Beruflich Dokumente
Kultur Dokumente
• Rule 1 : Competence
o Protect the health safety and welfare
o Account for all applicable state and municipal building laws and regulations
o Qualified by education training and experience
o Shall not practice if in the boards judgement such persons professional competence is impaired
by physical or mental disabilities
• Architect
* Denotes a base service per B101
o Structural base services *
o Civil
o Landscape
o MEP *
o a/v
o Lighting
o Acoustic
o Cost estimator
o Code consultant
o Sustainability
PROJECT DELIVERY
Design-Bid-Build
▪ Driving Factors : Cost & Risk
▪ “Traditional method” well defined roles, linear process
▪ Public Projects : Lowest Bidder
▪ AIA A101
▪ Owner carries all Spearin Gap Risk
▪ 3 Roles
• 1. Owner: Principal
• 2. Architect – Agent
• 3. Contractor – Vendor/Third Party
▪ 3 Phases:
• 1. Design : CDs and Specifications
• 2. Bid : Multiple contractors, selection based on low bid or best value
• 3. Build
▪ 2 Separate Contracts:
• B101 : Owner Architect Agreement
• A101 : Owner – Contractor Agreement
▪ Construction Cost is determined after design
▪ One Construction Contract
▪ Best for owners who are not under a tight timeline and have a limited budget, cost is
the driving factor and quality is not
▪ Drawings must be @ 100% before construction can begin
▪ Advantages:
• Competitive bids, maximize the built product for price
• Architect is the owners advocate
• Architect is active in CA so design intentions are followed
• Minimal coordination issues
▪ Disadvantages:
• Sequential phases that involve more time
• Owner at risk for final construction costs
• Not good for a building that needs to be done quickly
• Creates an adversial relationship with contractor
Negotiated select Team
▪ Variation of Design Bid Build
▪ Contractors selected early in design phase
▪ Construction cost is determined after design
▪ One construction contract
▪ Owner carries spearin gap risk
▪ Not permitted for publicly funded projects
Construction Management
• Used when additional support of construction management services are needed
• CM can play one of 3 Roles
• CM as Advisor
o Driving Factors : Risk & Quality
o Constructability and cost management consultant
o Does not build the project
o Does not provide construction costs
o Many contracts
o 3 Payment Types
▪ Stipulated Sum
▪ Cost Plus w/a GMP
▪ Cost Plus w/o a GMP
• CM as Agent
o Driving Factors : Risk & Time
o One or More Prime Contracts
▪ Architect – Owner – CM
o Construction cost is determined at completion
o Compensation Methods:
▪ Stipulated Sum
▪ Cost Plus w/ a GMP
▪ Cost Plus w/o a GMP
o Provides early cost estimating, scheduling and assistance
o Provides services for a fixed fee but passes along savings and cost overruns to the owners
o No risk for actual construction costs
o Advantages:
▪ Reduces owners burden to manage the project
▪ Project scheduling can speed process to save money
▪ Cost estimating monitors costs
o Disadvantages
▪ Added costs, final construction cost is unknown until design is complete
▪ Multiple prime contracts increase administration costs can lead to claims and disputes
▪ Cant resolve design-construction issues only serves as a mediator
o 2 Payment Types
▪ Cost Plus w/a GMP
▪ Cost Plus w/o a GMP
Design Build
o Driving Factors: Risk & Cost
o Owner contracts with single entity for design & Construction
o One Contract
o 2 Prime Players:
▪ Owner : should have construction knowledge to utilize this method effectively
▪ Design Build Entity
• Can be architect, if architect, architect assumes responsibilities of contractor
o Selection based on
▪ Direct Negotiations
▪ Qualifications based selection
▪ Best value fees
▪ Total Project Cost
▪ Lowest Bid
o Methods of Compensation
▪ Stipulated Sum
▪ Cost Plus w/a GMP
▪ Cost plus w/o a GMP
o Construction cost determined before design
o Overall collaborative project planning
o Overlapping phases
o Preconstruction services
o Emerged from dissatisfaction of tensions between arch & contractors
o Typically a fixed fee
o Beneficial for owners who have construction experience
o Typically will hire an additional CM Agent
o Arch is a vendor not an agent
o Advantages:
▪ Fastest Project Delivery Method
▪ Single entity of responsibility
▪ Lower chance of cost overruns
▪ Early cost and scheduling commitment
▪ Conflicts w/ professional are internal do not involve owner
▪ Lower chance of cost overrunsfast track
o Disadvantages:
▪ Owner involvement is limited in early phases
▪ Non competitive costs – less building
▪ Hidden reductions in quality & design & finishes
▪ CDs not complete upon commitment
▪ No objective agent for owners best interest
o Owner assumes construction contract admin duties normally provided by architect including:
▪ Certifies substantial completion
▪ Submittals
▪ Approving changes
▪ Rejecting nonconforming work
▪ Site visits
▪ Develops project criteria
Bridging
o Driving Factors: Risk & Quality
o Combination of Design Bid Build w/ Design Build
o Construction cost determined after design
o 2 Architects
▪ Acts as project manager/Designer for basis of project
• Not responsible for final construction documents, but reviews them
• Provides performance specs
▪ Design Build Architect provides technical drawings based off of design architect
o Advantages:
▪ Lowest cost/fixed price
▪ Owner has an agent
▪ Owner doesn’t have to develop project criteria
▪ Competitive bidding & fixed cost
▪ Single source of responsibility
▪ Meets owners requirements
Design Assist
• Specialty subcontractors or trades are included early in the design and construction document phases to
help with the development of complex or unique portions of the project
• When a project requires specialized detailing and specifications
• Best when used with Design Build or Construction Manager at Risk
• Not appropriate for projects that will be bid
