Design Economics / Cost Planning

Question 1

What is Life cycle costing?

Answer 1

Decision making tool to establish the initial and future (build and running) cost of a building over its life time.
Capital
Operation 
Replacement
Demolition

Question 2

What is whole life costing?

Answer 2

Similar to life cycle costing but gives the full financial impact of the building (CORD + Land acquisition).

Question 3

What are the NRM documents and their titles?

Answer 3

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

Question 4

What are the key cost drivers when preparing a cost plan?

Answer 4

Building plan
Building shape
Building height
Building size
Buildability
Construction method – Steel vs concrete

Question 5

What are the RIBA Plan of works?

Answer 5

0 – Strategic Definition
1 – Preparation and Brief
2 – Conceptual Design
3 – Spatial Coordination
4 – Technical Design
5 – Construction and manufacturing
6 – Handover
7 - Use

Question 6

What is Benchmarking and why do we do it?

Answer 6

Allows us to measure performance on a given project against a set standard.
Carried out at the early stages of design to set a cost limit before too much time is spent on design.

Question 7

How is benchmarking carried out?

Answer 7

Collecting information on;
Contract details – type of contract used, start and competition dates
Project description
GIA and NIA
Location

Question 8

What is the structure of a Cost Plan?

Answer 8

QA sheet
Contents Page
Basis and Assumptions - VIP
Exclusions - VIP
Executive summary
Cost summary
Area Schedule
Benchmarking Analysis
Risk and Opportunities
Measured Works

Question 9

What are typical assumptions in a cost plan?

Answer 9

Competitively tendered

Risk and contingency allowances

Question 10

What are the typical exclusions in a cost plan?

Answer 10

Section 106 / 278
VAT
Site Surveys
Professional fees

Question 11

What does a cost plan do?

Answer 11

Gives an estimate of the final out-turn cost of a project
Assists in financial control
Based on specific design information

Question 12

What is a cost estimate?

Answer 12

Forecast of possible cost based on historic data, split out elementally

Question 13

What is the difference between a cost plan and a cost estimate?

Answer 13

Cost estimate gives an idea of the likely out-turn cost and breaks it down into elements
Cost plan gives itemised rates to indicate how the budget will be spent

Question 14

What cost would you typically allow for a Cat A fit out in central London?

Answer 14

£50/ft²

Question 15

What is Value Management?

Answer 15

A systematic review of essential project functions or performance, focused on achieving the best value for money. Includes overall view of a project including capital and recurrent costs.

Question 16

What is Value Engineering?

Answer 16

A systematic approach that seeks to enhance value by eliminating unnecessary costs whilst maintaining function

Question 17

Is Value Engineering only about cutting costs?

Answer 17

No – about streamlining the design, eliminate unwanted costs and improve function and quality

Question 18

How would you adjust costs for time?

Answer 18

Indicies

Question 19

What is TPI?

Answer 19

A measure of the movement of building prices paid by clients
Tender Price Index
In buoyant times can move faster than BCI
Inflated to start on site date

Question 20

What is BCI?

Answer 20

A measure of movement of building labour and material costs.
Building Cost Index
No element for OH&P
Inflated to mid-point of the project

Question 21

What is Aecoms current TPI?

Answer 21

Central London November 2019 – 117.3
Annual growth of 1.5%
UK November 2019 – 119.8
Annual growth of 3.5%

2015 is 100 as a perspective

Question 22

What is AECOMs current BCI?

Answer 22

November 2019 – 116.4

Annual growth of 3.9%

Question 23

What are some current location indices?

Answer 23

Inner London – 1.06
Outer London – 1.00
Yorkshire – 0.87

Question 24

Where do you source data to accurately prepare cost plans and advice?

Answer 24

BCIS data?
In house cost data
Published cost data - SPONS

Question 25

What are some typical efficiencies?

Answer 25

Net to gross – NIA / GIA – over 70% is good | Wall to floor - Wall area / GIA below 40% is good

Question 26

What is a Feasibility estimate?

Answer 26

Based on historical data and uses functional area / unit to give initial budget £/ft² - office £/seat – theatre £/key – hotel

Question 27

How would you improve the wall to floor ratio of a building?

Answer 27

Reduce floor to ceiling height – more slabs | Change the building shape – Circle – more expensive but most efficient, square is cheapest

Question 28

What factors affect the price of a development?

Answer 28

``` Procurement Route Location Size of project Market conditions Site specific issues – soil conditions or archaeological remains ```

Question 29

What is the minimum information you’d need to prepare a cost estimate for a new client?

Answer 29

Size – functional units Location Time – Indicative programme Use – 5* hotel, office or warehouse?

Question 30

How would you advice a client that they are designing to the best value?

Answer 30

Benchmarking

Question 31

Are there any limit of liability type statements or wording that should be included in a cost plan?

Answer 31

Exclusions

Question 32

How is contingency defined under NRM?

Answer 32

Design Development Risk Construction Risk Employer Change Risk Employer Other Risk

Question 33

What would you consider when benchmarking?

Answer 33

``` Date Location Size Procurement route Form of contract Scope – any unique aspects of the design Contract sum Programme duration Elemental breakdown Construction cost /m² or per function unit ```

Question 34

Any extra information in the benchmarking report I did for Derwent?

Answer 34

Project data sheets, area analysis and overhead comparison Data sheets for; Reception in relation to GIA = £7/ft² WC in relation to GIA = £12/ft² or £25k a cubicle Cladding = c.£800 - £1,600/m² Cat A Lighting = c.£10/ft²

Question 35

What is COMP?

Answer 35

Code of Measurement Practise 6th edition – GIA NIA etc.

Question 36

What has replaced COMP?

Answer 36

RICS Property Measurement 2nd Edition

Question 37

What is a Post Tender Estimate?

Answer 37

An estimate between receiving tenders and entering a contract – tracks any change

Question 38

How did you advise on the design economics of paving in site C

Answer 38

Had to factor in the cost of the slip resistance and finish – flamed or water jet finish to achieve correct R rating Cost of Granite vs marble and longevity of each

Question 39

How would you evaluate and advise on the use of historic data and the considerations to be taken into account?

Answer 39

Indicies after 3 to 5 years should be flagged as beyond then indicies stop being as useful

Question 40

How did you advise the client on the LCC of the paving?

Answer 40

Advised that the marble was more expensive (construction cost? than the granite. the slip finish (water jet) needed redoing every 10 years for the marble unlike the granite. (higher maintenance cost)

Question 41

Was it an issue that i did the Stage 4 Cost Plan and the PTE on Wedge?

Answer 41

Understand it's not best practice because of resourcing i carried out the PTE however had someone not familiar with the project verify it