PROJECT MANAGEMENT Flashcards
Net-to-gross
Rentable-to-useable
Grossing factor
Each of these metrics is a measure of efficiency (profitability for the owner); especially important in commercial office space construction.
= Net/Gross (less-than 1): Net assignable area=all the spaces needed by the client (offices). Gross area is the whole building, including structure, mechanical, and circulation spaces not included in net assignable area.
= Rentable/Useable (greater-than 1): Rentable includes common areas used by all building tenants like lobbies, stairwells, janitorial closets, mechanical rooms, and elevator shafts. Landlords charge tenants rent for a pro-rated portion of those spaces. . . so if your company rents 11% of a building floor, you will also pay for 11% of the mechanical room and common lobby area. Usable=just the area the tenant will occupy to do business, including columns, private restrooms, private corridors within the office suite, and private storage, but not the lobbies, janitorial, etc. shared by other tenants. Companies that will lease the floor from the owner obviously want low rentable/usable values.
= Grossing Factor (greater-than 1): a grossing factor, established during programming, of 1.30 means that you will need to plan on 30sf of mechanical, circulation, etc. space for every 100sf of office space.
*There are all kinds of varied conventions for how to calculate these. . . Atrium square footage is usually only counted once but multi-floor mechanical shafts may either be counted once or not counted at all. Covered walkways and exterior stairs may be counted as 50%, or may not be counted at all. Sometimes spaces with ceilings lower than 7.5ft aren’t counted, and sometimes only spaces with ceiling heights under 6ft aren’t counted. How do you count an extra-wide corridor in a head trauma rehab facility designed to double as a runway for patients to practice walking during physical therapy sessions? Most commonly, gross building area is measured from the outside face of the outside wall, but I’ve been told that in some local markets, landlords establish commercial real estate rents from the inside face. So don’t get too stressed by the lack of a universal standard. If you see a question on an exam, take your best guess based on what’s on this card and the information presented in the test question and trust that it will (probably) work out.
Zones of occupancy
Determines occupant density, usually for HVAC and ventilation reasons. . . how close, on average, is the nearest person?:
Public (25’ radius) for each person Social (12’ radius) Personal (4’ radius) Intimate (1.5’ radius) A college-town bar will require more ventilation than a bank.
If the owner-architect contract stipulates that the architect’s fee will be 7% of construction costs, will the architect be paid for that 7% portion of the contractor’s overhead costs?
Yes, a percentage of the contractor’s overhead is included in the architect’s fee. The Owner’s budget of the Cost of the Work includes general construction costs, and profit, and overhead.
Business entity concept
The business is a separate entity and financial transactions of the business, therefore, should be kept separate from personal financial record keeping. Don’t pay for your dry cleaning with your firm’s credit card, even if you own 100% of the firm and the suit needs to be cleaned for a client meeting.
Accessory space
A small space that might otherwise require classification as a different occupancy group, but doesn’t because it is less than ten percent of a story’s floor area. For instance a small office in the corner of a factory floor doesn’t need to be classified as B (which might trigger a fire-rated wall requirement), but can instead be classified the same as the rest of the factory (F-1).
If the Owner suspends the project, the Architect can…
Suspend work
Require payment for work-to-date
Require payment of delay-caused expenses
Submit a new schedule
AIA B101 SP
Similar to typical B101 contract, with a focus on Sustainability.
The Owner must provide drawings, manuals, and building operational costs, appeal for certifications, ensure design fits sustainable guidelines, and comply with authorities on ownership and operations.
Architect’s responsibilities to prepare for bidding
Finish CDs
Administrate bidding
Update cost estimates
Task dependency
The relationship of stop and start times for tasks
Start-start: align the start times of the steel folks who cut the rebar and the welders
Start-finish (also called a natural dependency): align the finish time of the rebar welders with the start time of the concrete trucks
Finish-finish: align the finish times of the folks who remove the formwork from the concrete foundation and the rented pumps that keep the foundation excavation pit dry during construction.
See here for a graphic representation.
See here if you are unsure about these.