• Subcontractor is paid by owner a design fee for its services
• The subcontractors documents may be used instead of shop drawings
• Three Phase Process
1. Architect & Owner decide which portions of the project will utilize this method
and write an RFP for those services
2. Responses are reviewed and Architect & Owner select a subcontractor
3. The selected contractor works with the architect to provide technical advice to
detailing the specific system, and writes the specifications
Accelerated Schedules
• Directed Acceleration
o Owner directs contractor to speed up
o Change order
• Voluntary acceleration
o Contractor may decide to speed or catch up for a bonus or to get on another job
• Constructive acceleration
o Situation causes excusable or unavoidable delay
o May incur a claim
Sole Proprietorship
• An individual conducting business in an unincorporated format
• No legal arrangements w/ other individuals
• Not required to file state documents & legal tax forms
• Business and personal expenses should be kept separate
• No federal tax return, included in personal Taxes
• Taxable year: Calendar Year
• Net profits : Taxable
• Self Income : Taxable
• 100% of Health insurance may be deducted from gross income
• Self Employment Tax : ½ of SE deducted from gross income
• Capital losses are carried forward indefinitely, 3,000 per year
• Transfer of ownership typically occurs with assets not business
• 2 Factors
o Liability
▪ Liable for all business claims
▪ All assets, personal and business are at risk
• Professional liability insurance can protect from claims
o Death or Retirement
▪ Would terminate SP, unless:
• Successor is assigned to purchase practice
• Estate or liquidation plan
• Advantages
o Low Cost and easily setup
o Tax Advantages
o Total management control over owner
• Disadvantages:
o Owner liable for all debts/losses
o Personal assets at risk
o More difficult to raise capital if you have bad credit
Partnership:
• Not a sperate legal entity distant from partners
• Unincorporated association of 2 or more people
• Not required to file state organizational documents or federal tax id’s
• Partners share losses and profits equally and are personally responsible for any claims, even those of
others
• Agreements:
o Financial contribution agreements
o Responsibility and authority delineation
o Fiduciary duties of partners
o Operation and management responsibilities
o Distribution of profit and losses
o Dispute resolution
o Dissolution of partnership
Corporations
• Existence transcends those who own and manage it
• Must be filed w/ state to notify public of establishment
• Governed by laws of individual states
• Shareholders are not protected from professional liability
• Shareholders only financially responsible for amount invested
• Cannot reach personal assets
• Separate Tax Paying Entity
• Shareholders who are employees are taxed on salary
• Compensating Retiring Partners:
o Buy/Sell Agreement : Must sell back shares to corporation
• Taxes
o Taxed @ lower rates than individuals
o 2 Ways:
▪ Profit of corporation
• Salaries and business expenses deducted to determine revenue which is taxed
o To reduce this amount, may be divided into bonuses, pensions or
donations
▪ Shareholders Dividends
• 2 Levels of Participants
o Owners and investors : Members
▪ Does not have to be managed by members
o Managers : Managees
• Ownership may be transferred similar to corporation
• Classified as a partnership for federal tax purposes
• Characteristics similar to a corporation
o Conducts business in name
o Losses passed through personal income while limiting liability
• Liability is limited to investment
o Members have no personal liability, personal assets are not at risk
• May Elect to be taxed as SP, Partnership or Corporation
Joint Ventures
• Temporary association of 2 or more persons or firms to complete a project
• Used when experience is lacked or project is too large
Partnering Agreement
• Before a joint venture is formed, this should be developed
• Defines: roles, responsibilities, and contractual relationships that will be established if the firms are award
the project and the join venture is formed
• If a team wants to forma prime consultant agreement
• Aka a Memoranda of Understanding
Teaming Agreement
• Not a contractual relationship
• An agreement between the parties to work together toward the common goal of constructing a building
• May or may not be a written document, aia recommends using a partnering charter, developed during a
workshop facilitated by someone not involved with the project in which all team members participate
that outlines the responsibilities and goals to the team
PROJECT MANAGEMENT
o Tasks need to complete a project, sequences and earliest and latest start and finish dates
o Defines tasks and start & end dates which must be adhered to for success
o Arrows : represent tasks
o Tasks beginning and end points represented by a numbered circle
o Next task cannot begin until all tasks pointing to circle have been completed
o Dashed arrows : Dependencies
▪ Do not represent tasks and have no duration
o Heavy arrows : critical path
▪ Must finish on time
o Non critical task may start or end later without effecting final completion
▪ Max length, non critical task may take without effecting deadline is called “float”
• Milestone Chart
o Used for short duration projects with few tasks
o Low project fees
o Easy to prepare track and communicate
o Shows : tasks, start and end date, hours allocated, billing rate, percentage complete and earned
value
• Wall Schedule
o Preliminary schedule using index cards that involves time and involved parties, requires all
parties to review before finalized documented and transferred to bar chart
o Typically used to create a project work plan
Work Plan
• Aka fee projection
• Detailed project schedule which breaks project into tasks and assigns staff to tasks
