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RICS APC > Design Economics & Cost Planning > Flashcards

Design Economics & Cost Planning Flashcards

1
Q

What is the 12 month look ahead in TPI

A

2.17%

Q3 2022 to Q3 2023

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2
Q

What has happened in the construction industry in the previous 12 months

A

“The TPI states prices have raised by 8.9%. However we have seen prices raise significantly above this.

material price fluctuations have been significant.

recent information suggests suppliers are concerned about the current market, supply, energy prices, interest rate increases, late payments

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3
Q

What is Net to Gross ratio

A

“Floor Plan efficiency rating

It is an indicator of rental value

Lettable space compared to overall”

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4
Q

What would be your typical exclusions from an estimate

A 
"VAT
S106 payments
Archaeological findings
Site acquisition costs
Road closure costs
Right of light issues
Survey and investigations"
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5
Q

What is whole life costing

A

“WLC - Improved the understanding of true life time financial impact of investment in a built asset

Up to 80% of lifetime cost are determined at the early stages of design (concept/spatial)”

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6
Q

What time period would you typically assume for LCC

A

This is dependent on the client. Be that conclusion of a lease, functional life of building, whole building life duration, time to first refurb etc.

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7
Q

What is value management

A

“It is an analytical tool Value Management isa creative, problem-solving.process that uses a methodical approach to include the necessary parties and, working together, to achieve the best solutions for value from construction.

It is based on cost time and function

EXAMPLE: what is the best mix of different sizes and types of housing units in a residential development? This will depend on issues such as local demand, relative construction costs and planning constraints”

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8
Q

What is passive design

A

Passive design works to maximise the use of natural sources of energy. Such as solar gains

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9
Q

What are the RIBA stage of work

A 
"0 - Strategic Definition
1 - Preparation and Briefing
2 - Concept design
3 - Spatial Coordination
4 - Technical Design
5 - Manufacturing and construction
6 - Handover 
7 - Use"
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10
Q

What is life cycle costing

A

“LCC is decision making tool looking beyond construction into the operational cost of a building

CROME
Construction
Renewal
Operational
Maintenance
End of life "
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11
Q

What is WLC

A

“WLC true financial impact of built asset include E/O CROME

Non construction costs
Income
Externalities”

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12
Q

What is the difference between WCL & LCC

A

LCC focuses only on the construction, maintenance, operation and disposal of the asset, whereas

WLC also includes client and user costs, such as project financing, land, income and external costs (those not born by parties to the construction contract – such as tenants)

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13
Q

What are the considerations or advice needed to give to clients on time cost quality and risk

A

They all cant be satisfied

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14
Q

How did you price on a £/m2

A

Based on benchmarked rates for example £1,900-£2,100/m2 for a house inclusive of uplifts

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15
Q

How did you price on a functional area

A

CP space, hospital bed, stadium seat

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16
Q

How do you benchmark

A

Logging all the agreed tendered rates for schemes, uplifting against location/ time to ensure comparable. Doing this based on scheme type

process of comparing similar schemes against one an other to ensure they are within the correct quantum/range

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17
Q

Who owns BCIS

A

RICS

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18
Q

What is BCIS

A

Leading provider of cost and price information

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19
Q

What is a feasibility estimate

A

Initial ROM estimate carried out at RIBA Stage 1

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20
Q

What is the difference between an estimate and a cost plan

A

“a. Cost Estimates
It is a high level exercise carried out at Stage 1&2 based on limited information
- Used for a business case
- Setting budget

b. Cost Plans
More detailed estimate carried out during RIBA stages 3&4. this is a plan to show how the funds will be allocated against developing deign”

21
Q

When do you issue a cost estimate or a cost plan

A 
"Cost estimate;
RIBA 1 - Preparation & brief
Cost plan;
RIBA 2 - Concept Design
RIBA 3 - Spatial Coordination
RIBA 4 - Technical design"
22
Q

How did you price a scheme at stage 3-4

A

“With a cost plan

Item rates - excavation, concrete footing, brick & block works, lean mix concrete, beam and block flooring, insulation DPM screed etc”

23
Q

“What is NRM

What are the volumes”

A

“New Rules of Measurement

NRM 1 - Order of cost estimating and cost planning for capital building works
NRM 2 - Detailed measurement for building works
NRM 3 - Order of cost estimating and cost planning for building maintenance works”

24
Q

How do you update for location factors

A

Location factor applied to adjust for location

25
Q

What is BCIS all in TPI

A

“BCIS all in Tender Price Indices

Is a cost indices that forecasts the cost increase in tender prices from the period in which an estimate is done to the SOS date”

26
Q

How do you calculate TPI increase

A

New number - Old Number =Difference/Old number *100%

27
Q

What other Indices are available

A

“RCI - Resource Cost Indices - Calculates cost increase on construction projects

OPI - Output Price Indices - Calculates cost increases on labour plant and materials”

28
Q

How do you allow for percentages, OH&P, Prelims & contingency

A

“Within our estimate we allow

Prelims - 13-15%
OH&P - 8-10%
Design Contingency - 3%
Professional fees 10%

For prelims if it a housing scheme we also pro rata the construction build rate to calculate the nr of weeks and apply a weekly run rate for prelims seen across other schemes.”

