Design economics and cost planning Flashcards
(146 cards)
1
Q
What is the difference between an order of cost estimate and a cost plan?
A
An order of cost estimate is crafted in early design stages and relies on cost per m2/sqft or functional unit, while a cost plan offers a detailed breakdown through measurements, rates, and assumptions.
2
Q
What is the pivotal role of cost planning in projects?
A
The pivotal role of cost planning is maintaining financial control over projects.
2
Q
At what stages of the project is an order of cost estimate typically crafted?
A
An order of cost estimate is typically crafted in early design stages, specifically Stage 0-2.
3
Q
Why is precise cost estimating important?
A
Precise cost estimating is important because it impacts project feasibility.
4
Q
What are some examples of efficiency ratios?
A
Examples of efficiency ratios include wall to floor and net to gross ratios.
5
Q
What stages of the RIBA Plan of Works have you contributed cost plans and order of cost estimates to?
A
Various stages of the RIBA Plan of Works,
6
Q
What tasks did you undertake at Citi Bank pretender?
A
Successfully completed pre-tender estimates for several trade packages.
7
Q
What did you do at Triton Square during RIBA Stage 3?
A
Meticulously measured fit-out elements and secured rates for each line item from diverse sources.
8
Q
How do you ensure accurate and current costs in your projects?
A
By consistently market-testing different project items, such as structural alterations to office buildings.
9
Q
What aspect of cost plans have you provided counsel on to clients?
A
Different specification options
9
Q
How have you organized package cost information for AECOM’s internal benchmarking software?
A
By formatting it into a compatible format for personal or company-wide use.
10
Q
Can you provide an example of your value engineering expertise?
A
Proposing cost-effective options to enhance value, such as replacing joinery dividing screens with part-height drywall partitions and reducing bespoke acoustic paneling within meeting rooms.
11
Q
How do you contribute to managing post-contract design changes?
A
By managing and reporting them through change control processes and contributing to the preparation of monthly cost reports.
12
Q
Can you provide an example of advising a client on component life-cycle costing?
A
Recommending a high-spec carpet over a medium-spec one to align with their lease duration.
12
Q
How did you enhance cost accuracy during the Stage 3 cost estimate for The Citi Bank Project?
A
By maintaining regular communication with the design team and making informed assumptions on specification and finishes when necessary.
13
Q
How did you present the Stage 3 cost estimate for The Citi Bank Project to the client?
A
Meticulously, elucidating the impact of design developments on the estimated project cost and advising on assumptions and exclusions.
14
Q
What did you develop to enhance cost accuracy?
A
A workplace fit-out rate database leveraging tender return information from various projects.
15
Q
ow did you ensure clients remained well-informed about project costs during the design of the Executives Cloud Lounge at Citi Bank?
A
By continuously updating the estimate as design changes unfolded and adapting to varying levels of design information.
16
Q
What approach did you take to empower clients to make informed decisions during the design phase of the Executives Cloud Lounge at Citi Bank?
A
Providing estimates based on initial designs and continuously updating them as design changes unfolded.
17
Q
When is a cost estimate typically prepared in the design process?
A
Between RIBA Work Stages 0 to Stage 2.
18
Q
Why is a cost estimate prepared earlier in the design process?
A
Because the level of design information is more limited at this stage.
19
Q
On what basis is a cost estimate prepared?
A
On a cost per m² or cost per functional unit basis.
20
Q
When is a cost plan typically produced?
A
At each RIBA Work Stage from Stage 2 onwards.
21
Q
How does the level of design information affect the cost plan?
A
As the design progresses, more detailed information is included in the cost plan.
22
How is the cost of the development broken down in a cost plan?
The estimated cost is broken down elementally into components such as sub-structure, superstructure, services, and professional fees.
23
What is cost?
The cost is the total cost of labour, plant, materials and management deployed for a specific activity.
24
What is price?
The price is the amount a purchaser or client will pay for an item or product and is made up of the cost
plus the main contractor’s profit margin.
25
How do you proceed if the cost plan exceeds the project budget?
* I would analyse the costs to assess the source of the increase and identify whether any element of work is abnormally high against the order of cost estimate.
* When the reason for the overspend is identified I would then look to propose value engineering
options to my client and design team to bring the forecast back in line with the project budget.
26
What is buildability?
Buildability is harnessing the contractor’s expertise and knowledge during the design stage to generate
ideas for effective and efficient methods of construction.