• Details fee after deductions will be used to pay staff
• Primary element of the work plan is the schedule often presented in the form of a bar chart
• Should show
o Scope of services
o Breakdown of services to be provided into phases and tasks
o Dependencies
o Milestones
o Staffing requirements and consultant and fee requirements
o Allocation of time and fees
1. Project Descriptions and Client requirements
• Description of the project, scope, clients budget and record of what client has authorized
• Clients primary goals and quality of project
2. Statement of deliverables
• Reports, sketches, drawings, specs, models
• Work plan should include estimates for each deliverable and quantities
• Provides basis for schedule and staffing and budgets
3. Team organization
• Defines hierarchy of architects team
• Responsibilities for assignments
• Relationships of team members
4. Responsibility matrix
• Companion to defining deliverables is who will do what
• Understanding what deliverables each consultant will provide
5. Preliminary project schedule
• Preliminary driver of architects assessment of staffing needs
• Key milestones to meet delivery
6. Preliminary staffing needs
• Determined once scope has been finalized
• Key personnel available and what support staff is required
7. Project directory
• Listing of all project entities and key personnel
8. Internal project budget and profit plan
• Allocation of fee to tasks to determine profit
• Also known as project budget or “job cost budget”
9. Code information
Meeting Management
▪ Occurs in either one large session or spread through out a longer schedule
▪ Two Key elements for effective agendas
o Time block for discussion items
o Attachments that support agenda
▪ Meeting schedule
o Regularly and as required
▪ Meeting agendas
o Purposes, attendees, etc
▪ Executive Session
o Critical decision making and progress based discussion
o Key points to meetings
o Meeting where decisions happen
▪ Project design meeting (internal)
o Flexible and frequent
o Used to prepare for client meetings
▪ Coordination meetings
o Periodically and after design meetings
▪ Redline
o Key designers and professionals
Project Teams:
Typical teams by delivery methods
▪ Owner/Architect [Working with Contractor]
o Design bid build
o owner and architect : key figures until bid phase
▪ Owner/Architect/Construction Manager
o CM@R or Agent
o CM advices on construction means and methods
▪ Owner/Architect/Contractor
o Design build
o Well defined project early, overall lower cost
▪ Owner/Architect/Contractor
o IPD
o More effectiveness through risk/reward sharing
▪ Architect/Architect Teams
o When one architect lacks technical expertise in specific project and needs to team with another
architect
o Primary architect has relationship with client but lacks jurisdiction code knowledge
▪ Responsibilities of PM
o Budgets
o Work planning
o Scheduling out activities
▪ Budget
o Predesign : controlled by client
o SD, DD, CD : controlled by architect
o Bidding : controlled by contractor
▪ Work planning
o Customizable by project manager
o Number of milestones
o Drives all factors at once
o Assignment of tasks
o Client influences of goals, deadlines and define deliverable
o Internal collaborative benchmarks
▪ Not for clients influence
▪ Freedom of defining strategy
Managing Scope & Services
▪ Project Scope
o Owners design requirements : program, site area, and volume and levels of quality
▪ Scope Creep
o Project grows beyond contracted scope
o Ways to manage : milestone checks
Managing schedules and Budgets
▪ Project schedules
o Defines target completion dates and major milestones
▪ Budget monitoring
o Periodic review of time and expenses charged against the project
▪ Project overruns
o Hours over what was budgeted
o Causes
▪ Unrealistic fees
▪ Scope creep
▪ Poor project management
o Options
▪ Charge for additional services
▪ Overtime
▪ Alternatives for completion (staffing)
▪ Take the loss
Managing Billing and Compensation
▪ Billing requirements
o Invoice frequency
o What is included
o Time for payment
o Interest rates on overdue payments
Resource Management:
• Ways for Architecture firm to increase profit
o Accept more projects
o Increase architectural fees
o Reducing administrative salaries
• Productivity:
o Degree of direct efforts of firm can generate revenue
o Measured by net multiplier which is the best measure for productivity
o Creating a through business plan
o Stimulate employees and encourage how their work helps the business
o Giving clear direction and guidance to employees
o Creating a staff manual for employees
o Best way to track progress during cds: view timesheets
o Moonlighting while unethical, should only be a reason for termination if directly stated as against
employers standards in a previously provided employment agreement or contract or firm manual
▪ Performance Evaluations
o Do not have to be formal
o Do not need to occur annually
o Awareness of strengths and weaknesses of employees
o Basis for promotion and raises
INSURANCE TYPES
Automobile Insurance
• Liability and property damage to vehicles used or owned by the business
• Includes protection against claims made by employees using personal cars & taxis
Business Interruption
• Natural Disasters
• Pays the expenses and loss of profit if work is interrupted
Fidelity Bond
▪ Covers employees for theft of $
PROJECT FINANCING
• Blanket loan or Blanket Mortgage
o Funds large piece of real estate that borrower intends to subdivide and resell as each parcel is
sold a portion of the mortgage is paid off
• Bridge Loan
o Short term load used to purchase property or finance project quickly before long term financing
can be arranged
• Construction loan
o Finance a project for duration of construction the converted to longterm payment load
• Hard money Loan
o Short term loan with a distressed financial situation such as foreclosure, bankruptcy, etc.
