Construction Management 3
complete assignment, discussion question & respond to other students
ConstructionManagement Week 3
COURSE: CE 5324 CONSTRUCTION MANAGEMENT
LEVEL: GRADUATE
ASSIGNMENT # 3
TOTAL POINTS: 200
LEARNING OBJECTIVES:
After successfully completing this assignment, students will be able to:
▪ Compare typical contracts used in the construction industry
▪ Prepare quantity and cost estimate of small residential and commercial
projects
Note: Your work should be professionally presented and all the steps for calculations must be
included.
Q1. You are hiring a general contractor for your upcoming commercial project. Use the
following website to create a contract document as an owner. Please create at least 7 different
events under the payment section. Complete the contract and submit the document along with the
answers to the following questions: 100 points
Website link: https://www.rocketlawyer.com/document/construction-contract.rl#/
a) Name the three most important components of a contract and describe how these
components are handled in this sample contract.
b) Explain the deadline and procedure for submitting payment requests.
c) What are the possible conditions for default under the contract?
d) How will the disputes be resolved?
e) What additional clauses you would like to have in this sample contract to minimize your
risk as an owner?
Important Notes:
▪ At the end of creating your document on the McGraw-Hill website, the website prompts
you to sign up for a 7-day free trial. However, it asks for credit card information. You
DO NOT have to submit your card information. If you are able to receive your contract
via email from this website, then use it. You can also take screenshots of the construction
document that is created. As a second alternative, you can use the attached document
Construction Management Week 3
instead. The Rocket Lawyer website is the preferred method. However, if you are not
able to receive your contract then use the attached contract.
▪ Q1 requires that we add at least 7 different payment events in the contract, however, the
website only allows up to 6 that can be created. If you continue, it provides an option to
write-in additional payment provisions or instruction. You can add an additional payment
event in this section:
It also provides an option to add an additional provision to the contract at the very end of
generating the contract. It can also be added here, though the first option is best since it’s the
payment section.
Construction Management Week 3
Q.2: Different contract types have different financial implications or impacts on the owner and
the contractor. Fill in the chart below to show how costs affect both parties. 50 points
The project has a COST PLUS contract (the contractor’s fee is based on 8% of construction cost)
Hint: Please follow the example on slide #25 of the weekly lecture.
Find out the fee amount first and then follow the example.
Contract Actual Impact on Contractor Impact on Owner
Amount Amount
Incl. Fee
$500,000 $525,000
$500,000 $475,000
Q.3. An owner has got complete plans and specifications for a project. You (as a
general contractor) submit a good and fair bid for the work and the owner accepts your bid.
The two of you shake hands but you do not sign an agreement. We have learned that not having a
contract in writing can be a problem for both the contractor and the owner. (Assume that your
oral contract with the owner is valid) 50 points
a) Explain by giving two reasons that you are at risk because your contract is not in writing.
b) Explain by giving two reasons that the owner is at risk because your contract is not in writing.
Discussion
Question 3
1. As builders complete work, the actual costs for the project should become part of an historical
database for the company. access to the costs for this project, along with that of all other past work, is a
useful knowledge base for future estimates. Disc
uss the specific ways project costs should be captured
to create this database.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
Discussion Question 3
1. As builders complete work, the actual costs for the project should become part of an historical
database for the company. access to the costs for this project, along with that of all other past work, is a
useful knowledge base for future estimates. Disc
uss the specific ways project costs should be captured
to create this database.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
Discussion Question 3
1. As builders complete work, the actual costs for the project should become part of an historical
database for the company. access to the costs for this project, along with that of all other past work, is a
useful knowledge base for future estimates. Discuss the specific ways project costs should be captured
to create this database.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
E
V
1. As build
ers complete work, the actual costs for the project should become part of an historical
database for the company. Access to the costs for this project, along with that of all other past work,
is a useful knowledge base for future estimates. Discuss the spe
cific ways project costs should be
captured to create this database.
Actual costs from projects should definitely be part of a hist
orical database in a variety of ways. If the
work that a contractor does is
similar
for each job, like building garden style apartments nationwide, it
would help to keep track of the total cost per square foot for each project per region. Then, it’s
important to go into depth of tracking the price per square foot for each of the trades. Other cost should
also be considered like rentals. This will help the estimator predict trends for future projects and trades.
