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Business 202 - The Value of Preliminary Design

Instructor: Butch Malabute, ALT Cladding and Design Philippines, Inc.

The value of cladding design prior to tender is covered in this class.  Typically, the cladding design is of a very schematic nature prior to the tender of the cladding contract.  The winning contractor ends up being responsible for the much of the design.  This class presents an argument for developing and refining the design prior to issuing the cladding tender documents. 

Class syllabus

Introduction
Background
Analysis
Conclusion
Exhibit A - Typical Cladding Estimate

INTRODUCTION

When a developer wishes to put up a project, the first thing that he does is commission an Architect. Some developers will hold a design competition among Architects. Competing architects submit schematic designs and budget proposal along with their professional fee. Once an Architect is engaged, building plans are finalized and tendered to contractors. Usually a project manager is appointed to oversee and assist the developer in securing bids complying to project requirements such as schedule, quality and cost.

A common bidding strategy is to divide the building into several contract packages. The most basic contract packaging will involve separate contracts for mechanical, electrical, auxiliary systems, structural, architectural, sanitary, fire protection, elevators and curtain wall. By subdividing the building into several contract packages, the developer can secure bids directly from specialty contractors and therefore eliminate the usual mark-up by the General Contractor for attending these packages.

This class will focus on one particular contract package: the curtain wall works.

In a typical high rise office development, the curtain wall is the second biggest single cost item. The building structure is usually the largest. The curtain wall contract usually accounts for 10% to 20% total building cost. Exhibit A is a typical cost structure for a curtain wall.

The key to a successful curtain wall tender is to send out for bids a set a well defined set of tender documents that satisfy the Architect's design intent and at the same time attain a budget that is acceptable to the developer.

BACKGROUND

A building is like a sculpture using glass, stone, metal and concrete as mediums. An architect fashions these materials into shapes and forms that are not only functional as an office or residence, but are also a work of art. The architect naturally wants to create the most fantastic looking edifice that will rival all existing structures of its time. Unfortunately, he is limited by the cost of such projects. When the design estimate exceeds the budget, the design team finds ways and means to bring the design and consequently the estimate, within budget. Sometimes, this process compromises the design to the point where the original intent is no longer achieved.

The architectural package is usually the first item reviewed for cost savings because there are several materials that you can substitute that change the appearance but not the function of the building. Examples are floor and wall finishes, tiles, paint, etc.

The other construction packages normally are not as impacted in the cost savings stage because they represent systems necessary for safety and comfort. Examples are the elevators, power, water, fire protection, etc. The curtain wall is the biggest architectural package that can be subjected to re-evaluation. Therefore, the Architect's design intent for the curtain wall is at the greatest risk of being compromised.

ANALYSIS

In Exhibit A you will notice that Aluminum Works and Glass make up a large portion of the cost of the wall. This means that if we were to find any significant savings from the curtain wall, these two items will probably be the main contributors.

There are several ways to achieve a reduction in the curtain wall cost:

1. Design the aluminum to its most efficient form

Without a preliminary detail design from an Architect or cladding consultant, the curtain wall contractors are normally asked to enter into a "design and construction" type of contract. In this case, the architects issue drawings that show building elevations, floor plans, and schematic curtain wall details to several aluminum contractors. Each aluminum contractor then roughly designs the wall and estimates it. These estimates are then submitted as a bid along with design sketches. The Architect then evaluates the proposals. Usually, the designs of the contractors are different from each other. Also, the cost varies between designs as there are differences in systems proposed and materials used by each contractor. The lowest cost does not necessarily mean the best wall and the most expensive bid may not be the best either. It is good if the bids are within the budget. But usually several are not. Eventually, the design or the quality is compromised because of budget or other constraints.

If a detailed preliminary design is done prior to tender, the aluminum shapes that make up the wall can be issued in their most efficient form. This involves determining the minimum amount of aluminum required to resist wind (typhoon induced) loads and fashion them into shapes that conform to dimensions and modules set by the Architect. In order to back-up this design, structural design calculations are required that may be submitted to the Engineer-on-record for review.

