AN APPRAISAL PROJECT

An Appraisal Project



An Appraisal Project

Chapter 1: Introduction

A developer is interested in purchasing land in London and the land is going to cost about 30 million UK STERLING, the developer intends to submit a planning application for a 30,000 sqm and 15- storey office tower scheme.

Recently a diffeRent business model has become more popular. Many owners - particularly government agencies have let out contracts which are known as Design-Build contracts. In this type of contract, the construction team is known as the design-builder. They are responsible for taking a concept developed by the owner, completing the detailed design, and then pending the owner's approval on the design, they can proceed with construction. Virtual Design and Construction technology has enabled much of the ability of contractors to maintain tight construction time

There are two main advantages to using a design-build contract. First, the construction team is motivated to work with the design team to develop a design with constructability in mind. In that way it is possible for the team to creatively find ways to reduce construction costs without reducing the function of the final product. The owner can expect a reduced price due to the increased constructability of the design.

The other major advantage involves the schedule. Many projects are given out with an extremely tight time frame. By letting out the contract as a design-build contract, the contractor is established, and early mobilization and construction activities are able to proceed concurrently with the design. Under a traditional contract, construction cannot begin until after the design is finished, the project is bid and awarded, and the team can mobilize. This type of contract can take months off the finish date of a project.

The major problem with design-build contracts is the inherent conflict of interest. In a standard contract the designer is responsible to the owner to review the work of the builder to be sure the products and methods meet specifications and codes. The builder as a construction professional experienced working with many designers is attuned to picking up design flaws which would go uncaught or unmentioned when builder is also designer. The owner may be more likely to get a building that is over-designed in order to increase costs and profits for the design-builder, or built with lesser grade products to maximize profits. If time is of the essence, a design and construction contracts can be awarded separately, with bidding taking place on preliminary plans in a not-to-exceed contract in lieu of a single firm design-build contract.

Typically the construction industry includes three parties: an owner, a designer (architect or engineer), the builder (usually called the general contractor). Traditionally, there are two contracts between these parties as they work together to plan, design, and construct the project. The first contract is the owner-designer contract, which involves planning, design, and construction administration. The second contract is the owner-contractor contract, which involves construction. An indirect, third-party relationship exist between the designer and the contractor due to these two ...