2.
It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
A good schedule can help with projec
t costs. The main reason that comes to mind is if the schedule is
tight or might not be able to be completed during normal hours. If the schedule is very demanding, the
estimator will need to take into account additional costs like overtime and expediting
material. If
mo
re
people are involved in a trade’s crew to complete the job, there will be more costs for normal labor
hours as well. It is also possible contractors will have additional costs for working weekends and holidays
if that is necessary.
If mat
erial isn’t available at all for a demanding schedule, it is possible that the job
will need more expensive material that will need to be accounted for in the estimate.
R
espond to E
V
D D
1. As builders complete work, the actual costs for the project should become part of an historical
database for the company. Access to the costs for this project, along with that of all other past work,
is a useful knowledge base for future estimates. Discuss the specific ways project costs should be
captured to create this database.
To capture all the costs data on a project daily
reports should be completed to track the amount of
work completed each day. This gives an estimator a good idea of how much work can be completed with
very specific criteria. With more data from more job sites the estimates created will become more and
mo
re accurate. Notes from each day should also be kept to keep track of any obstacles or particular
instances that caused a significant
delay
or change in cost. These notes will give the estimator
somethings to look out for on future projects. Historical dat
a will also show if a company’s crews are
becoming more efficient on specific tasks.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good schedule? Please provide comments.
The schedule is a very important part of the estimate because time is one of the biggest factors to cost
on a project. If a project takes a lot longer than
anticipated
then it will also cost a lot more than
expected. The timing of subcontractors and suppliers can also make a huge impact on the cost and the estimator needs to be careful to include all of these aspects into the timeline of the project.
Respond to DD
X C
1. As builders complete work, the actual costs for the project should become part of an historical database for the company. Access to the costs for this project, along with that of all other past work, is a useful knowledge base for future estimates. Discuss the specific ways project costs should be captured to create this database.
I agree 100% that cost estimates based on historical cost performance is one of the most efficient and accurate methods of estimating. This is true especially when building “similar to” projects. If you are working on a “similar to” project with a few variations, the best approach is to use a hybrid of historical data and estimate the variations using a different method more specific to the variations. To create a historical cost performance data for each project, the contractor can establish data repositories such as share drives where all costs are archived. The company policy regarding the project close-out process needs to be revised to include this step as a requirement during project execution and add it as a mandatory step during internal project close-out. A good practice can be to develop a project close-out checklist that identifies cost capture as a mandatory element before closing out any project.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good schedule? Please provide comments.
I agree 100% that a good estimate must be based on a timeline completion. However, it is important to understand that in earned value management or project cost management, cost and schedule are two independent variables, many times they are confused as only one. There are costs that are dependent on schedule such as some elements of general conditions, the duration of the project impacts the cost of items that are rented based on time. Also, multi-year projects need to take into consideration the cost of money. It is also important to estimate the amount of overtime planned to meet schedule. In summary, the first data point an estimator needs to have in hand when developing a cost estimate is the project schedule, even if it is in a rough form.
Respond to X C
C M
1. As builders complete work, the actual costs for the project should become part of an historical database for the company. access to the costs for this project, along with that of all other past work, is a useful knowledge base for future estimates. Discuss the specific ways project costs should be captured to create this database.
Historical project data should be collected and evaluated to develop useful information that can support future estimating and scheduling measurements. The database may include key features or elements of any project as type of construction, building type, shell, interiors, substructure, materials, equipment, location, overhead and profit, those elements can be comparable and might help predict the behavior of the company throughout the year. Also, for a successful internal database it is important to keep it updated on a regular basis.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good schedule? Please provide comments
.
Especially with complex and tighter budget projects. Having a clear idea of how the schedule will look before creating the bid estimate will be advantageous if there is a need to fast track the project getting extra equipment and overtime compensation for workers. The way I see it, the schedule is the planning and estimating is the cost/budget of all that planning, hence it needs to start with creating a good schedule, identifying critical path activities, and limitations such as weather conditions.
