AGENCY CONSTRUCTION
MANAGEMENT :CM NOT AT-RISK
DOES THE DESIGN/BUILD PROCESS ALWAYS
WORK?
So, what happens if an Owner DOES NOT have the
knowledge or experience necessary to make
construction related decisions?
SOLUTION: Hire a Construction Management firm to act
as “owner’s agent”
AGENCY CONSTRUCTION MANAGEMENT
“CONSTRUCTION MANAGEMENT FOR FEE”
(CONTRACTUAL RELATIONSHIPS: CM NOT AT RISK)
Owner
General
Contractor
Architect/Engineer
Sub
Sub
Construction
Manager
Resident Field
Engineer
AGENCY CONSTRUCTION MANAGEMENT
• Agency construction management (ACM)
encompasses a range of services provided
by a CM on behalf of an Owner.
• This method can been used successfully
regardless of the type of formal contract.
WHY AN OWNER CHOOSES ACM?
Owners who:
 Doesn’t have the experience/knowledge to make sound decisions
during the construction process
--OR- Does ‘t maintain the staff necessary to deal with responsibilities
involved in the management of major projects.
WHAT DOES THE ACM DO?
CM as owner’s agent may provide professional
services on behalf of Owner throughout the
project, including:
 Pre-design & Design phase
 Construction phase
CM maintains “fiduciary duty” to act on Owner’s
behalf & provide impartial advice concerning
the project.
WHAT IS “FIDUCIARY DUTY”?
FIDUCIARY DUTY - An obligation to act in the best
interest of another party.
A fiduciary obligation exists when one person
places special confidence in another person
and relies upon that person to exercise his
expertise in acting for the client.
WHAT IS “FIDUCIARY DUTY”?
• The fiduciary knowingly accepts that trust and
confidence.
• Thereafter undertakes to act in behalf of the client
by exercising his own discretion and expertise with
concern of the interest of the client.
The Agency Construction Management firm
has no vested interest in the project.
They are to simply act as the “owner’s agent”.
LET’S REVIEW THE SERVICES OFFERED BY AN
AGENCY CONSTRUCTION MANAGEMENT
FIRM
PRE-DESIGN AND DESIGN PHASE
Selection Of The Design Team
 ACM will often have historical experience in the market and can
assist owner in selecting the most qualified A/E (architect/engineer)
Budget & Cost Estimating
 Based on historical data for similar projects, ACM will assist owner
in determining feasibility of initial scope.
 Refined estimates are done later in the design phase to pinpoint the
construction budget.
PRE-DESIGN AND DESIGN PHASE
Constructability Review
A review of plans to verify that the design presented poses
no construction conflicts and is economical to build.
Contract Bidding
Development of bid package and bidding procedures
CONSTRUCTION PHASE
SERVICES
Construction Inspection & Surveillance
Examine contractor performance, compliance with specs,
safety, etc.
Project Controls
Correspondence, progress meetings, submittals & requests
for information, documentation of progress schedule, review
of pay requests
CONSTRUCTION PHASE
SERVICES
Change Order Review
 Coordinating design changes with A/E
 Negotiating change orders
 Determining responsibility for changed conditions & coordination conflicts
CONSTRUCTION PHASE SERVICES
Project Closeout
 Develop punch list
 Resolution of outstanding issues
 Review & analysis of claims or disputes
PROJECT MANAGER MAY DELEGATE
RESPONSIBILITY TO A RESIDENT FIELD ENGINEER
•
•
•
•
•
•
•
•
On site on a regular basis.
Works closely with contractor
Inspection & quality control/assurance
Accepts/rejects materials
Oversees field testing
Prepares “as-built” drawings
Involved in change order process
Provides status reports to PM
• **Must keep PM informed on a daily basis of project issues
OPTIONS
Some owners are equipped with A/E services
 Need assistance with bidding
 Need assistance in finding qualified contractors to perform work.
When an owner has the ability to handle certain aspects,
he may tailor the use of ACM services to meet specific
project needs:
 Project cost control services
 Project scheduling services
 Construction Phase Work