Prime contract
Prime contracts: Main contract with the owner for the work with the expectation that some of the work will be completed with the use of subcontracts. The contractor has a prime contract with the owner, and he hires a plumbing subcontractor, a concrete subcontractor, a roofing subcontractor etc. using subcontracts.
Multiple prime contracts– The project is fast-tracked, staged, phased, has multiple funding sources, or there’s a CM-as-agent managing a project on behalf of the owner, and the owner signs multiple prime contracts with a contractor, who in turn, will sign multiple subcontracts: one for the curtain wall while she waits for the rest of the drawings to be completed (fast track). . one for the abortion clinic that will be paid for with private funds and one for the attached medical clinic that will paid for with government funds (multiple funding sources) . . .one for the construction of the storage facility and one for ongoing maintenance at that same facility to be provided by the builder after the facility is occupied (multiple stages). . . or one prime contract for the HVAC contractor and another prime contract for the framing contractor (multiple phases).
Articles of B101, Owner-Architect Agreement
See if you can tell yourself (aloud) what each of these contract sections requires
Initial Information Architect’s Responsibilities Scope of Architect’s Basic Services Additional Services Owner’s Responsibilities Cost of the Work Copyright and Licenses Claims and Disputes Termination/Suspension Miscellaneous Provisions Compensation Special Terms and Conditions Scope of Agreement
Initial Information; i.e. identifies project, budget, schedule
Architect’s Responsibilities; architect obtains insurance and provides services consistent with the professional skill and care ordinarily provided by architects practicing in the same or similar locality under the same or similar circumstances (Standard of Care)
Scope of Architect’s Basic Services; architect submits a schedule, architect must meet code, architect facilitates bidding, architect certifies payment to the contractor, architect reviews contractor’s submittals (shop drawings, product samples), “Architect shall consider sustainable design alternatives” (if you think that “shall consider” sounds like it is a contractual obligation without teeth to enforce it. . . I agree!)
Additional Services; almost everything beyond a single drawing set with MEP and structural engineer is an additional service
Owner’s Responsibilities; geotech engineer, everything site- and permit-related, if an owner hires her own consultants, it’s on her to coordinate them
Cost of the Work; includes construction cost, but not architects fees, cost of the land, or contingencies for change orders
Copyright and Licenses; architect and architect’s consultants own the drawings
Claims and Disputes; contract gives architect and owner a choice, before work commences. . . Mediation then arbitration OR mediation then litigation in court
Termination/Suspension; if the owner doesn’t pay the architect or suspends the project for 90 days, the architect can terminate, if the owner just feels like it, she can terminate but has to pay the architect for expenses (for instance, costs associated with terminating the MEP engineer). The contract automatically terminates one year after substantial completion.
Miscellaneous Provisions; architect’s constultants can’t directly file a claim against the owner and the owner’s consultants can’t directly file a claim against the architect
Compensation; owner pays architect stipulated sum (fixed amount, payable after each milestone: SD, DD, CD, Bidding, CA) or pays a percentage of the BUDGET for the Cost of Work
Special Terms and Conditions; add your own, project-specific terms here. Maybe you want to shoot a documentary about your design process and want the owner’s agreement to be featured in the film.
Scope of Agreement; this contract supersedes all prior negotiations and can only be amended in writing with both signatures
To read the full contract, which I recommend, visit here
How does the owner pay the contractor? Explain each of these
Unit Cost
Cost plus Fixed Fee
Guaranteed maximum price (GMP)
Stipulated (lump) sum
Unit Cost: Owner agrees to pay $245,000 per housing unit
Cost plus Fixed Fee: $1.6M estimate for the cost of the project (but owner pays more if budget is exceeded) plus $300,000 in fixed profit for the contractor. No limit on change orders, which can net the contractor additional profit.
Guaranteed maximum price (GMP): like a cost plus fixed fee contract, but if the project is delayed or the price of materials goes up beyond a total project cost of $2M, the contractor has to complete the project and eat the extra cost.
Stipulated (lump) sum: Owner pays contractor $1.9M to build everything in the contract, period.