27
What are the advantages of buildability?
* Buildability can result in better programming, sequencing and construction methods.
* A quicker more efficient programme can be achieved.
* Reduced capital and life cycle costs of the building can be obtained.
* The quality in the finished building’s performance and maintenance characteristics can be improved.
28
What is a wall to floor ratio?
* This shows the relationship between the wall area and floor area.
29
What is the wall to floor ratio used to show?
The cost efficiency of the building.
30
What is best a low or high wall to floor ratio?
The lower the ratio, the cheaper the building is to construct as there is less external envelope to
construct in comparison to the floor area.
31
What is the most efficient floor plan shape?
In theory a building with a circular floor plate building would offer the most efficient design as there is
less wall to floor area.
32
Why would a square floor plate be used over a circular floor plate?
A circular floor plate has a poor lettable floor area and is difficult to fit out therefore a square
floor plate is considered to be the most efficient.
33
How would you prepare an estimate for M&E works?
I would ask an M&E specialist surveyor to undertake the estimate.
34
How would you prepare an Feasibility estimate for M&E works?
For feasibility estimates the M&E amount would be included in the m2 or functional unit rate.
35
What is a Section 106 agreement?
S106s are agreements between local authorities and developers that are negotiated in the context of
granting planning consent.
36
What is shell and core?
Shell and core is the basic structure, services and envelope of the building.
37
What does construction to ‘shell and core’ include?
This normally includes the fit out of landlord and common areas for example the reception, toilets, lifts
& stair cores.
38
What is a CAT A fit out?
CAT A is also known as a ‘developer’s fit out’.
39
What does a CAT A fit out provide?
CAT A is also known as a ‘developer’s fit out’.
40
What is included in a CAT A fit out?
Generic fit-out items to suit most developers for example life safety elements and basic fittings such as suspended ceiling tiles, raised floors, carpets, lighting and power distribution to floor plates.
41
What is a CAT B fit out?
A CAT B fit out overlays the CAT A provision with bespoke elements that are specific to the needs of
the building’s user to enable the tenant to occupy and use the space.
42
What would a CAT B fit out typically include?
partitions, power distribution to floor boxes, data cabling, artwork and branding, upgrading CAT A finishes and toilet finishes.
43
Where could you find the definitions of CAT A & B fit out ?
The British Council of Offices (BCO) fit-out guide.
44
What is BWIC?
BWIC accounts for the Main Contractor to perform any drilling, fixing, cutting and penetrations to
enable the services installation.
45
What does BWIC stand for ?
Builders Work In Connection and is usually set as a percentage of the services cost.
46
What is an order of cost estimate?
Under NRM this is described as the determination of the possible cost of a building early in design
stage in relation to the employer’s fundamental requirements.
47
What is the purpose of an order of cost estimate?
To establish if the proposed building project is affordable and, if affordable, to establish a realistic cost limit.
48
When does an order of cost estimate take place ?
This takes place prior to preparation of a full set of working drawings or bills of quantities and forms the initial build-up to the cost planning process.
49
What is a cost limit ?
The cost limit is the maximum expenditure that the client is prepared to spend on the proposed
building project.
50
In what formats can a feasibility estimate or order of cost estimate be presented?
On a cost per m², functional unit, or elemental basis.
51
How might a feasibility estimate or order of cost estimate be expressed?
It may be presented as a range, for example, £700-£850/m².
52
What main building elements might be included in the element rates of a feasibility estimate?
Substructure, Frame, External Walls, Upper Floors, and Roof.
53
What site-specific factors are considered in a feasibility estimate?
Site abnormal costs or enabling works.
54
What additional factors are included in a feasibility estimate?
Preliminaries, Contingency, Inflation, and location factor adjustments.
55
What is a functional unit?
A functional unit is a unit of measurement that considers the prime use of the building.
56
Please give an example of a functional unit?
For example in the construction of a hotel or hospital the functional unit may be presented as a cost
per bedroom or cost per bed.
57
Where would you get your rates from for a preliminary estimate?
* Previous similar projects and historical cost data
*Spons, the Building Cost
Information Service or specialist contractors.
58
What does a cost plan show?
It shows how the design team proposes to distribute the funds available on the different elements of the proposed building.
58
What information do you need to be able to carry out an order of cost
estimate?
* Building Location.
* The type of building.
* Floor area or number of functional units.
