Construction Law

Project Delivery Systems: Construction Management (At Risk)

Currently, there is an ongoing debate about which project delivery system for a commercial project is best. Our Florida construction lawyers believe the selection of a system should factor in the considerations of the owner, project requirements, and team selection. After all, a properly selected project delivery system will decrease your potential for construction-related disputes. This article is intended to help construction professionals get a better idea of the best delivery system that will convert into a successful project completion.

Construction Management (At Risk)

A construction management at risk (CMR) project delivery system is a team consisting of an owner, architect-designer, and construction firm. The construction firm acts as the construction manager and subcontractors are bid to the construction manager. Both the architect-designer and construction firm are selected based on a qualifications process. The construction firm is responsible for the contract performance, the subcontracts, the vendor contracts, and for paying subcontractors. The firm must ensure that the project is completed and delivered at the agreed upon price. This system is being used more in both public and private sectors.

What are the Benefits and Risks of This System?

It is obvious that each system has it’s advantages and disadvantages for everyone, whether an owner, an architect or a contractor.

Advantages: The CMR provides less risk for owners and produces predictable and manageable results due to a more collaborative and non-adversarial process. Owners also have more control over the team selection process. There is increased opportunity for subcontractors, suppliers, and vendors. Additionally, fewer change orders occur and more time and money is saved.

Disadvantages: The risks associated with a CMR include a potential for less competition if the pool of qualified construction managers is low. The construction manager is also seen as an extension of the owner’s staff and is responsible for subcontracts.

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Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.