Supplemental instructions to bidders vs Architect’s supplemental instructions
Supplemental instructions to bidders: Modifications to general conditions in contracts. Example: a project goes out to bid and one contractor notices that there is no space set aside for the fourth floor electrical equipment. Architect says, “good catch,” and redraws the plan to include an electrical closet. That’s called an addendum (plural: addenda), which is then sent to all the bidders so that they can all bid on the same project, and so all the bid dollar amounts can be easily compared by the owner; they each have the electrical closet cost factored in.
Architect’s supplemental instructions: after construction is underway, like a change order, but so minor it won’t affect the cost or project schedule. Example: changing the paint color before the paint has been purchased.
“Top-down” vs “Bottom-up” project budgeting
Top-down budgeting
Start at the “top” with the gross fee the owner will pay your firm
Subtract expenses to see what is left for design time
Example:
Bottom-up budgeting
Start at the bottom with each person who will be working on the project, their hourly rate, and the number of hours you estimate they’ll need to work. Each task is tallied upwards
Time consuming, but more accurate
Good for multi-faceted, large projects
Project cost = Sum(Hours/Task * Dollars/Hour)
Example:
In these examples, for the same project, the RFP suggests that you will have a (top-down calculated) half-million dollars to design the project. . . but your bottom-up estimate, based on what you thought it would take to design the project, came in at over two million dollars! Talk to the client about renegotiating the architect’s fee or do not respond to this RFP because you will lose a lot of money if you take this project on.
*For the most accurate budgeting numbers, do both top-down and bottom-up estimates and use those to determine upper and lower limits.
Smoke pencil
Smoke pencil: for tracing the source of building skin air leaks. See here for an example.
We use a blower door test to pressurize and depressurize the building to measure total building air leakage. While we have the building pressurized for the blower door test, we can run a smoke pencil (also called a smoke pen) as a wand and watch the smoke move into or out from seams in the building skin, at door and window frames, and at penetrations for utilities.
If the Contractor requires information from the Owner, the Architect has ____ days to give that information to the Contractor.
7
An architect is designing a horse barn, and during construction, the owner provides many of the building materials needed for construction from his personal stash. If the owner-architect contract stipulates that the architect’s fee will be 7% of construction costs, will the architect be paid for that 7% of the actual construction cost or 7% of what the construction cost would have been had the material not been provided free by the owner?
The Owner’s budget for the Cost of the Work, which is what that 7% fee is based on, includes the reasonable value of labor, materials and equipment provided by the owner. If the owner provides his own materials or labor, the architect gets paid her portion of that too, provided the fee is based on a percentage of construction costs.
Summarize AIA B101, the owner-architect agreement
Typical Design-Bid-Build Owner-Architect Contract
The Architect must:
Maintain schedule and budget
Manage utilities, codes, governmental agencies
Consider environmentally sustainable options
Provide the instruments of service at the standard of care
Cost estimate at every phase and redesign if over budget
Contemporaneous documentation
Contemporaneous documentation: Recording of non-regular communications, decisions, and actions throughout a project, in real time. Stick to the facts and avoid conjecture or supposition. For example: the project architect keeps a journal (good) and it becomes known throughout the firm as the place for anyone on the project team to document conversations, meeting observations, sketches, business cards, and write casual notes (also good). It is not a good place to write, “I’m not sure what the occupancy group should be on this building. We decided at today’s meeting that we wouldn’t label the chemistry lab and see if the code official would catch the omission.” You shouldn’t do that anyway, even if you don’t write about it, but if you only wrote, “I’m not sure what the occupancy group should be on this building,” instead of, “To do: identify occupancy group.” you might be setting your firm up for a legal suit if the building burns and someone dies.
AIA C401 Architect-consultant agreement
AIA C401 Architect-consultant agreement:
The Consultant is not responsible for other Consultant’s works, but still has the same duty to say something when errors appear. The Consultant only reports to the Architect, then the Architect reports to the owner and contractor.
These documents are included in “contract documents”
Addendum: A change made to the drawings after the project goes out for contractors to bid, but before the bids are due.