* Storey height.
* Indication of specification and quality.
* Budget & cashflow constraints.
* Site conditions, probable ground conditions.
59
How do cost consultants use cost plans?
to control the development of the design.
60
What is a cost plan?
The cost plan presents the estimated cost of the development into an elemental or functional format.
61
What is the purpose of a cost plan?
It identifies the client’s agreed cost limit and how the money is to be allocated to the different elements
of the building.
62
When is a formal cost plan typically issued?
Between RIBA Work Stage 2 to Stage 4.
63
What happens at RIBA Work Stage 2 regarding the cost plan?
The Concept Design is made available and the cost plan may be produced at a fairly high level, broken down into different elements of the building based on an outline specification and Architectural concept drawings.
64
How is the cost plan refined at RIBA Work Stage 4?
The technical design is made available, and the cost plan is updated to reflect the Architect and Engineering technical designs. Specialist subcontractor designs may also be included to refine project costs.
65
What is done at RIBA Work Stage 3 in relation to the cost plan?
Spatial coordination of the building is undertaken, the schedule of accommodation may be adjusted, and the cost plan is updated accordingly.
66
What is the role of the cost plan at Stage 4?
It typically forms the basis of a pre-tender estimate to compare against tender submissions, although this is no longer referenced within the RIBA Plan of Work.
67
What are the principal components of a cost plan?
* Construction costs.
* Preliminaries.
* Contractor’s OH&P.
* Contingency.
* Inflation.
* Assumptions.
* Exclusions.
* Area Schedule.
* List of Drawings & Specifications adopted.
68
Name the main elements of an elemental estimate - Substructure
Substructure.
o Excavation
o Disposal.
o Foundations
69
Name the main elements of an elemental estimate - Superstructure.
Superstructure.
o Frame.
o Upper floors.
o External walls.
o Roof.
o Internal finishes.
o Services.
o External works.
70
What is usually excluded from a cost estimate?
* Professional fees.
* VAT.
* Client decant costs.
* Loose fixtures and fittings.
* Inflation.
* Site acquisition costs.
* Section 106 Agreement.
* Removal of asbestos.
71
Why is VAT excluded?
Because different clients will incur different levels of VAT, for example charities may not be subject to
VAT.
72
Would i be able to advise on VAT?
We would not be in a position to know the correct rate unless informed of it.
73
How is contingency typically included during the early design stages?
As an overall percentage of the cost estimate, around 5%-10%.
74
What is contingency?
A sum included within the estimate to cover unknown expenses or unmitigated risks during the
project.
75
What should the amount of contingency reflect?
The risks and unknown specific items associated with the project.
76
How are items on a risk register assessed for contingency?
Each item is assigned a probability and cost impact.
76
What tool is used to assess contingency as more design information becomes available?
A risk register.
77
How is the total project contingency determined using a risk register?
By including the total cost of the risk register items as the project contingency.
78
How do you take account of inflation when preparing a cost estimate?
I take into account inflation through the use of Tender Price Indices and include adjustments for
Construction Inflation and Tender Price Inflation.
79
What time period would Construction Inflation be included for?
I would allow for Construction inflation from the anticipated start of the project to the mid-way point
of the project.
80
What time period would Tender Price Inflation be included for?
I would allow for Tender Price inflation from the estimate base date to the anticipated tender return date.
81
What is meant by the base date within a cost estimate?
The base date refers to the date on which rates and prices contained within a cost estimate are based
on.
82
How can base dates be used?
The base date can be used as the starting point from which inflation would be adjusted.
83
What does TPI stand for?
Tender Price Indices.
84
What do TPIs show?
They reflect changes in the level of tender prices over a period of time.
85
Where can you obtain Tender Price Index information from?
AECOM produces its own in-house tender price forecasts.
86
Why do you need to take account of location in regards to TPIs?
Inflation needs to be accounted for to anticipate the changes in the prices of labour, plant and materials. This is to ensure accuracy of the estimate.
87
What does BCIS stand for?
Building Cost Information Service.
88
What is BCIS?
The BCIS provides construction cost and price information through publications, online services and
price books.
89
Where do you get cost information from?
* Previous Tender Submissions.
* Previous Contract Sum Analysis.
* Benchmarks.
* BCIS.
* Building cost models.
* SPONS and other price books
* Specialist sub-contractors and suppliers.
90
What are two price books that you know of ?