The Architect specifies the type of materials to be used and color and type of the finishes of the exterior and interior. Once those are identified, the detailed preliminary design can be estimated. If the cost is within budget, the documentation is released for bidding. If the cost exceeds the budget, more cost and budget review is undertake. The cladding consultant will make several recommendations on how to reduce cost. The Architect then chooses from this list until the budget is met. Once the wall is architecturally acceptable, within budget, and well defined in the detailed preliminary design, the tenders can be released.

2. Change to a glass that costs less

Architects and Owners normally do not want to change the glass significantly since changes in the glass normally affect color. The key to getting the best glass price is to source from the most number of contractors possible.

There may be some sacrifices to be made in choosing glass. For example, blue glass from one manufacturer is different, in both quality and color, from the blue glass made by another. But prices between these two may differ by as much as 50%. Also, changing the glass may affect air conditioning requirement. Say, a glass may be expensive at purchase but may deliver lower energy requirement for air-conditioning (since the glass prevents the heat from entering the building therefore reducing air-conditioning capacity) or a glass may be cheap but will drive air-conditioning and energy cost upward.

Sometimes suggest increasing the mechanical properties of the glass to reduce building energy requirement but this usually changes the color and reduces the ability to see out at night. Residential condominiums usually prefer to be able to see the view outside at night.

3. Alter the proportion of the aluminum versus glass because glass is cheaper than aluminum on a per square meter basis.

A recent example of this approach is a building in Manila that has six above grade parking, floors. Initially, the Architect proposed to use aluminum louvers and sunscreen to cover the above grade parking area. The cladding consultant, ALT Cladding and Design, proposed to delete the louvers and sunscreen and replace them with glass. This suggestion however, required mechanical ventilation at the parking area. When the additional cost for the glass and ventilation were added, it was still significantly less than the cost of the louvers and the sunscreen.

4. Revise the design but keep the architecture

On a building in Fort Bonifacio, ALT Cladding and Design were able to reduce cost by changing the way the "look" was achieved without changing the "look". Initially, when the Architect presented the design to the Owner they showed concrete canopies clad with aluminum protruding at each floor level. The windows sit on top of the concrete slab and end at the underside of the next floor slab. This design required the curtain wall to span one floor height and act as a simply supported beam/slab system.

ALT proposed to cut the slab short, make the curtain wall. Run past the front or the slab as a continuous slab/beam system and simulate the canopies by providing a metal sub-frame clad with aluminum. This way, we save on concrete which translates to a lighter structural frame which is cheaper and we benefit from a continuous slab/beam system which requires less aluminum than a wall which is simply supported. From an original design estimate of 1.1 Billion Pesos, we were able to award, the contract at 850 Million in large part due to this change.

The following are the advantages of making a detailed preliminary design prior to tender.

1. By designing the aluminum profiles in the preliminary design stage, the cost of of aluminum required can be estimated to some degree of accuracy. Since aluminum is a large percentage of the total wall cost, designing it most efficiently will greatly lower the total wall cost.
2. By designing the wall in detail up-front, the Architect is able to see the design in workable form. The design can be verified and confirmed to meet intent.
3. The Owner is appraised of the costs at a time when decision can be made. Before the tender process is the best time to make design changes.
4. The aluminum contractors are given the same documentation detailing system and material requirements. Therefore eliminating guesswork or "contingency" factors that normally drive costs upward.
5. The bid period is reduced since contractors do not need to redesign the system. They just need to modify of enhance the detailed preliminary design to suit their technical capabilities or limitations.
6. Variation between bids is kept small. Since the design is well defined, the contractors do need to make as many guesses as to the intent.
7. The contractors cost is within budget. Since the curtain wall is estimated before the issuing of tender documents, there should not be any significant difference between this estimate and the contractor's estimate.
8. Overall contract management is made simpler. Since the design parameters are clearly defined by the detailed preliminary design, future differences or discrepancies between what the contractor provides and what was intended are avoided. Therefore extra costs or back charges are also reduced.

CONCLUSION

The detailed preliminary design of the curtain wall before bids are issued is the best way to insure the Architect's design intent and the Developer's budget constraints at the highest possible quality.

EXHIBIT A - Typical Cladding Estimate

Note: All costs are in millions of Philippine Pesos.

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