29
Q

What is a value for money statement

A

“VFM - It a brief tender report that provides the client with our recommendations for tender award.

This is not based on the cheapest it is based on the optimum price to deliver the scheme at the require quality.

”

30
Q

How did you compare the extra care scheme noted in your SOE to identify cost differences?

A

“Used our benchmarked rates for Extra care schemes

Ensured they were of a similar size and scope (We do a lot of works with the same client so were able to compare directly with schemes of the same scope)

This gave an indication of cost and identified where cost areas were high. Which allowed for further analysis of why e.g. curtain walling, atrium space”

31
Q

How do you compare schemes through benchmarking

A

As noted above comparing similar size and scope/ quality re base to location if required and uplift against BCIS TPI

32
Q

What is the typical life cycle of a house

A

70-100 years

33
Q

what is the typical replacement times for certain parts of a house

A

Roof - 40-50 years

Windows & doors - Min 20 years

Driveway - 15 min years

Fencing 10-15 years

Boiler 10-15

34
Q

What are the key headline factors of design consideration when designing and developing a scheme

A

“Time - Duration. When the client needs to make money from the scheme. Impact of delay (Legislation Part L&F)

Cost - What client can afford

Quality - What quality can be delivered in the time and the budget

Risk - What risk is the client willing to take”

35
Q

What is a wall to floor ratio

A

“Efficiency rating

Ratio of external wall area to internal floor area, shows efficiency of buildings

The lower the rating the more efficient the building 0.3W:F mean there is 0.3m2 of wall to 1m2 of floor area

0.4-0.5”

36
Q

what is a good wall to floor ratio

A

Anything below 0.5 is considered efficient

37
Q

What RIBA stage would you start NRM cost planning

A

RIBA Stage - Concept Design Stage 2

38
Q

What is included in your cost plan/estimate

A

“Cost Estimate

Front cover
QA Sheet
Content
Executive summary
Assumptions & Exclusions
Estimate

Cost Plan (As above but including)

VE Options
Cashflow
Statement of changes since previous issue”

39
Q

What do you do to market intelligence of other regions

A

“Re base based on location

Calculate percentage difference between location factors and adjust rate accordingly”

40
Q

How is Risk delt with through the cost planning process

A

“Through the five below options:

  1. Risk avoidance - Avoid risk/ design out, look at a different site etc
    • Risk reduction - Mitigate/ Change design, different material, different method, change strategy
    • Risk Transfer - Pass the risk to contractor
    • Risk share - Risk not fully transferred some risk maintained, Prov sum
    • Risk retention - Risk that cannot be controlled remains with the client.”
41
Q

What is the CPC TPI/inflation increase based on

A

“The CPC TPI forecasts is based on a survey that has been completed with contractors in the residential sector

Asking a series of questions such as;

  • Capacity/ order book % for upcoming years
  • Pipeline
  • Procurement trends
  • Inflation trends; OH&P, Prelims, sub con changes”
42
Q

What RIBA stage would you issue a pre tender estimate

A

RIBA Stage 4 Technical design

43
Q

What percentage variance in a PTE

A

5%

44
Q

What efficiency ratios would you use to understand the efficiency of a scheme

A

“Net to Gross - The variance between lettable areas and the overall area inclusive of communal, lifts, stairs etc.

Wall to floor - the efficiency of wall area to floor area more wall to floor area the less efficient.”

45
Q

What are some initial areas you would suggest for value engineering for a supported living

A

“Corridor width
Apartment size - NDSS
Removal of/ review of communal spaces
Façade review (curtain walling, cladding, etc)”

46
Q

Typical exclusions for a stage 2 cost plan

A

“VAT

Local authority costs

Abnormal services

Abnormal foundations

Post contract fees

Site acquisition costs”

47
Q

What is the difference between BCI & TPI

A

TPI - forecast increase in construction costs from estimate toSOS

Building Cost Indicies - measures the change in the cost to the building contractor of obtaining his input costs of labour and materials before adding his profit

48
Q

What is the current TPI

A

377

RICS APC (18 decks)

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