o Loan based on quick sale value, increased interest rates
• Mezzanine Loan
o Used by developers for a large project loan is secured by collateral in stock of company
• Mortgage Loan
o Provides cash to buyer to purchase property in exchange for a lien on a property until loan is
repaid
• ProForma Statement
o Statement or model of all the expected expenses, initial and long term of developing a project,
Compared against the expected income and increase in value of a project
o Proforma is latin for “As a matter of form”
o Determines whether a project can be financially successful
QUALITY MANAGEMENT
• Lean Systems
o Based on eliminating waste
o Manufacturing model that is based on 5 Principals
▪ Specify Value in Eyes of the customer
• Define processes around customers needs and requirements
▪ Identify the value stream
• The steps in a process that add and don’t add value
▪ Make value flow
• Cutting out as many steps as possible for value purposes
▪ Institute pull
• Delivering to the customer what they need and when they need it
▪ Pursue perfection
• Learning the process
• Improving the processes
• Pareto Theory
• 80% of all work can be standardized
• Measure Performance
▪ Lagging
• Orders filled
• Training hours
• Customer retention
▪ Leading
• Orders in process
• Staff enrollment in training
▪ Auditing
• Post occupancy evaluations
• Client satisfaction surveys
• ISO 9001
• 8 Management Principles
▪ Client focus
▪ Leadership
▪ Teamwork
▪ Process approach
▪ System approach to management
▪ Continual improvement
▪ Evidence based approach to decision making
▪ Mutually beneficial consultant relationships
• Library of constantly updated guidelines
RISK MANAGEMENT
Assessment
• Is there experience there or hire someone w/experience
• Sufficient staff or hire more
• Financial capacity
• Successful or similar projects in past
Client Selection
• Research clients
• Past experience & Repeat Clients
• Flexibility
• Client matrix & updating client lists
Project Selection
• High Risk Projects
o Condos
▪ Typically done by developers, and need to be done fast and cheap
▪ Cheap labors and materials
▪ If doing one of these projects, staff on should be the best staff that creates the best
documents
▪ Maintain thorough record keeping
o Hazardous Conditions
o Asbestos Remediation
o Publicly Controversial Projects
o Public Projects
o Projects that adapt cutting edge technologies
Consultant Selection
• Vicarious Liability: legal responsibility of one party for the acts of another party
o Legally responsible for conduct of consultants as if they are the architects own employees
• Selection based on qualitative factors not based on a price
• If owner selects consultants, architect should provide an indemnification clause
Insurance
• Admitted carrier:
o Licensed and authorized insurance carrier in a specific state and subject to specific state
regulations
• Non Admitted Carrier
o Not subject to same scrutiny
• Claim :
o Demand for money, service or property based upon a right typically found in a contract
• Claim Expense:
o Cost associated with handling of a claim, example : defense attorney
• Claims Made Policies
o Date in which claim is filed for event
Liability
• Legal responsibility for injury or damage to another person or property
Negligence
• Failure to use due care to avoid harming another person or property
• 3 Ways an architect can be found Negligent
o Legal Duty established between the parties
o Architect Breached that duty
o Break of duty was cause of damage or injury
Contractual Protections
• Project Scope
• Project Time Frame
• Project Fees
Indemnification Provisions :
• Defined in A201
• Owner and Architect are not responsible for any damages claims or losses resulting from any performance
of work whether by the contractor or others whom architect has no contractual relationship
• Contractual requirement that architect reimburses if any acts of error or omissions
• Some courts may not support this clause
o Directions arch gave/failed to, were primary cause of damage
Privity:
• Architect is protected from claims by parties with whom has no contractual relationship
• No contractual relationship, third party actions
o example : a claim from a subcontractor whom architect has no contractual relationship with
Hold Harmless:
• One party assumes another’s liability
Statue of Limitations:
• Timeframe in which a claim must be asserted
o Negligence claim 3-10 yrs after completion
• When a mistake or flaw is discovered, a party has a limited time to report the damage and file a claim
Statue of Repose:
• Commences at the time of discovery
o Completion of construction or occupancy begins
• Time to submit is much shorter than the statue of limitations
• Three years after substantial completion with a 6 year cut off date
• Begins to run at the end of construction or whenever services were last provided. Construction contracts
may contain provisions that modify or further define these statuory time restrictions
• “There is some mistake or flaw that is in repose (asleep) waiting to be discovered after construction has
been completed, if its not found in time then the architect and contractor cannot be held liable for it”
Betterment:
• Concept that applies to some negligence claims against architects, the act of trying “better”
• Can be asserted either for an error or an omission
o Errors :
▪ design not code compliant
▪ Responsible for full amount
o Omission :
▪ neglecting to include required elements
▪ responsible for a fraction of amount
Subrogation
• a legal right held by most insurance carriers to legally pursue a third party that caused an insurance loss to
the insured. This is done in order to recover the amount of the claim paid by the insurance carrier to the
insured for the loss
• one party has the right to “step into the shoes” of another party for the purposes of bringing a claim for
damages. Not all types of claims may be subrogated. The most common type that can be subrogated is
property damage claims
• Example: if you are involved in an auto accident where no one is injured, but the vehicles are damaged,
and you are completely free of fault, your insure will pay to have your vehicle damage repaired. If your
insurer pays for the property damage to your vehicle, your insurer then becomes subrogated to your
rights for that property damage. In other words, your insurer can step into your shoes and make a claim
against the other driver in your accident that caused the damage to your vehicle for which your insured
had to pay the repair cost. If the other driver does not voluntarily pay for the damage, your insurer may
