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Greater cost certainty expected with emerging project delivery model – webinar

Author(s): Andrew Wong, Jagriti Singh

Feb 3, 2022

The progressive design-build project delivery model is gaining traction in the construction industry, with its benefits including greater cost certainty, collaboration and transparency. The advantages of this model were highlighted by Osler’s Andrew Wong, partner, and Jagriti Singh, associate, Construction and Infrastructure Group, during a Progressive Design-Build webinar.

Unlike other project delivery models where fixed prices are set and contingency fees are included, the progressive design-build model establishes a process for the development of the construction price. The parties to the contract agree on construction, pre-construction and post-construction costs. They also agree to a markup as part of the design builder’s profit. There is no agreement on the amount it will cost to complete the construction work.

Once building drawings and specifications have reached a certain degree of completion, the design builder seeks bids on each of the scope of work components. Once the bids are received, the design builder reviews these with the owner with full disclosure and transparency. The successful bid costs for each of the scope of work components are added to the design builder’s profit markup. This sum is then presented to the owner as the total construction work costs. This helps with cost certainty while mitigating disputes over scope of work and reduces change orders.

Andrew told the audience he has acted on recent projects in which the progressive design-build model has been used, including the building of a data centre for a financial institution and a public infrastructure social initiative. He has also used the CCDC 14 price contract in negotiating agreements, adding supplementary conditions to take into account the progressive design-build elements.

View the full Progressive-Design Build webinar