Change order: a change, after the bid is accepted, negotiated among the contractor, owner, and architect that impacts the cost or schedule. It is agreed upon in writing by all three parties.
ASI (architect’s supplemental information): a clarification or interpretation of the drawings or specs that does not change the cost or schedule.
Construction change directive: architect-issued directive to modify the work now while the contractor and owner continue to negotiate who will pay for the change. Used so that disagreements don’t delay the project.
These documents are not included in “contract documents”
RFIs (though the results of an RFI could lead to an addendum, architect’s supplemental information (ASI), construction change directive, or change order, which would then become part of the contract documents)
Consequential damages
Consequential damages: arise not from a botched job that has to be fixed for a given cost (those are direct damages), but rather from the indirect effects of the botched job, including lost owner rents, lost owner’s customers, lost owner’s productivity, loss from owner’s bank loan penalties, and most costly of all, lost owner’s profits. Consequential damage awards can become disproportionately high, so the AIA contracts include provisions where all sides agree to waive any right to sue one another for consequential damages.
In 1984, the Sands casino in Atlantic City underwent a renovation to install a new glass facade. It was scheduled to open in May, but didn’t open until August, which is not an unusually long delay for a construction project. However, the agreement between the construction manager and the owner was absent any waiver of consequential damages, allowing the owner to sue the construction manager–who was only paid $600,000 to install the facade–for 14.5 million dollars in damages! The casino argued for, and received, the high settlement on the basis of lost profit, because the renovation was scheduled to open before the summer high season, but opened after it. With the sting of this case, and many like it, the AIA incorporated a mutual waiver of consequential damages beginning in 1997. If that same delay happened today with a standard AIA contract, the construction manager would have been only liable for the cost of the delay (extra days of rented cranes), and could not have been sued for the lost profits.
In my research for this course, I’ve been converted to a believer on the importance of using the standard AIA agreements. (1) They’ve worked out kinks that you would never know about on your own, like the consequential damages waiver, and dozens (hundreds?) of others like it, based on real cases over many decades. (2) Courts know how to enforce the standard contracts because they can draw on a long history of case law. (3) Your liability insurance probably will cover you for a goof under the AIA contract, but very well may not cover you for a goof in a one-off contract you concocted with the owner. And (4) when a developer and architect sit down to write a contract, who do you think is going to win that negotiation? Developers devour us for sport and we don’t know they did so until the project is over and the claims come in.
C Corporation
C Corporation: Large company with public stocks – double taxed. Not really for architecture firms, except the largest ones. For instance, AECOM is traded on the New York Stock Exchange, and almost all publicly traded companies are C-Corps.
Descriptive Specification
Prescriptive Specification
Descriptive Specification: Detailed written information on requirements for material and product quality, including installation
Prescriptive Specification: Detailed means and methods of construction
Joint venture
When two companies make a temporary third company to win a commission and build a project, with profits and risks shared between the two parent companies.
PERT critical path diagrams
Subset of critical path scheduling diagrams that clearly identifies the building sequence, but is unspecific as to task duration. Developed by the contractor (as is all construction scheduling). See here for an excellent example. The alternative, Gantt charts, also demonstrate sequence, but Gantts include task duration. They look like this.
An architect is designing a place of worship, and during construction, members of the community band together as volunteers to assist with the building process. If the owner-architect contract stipulates that the architect’s fee will be 7% of construction costs, will the architect be paid for that 7% of the actual construction cost or 7% of what the construction cost would have been had the labor not been donated?
The Owner’s budget for the Cost of the Work, which is what that 7% fee is based on, includes the reasonable value of donated labor, materials and equipment. The owner has to pay the architect for 7% of the value of the donated labor too.
In the AIA contracts, what is “The Work” and is “The Project?”
The Work vs The Project: it’s a subtle difference. The Work includes all the construction required to meet the obligations of these particular contract documents. The Project may also include efforts and buildings constructed by other contractors or the owner. For instance, as a developer, I have a background in construction and own land. On that land I’m going to build a restaurant myself, but need the expertise of a specialized contractor to build the attached movie theater at the same time. I hire an architect who creates construction documents for the theater-only portion. That part of the building goes out to bid and you win the construction contract to build the theater portion of the building. The Work includes only the theater. The Project includes both the theater and the restaurant.
