I’d like to get industry news & insights in my inbox on these topic(s):

padlock-black Your privacy is important to us; we won’t share your information with anyone else.

 

read

Effective Design-Build Procurement Strategies

By Jim Avitabile, PE, DBIA

July 17, 2020

Design-build procurement strategies for infrastructure capital improvement programs.

If your capital improvement program involves a design-build (DB) or Public-Private Partnership (P3) project that exceeds $500 million in size, you are acutely aware of the challenges in attracting the right level of contractor, designer, or developer interest. The odds are that you have already held meetings with industry representatives and allowed them to express their concerns. Those meetings may have led to discussions regarding excessive risk transfer, bonding restrictions, and insurance issues.

While your agency may be in the process of deciding on a course of action, you are not alone in this dilemma. The transportation industry has seen a major reduction in interest for large DB and P3 projects. But, more than one solution may exist to successfully procure your project and other agencies are in the process of developing new improved strategies.

 

Design Build Projects & Risk

In general, the desire for an agency to perform a major corridor improvement as one single DB project has many advantages.

The truth is that many of these major transportation projects include construction schedules that span three plus years. This significantly increases the risk to the design-build team. In general, the size of a construction contract can dictate the risk to the DB team and if schedule adherence is factored into the procurement as a contract disincentive, this risk increases.

 

Seven Ways to Address & Mitigate Risks

Infographic for Design-Build Procurement Strategies.

1. Industry Forums

Hold an open and transparent industry forum to obtain input from the potential bidders.

2. Provide Complete Field Investigations Prior or During Procurement

Risk should always be allocated to the party that can handle it more efficiently. Field surveys, utility locates, geotechnical investigations, and even right-of-way acquisition are much more efficiently handled by the owner.

3. Expanded Procurement Schedule

Best Value DB represents the majority of public sector DB. It fosters creativity and innovation, while uniquely allowing the team to create value for the owner through applying DB techniques. But it also requires a team to prepare a fixed price proposal with only preliminary plans.

4. Validation Period – Following the Bid

If extending the proposal schedule is not an option, another method of reducing risk for both the DB teams and owner is to include a validation period after the project is awarded. This can be beneficial by allowing the design to advance while more information is collected by the team to validate the subsurface information and structural design of the major features.

5. Project Phasing

Another way to reduce risk to the bidders is to break the project down into several separate contracts. This is referred to as phasing the project.

6. Progressive Design-Build

The use of progressive design-build (PDB) has expanded considerably. In some disciplines, such as water and wastewater, it is becoming the procurement method of choice.

7. Project Development Agreement

The project development agreement (PDA) method of procurement can be adapted to procure major DB projects and to realize the benefits of PDB while including a price component.

Learn more about these seven strategies in the full white paper >

 

What Strategies Are Right for Your Agency?

When evaluating the use of these tools it is imperative to have a team of consultants who has the experience and technical leadership that can serve as an Owner’s Representative and assist your agency in determining the best options available.

Download the full white paper to learn more about design-build procurement strategies and how to choose the right one for your agency.

Get all articles of the alternative project delivery series delivered to your inbox.

Topics: Insights, Transportation, Alternative Delivery, APD Series, Transportation Infrastructure

Related Articles

3 Key Lessons for Tolling Agencies During an Unpredictable Economy

In the coronavirus era, we can take lessons learned from past situations, like the Great Recession, to inform our current...

( read )

Topics: Insights, Transportation, Tolls & Managed Lanes, COVID-19, Transportation Infrastructure

Design-Build for Science Projects: It’s All About Chemistry

You would anticipate there being some science involved when it comes to the planning, design and construction of complex...

( read )

Topics: Design-Build, Insights, Alternative Delivery, Buildings, Science & Laboratory, Healthcare & Science

10 Best Practices for CPM Scheduling

Have you ever received a 90-page schedule analysis, read the five-page summary, and still didn’t understand what you were...

( read )

Topics: Insights, Construction Management, Transportation, Project Controls

About the Author

Jim has 40 years of experience in the transportation market and is a recognized leader in alternative delivery. He can be reached at James.Avitabile@rsandh.com.

Follow RS&H