Design and Construction within Turnkey Delivery
Turnkey delivery offers a more effective process for designing and constructing new facilities than a traditional Design-Bid-Build (DBB) procurement. Turnkey delivery consolidates multiple contracts into a single point of accountability, provides early risk transference with certainty of schedule and cost, and results in accelerated delivery, while integrating the Agency as an active participant in the design process.
Greater Accountability and Risk Transference through Contractual Alignment
The turnkey delivery process contractually aligns real estate (development), design (architect), and build (contractor) team members through a single source contract, creating greater accountability to the Agency by the private sector (see facing page). Delivery risk is assigned by the Agency to a turnkey delivery team that is positioned to effectively manage the risks inherent to building new facilities. A typical turnkey delivery team is comprised of a developer that manages the team’s performance of development activities, such as site acquisition, entitlements, utilities, permitting, public relations and end-user coordination, and a Design-Builder that is responsible for the design and construction activities employing a Design-Build method.
“Turnkey-Design-Build commonly results in schedule reduction of 20% or more, which equates to 10 months or more on most projects.”
Understanding the Design-Build method within the turnkey delivery process begins with the role of the Agency. As represented in the graphic on the facing page, with a traditional DBB, the Agency is central in orchestrating and managing the process. The Agency holds multiple contracts and is responsible for managing the contractual process between all the various parties involved. With this, the Agency assumes the delivery risk, and is ultimately responsible for cost and schedule overruns. Once the building is complete, the Agency is responsible for building operations & maintenance (O&M).
A turnkey delivery approach offers the Agency a single source, fully integrated and effective way to manage the development, design and construction process. The turnkey delivery team is responsible for overseeing the facility’s development at a fixed cost and schedule, eliminating Agency risks of schedule delays and cost overruns (see page 14 for a cost and performance analysis produced by Caltrans). This approach enables Agencies to do more with less staff and to tailor their level of involvement on a specific project to meet their broader organizational needs.
Schedule Savings via Turnkey-Design-Build Delivery
With a turnkey delivery approach, development, design and construction activities overlap, allowing for fast-track delivery of facilities with no additional risk to the Agency. Turnkey-Design-Build commonly results in schedule reduction of 20% or more when compared to traditional Design-Bid-Build delivery. This equates to 10 months or more on most projects. Integrated design and construction teams are better equipped to realize solutions to complex building problems by promoting close collaboration through a contractually defined process. This consolidation of expertise allows for tasks such as permitting, submittals, inspections, and quality control processes to occur simultaneously with construction.
Leveraging Private Sector Expertise Frees Agency to Focus on End-Product Goals
Turnkey delivery does not remove the Agency from the equation; they are present throughout the Design-Build process, attend all design and construction meetings, and exercise a large degree of control over the direction of the project. While profoundly involved throughout the entire process, the Agency’s time is leveraged by the expertise of the development team for greater efficiency. With the aid of the development team, the Agency avoids the minutia of the process while maintaining focus on their end-product goals. Design approval is verified through a design review process, where the Agency has the opportunity to review and approve the design packages created by the Design-Build team. During construction, the Agency can retain 3rd party inspectors and commissioning agents to independently verify that the Design-Build team is meeting all the requirements of the agreement. In this way, the Agency can maintain laser focus on meeting all of the objectives of the project end-users.
Keys to a Successful Design-Build Process
Critical to the success of the design and construction component of turnkey delivery is organization and management of the design process. Creating a framework for collaboration between the various team members is key. Under a turnkey delivery, the Design-Build executive manager assumes responsibility for leading the design effort and coordinating the design with the Agency. Establishing a regular place to host design meetings is a crucial feature of the Design-Build process because it promotes teamwork and improves efficiency. Also important is creating a central repository of critical information that is online and accessible to key project stakeholders.
Active Agency Involvement – No Loss of Control
A typical concern raised by Agencies when contemplating turnkey delivery and the Design-Build process is loss of control over design. Our experience suggests that this concern is overstated. Active involvement from the Agency throughout the design process is integral to achieving success. In addition, at key stages in the design process, packages are created for review and approval to ensure the design solutions created by the project team meet the requirements of the Agency. A formal process for recording feedback and resolving design matters is essential for validating the design and moving forward with construction.
Because design and construction activities overlap, early construction phases involving sitework, foundations, superstructure and the exterior enclosure can be built while the remaining building interiors and mechanical system designs are being finalized. At this stage of the project, the Agency is in the field and is actively engaged in the building process while the design is being completed. Onsite construction continues like a traditional construction process; architects and engineers provide construction administration services and operate under the same professional standard of care. Third party inspectors and jurisdictional code review agencies are also involved, providing independent reporting and quality control services.
Throughout the design and construction process, it is essential for the Agency to establish its level of involvement. One Agency may want to actively supervise the Design-Build process, while another may only want to be involved during key design phases. Turnkey delivery offers varying degrees of project involvement and consistently delivers on cost and schedule guarantees.
Refining Design to Improve End-User Experience/Maintaining Budget and Schedule
Another exciting feature of turnkey delivery is that it offers the Agency more opportunity to provide input into design refinements focused on the experience of the facility end-users. The integrated Design-Build approach of turnkey delivery allows design refinements to be incorporated more quickly, reducing any cost or schedule impacts to the project. As detailed in the case study on page 15, the use of mock ups enable design refinements to be made in real time with input from actual users of the planned space. If decisions cannot be made regarding future refinements, the project team can make provisions to accommodate the refinements at a later date. The use of a collaborative team approach can extend to senior level leadership when a special executive leadership team is established. This partnering approach ensures all members of the project team are aligned and able to determine the course of action when the unexpected occurs.
Effective Risk Management Through the Turnkey Design and Construction Process
Turnkey development promotes active Agency involvement and aligns the incentives of the designers and builders, enabling them to work towards their shared performance goals. The resulting process is streamlined, productive and offers great value to institutions and the public sector that are pursuing major facility projects.