bring a lawsuit against the other driver, and your insurer may bring that claim into your name just as if
you were bringing the suit yourself
• A waiver of subrogation clause is placed in the professional services contract to minimize lawsuits and
claims among the parties. The result is that the risk of loss is agreed among the parties to lie with the
insurers and the cost of the insurance coverage is contractually allocated among the parties as they may
agree. The risk once assigned to the insurers by the parties, is determined to stop there, without allowing
the insurer to seek redress from the party at fault
• Intended to minimize the potential for lawsuits, cross suits and counter suits arising from property loss
that may occur during the project. An effective waiver will prevent the various insurers involved from
suing the parties to the construction contracts. One reason to use the available form contracts is that the
entire network of the waiver of subrogation provisions has already been through that, drafter, is in place
ready to use and has been tested in the courts to a greater or lesser extent. The clause quoted from AIA
B141 has a sister provision in the AIA owner and contractor agreements
Vicarious Liability: legal responsibility of one party for the acts of another party
• Legally responsible for conduct of consultants as if they are the architects own employees
Tail Insurance
• Addressed retirement or withdrawal from practice
Surplus Lines
• Insurers not licensed in a particular state, but are surplus carriers because licensed insures wont provide
necessary coverage
Copyright
• Protection for architectural work
• 2 Categories
o Traditional:
▪ Drawings, specs, other pictoral/graphic representation
o Architectural works Copyright Protection Act
▪ Building itself
▪ Applies to buildings erected after Dec. 1, 1990
▪ Graphic representation of building
▪ Overall form, layout, arrangement, composition of spaces and design elements
▪ Owner cannot make unauthorized copies of building or derivative works
• Substantially similar or slightly modifies
▪ Architect owns copyright unless if an employee of owner or if architect assigns copyright
to owner
▪ B101 States, “Architect is owner of instruments of services
▪ Architect should specially claim ownership rights of building copyright
▪ Architect should register work w/ us copyright office
• Not required but recommended
• Made w/in 3 months
▪ Architect grants instruments of service of intended project
▪ If agreement is terminated, the owner, cannot continue to use instruments w/o
payment of licensing fees
DISPUTE RESOLUTION METHODS
Litigation
• Initial step : Complaint
• Discovery Stage: After responses have been filed the Discovery Stage begins
4. Submission & Response to Interrogatories : Questions
5. Submission of Relative documentation
6. Taking of depositions
a. Interview of a party or witnesses
• Trial Procedures
• Appeal Process
o Reasons for an appeal
▪ Trial judge was mistaken on submission of evidence
▪ Trial judge was mistaken in submission of an issue
▪ Judge gave incorrect directions
▪ Jury guilty of misconduct
o If verdict is overturned, a new case will begin
• Advantages & Disadvantages:
o Very Expensive
o Very Timely
o Can last awhile until all appeals are exhausted
o Decision is based upon an unbiased jury
o Binding resolution method
Arbitration
• Disputes are handled by an arbitrator who has knowledge of the construction industry
• Lawyers not always necessary
• Discovery is not necessary
• Disputes and hearings are private
• Typically resolved quickly, less than a year
• Fees for arbitration may be significant
o Dependent and in conjunction w/claim amount
• Arbitrators, are typically diverse and either an, architect, lawyer or has construction experience
• The Process
o Filing for demand for arbitration
▪ One page statement that:
• Identifies parties
• Amount is quantified
• Statement describing nature of dispute
o Party is notified about arbitration filed
▪ The person has the option to
• File an answer to allegations
• Or file a general denial
• File a counter claim
• Do nothing and would be considered denied
o After Demand and answer is filed a case administrator will be assigned
▪ Sends out a list of prospective arbitrators
• If parties cannot decide on an arbitrator case administer will chose one
o Pre-hearing conference (Only one will occur)
▪ By phone or in person
▪ Both parties and representative or lawyer, arbitrator & case administer
▪ Nature of dispute is discussed
▪ Schedule is established w/ dates for the following:
• Itemization by each party of respective monetary claim
• Exchange of relative documents & records
• List of witnesses
• Exchange of hearing exhibits
• Establishment of hearing dates
o Hearing will commence and at end arbitrator must submit a decision w/in 30 Days
▪ Grounds to overturn decision is very slim unless arbitrator acted unethically
• Three Arbitration Procedures
o Fast Track Procedures:
▪ $75,000 or less
▪ Only one arbitrator
▪ Must be completed within a few months
o Standard Track
▪ $75,000 - $1,000,000
• Up to $500,000 : 1 Arbitrator
• Over $500,000 : 3 Arbitrators
▪ Pre-hearing is held w/in 60 Days of selection of arbitrator
▪ Arbitrator requires
• Exchange of project documents
• Itemization of claims and counterclaims
• Disclosure of identity of experts and their reports
• Pre-hearing briefs
• One or more case management conference
o Large Case Track
▪ Multi Million dollar cases
▪ Usually involves discovery
Mediation
• Also administered by the American Arbitration Association
• Initiated by a demand for mediation similar to arbitration
• Selection of a mediator, similar to selecting an arbitrator
o Assists parties in settling the dispute so that it does not end up in court or arbitration
• Pre-Mediation Conference to select date for mediation
• Documents submitted are submitted privately
• At mediation, parties will submit positions then each party privately w/ mediator shuttle diplomacy
o Offers and counter offers are considered
• Suggestions a mediator may provide
o Monetary settlement
o Reduction of amount if brought court
o Parties should chose arbitration or litigation
• Up to parties to accept or reject solutions
o If so then will go to arbitration or litigation
• Use a written settlement statement
Stipulated Sum:
• Fixed fee for a known scope of work
• Knowing cost of work at time contract is signed
• Most Successful when:
o Fully Defined scope
o Architect is familiar with
▪ Client
▪ Project type
▪ Local jurisdiction
