By Susan Van Bell, Esq., AIA Contract Documents content contributor
If you are an owner interested in a small commercial project or a residential construction project, you’ll want to know the basics of the design-bid-build and design-build delivery methods in order to decide which is the best choice for you. There are other delivery methods used in construction (such as construction management or integrated project delivery), but those are generally used for more complex projects. This article provides a basic overview of the design-bid-build and design-build delivery methods.
If you use the design-bid-build delivery method, you will have separate agreements with an architect and a contractor. Typically, you will retain the architect first to develop the design and then retain the contractor for the construction of the project. The design process will go through several phases, depending on the complexity of the project.
For a high-end custom residential project, for instance, there will likely be a schematic design phase, which would be a set of drawings that capture your basic requirements for the project, such as a two-level four-bedroom house with a finished basement. If you agree with these preliminary drawings, the architect will then develop a more detailed design. Finally, when you have agreed upon the design drawings, the architect will prepare construction drawings that include the details that the contractor needs to construct the project. Using this method, you will have the opportunity to review the drawings at several stages and provide your input into the design. For a less complex project, there may be a more abbreviated design process.
Many people think that all an architect does is develop the design, but, in the design-bid-build method, the architect often assists the owner with obtaining a contractor, as well as providing administration and oversight during the construction phase.
In the AIA standard form owner/architect agreements, the architect will review bids from contractors, make recommendations, and assist with preparing the owner/contractor agreement. The architect reviews shop drawings, answers contractor questions, and performs site inspections to make sure that the construction complies with the requirements of the drawings. The architect will also review the contractor’s payment requests to be sure they are accurate, as well as approving contractor’s requests for changes in the work and any adjustments to time or cost.
The architect will also determine when the project has reached substantial completion, which is when the project is sufficiently complete to be used for its intended purpose. For example, if you are having a house built, this would be when you could move in, even though there may be some items that still need to be completed. Similarly, if you are building a restaurant, this may be when you can open the business, even if some work remains to be done. The architect will assist with development of a “punch list” of items that need to be completed and will perform a final inspection to verify that the punch list items have been done, the project is complete, and the final payment should be made. If the architect is providing these construction phase services, the owner and contractor would communicate through the architect.
If you are using the design-build delivery method, you will only hire one entity, the design-builder, rather than a separate architect and contractor. A design-builder provides both the design services and the construction. Design-builders are often contractors, and many residential home builders are design-builders. Some design-builders offer complete design services, using an in-house architect or by contract with a third-party architect. In other instances, a design-builder or home builder in residential construction may have pre-developed plans and the homeowner can select which plans they would like to use, which simplifies the process.
Typically, there would be separate compensation provisions for the design and construction. Design-builders vary on how they charge for pre-construction services, including design. If you accept their design proposal, you pay the agreed upon compensation for those services. Then, you go on to construction and pay the compensation for construction. If you don’t accept the design proposal and go on to the construction phase, you would only pay whatever was agreed upon for development of the design and other pre-construction services.
During the construction phase, the design-builder performs the construction. The owner communicates directly with the design-builder and is responsible for performing the types of construction administration services (to the extent they are needed), that the architect would provide in the design-bid-build model. If you have chosen from a pre-developed set of drawings and the design-builder has experience in constructing from those drawings, you may not need to be too involved in the process. If you have a more custom project, then you would likely be more involved in the development of the design and the construction process.
So which delivery method should I choose?
You can see, from the descriptions of these two methods, that there may be pros and cons to each, depending on the complexity of the project and on how much the owner wants to be involved in the design and construction of the project. You may find design-build more appealing because you will only have one contract and be dealing with one entity. It may be a faster and more simplified process than design-bid-build. On the other hand, you may find design-bid-build more appealing because you want the flexibility of choosing the architect to provide the design services and then choosing a separate contractor to perform the construction. You may also want the assistance of the architect to provide the construction phase services rather than doing it yourself.
We hope this article has provided you with a basic overview of these delivery methods to help you make the choice that is right for you and your project. Article 3 in this series will look at working with an architect, addressing issues such as the architect’s standard of care and providing more detail on the architect’s services as well as your responsibilities as the owner.
Susan Van Bell, Esq. was Senior Director of Content for AIA Contract Documents for over ten years. She is currently a consultant.
AIA Contract Documents has provided this article for general informational purposes only. The information provided is not legal opinion or legal advice and does not create an attorney-client relationship of any kind. This article is also not intended to provide guidance as to how project parties should interpret their specific contracts or resolve contract disputes, as those decisions will need to be made in consultation with legal counsel, insurance counsel, and other professionals, and based upon a multitude of factors.