SPONS & Laxtons
91
What does VE stand for ?
Value Engineering.
92
What do you understand by the term VE?
a reactive procedure to bring the anticipated cost of the development back in line with the project budget
when a potential overspend is identified, taking into
account the clients objective
93
What does VM stand for?
Value Management
94
What is value?
Value is a measure of worth taking into account the overall usefulness and benefits that are delivered in
relation to cost being paid for it.
95
What is VM?
Value Management is the proactive process of defining what value means to a client and putting
procedures in place to ensure that maximum value is delivered for the client, first time.
96
What does value mean to clients?
Value is a complex concept and means different things to different clients.
97
Who typically attends a value engineering (VE) process meeting?
The design team, including the Client, Quantity Surveyor, Architect, Engineers, and potentially the Main Contractor and specialist subcontractors.
98
What is the main activity during a VE process meeting?
The team pools together their expertise and suggests different value engineering proposals
99
What is the role of the chairperson in a VE process meeting?
To monitor the proposals against the client’s objectives around value.
100
What is the first phase of the VE process and its purpose?
Information Phase
- Understanding the client's objectives around value.
- Defining the client's objectives and key criteria governing the project.
- Understanding background decisions that have influenced the design development of the project.
100
What is the goal of the VE process team?
To deliver increased value for money by offering cost-effective solutions without compromising the overall usefulness of the building in line with the client’s objectives.
101
What activities occur during the Speculation Phase of the VE process?
- Listing creative ideas to generate a lesser capital or life cycle cost.
- Generating ideas to provide the necessary functions of the building at the most efficient price.
- Prohibiting judgment of each idea.
102
What is the main focus of the Evaluation Phase in the VE process?
- Defining the criteria for evaluating ideas generated during the speculation phase.
- Assessing each idea against the evaluation criteria.
- Retaining ideas that offer the greatest potential cost savings and value improvement.
- Discarding ideas considered not worthy or impractical.
103
What occurs during the Development Phase of the VE process?
- Developing and expanding retained ideas into workable solutions.
- Describing proposed design changes with advantages and disadvantages.
- Undertaking cost comparisons and design calculations.
104
How do different working groups within client organizations affect the need for VM?
Client organizations sometimes consist of different working groups with contrasting priorities.
104
Why does each construction client need Value Management (VM)?
Because each client has their own specific objectives and definition of what value means to their organization.
104
What is the risk if agreements on the definition of value are not reached?
The chances of perceived failure of the project increase.
105
What is involved in the Presentation Phase of the VE process?
- Presenting retained ideas to the client in a written report.
- Providing a briefing or verbal presentation to build the client's understanding.
- Explaining the rationale and background of the recommended proposals.
- Communicating how proposals deliver the client's specific objectives beyond monetary benefits.
- Making decisions with the client and design team on accepted or discarded proposals.
106
What is the primary purpose of VM in construction projects?
To reach an agreement on what value is defined as and to achieve a shared understanding of the objectives being sought.
107
What are the advantages of life cycle costing?
- Allows consideration of the long-term implications of a decision.
- enables informed decisions to be made on material selection.
- can result in lower operational, maintenance and replacement costs.
108
What are life cycle costs?
The costs that will be incurred over a defined period of operating and maintaining a building or an asset
including repair, maintenance, replacement, cleaning, decorating, services provision and disposal.
109
What are the disadvantages of life cycle costing?
* The cost of defects caused by bad workmanship and design faults cannot be predicted.
* It is hard to predict life spans, future inflation and maintenance requirements over long periods.
110
What costs should be considered in life cycle costing?
* Capital costs.
* Operational costs.
* Maintenance costs.
* Replacement costs.
* Disposal costs.
111
Where can you get information about maintenance costs?
* Building Maintenance Cost Information Service (BMCIS) – part of BCIS.
* From sub-contractors and suppliers.
112
How does the payback period method judge an investment?
It judges an investment based on the time period over which the invested sum is returned in cost savings.
113
In the payback period method, how are increased expenditures and future savings viewed?
he increased expenditure on a higher quality component is viewed as the ‘investment,’ and the savings provided in the form of future costs is viewed as the ‘revenue.’
114
According to the payback period method, what is considered the best investment option?
The one that repays the investment in the shortest time.
115
For what type of materials is the payback period method often used?
It is often used to evaluate options for incorporating sustainable technologies.
116
Why is the payback period method suitable for certain elements?