▪ Project delivery process
• Determined by:
o Hours estimated
o % cost of construction
o Comparable projects
• Typ. Invoiced monthly by percentage completed
GMP
▪ Contractor assumes risk that cost will not exceed an amount
▪ Must have defined scope of work
▪ Entitled to increase for change in scope
FINANCIAL MANAGEMENT
Direct Expenses:
▪ Salaries
▪ Consultant fees
▪ Reimbursables (typically paid for by client
o Travel, expenses, phone, printing
▪ Insurance
Indirect Expenses or Overhead
▪ Payroll burden : insurance, workers comp. payroll taxes
▪ Administrative expenses and managers
▪ Items that do not support project activities
▪ Rent
▪ IT Maintenance
▪ Direct Personnel expenses
o Salary expenses & payroll burden
Revenue:
o Fees received from providing services (Fees billed)
o Reimbursable expenses
o Outside consultants
o Project related expenses
o Additional Sources of Revenue:
o Capital Raised
o Revenue from associated businesses
o Income from interest, rent or sale of assets
Profit:
o Difference in revenue + expenses
o Excess of revenue over expenses
o Required at 3 Levels
1. For The firm
▪ In the form of retained or reinvested earnings to provide for :
• Capital investments
• Endure downward economic cycles
• Sustain growth
2. For Producers
• Those who produce profit
3. For the Owners
• For the risk taken and a return on that investment
Practicing at a Loss : no profit and costs are not being covered
Profit-Loss Statement
▪ Reflects results of a firms operations in terms of revenue, direct and indirect labor, indirect expenses and
net profit for given accounting period
▪ 4 Most Important Factors
o Net Operating Revenue
o Direct Labor
o Total Expenses
o Net Profit
o Profit + Expenses = Revenue
o Revenue – Expenses = Profit
2. Overhead Rate
▪ Cost of operations, not directly attributable to a project
▪ Target:
i. 1.3-1.5 of Direct Labor
Method 1:
Overhead Rate + 1.0
(Represents one unit of cost for an hour of salary)
Method 2:
(Direct Salary Expense + Total Overhead) / Direct Salary Expense
Example : an employee makes 35$ per hour and has an overhead rate of 1.7, what is their
break even rate :
1.7 + 1 = 2.7 (overhead +1)
2.7 * 35 = 94.5$ per hour
4. Net Multiplier
▪ Measures revenue generated for every dollar spent on direct labor
▪ Must be greater than break even rate for a net profit to be realized
▪ Target : Greater than break even rate
Net Operating Revenue / Total Direct Labor
Break Even Rate / Inverse of Target Profit% OR Overhead Rate + 1.0 / Inverse of Target Profit %
Progress Payments:
• Intermediate payments
• Notarized payment
• 10 days before date established for each payment
• Includes value of work for up to that date
o Including
▪ Value of materials purchased and storage
• If storage if off site this must be agreed upon and costs associated w/
transportation and insurance must be included
• Architect to approve but not responsible to review in depth the requisitions
• Amounts due are based on schedule of values that is due after contract is awarded
• Retainage withheld
o Used to satisfy potential liens
o Leverage
Final Payment
• If all work conforms a final certification for payment is issued to the owner
• Prior to certificate being issued contractor must submit the following to the architect:
o Affidavit that payrolls, materials and debts are paid
▪ AIA G706 contractors affidavit of payment of debts and claims
o Certificate showing insurance wont expire
o Statement that no reason insurance will not be renewable
o Consent of surety of final payment AIA G707
o Releases and waivers of liens
Project Closeout
• Contractor notifies architect in writing list of outstanding items
Substantial Completion
• When work is sufficient w/ contract documents and can be utilized for its intended purpose
• Date is important
o End of contractors schedule
o Errors by architect
Punchlist:
• List of items by architect
• Contractor must submit:
o Warranties, maintenance contracts, operating instructions, certificates of inspections and bonds
o All items for documentation of final payment
o Set of record drawings
o Certificate of occupancy
o Excess materials
o Cleaning
o Keys and keying
• Architects services are complete when final certificate of payment is issued
TYPES OF SPECIFICATIONS
• Descriptive
o Technical descriptions of exact characteristics of materials and products
o Utilizes proprietary product names to specify a “Basis of Design”
• Performance
o Describing performance qualities of a material or product
o Example : specifying the strength of concrete
o Often mandated by government agency clients, otherwise its seen as preferential
o Commonly used in Design Build
• Reference Specifying
o Reference standards by industry associations and allows industry accepted standards of practice
and performance
o Published by industry associations and tasting organizations
▪ ANSI, ASTM, UL
• Proprietary
o Preferred method, simple
o Specifier is familiar with qualities of specific products
o Supplemented with reference standards and performance requirements
CONTRACT DOCUMENTS
The Only Parties allowed to STOP WORK are the owner and the contractor since they are contractually obligated
to one another, unless other method is used… Architect typically does not have this ability.
AIA CONTRACTS
• SP after X### Designation represents a project that involves Sustainability, Sustainability Project
• Bim Projects will utilize, B, C, E & G series ONLY
• A Series : Owner Contractor Agreements
o A101 : Stipulated Sum
▪ How to remember : 1+1 = 2, reverse your 2 to represent an S, SS, Stipulate Sum
o A102 : Cost of Work Plus a fee with GMP
o A103 : Cost of Work Plus a Fee without a GMP
o A105 : residential or small commercial Project
o A107 : Project of Limited Scope
Compensation Methods
• Stipulated Sum/Fixed Fee
o Fixed sum for a specific set of services
o Architects fee does not include reimbursable expenses
• Cost Plus Fee
o Actual cost to do the work and a fee for profit
o Multiple of direct Personnel Expense
▪ Direct salary is determined and multiplied by a factor to include personnel expenses and
taxes, healthcare, sick leave, etc. then increased by a multiplier for overhead and profit
o Multiple of direct salary expense
▪ Sim to above but includes larger multiplier for employee benefits
o Hourly Billing
▪ Multiplier is built into hourly rate
• Percentage of Construction Cost
o Fixed percentage of the cost of construction
• Unit Cost
o Fees are based on a defined unit for example : square footage
o Used on projects with a great deal of repetition, hotels, hospitals, etc..
