How to decide who's the best for a big commercial renovation project?

June 25, 2015 2:10 PM

We're spending several million dollars to renovate our community health centre. We've received several bid proposals for the prime consultant function who will do the design/architecting and then oversee the mechanical, electrical, signage, building code etc. I'm helping assess the proposals. What should I look for? What are danger signs? What questions should I ask of the bidders when they come in to present?

I'm doing everything I can think of that makes sense (e.g. check their experience with similar projects, references) but I'd love to hear from others who've been through this (on both sides of the fence).

posted by storybored to Law & Government (4 answers total)

Beyond the basics which you already seem to have covered (relevant experience, references, capacity, etc.), I would recommend discussing their standard contract terms. Here are some things which are always important to my company when we negotiate design-build contracts:

Termination rights: We always want the right to terminate the contract with reasonable notice, and not just for cause but for any reason.

Ownership of the work: If the contractor is terminated for cause or any other reason, we want it to be clear that we own the drawings and any other work product, so long as we have paid for the work. Some architects' and engineers' standard contract terms state the the work goes with them when they leave. You don't want to have to pay to start from scratch all over again with a new designer if you sack the contractor.

Insurance: I am not an expert on this but others in our office spend some time making sure their coverage is adequate to the work.

Indemnities: Make sure an attorney reviews the indemnity language.

Conflict/arbitration procedures: Same as above.

In addition, we like to make sure that the contractors we work with are financially sound. They'll often have to pay subs before getting payment from you and they should absolutely have adequate capacity for this. A contractor should be prepared to show his financials.

I would recommend this book. Full disclosure - I have worked with the author. Successful RFPS.

Finally, don't underestimate your gut feelings. It really helps to work with people who instill trust, are pleasant, and have good communication skills. These qualities are sometimes hard to find in the construction industry.

Good luck!
posted by rekrap at 2:50 PM on June 25, 2015 [1 favorite]

A few suggestions, most of which you've probably covered somehow:

Ensure your comfort with who the team is, how long they've been with the firm, and their percentage of time on your job. Doesn't matter if Susie Seniordirector has marvellous municipal project experience and her CV is front and centre if she'll be on the job half a day per month and John Justoutofcollege is running it. This will also explain some of the fee variances across the proposals.

Ensure the proposals are leveled and everyone agrees on scope that the prime consultant is not touching and that you will need to procure other consultants to do. Often security and furniture falls into this category, sometimes lighting, asbestos abatement if that's an issue. Preliminary hard cost estimating. Various liaise-with-the-city stuff.

Have they worked with the proposed M&E etc consultants before, how well they know them, what projects have they worked on together, were they successful.

If it's a renovation is part of the facility occupied during construction? Does that imply phasing and how will they approach that? If it's not occupied what is your proposed completion date and what are their thoughts on it?

Approach to mitigating the inevitable changes during construction. Ask them, but also with references check that their documents are typically tight and complete when it goes to tender. If there are holes you will be dealing with lots of change orders and questions after a GC is hired.

Are they doing all the tendering stuff too ie coming up with the GC bidders list etc? Or will a project manager do that? If they are you'll want to know how they come up with that list, who they have used in the past, questions like that.
posted by jamesonandwater at 2:56 PM on June 25, 2015

I teach construction contracting and have degrees and experience in Construction Management and Law.

I agree with the other posters especially "rekrap". To specifically answer your question "What are danger signs?" consider the following:
Someone too eager to start;
Someone not licensed as an Architect or certified construction manager;
Someone who does not want to "bother with a contract";
Someone who cannot provide LOCAL references (visit the project) with similar projects (type of project and size of project);
Someone who has not been in business at least 5 years or someone whose business name has changed (you can look up their business names on your state's Secretary of State's website);
Someone who has several other jobs underway;
Someone who is just broker, they only hire designers and specialty contractors and cannot perform any services themselves.

Make sure you know what you want before construction begins, many times owners mess up projects by changing their minds too many times. Have the discipline to postpone additions to your agreed upon project, even if the builder says the change is fine.

A good designer should provide you with ideas and honestly tell you what they do well. Most of them in the US cannot tell you exactly how much construction will cost, construction cost estimating is just not taught in depth in design school.

Finally, and this may not sit well with others, I prefer construction managers as leaders in a project that has both design and building components. You can pay a little extra and hire a Construction Manager as an agent, someone who will NOT perform the work but act as your advocate and hire a designer and builder for you. A good place to begin to find a construction manager is the Construction Managers Association of America.

Good luck
posted by drthom at 10:18 AM on June 26, 2015

Response by poster: This is great, thanks for the help! We had our first meeting today and rekrap, I asked after several of the points you raised (termination rights, financial disclosure). Jamesonandwater, I looked through the bids to see exactly what percentage of time the design project lead would be spending and it turns out one of the bidders is a little more "hands-off" than expected.
We winnowed down the field from seven to three contenders and we will be bringing them in for an interview in a few weeks. drthomasmobley, one of the bidders does indeed have several projects ongoing, so we'll have to ask for detail on that. The tricky part will be how to decide whether that bidder is overloaded or not.
posted by storybored at 8:33 PM on June 26, 2015