Spokane Journal of Business

Design-build competitions rise

Architecture-contractor teams jousted recently for two big Spokane jobs

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-—Staff photo by Treva Lind
ALSC Architects PS principals Jeff Warner, left, and Rustin Hall say a design-build project can move ahead quickly.

Two multimillion-dollar Spokane construction projects that emerged this spring began their conception in a design-build contest format relatively new to the Inland Northwest.

For the planned $55 million Spokane Convention Center expansion and a $60 million project to construct a new university center complex at Gonzaga University, Spokane-area architectural firms aligned with contractors here as teams to submit proposals.

The winners got a contract; the losers were offered a comparatively smaller stipend.

The design-build process has been around for about two decades as a way for a construction company, an architectural firm, and consultants to collaborate from a project's start. That compares with the conventional development method in which a project owner first hires an architect to design a project, and then selects a contractor separately based on the lowest bid.

In this contest format, the owner first narrows the field down to typically three or four qualified teams, which then spend the time developing proposals. The unsuccessful teams were offered what's called an honorarium or stipend, to defray part of the expense of developing the proposals. In these cases, the Spokane Public Facilities District advertised a $100,000 stipend, and Gonzaga offered a $25,000 honorarium.

Washington State University planners in Pullman started using the design-build contest for some projects within the past three years. Federal agencies here have sought such design-bid submittals for about four years now and typically don't offer any stipends to unsuccessful teams, architects here say.

Generally, these contests are for big public or multiuse projects. Many architects also say the design-build process in general is becoming more popular, including when a project owner selects a preferred contractor-architect team without a contest.

"We're seeing it happen in the public sector like we haven't seen it before," says Bob Wills, a principal at Bernardo Wills Architects PC, in Spokane, which is the associate architect on the big Gonzaga project. "With the design-build, the owner knows who the contractor is he'll be working with. The owner's selected the team, and he knows there will be a guaranteed price."

An integrated design-build process also can put construction on a faster track, says Rustin Hall, president at ALSC Architects PS, of Spokane, which is the architect on the convention center project. Once a team is selected, the contractor who sees designs from conception can order some materials and equipment earlier to avoid delivery delays. The contractor also can do initial site work before architects complete the final design work, Hall adds.

"Usually, by the time the architect is 60 percent along in the design, we know what the foundation will be, and we know the components needed," Hall says. "You can gain weeks on a schedule by overlapping that way. They're building before we're done designing."

Tim Graybeal, president of the Design-Build Institute of America's Inland Northwest chapter and a project manager at Integrus Architecture PS, says this approach is gaining popularity in the U.S. as a highly customizable process. The Washington D.C., membership-based DBIA offers best-practice guidance and certification, and the chapter here hosts workshops.

"There are dozens, if not hundreds, of different ways you can tailor the design-build process to your needs, and one of them is this design competition," Graybeal says. "Design-build is by far the fastest process from conception to delivery."

Graybeal adds, "What I love is just in terms of the philosophy of building a team. The success of the team is people who can deliver the right competencies. Design-build is the only tool that eliminates the randomness of the teaming for the project."

In May, the PFD selected the design-build team of Garco Construction Inc., of Spokane, as general contractor, and ALSC as architect with Seattle-based LMN Architects as a design consultant, to build the convention center expansion project. Two other teams involving Spokane-area companies—Lydig Construction Inc. with Integrus and YLK JV/Bernardo Wills/tvsdesign—weren't successful.

For Gonzaga's big project, the university selected Hoffman Construction Co., of Portland, as the general contractor and Opsis Architecture, also of Portland, as the lead architect, with Bernardo Wills as associate architect. Three other teams that weren't selected by the university were Garco/ALSC; Lydig /NAC|Architecture; and Graham Construction & Management Inc./Integrus, says Marty Martin, Gonzaga's executive vice president.

Martin says Gonzaga opted for the design-build competition on this project because of its large scope. The design-build approach in general also shortens the building schedule, he adds.

"We wanted to be sure we were presented with the opportunity to strike the best partnership we could for this project," Martin says. "The competition gave us the opportunity ourselves to reflect on what we really wanted this building to look like and get input from some great minds."