• Liquidated Damages :
o Fees paid by contractor for everyday the project is late
o Typically will be supplemented with a Bonus Provision:
▪ Payment for early completion
▪ Based on an amount owner expects to save if project is completed early
• Additional Penalty
o Included sometimes with liquidated damages
o If this is used, must be accompanied with a Bonus Provision
Article 5 : Payments
• Covers how owner will pay
• Amount due at any period is based off of a percentage of completion plus amount allocated for materials
stored
Compensation Methods
• Stipulated Sum
o Fixed price
o Competitive bidding always uses this
o Attractive to owners, costs are known as soon as bid is made
o Best used for projects that involve unit pricing, hospitals, hotels, etc…
o Lowest cost and total fee prior to starting work
• Guaranteed Max. Price
o If project is done for less, owner receives that money
o If project exceeds cost, contractor pays
• Cost Plus Fee
o Compensation for actual costs of labor, materials and subcontractors plus a fixed fee
o More flexibility than fixed fee, and allows construction to proceed before design is complete
o Disadvantage : cost is unknown but can be mitigated through :
▪ Guaranteed maximums
▪ Target prices with incentives, establishes a likely project cost and savings shared
▪ Partial cost guarantees
• Involve obtaining fixed fee from subs or material suppliers
• Unit Pricing
o Used for portions of project, when not possible at bidding to quantify
o Frequent in excavation projects, and hotels and hospitals
Termination of a Contract
• 7 DAYS written notice
• Contractor:
o If work has stopped for 30 + DAYS, at no fault of the contractor
▪ Reasons including:
• A court order
• Act of government
• Architects failure to issue a certificate of payment or give a reason for not
doing so
• Owners failure to make payment within a reasonable time as stated in the
contract
• Owners failure to give evidence that financial arrangements have been made
o If work has been delayed for 120 DAYS in a 365 DAY PERIOD or for a total number of days equal
to construction time frame
o Cannot be delays due to contractors errors
• Owner:
o May suspend work for any reason without cause
o If contractor fails to have sufficient man power at site, or fails to pay subs, disregards laws, or is
guilty of substantial breach of contract
OTHER DOCS
• Consensus Docs:
o Used by other (contractors, owners) to end the bias in architectural favored agreements
EMPLOYER COMPLIANCE
15+ Employees
• Cobra
• Civil rights act
• American with disabilities act
20 + Employees
• Age Discrimination in Employment Act (40+)
50 + Employees
• Family medical Leave Act (12 Weeks)
• Affirmative Action Plan
• EEO Reporting
• Annual Report (Form 5500)
Miller Act
• Requires contractors to post performance and payment bonds
Brooks Act
• Requires federal agencies to award projects to architecture and engineering firms based on qualifications
based selection processes.
• Firms submit evidence of their experience and qualifications but do not submit cost proposal
• After the firm is selected the agency negotiates with the firm to determine the fee
METHODS OF FIELD MEASURING AND REPORTING
• Electromagnetic distance measurement
o Laser based instrument with an onboard computer to measure distance, horizontal and vertical
angle to a reflective prism
o Two people are required to operate
o Accuracy of 1/64” @ 1600 feet
• Reflectorless electromagnetic distance measurement
o Does not require reflective prism, relies on return signal of object being measure
o Accuracy of 1/8” at 100’
• Rectified Photography
o Uses digital cameras to photograph facades
o Cameras focal plane is set perpendicular to façade and gives flat image with no perspective
distortion
• Orthophotography
o Similar to rectified photography but uses digital photography and computer software to correct
for optical distortion
• Photogrammetry
o Surveying objects or spaces through photography and associated software
• Stereo photogrammetry
o Two overlapping images in a computer program to create a digital stereo image
o Used to create 3D models
• Convergent Photogrammetry
o Multiple photographic images of an object at different angles
o Creates measurements and 3D models
o Reference must be created using surveying techniques
o Accuracy of .05%
• Laser scanning
o Uses medium range pulsing laser beams that pulsate over an object to obtain 3D coordinates of
points on surface being scanned
o Resulting image is a “point cloud” which forms a 3D image
▪ Computer software can develop drawings from this
o Accuracy of .05-.01 or better
o All info can be gathered from a single point
ZONING TECHNIQUES
• Bulk Plane Restriction
o Imaginary inclined plane (center of a street or lot line) & sloping at a prescribed angle over lot.
Building cannot extend into this plane.
o Ensures lights and air to neighboring properties
• Eminent Domain:
o Right of government to acquire private property for a use that is determined to be in the public
interest.
o It is granted by the fifth amendment
o Intended to allow public projects to move forward while fairly complicating private property
owners for their property and any other damages, such as relocation expenses. Sometimes
known as condemnation
▪ The condemner must prove the property to be acquired for a public purpose in order to
determine fair market values
• Easement
o Right of one party to use a portion of land of another party in a particular way
▪ Example : utility company can install equipment but no structure can be built without
permission of party holding the easement
▪ Utility, access, support (party walls), joint use (share common feature, ie: driveway)
▪ Scenic: protect views and development
▪ Conservation : limit land use in large areas
• Right of Way
o Right of one party or the public to transverse land belonging to another
• Deed Restriction
o Rules and regulations that govern one or more lots or parcels of land
o Created in a document that is recorded with the county register of deeds records where the
property is located
o Permanent and run with the land, bind all current and future owners of the lot or parcels
involved
o Set of regulations imposed by a land developer when created a plan, condominium development,
multi parcel land division
o Negative or restraints on the use of land
• Restrictive Covenant
o Provision in a deed limiting the use of the property and prohibiting certain uses
o A clause in a deed or lease to real property that limits what the owner of the land or lease can do
with the property
o Allows surrounding property owners, who have similar covenants in their deeds, to enforce the
terms of the covenants in a court of law
o Intended to enhance property values by controlling development
o Not established by the federal government, established by any landowner who limites of use of a
property
▪ In addition to any local zoning ordinance restrictions
o Must be reasonable, and not so unfair that its unreasonable.
