UK
Answer ... The traditional project structure has the design team appointed directly by the client. The contractor is typically appointed after a competitive tender process and coordinates the construction team, including all subcontractors. Often the design team is novated to the contractor at a milestone stage – for example, after planning approval. However, many projects adopt design and build procurement, where the contractor engages the design team and all subcontractors from the outset. Collateral warranties or third-party rights, given under the Contracts (Rights of Third Parties) Act 1999, are typically given by contractors and certain consultants and subcontractors to the client and/or other interested parties, such as funders, purchasers and tenants.
Construction management suits experienced developers whose in-house team engages and manages individual trade packages appointed directly by the client. Management contracting is similar, but the client employs a management contractor which engages the works contractors for a fee, plus overheads.
In turnkey and engineering, procurement and construction (EPC) contracting, the contractor develops the detailed design and is often responsible for facility commissioning, start-up and handover.
Generally, the involvement of an international party does not affect the structure of the project, subject to tax considerations and the provision of suitable guarantees.
UK
Answer ... The separation between the design and construction teams is the main disadvantage of traditional procurement, although it is a well-established structure. Under design and build, the contractor takes on all risks and is the single point of contract, simplifying communication and processes; although this may not be as cost effective.
The construction management is time and cost effective, but involves more risk and management for the client, even it receives collateral warranties from key works contractors. EPC and turnkey require a suitably experienced and technologically competent contractor; although this comes at a cost and limits client involvement and flexibility of design.
UK
Answer ... These include:
- the nature of the project and the client;
- the time for completion;
- design and planning risk;
- specific site issues and location;
- the method of financing;
- the need for operation and maintenance;
- entitlement to the facility’s product or revenues; and
- tax considerations.