Mick McDowell, chairman of the PFD board, says the design-build method provides owners the advantage of setting up a collaborative and innovative design approach, while more conventional methods may have finger-pointing conflicts among parties working under separate contracts.

"Yes, it's a growing trend," McDowell says. "WSU and the University of Washington have embraced design-build as the methodology of choice. Owners got tired of designers arguing with contractors over the scope of work and who has to pay for it. Design-build by definition eliminates all change orders, except for owner-initiated scope increases."

Additionally, the design-build contest approach is well suited to projects that have a number of groups that will use a facility, he adds.

"The most innovative way to meld all those interests is by using the design-build scenario because it's the most flexible," he says. "You can either gauge qualifications independent of price, or you can do a best value, best design, and best price, so there are numerous methodologies."

Meanwhile, the city of Spokane recently put a process in place for issuing building permits geared to design-build projects, says Scott Chesney, the city's director of planning and development.

"It's called a deferred submittal," Chesney says. "We've always been able to issue permits in packages so you can get, say, footings and foundations ahead of other scheduled construction, but still, you had to have designs fairly far along when you did that."

He adds that the new design-build permitting process allows the city to issue a building permit for such projects if a basic set of plans are submitted, along with an agreement listing all deferred submittals to be received within a year. "We issue a permit based on the basic plan, and the contractor can work faster instead of waiting for package permits to go through."

Both Hall and Wills say the design-build contests typically require at least a 20 percent to 30 percent design effort when price proposals and early design concepts are submitted to owners, who then select one team to go forward to complete the full project design and construction. The work in developing the winning PFD proposal involved 14 consultants in addition to work done by Garco, ALSC, and the Seattle design consultant.

"I think it certainly benefits the owner," Wills says. "It's more risky for the general contractor, I think, because he's having to provide this guaranteed price without much of a design concept."

However, he adds that on some design-build contests that Bernardo Wills has been a part of, the parties involved in the team collectively have invested upwards of $200,000 to develop a proposal.

"To do a 20 percent effort and not get the project can be very expensive," Wills adds. "If you're not successful, that can be a very expensive marketing effort."

Martin says two of the three teams accepted the Gonzaga's $25,000 honorarium, while one opted to keep its design work as intellectual property. He declines to say which team. "We, said, 'If you accept the honorarium, we the university, would receive the design work to date,'" Martin says.

A design-build team usually splits a stipend by the percentage of involvement of the individual team members during the design-build selection period, architects here say. If for example, an architecture firm invests 1,000 hours, consultants put in 200 hours, and a contractor company has 200 hours into the process, the stipend could be split accordingly.

For another project awarded in May, Lydig and ALSC were selected after a design-build contest by the Wine Science Center Development Authority, in Richland, Wash., to construct a $23 million research-teaching facility at the WSU Tri-Cities campus there.

Two other teams that developed proposals were Hoffman with Olson Kundig Architects, of Seattle, and BNBuilders with Mithun, of Seattle. Hall says the contest had a $75,000 honorarium.

Graybeal says the design-build process needs to be applied to the right type of project, such as some large public projects, with the owner seeking the appropriate criteria for proposals from teams.

"As far as competition, it's been part of the process for as long as there's been a process," Graybeal says. "It is appropriate for a design-build competition that a stipend is offered for the amount of effort the owner is asking from all teams. That's one of the design-build best practices."

Overall, architects say that other design-build benefits include the ability for team members to foresee potential problems before breaking ground. However, the design process isn't linear and still might require going back later to correct a problem, says Jeff Warner, a principal with ALSC.

He also says that architectural firms during the design-build proposal phase typically don't have as much access to getting an owner's input as they would if hired directly by a project owner. A contractor is the primary contact, and architects may have two direct meetings with owners, he says.

"There's a certain amount of taking chances of what you think they want," Warner says. "Normally, you have several meetings, and you can take two different concepts back to owners."

Hall adds, "At the same time, two of our biggest design-build projects have won (design) awards. To get the design owners want, it's incumbent to do your homework. You have to know your clients and use the time you have with them very efficiently."

Treva Lind
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