Obviously, in most cases, The Work and The Project are the same, but when there are, for instance, multiple prime contracts for different areas of the building(s), we need a way to differentiate The Work associated with one contract, relative to The Project associated with all the contracts combined. To see for yourself the legal definition, see the A201 and scroll down to sections 1.1.3 and 1.1.4. A warning that this legalize definition will probably not make the difference between the two terms clearer to you.
Prevention costs
Costs to prevent and avoid mistakes on the job. Incurred and accounted for before the project, and separate from the project, to create and maintain the quality management program (checklists!). This seems obvious, but most firms don’t have money set aside to prevent errors.
Specifications (products, like plotters that alert you before they run out of ink so you don’t accidentally send a drawing set that is faded on the last pages. . . or services like a third-party printing service that maintains its own plotters and has a good reputation) Quality planning (submission to ISO 9001 quality management program) Quality management (checklists for each project kickoff meeting) Training (send staff to code officials’ annual conference) As with all Quality Management strategies, the key is intentionality: Quality is in the budget from the beginning, so someone’s time and conference registration are already accounted for and a manager won’t deny the conference request, nor will the conference attendee decide that catching up on project work prevents her from attending the conference. Attending that code officials’ conference is in her job description.
ADA clear floor space
30” width by 48” depth
Parts of a project manual
Bidding Requirements
Contracts
General and Supplemental Conditions
Specifications: the bulk of the project manual is specifications, and they are typically organized in MasterSpec format (concrete, then masonry, then metals, etc.)
Electrical engineer provides design services for which building systems?
Data and telephone systems
Power system drawings and specifications
Signal systems
Lighting systems
Partnership
General partnerships: Two or more people get together to start a firm. Partnership agreements are very important to establish who will do what, who gets credit, how profits are divided, who can put the firm into debt, what happens when one person decides to leave the firm, etc..
Limited partnerships: partial owners in a firm with limited management roles. Your rich aunt wants to invest in your idea to start a firm, but knows nothing about architecture. You take her $15,000 to start your firm and give her 10% ownership. She’s entitled to 10% of future dividends paid to owners from profits, and as a limited partner, she’s not (much) liable for civil damages when the building you designed burns down and hurts someone. If you sell the firm in 20 years, she gets 10% of the sale price, after expenses; if you list it on a public stock exchange, she gets 10% of the stock; if you go broke, she gets nothing back.
Don’t confuse partnerships, which happen when people couple-up to start a company, with the ways that firms couple-up. . . Strategic alliance is two companies hanging out together to land or execute a job; joint venture is two companies making a baby to land or execute a job and each one has ownership in the baby; a merger is a total combining of the two companies into a single company that now shares everything as a single, larger, firm.
Floor area ratio: FAR
Floor area ratio: FAR: Defines the limit on buildable footprint and height
= Total Floor Area (Stories*Footprint) / Area of Lot
Set by local zoning codes
Gantt chart
A project management chart that shows tasks against time and their relative dependencies. See here for an example.
Corporate memory
Organizational or institutional accumulated body of data, information, and knowledge. Part of quality control is to organize this info clearly and efficiently. When a client invites our firm to a project that may not be profitable for the firm, do we pass on the project, negotiate the project scope down, or negotiate higher design fees? Who, working at the county building department, will offer you the best help with an occupancy type question? Who’s the go-to person there for limitations on exterior building signage?
Unit prices
Unit prices: Cost for performing additional work when encountering unknown conditions. How much will it cost the owner to clean each cubic yard of contaminated soil (because we’re not yet sure how much of the site is contaminated)? How much to design each new fast food franchise building (because the restaurant chain is growing, but may not be in five years, and we want to specifically quantify the costs of expansion now)? How much to design and build each additional rehab patient room beyond the first 40 patient rooms (because our non-profit client will want to help more people if they land the grant they’ve applied to)?
