Preparing for
Design-Build: What Design
Professionals Need to
Know About the
Proposal and the
Contract
A Schinnerer Webinar
April 8, 2015
Presented by:
Martin Sell, AIA, MBA, NCARB President and Founder of RKETEK President and Founder of RKECOM
With Nahom A. Gebre, Esq., P.E. Risk Management Attorney Victor O. Schinnerer & Company, Inc.
Martin Sell, AIA, MBA, NCARB, is the president and founder of RKETEK (pronounced architect), a development, design, and construction management firm specializing in providing alternative and collaborative project delivery to a variety of clientele. He is also the founder and CEO of RKECOM Commercial Construction, a related at-risk construction entity. He has extensive design-build, development, construction management, and integrated project delivery experience. For 14 years—serving at varying times in the roles of project manager, principal in charge, chief operating officer, and CEO—Marty helped grow a ten person integrated design-build firm into a 150 person firm, and one of the top 20 commercial design-builders in the country. In the past decade, he managed the rapid growth of an architect/developer-led design-build firm and then formed the sister companies of RKETEK and RKECOM to provide design and construction services to clients.
Marty received his Bachelor of Science in Architectural Studies and Masters of Architecture degrees from the University of Wisconsin—Milwaukee. At age 23, he became the youngest registered architect in the State of Wisconsin history, and one of the youngest persons ever registered nationally. In 2000, he earned his MBA from the University of Wisconsin—Madison, School of Business.
Nahom Gebre
Nahom Gebre is a risk management attorney with Victor O. Schinnerer & Company. A registered professional engineer, Nahom practiced civil engineering prior to his involvement with risk management issues. His background includes service as in-house counsel and project manager for a large engineering firm. Nahom provides risk management advice to Schinnerer and CNA policyholders. Nahom received his
Bachelor of Science in Civil Engineering from Washington University and his Juris Doctor from Tulane University Law School. Nahom’s email address is
Preparing for Design-Build: What Design Professionals Need to Know
About the Proposal and the Contract
Schinnerer Webinar – April 8, 2015
1 Preparing for Design-Build:
What Design Professionals Need to Know About the Proposal and the Contract
Presented By Martin Sell, AIA, MBA, NCARB President and Founder of RKETEK President and Founder of RKECOM with Nahom A. Gebre, Esq., P.E. Victor O. Schinnerer & Company, Inc.
© 2015
•Introduction
•Selecting a Partner
•Teaming Agreement Issues •Structuring the Relationship •Post Contract Award Issues &
Challenges
Agenda
© 2015
• Single point of responsibility
• Faster and more cost effective
•Owner’s concerned about result, not
process
• Focus on problem solving, not assigning blame for problems
© 2015
Traditional
Design-Bid-Build Relationship
Owner
A/E Prime
Contractor
© 2015 Design-Build Arrangement Owner Design Build Entity Professionals Trade Subcontractors Suppliers Design Build Criteria Consultant Selecting a Partner
• Choosing the right partner. Why is it important?
Preparing for Design-Build: What Design Professionals Need to Know
About the Proposal and the Contract
Schinnerer Webinar – April 8, 2015
3
© 2015
Teaming Agreement Issues
• Protect against the possibility of being replaced by a subsequent firm
• Cost of preparing the proposal.
• How will the relationship be structured?
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Structuring the Relationship
• Complexity and size of the project
• Jurisdiction of the project, including the licensing requirements for both
contractors and design professionals
• Insurance and bonding requirements
• You and your partner’s preferred allocation of risk.
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Structuring the Relationship
• Vertical / Traditional Prime-Sub
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Traditional / Prime-Sub
• Contractor led or Design professional led?
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Contractor Led Design-Build
Pros and Cons of Contractor Led Design-Build
How do you (design professional) manage the risks if the project is led by a contractor?
Owner
Contractor Design Professional
Design Professional Led Design-Build
Pros and Cons of Design Professional Led Design-Build
How do you (design professional) manage the risks if you are the lead?
Owner Design Professional
Preparing for Design-Build: What Design Professionals Need to Know
About the Proposal and the Contract
Schinnerer Webinar – April 8, 2015
5
© 2015
Horizontal / Joint Venture
Pros and Cons of Joint Venture
How do you (design professional) manage the risks if you are in a joint venture? Owner Design Professional / Contractor JV © 2015
Post Contract Award Issues
Successfully managing the scope of services.
Who bears the risk if it is apparent the job is going to cost more?
• Builder’s perspective
• Design professional’s perspective
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Design Professional Challenges
Responsibility for Health, Safety, Welfare always remains with the licensed professional.
Standard of care.
© 2015
Online Resources
www.Schinnerer.com/AERiskmanagement
You can view or download claim studies, risk management information, contract language and commentaries.