It is suitable for elements with a very high initial capital cost that will ‘pay back’ this initial investment over time through reduced running costs.
117
Why might a client accept higher capital costs?
* For prestige reasons.
* When considering that the replacement or repair may be inconvenient even if the solution is cheaper.
118
What is the difference between a cost estimate and a cost plan?
Cost Estimate: An initial approximation of project costs based on preliminary information. It provides a rough idea of the total cost and is often used during early stages for budgeting purposes.
Cost Plan: A detailed and structured breakdown of costs, developed as the project design progresses. It includes a detailed analysis of costs by different elements and phases of the project, used for more precise budgeting and cost control.
119
What can be determined by a wall:floor ratio? What is a good wall:floor ratio?
Determinations: Indicates the proportion of wall area to floor area in a building. It helps in assessing the building's design efficiency and structural requirements.
Good Ratio: A balanced wall
ratio is typically around 1:1 to 1.5:1, but this can vary based on building type and design. Lower ratios might indicate more open-plan spaces, while higher ratios might suggest more partitioned spaces.
120
What limited info would you need to provide an estimate?
Basic Info Needed: Project size, scope, type of construction, and key specifications. Even with limited details, estimates should be based on historical data and industry benchmarks to provide a reasonable approximation.
121
Please describe how you produced the feasibility estimate on Waitrose?
Based on preliminary design data, site conditions, and historical cost data. The feasibility estimate involved analyzing potential costs and comparing them with the project budget to assess viability and inform decision-making.
122
Why are PTEs important?
PTEs provide a benchmark for assessing tender submissions, ensuring they are realistic and competitive. They help in managing budget expectations and identifying any discrepancies between estimated and actual costs.
123
What would you advise a client if they asked for an ITT to be issued before you had carried out your PTE?
It’s crucial to complete the PTE before issuing the Invitation to Tender (ITT) to ensure that the tendering process is based on a well-defined budget. This helps avoid surprises and ensures that tenders are aligned with budget expectations.
124
What are the risks with benchmarking?
Can include reliance on outdated or non-comparable data, leading to inaccurate cost predictions. Benchmarking should be done carefully, ensuring that the data is relevant and reflective of current market conditions.
125
What was the cost saving on Citi Bank CGC1 for replacing bespoke joinery with part-height drywall?
Replacing bespoke joinery with part-height drywall resulted in significant cost savings due to reduced material and labor costs. Drywall is generally less expensive and faster to install compared to custom joinery.
126
Please explain the cost advice given for a higher-spec carpet compared to maintenance of replacing a lower-spec carpet?
Higher-spec carpets have higher upfront costs but can offer better durability and lower maintenance costs over time. The advice would weigh the initial cost against the long-term savings on maintenance and replacement.
127
What services were relocated to BOH area? What were the cost implications?
Relocations: Services such as HVAC, plumbing, and electrical systems were moved to the back-of-house (BOH) area.
Cost Implications: Relocations typically involve costs for re-routing services, additional construction work, and potential disruptions. These should be factored into the overall project budget.
128
How do you produce a reconciliation?
Compare actual costs incurred against the budgeted costs, analyzing any variances and providing explanations. This involves reviewing invoices, change orders, and other financial records to ensure accuracy.
129
How would you advise a client on a cost increase that wasnt related to design development?
Investigate the cause of the cost increase, such as market changes or unforeseen issues. Provide a detailed explanation to the client and suggest strategies for mitigating the impact, such as adjusting other project elements or sourcing alternatives.
130
What is one thing that the TPI at AECOM doesn't include ?
MEP works
131
what are some examples of exclusions in a project ?
- Client costs
- Asbestos
-
132
Why is VAT usually excluded?
its for the accountants to decide what type of VAT. We would not necessarily advise on it.
133
what are the different types of provisional sums ?
- Defined
- Undefined
134
What is a defined provisional sum?
The work is described in enough detail that the contractor can make allowances for it in their planning, programming, and pricing.
135
What is an undefined provisional sum?
The nature and costs of the work are not known.
136
What are provisional sums?
They are allowances or best guesses that are inserted into tender documents for elements of a project that are not yet defined enough to accurately price. As the project progresses, provisional sums are replaced by valuations of the work that has been done, which can cause the contract sum to increase or decrease
137
can both defined and undefined provisonal sums have an EOT?
Only undefined provisional sums
138
