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I've already hired an architect, why would I need a project manager for our next expansion?

The services a project manager -- sometimes called an owner’s rep -- provides for you are different from the services provided by either an architect or general contractor. An owner’s rep will be your eyes and ears on the site, helping to manage both the architect and the GC, confirming that work has been completed, reviewing change orders, helping to assure that RFI’s are handled in a timely way, reviewing lien waivers before checks are issued, resolving questions about field conditions and other matters. Both the architect and GC are inextricably linked to their own interests in the job – defending drawings or bids, possibly in conflict with each other, and not able, therefore, to always give you completely independent counsel. This is appropriate and inevitable – structural. In addition, your owner’s rep will assist you in areas where the architect and GC have no responsibility or limited interaction – for instance IT, telecom, signage and security vendors. In a situation where you are building out in a leased facility, your owner’s rep may also be the key liaison with building ownership – to help coordinate base building work, contractor access to areas outside your premises, and changes in building ownership’s construction rules.

An owner’s rep will work with you at both a strategic and tactical level. On a recent fast-track job, when the GC who’d won a competitive bid could no longer perform, we helped our client quickly qualify another contractor. We helped drive the team to 40% savings on the build-out through value-engineering, found ways to keep the project moving despite a hurricane-related power outage and a telecom strike. We opened the new facility just 15 days after target occupancy with no financial or other penalties to our client who was moving from a leased location.

An owner’s rep has a single focus – your interests. A good owner’s rep will help you save money, keep your project moving forward, and assure that you spend less on Tylenol.

What is the difference between a Guaranteed Maximum Price (GMP) and a stipulated sum contract?

In choosing the general contractor, decide first on the building model you will use to execute the job. The most common models are "design-bid-build" and "design/build."

In the "design-bid-build" model (also called stipulated sum), all construction drawings and details are complete before you seek to hire a general contractor. The general contractors compete primarily on price in these situations, and as a result have little input into how a job will be constructed, little scope for creativity, and no official role in improving the job. General contractors hired on this basis sometimes overlook details, misread drawings, or simply want a larger profit margin. They have incentives to use change orders to make money, and this can make the process adversarial.

"Design/build," on the other hand, incorporates the general contractor earlier in the process and invites his or her construction expertise into the final design stages. This may take more management and some additional risk on your part, since according to this model you hire the general contractor before construction costs are finalized, but it can deliver lower costs and superior facilities. When this relationship is properly structured, you gain an additional consultant for the same general contractor fee.

Consider which approach works for your project. "Design-bid-build" may be best for straightforward work where the details are clearly laid out and the general contractor is responsible and qualified. "Design/build" works best for fast-track jobs where a general contractor, experienced in this type of job, not only builds but troubleshoots, and can deal with uncertainties that come up.

An example of how a general contractor may be called on to solve a problem occurred in one case when an unexpected change in building sites raised a facility owner's building costs from $800,000 to $1.4 million. The general contractor intervened and negotiated with subcontractors and trimmed costs to $900,000 by changing lighting, HVAC, and technical components-while making sure everything would work as it should.