic.

 

Build-operate-transfer worldwide:

The build-operate-transfer (BOT) model is the oldest and most popular form of development franchise worldwide. Under this approach, the private sector acquires right-of-way or an existing facility prior to construction, makes improvements, operates and collects revenues under the terms of the agreement, and transfers the facility back to the public sector upon expiration of the franchise. Early infrastructure development charters evolved into the build-operate-transfer franchises used today. 

The BOT system is developing on all the continents and most countries in the world. This technique is used by governments for restructuring their economies, rationalizing the management of their economic services of general interest, financing and realizing infrastructures, get the local communities out of debt, ensure a better technical performance of the activities given in concession thanks to the assets and the know-how of the most qualified operators in the field related to wich they are called upon at the end of a negotiation or an open tender. One expects improved living conditions for the population whose needs in equipment and public utilities will therefore be better satisfied.

U.S. Roadways DBFO and BOT projects:

Many of the first U.S. roadways were privately financed by associations, users and the automotive industry. In some countries, concessionaires are used to allow corporations with mixed capital structure or privately owned corporations to finance, design, build and operate toll roads.

 

Team Approach Contracting

Before beginning with the pre-construction phase of a project it may help to understand some successful models and patterns of team approach contracting. The most popular technique is design-build, which is in essence a revival of the age-old building practice of single-point responsibility. Single-point responsibility contracting has deteriorated in the twentieth century as architects, contractors, and owners have lined up in opposite corners protecting their own interests. Frustrated customers and contractors are now delighted when they experience the benefits of team-approach contracting and often later seek out only builders that include this discipline in their services. Why? Because it works! Instead of allocating risk, the team members share risk. They sit around the project table and work toward the same goals instead of grabbing at each other's piles. So why are people reluctant to take the plunge? Our "consumer beware" society perpetuates an "us against you" mentality that grates against writing a cost-plus-type contract. Another reason is it requires a level of sophistication, leadership, and effort by the project's owner. When the owner is not capable or is ignorant on how to proceed, the contractor also may not be informed enough to "lead the leader" or to take charge.

Whether a project is architect led or contractor led, the design-build method sets up a team or partnership with the same goals. It avoids the resulting finger pointing of design-bid-build methods. Design-bid-build methods can become a two-edged sword when designers do not guarantee the outcome of the project. As a general contractor, if you are going to implement the design-build system you must understand and promote it. In most cases the general contractor will take the leadership position even if it is a "shadow leadership" supporting the owner. Most owners are ill prepared or too busy to put forth the effort required to initiate a design-build project. General contractors must display knowledge and abilities in management and leadership skills in order for owners to have confidence in their abilities and to want them as part of the design-build project delivery team.