As the high-rise residential market enters a more subdued phase of its cycle, increased nervousness on the part of owners/developers could be said to have triggered a more conservative approach, and an increased trend towards design and construct (D&C) contracts with builders/contractors.
Despite the D&C environment, an owner/developer can still take steps to ensure that their original vision as to the safety levels and technology capabilities within their development is maintained throughout the process.
What is a D&C contract and how does it differ from a standard construct-only contract?
In a traditional or standard contract, the design is developed by the owner/developer’s team prior to contracting a builder. The owner/developer would provide significant detail regarding the specific inclusions and finishes to ensure a high degree of accuracy in the project brief for the builder.
In a D&C contract on the other hand, the owner/developer hands over the responsibility of both the design and construction of the project to the contracted builder. The builder then assumes responsibility of the project based on the design brief or principal project requirements (PPR) of the owner/developer and finalises the specific details prior to construction, using their own design team.
Why do some owners / developers choose a D&C structure?
Reducing risk, streamlining the process, and ensuring a fixed cost at a time when confidence in the market is not at its peak are very attractive reasons to use the D&C method. These factors, on the face of it, appear to meet the three primary criteria by which owners/developers often gauge the success of their project – Is it “on budget”, Is it “on track” and does it “meet expectations?”.
The most obvious consideration in ensuring this method works is choosing a suitable builder with the ability to meet their D&C obligations to a satisfactory standard.
However, the process of D&C is also subject to the builder’s interpretation of the brief and this set-up provides builders with the potential to save money by using their own construction methods, design team and building materials. They have every right to choose what is used in the build as long as it meets the spirit of the brief.
This is where there can be a disconnect between what the owner/developer has envisioned for their project and the reality of what is delivered by the builder.
How can the owner/developer ensure they get what they are after?
This part can easily be diluted by the D&C process if it is not part of the early brief. So, to ensure the owner/developer gets what they want, it is important that they provide a more comprehensive project brief. While this brief will not be as extensive as a specification sheet in the instance of a construct-only situation, the brief should outline the technical performance criteria and even the preferred choice of systems for the project, to ensure the final result is fit for purpose according to owner/developer’s original expectations. The larger, more complicated, or unique the project, the more intricate this early brief should be.
Developers/owners can also engage a specialist security/technology provider in the early stages to work with their consultants to help inform, plan and design a safe, secure, technologically-advanced solution, providing various options which may suit the specific development. Working with a security company that specialises in technology and can offer scalable, versatile, solutions in their product offering, provides room for movement for the builder down the track, without compromising on the quality and the type of security and technology capabilities that are required – whether that may be in relation to smart home automation options, access control, video surveillance or otherwise. Early engagement of a security/technology provider may also mean that developers/owners do not miss out on opportunities to add value to their development, particularly when it comes to offering resort-style features or a more “connected” living environment which are attractive to buyers.
As the world moves towards greater day-to-day technology with android touchscreen intercoms embedded with APPs that wirelessly control lights/blinds/temperature, measure power consumption, divert intercom calls to mobile, communicate with building management, provide for LPR (licence plate recognition) car entry, voice control, and remote access; the expectations by the public of the provision of such, or access to the same, is fast becoming the new “norm”. It is becoming important for owner/developers to cater for this especially as competition increases and customers become spoilt for choice.
For more information, please contact:
Robert Guterres | Group Marketing Manager
Urmet Group in Australia
T: +61 7 3801 3555