Respond to C M
E V
1. As build
ers complete work, the actual costs for the project should become part of an historical
database for the company. Access to the costs for this project, along with that of all other past work,
is a useful knowledge base for future estimates. Discuss the spe
cific ways project costs should be
captured to create this database.
Actual costs from projects should definitely be part of a hist
orical database in a variety of ways. If the
work that a contractor does is
similar
for each job, like building garden style apartments nationwide, it
would help to keep track of the total cost per square foot for each project per region. Then, it’s
important to go into depth of tracking the price per square foot for each of the trades. Other cost should
also be considered like rentals. This will help the estimator predict trends for future projects and trades.
2.
It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
A good schedule can help with projec
t costs. The main reason that comes to mind is if the schedule is
tight or might not be able to be completed during normal hours. If the schedule is very demanding, the
estimator will need to take into account additional costs like overtime and expediting
material. If more
people are involved in a trade’s crew to complete the job, there will be more costs for normal labor
hours as well. It is also possible contractors will have additional costs for working weekends and holidays
if that is necessary.
If mat
erial isn’t available at all for a demanding schedule, it is possible that the job
will need more expensive material that will need to be accounted for in the estimate.
R
espond to E
V
D D
1. As build
ers complete work, the actual costs for the project should become part of an historical
database for the company. Access to the costs for this project, along with that of all other past work,
is a useful knowledge base for future estimates. Discuss the spe
cific ways project costs should be
captured to create this database.
To capture all the costs data on a project daily
reports should be completed to track the amount of
work completed each day. This gives an estimator a good idea of how much work can be completed with
very specific criteria. With more data from more job sites the estimates created will become more and
mo
re accurate. Notes from each day should also be kept to keep track of any obstacles or particular
instances that caused a significant
delay
or change in cost. These notes will give the estimator
somethings to look out for on future projects. Historical dat
a will also show if a company’s crews are
becoming more efficient on specific tasks.
2.
It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
The schedule is a very important part of the estimate because time is one of the biggest factors to cost
on a project. If a project takes a lot longer than
anticipated
then it will also cost a lot more than
E V
1. As builders complete work, the actual costs for the project should become part of an historical
database for the company. Access to the costs for this project, along with that of all other past work,
is a useful knowledge base for future estimates. Discuss the specific ways project costs should be
captured to create this database.
Actual costs from projects should definitely be part of a historical database in a variety of ways. If the
work that a contractor does is similar for each job, like building garden style apartments nationwide, it
would help to keep track of the total cost per square foot for each project per region. Then, it’s
important to go into depth of tracking the price per square foot for each of the trades. Other cost should
also be considered like rentals. This will help the estimator predict trends for future projects and trades.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
A good schedule can help with project costs. The main reason that comes to mind is if the schedule is
tight or might not be able to be completed during normal hours. If the schedule is very demanding, the
estimator will need to take into account additional costs like overtime and expediting material. If more
people are involved in a trade’s crew to complete the job, there will be more costs for normal labor
hours as well. It is also possible contractors will have additional costs for working weekends and holidays
if that is necessary. If material isn’t available at all for a demanding schedule, it is possible that the job
will need more expensive material that will need to be accounted for in the estimate.
Respond to E V
D D
1. As builders complete work, the actual costs for the project should become part of an historical
database for the company. Access to the costs for this project, along with that of all other past work,
is a useful knowledge base for future estimates. Discuss the specific ways project costs should be
captured to create this database.
To capture all the costs data on a project daily reports should be completed to track the amount of
work completed each day. This gives an estimator a good idea of how much work can be completed with
very specific criteria. With more data from more job sites the estimates created will become more and
more accurate. Notes from each day should also be kept to keep track of any obstacles or particular
instances that caused a significant delay or change in cost. These notes will give the estimator
somethings to look out for on future projects. Historical data will also show if a company’s crews are
becoming more efficient on specific tasks.
2. It is often said that to complete a good estimate, an estimator needs to have completed a good
schedule? Please provide comments.
The schedule is a very important part of the estimate because time is one of the biggest factors to cost
on a project. If a project takes a lot longer than anticipated then it will also cost a lot more than