• Conditional Covenant:
o Permits the title of property to revert to the original owner fi the restrictions in the deed are not
followed
• Affirmative covenant
o Commits a buyer to performing a specific duty in the future
o Example : a garden must be maintained
• Conditional use Permit
o Provides permission from a zoning board to use property for a special purpose if the propose
may not comply with the zoning restrictions in force in that area. But it is permitted because the
use services the public interest
• Planned Unit Development
o Typically reserved for larger scale developments
o Ability to arrange land uses with greater flexibility
• Incentive Zoning
o Aka zoning bonuses
o Allows owner greater development density or bonuses if they provide benefit to the
communities
▪ Example : public parks
• Performance zoning
o When a development is evaluated on a measurable characteristic
▪ Example : pollution or traffic generated
• Overlay zoning
o A zone that overlays and modifies an underling district
o Typically used to support historic districts
• Transfer development rights
o Allows an owner who desires to build at a higher density rate, to purchase unused development
rights from another property owner
o Has been used to preserve historic properties and agricultural
• Form Based Codes
o Informed by design characteristics
▪ Forms, design character and contextual relationships
o Accompanied by illustrations
• Smart codes:
o Addresses dense urban core to rural
o Promotes compact development and walkable communities to conservation of rural land
• The Rezoning Process
o Involves changing the zoning classification
o Occurs at both planning commission and governing body
o 2 Steps
▪ Hearing at the planning commission, decisions typically advisory
▪ Hearing before governing body, uses political judgement in their decisions
• In most cases a board of zoning adjustment or appeals occurs, similar to a planning commission
hearing. Somewhat judicial process, typically no additional hearing by a governing body
• Subdivision regulations
• Minimum standards for the sudations of a property
• Division of parcel into two or more parcels
• Intended to insure a property maintains continuity and connections neighborhoods, adequate
service, etc.
• Subdivision process similar to rezoning
• Recorded by jurisdiction in maps known as PLATS
• SEE PAGE 894
LAND VALUES
▪ Influenced by 3 Factors
o Location
o Local market conditions
o Potential for generating profit
▪ Land Value Is calculated:
o Market Approach
▪ Based on comparisons in surrounding neighborhood “comps”
▪ Land value based on , value per sf, acre or other unit quantity
o Income Approach
▪ Potential that property has to yield a profit
▪ Gross income estimated than various expenses deducted
o Cost Approach
▪ Estimated at highest and best use, then cost to renovate or rebuild is calculated
▪ Estimated depreciated is deducted
TAX STRUCTURE
▪ Mill Levy
o One thousandth of a dollar or one 1oth of a cent
o Assessed Value
▪ X Percentage of actual value multiplied by actual value = X
▪ Yearly Tax = Y
• X x Mill Levy = Y
Acre : the most common shape for an acre is 1 furlong by 1 chain or 660 feet by 66 feet = 43,560 sf
BUILDING CODES AND STANDARDS
▪ Construction Classification
o A vs B
▪ Designation of whether you are protecting materials with fire rated protection. NOT
sprinkler system or similar
o Type 1 : Non combustible – Reinforced masonry, concrete or steel
o Type 2 : combustible– Reinforced masonry, concrete or steel
o Type 3 : Exterior non combustible, interiors are not
o Type 4 : Exterior non combustible, heavy timber
o Type 5 : any material
▪ Lot Coverage vs. Buildable Area
o Lot Coverage :
▪ Percentage of overall site area that footprint of building is permitted to cover
o Buildable area
▪ Area of site within setbacks from property line that is permittable to be built
• Example: buildable area may be 80% of lot but lot coverage may be 40%,
reducing building area to lot coverage
▪ Net Area
o Does not include circulation, mechanical rooms, walls and structural elements and thickness
o Only includes main building functions
o Aka net assignable area
o Secondary spaces : non assignable areas
▪ Gross Areas
o Non assignable + Net
o Ratio of non assignable to net is known as : efficiency, efficiency ratio or net to gross ratio
o To find gross area : net / efficiency % = Gross area
▪ Floor Area Ratio:
o Example : Coverage 40% of 10,800 sf lot
▪ Building footprint 4,000 sf
▪ FAR 1.3
▪ Can you build 4 Stories : NO
• 10,800 x 1.03 = 14,040
• 4,000 x 4 = 16,000 (EXCEEDS)
▪ 3 Stories @ 12,000 sf allowable
▪ Rentable Area
o Gross Area x Load Factor
o Includes circulation and service spaces (prorated)
o Determined by occupant area x load factor
o BOMA Measures
▪ Demising walls : to centerline
▪ Multi occupant corridor walls : inside finished surface
▪ External wall
• If 50% or more is glass : measured to inside face of glass
• Or inside face of wall
▪ Columns, recessed entries : ignored
o ANSI BOMA Methods to determine rentable area
▪ Method A : Legacy Method
• May result in different load factors for different floors
• Uses separate R/U ratio (rentable area / usable area) for each floor
▪ Method B : Single Load Factor Method
• Same load factor for all floors
• Use R/O Ratio (Net floor area / usable area)