We recently were asked to look at a new project – a mixed used residential tower in Vancouver. The project was originally tendered with the mechanical cost grossly over the original budgeted amount. After reviewing the drawings, we were able to find one million dollars in savings, while still meeting Vancouver’s onerous LEED rezoning and ASHRAE 90.1 requirements.
An over-budget mechanical system seems to be a common issue on bid-spec projects. Projects tend to be over designed and the systems selected, while technically compliant, simply are not cost effective.
Why does this happen repeatedly on bid-spec projects mechanically? What is the difference for design-build projects? Why is there such a disconnect between the design and costing?
The problem with bid-spec projects is that there is no motivation for the designer to focus on cost. Instead, the focus is on meeting the performance requirements, using a tried and true engineering system, and mitigating design risk. Cost is generally not considered until the actual tender and generally done by a third party such as a contractor or a cost consultant.
The result is cost over-runs and schedule delays. Because there is no accurate costing done initially, tender pricing usually is a surprise. Schedule delays often occur because redesign needs to be completed for cost savings.
In contrast, design-build projects consider both performance requirements and cost at the same time. The designer is now motivated to consider both items from the beginning, not at tender, when the design is 75 percent complete. There is a collaborative approach to working out the most cost effective solution that still meets the performance requirements.
Unique to the mechanical industry is the large variation of mechanical systems. This is a strength of mechanical design build because there can multiple solutions to the same set of requirements, with certain systems being more cost effective depending on the requirements.
Going forward, there are a number of developments that will benefit the mechanical design-build delivery method. The recent introduction of the BC Energy Step Code and the City of Vancouver’s new rezoning requirements are changing energy code requirements from prescriptive to performance based.
In other words, instead of specifying the desired type of mechanical system, the new codes set a desired energy intensity per square foot. This gives maximum flexibility for the designer and contractor to select the most cost-effective solution that still meets the requirements.
Going back to the originally mentioned project, we are on-track to take over the design and construction in the next few months. We are confident that this transition from bid/spec to design/build will lead to on-budget, on-time delivery with a single point of responsibility mechanically. Is your next project going to deliver similarly?
Henry Leung and Jim Gallacher from BC Comfort will be speaking on this topic in more detail at BUILDEX Vancouver on February 15, 2017. If you are interested in attending, please contact BC Comfort at 604-439-3344.
More information on the session can be found on the BUILDEX website.