Anyone who has worked in the construction industry has heard the saying — if you fail to plan, then you plan to fail. This holds true for the majority of projects that are each uniquely complex in nature. You should think of the building process in the same way you think about completing a puzzle. Some puzzles take days or weeks to complete, while others take months or even years. The lesser timeline is more likely if you have a strategy before you start. Borders first, pile similar colors together … you get the picture.
Everyone likes to save time and money. Unfortunately, when it comes to building a dream home, this often isn’t the case. By the time you have selected an architect, acquired a permit-ready set of plans and picked out your finishes, the cost is significantly over your desired budget. Can this situation be avoided? The answer is “YES” Let us tell you how.
If you utilize a professional’s pre-construction services, you are more likely to see your project be executed in an efficient and timely manner – as well as within budget. Precon services are offered by general contractors and are used in planning a construction project before the actual construction begins. During this process, challenges that could potentially hinder your project are addressed and resolved.
The most common reason why owners choose to utilize precon services is due to the minimal investment required on the front end and what you gain from that investment. You will identify cost-saving measures, pinpoint and reduce risks, and remove any unknowns of a project.
Challenges occur on every construction project, but having the opportunity to mitigate those challenges on the front end will be vital to the project’s success. Challenges typically addressed during the preconstruction phase of construction include but are not limited to: site selection, project feasibility, soil conditions, scheduling, permitting, value engineering and building material analysis.
Here is a practical example of planning to succeed. Let’s assume you have purchased a lot and selected an architect that you want to work with to complete a custom home design. After surveying a few people on current construction cost, you build an expectation that your new home will cost $400 per square foot to construct. The architect has now completed the plans, and you have worked with an interior designer to establish your finish allowances — you are now ready to send your plans out to four builders for an estimate. Disappointingly, only three of the four builders turn in pricing. The three bids come in between $525 per square foot and $625 per square foot. With a home design of 4,000 square feet, even when going with the lowest bidder (which is not always recommended), your projected investment is now coming in approximately $500,000 more than anticipated. You are frustrated and now have to go back to the architect, interior designers, potentially the engineers and the builders and then go through several rounds of value engineering to reduce the overall building cost to get closer to your budget. Going back through several rounds on the design process will cost time and more money in an effort to find some cost savings.
A better approach to traditional pricing is to hire a general contractor to work alongside your design team at the beginning of the project. You can sign an agreement that only obligates them to work with your other consultants to provide expertise and pricing input to ensure costs will be more in line with the overall targeted budget. At the end of the design/pricing phase and initial pricing has been vetted through the contractor, the owner and design team should have a more accurate picture of where the contract pricing will land. This approach will save the owner time, money, and align their expectations with actual costs. The owner is under no obligation to use the preconstruction services general contractor for actual construction. However, if the initial contractor involved in the precon effort is awarded the project, they should be enabled to plan and execute the construction process in a timelier and more cost-effective manner since they have been intimately involved from the start.
Undoubtedly, the best way to ensure a project’s success is to create an all-inclusive team from the beginning that includes pre-construction partners who are willing and able to get you to your project’s finish line, without sacrificing your expectations.
By Mike Carpenter, Project Manager at Grand Bay Construction