Construction of a pre-fabricated house

Several project structures can assist the owner in this integration, including design-build, partnering, and construction management. In general, each of these project structures allows the owner to integrate the services of architects, interior designers, engineers, and constructors throughout design and construction. In response, many companies are growing beyond traditional offerings of design or construction services alone, and are placing more emphasis on establishing relationships with other necessary participants through the design-build process.

The increasing complexity of construction projects creates the need for design professionals trained in all phases of the project's life-cycle and develop an appreciation of the building as an advanced technological system requiring close integration of many sub-systems and their individual components, including sustainability. Building engineering is an emerging discipline that attempts to meet this new challenge.

Financial advisors

Many construction projects suffer from preventable financial problems. Underbids ask for too little money to complete the project. Cash flow problems exist when the present amount of funding cannot cover the current costs for labour and materials, and because they are a matter of having sufficient funds at a specific time, can arise even when the overall total is enough. Fraud is a problem in many fields, but is notoriously prevalent in the construction field. Financial planning for the project is intended to ensure that a solid plan, with adequate safeguards and contingency plans, is in place before the project is started, and is required to ensure that the plan is properly executed over the life of the project.

Mortgage bankers, accountants, and cost engineers are likely participants in creating an overall plan for the financial management of the building construction project. The presence of the mortgage banker is highly likely even in relatively small projects, since the owner's equity in the property is the most obvious source of funding for a building project. Accountants act to study the expected monetary flow over the life of the project, and to monitor the payouts throughout the process. Cost engineers apply expertise to relate the work and materials involved to a proper valuation. Cost overruns with government projects have occurred when the contractor was able to identify change orders or changes in the project resulting in large increases in cost, which are not subject to competition by other firm as they have already been eliminated from consideration after the initial bid.^[1]

Large projects can involve highly complex financial plans. As portions of a project are completed, they may be sold, supplanting one lender or owner for another, while the logistical requirements of having the right trades and materials available for each stage of the building construction project carries forward. In many English speaking countries, but not the United States, projects typically use quantity surveyors.

Legal considerations

A construction project must fit into the legal framework governing the property. These include governmental regulations on the use of property, and obligations that are created in the process of construction.

The project must adhere to zoning and building code requirements. Constructing a project that fails to adhere to codes will not benefit the owner. Some legal requirements come from malum in se considerations, or the desire to prevent things that are indisputably bad - bridge collapses or explosions. Other legal requirements come from malum prohibitum considerations, or things that are a matter of custom or expectation, such as isolating businesses to a business district and residences to a residential district. An attorney may seek changes or exemptions in the law governing the land where the building will be built, either by arguing that a rule is inapplicable (the bridge design won't collapse), or that the custom is no longer needed (acceptance of live-work spaces has grown in the community).

A construction project is a complex net of contracts and other legal obligations, each of which must be carefully considered. A contract is the exchange of a set of obligations between two or more parties, but it is not so simple a matter as trying to get the other side to agree to as much as possible in exchange for as little as possible. The time element in construction means that a delay costs money, and in cases of bottlenecks, the delay can be extremely expensive. Thus, the contracts must be designed to ensure that each side is capable of performing the obligations set out. Contracts that set out clear expectations and clear paths to accomplishing those expectations are far more likely to result in the project flowing smoothly, whereas poorly drafted contracts lead to confusion and collapse.

Legal advisors in the beginning of a construction project seek to identify ambiguities and other potential sources of trouble in the contract structure, and to present options for preventing problems. Throughout the process of the project, they work to avoid and resolve conflicts that arise. In each case, the lawyer facilitates an exchange of obligations that matches the reality of the project.

Interaction of expertise

Design, finance, and legal aspects overlap and interrelate. The design must be not only structurally sound and appropriate for the use and location, but must also be financially possible to build, and legal to use. The financial structure must accommodate the need for building the design provided, and must pay amounts that are legally owed. The legal structure must integrate the design into the surrounding legal framework, and enforces the financial consequences of the construction process.

Procurement

Procurement describes the merging of activities undertaken by the client to obtain a building. There are many different methods of construction procurement; however the three most common types of procurement are:

1. Traditional (Design-bid-build)
2. Design and Build
3. Management Contracting

Traditional

Main article: Design-bid-build

This the most common method of construction procurement and is well established and recognized. In this arrangement, the architect or engineer acts as the project coordinator. His or her role is to design the works, prepare the specifications and produce construction drawings, administer the contract, tender the works, and manage the works from inception to completion. There are direct contractual links between the architect's client and the main contractor. Any subcontractor will have a direct contractual relationship with the main contractor.

Design and build

Main article: Design-build

This approach has become more common in recent years and includes an entire completed package, including fixtures, fittings and equipment where necessary, to produce a completed fully functional building. In some cases, the Design and Build (D & B) package can also include finding the site, arranging funding and applying for all necessary statutory consents.

The owner produces a list of requirements for a project, giving an overall view of the project's goals. Several D&B contractors present different ideas about how to accomplish these goals. The owner selects the ideas he likes best and hires the appropriate contractor. Often, it is not just one contractor, but a consortium of several contractors working together. Once a contractor (or a consortium/consortia) has been hired, they begin building the first phase of the project. As they build phase 1, they design phase 2. This is in contrast to a design-bid-build contract, where the project is completely designed by the owner, then bid on, then completed.

Kent Hansen, director of engineering for the National Asphalt Pavement Association (NAPA), pointed out that state departments of transportation (DOTs) usually use design build contracts as a way of getting projects done when states don't have the resources. In DOTs, design build contracts are usually used for very large projects. ^[2]

Management procurement systems

Main article: Construction management

In this arrangement the client plays an active role in the procurement system by entering into separate contracts with the designer (architect or engineer), the construction manager, and individual trade contractors. The client takes on the contractual role, while the construction or project manager provides the active role of managing the separate trade contracts, and ensuring that they all work smoothly and effectively together.

Management procurement systems are often used to speed up the procurement processes, allow the client greater flexibility in design variation throughout the contract, the ability to appoint individual work contractors, separate contractual responsibility on each individual throughout the contract, and to provide greater client control.

Authority having jurisdiction

In construction, the authority having jurisdiction (AHJ) is the governmental agency or sub-agency which regulates the construction process. In most cases, this is the municipality in which the building is located. However, construction performed for supra-municipal authorities are usually regulated directly by the owning authority, which becomes the AHJ.

During the planning of a building, the zoning and planning boards of the AHJ will review the overall compliance of the proposed building with the municipal General Plan and zoning regulations. Once the proposed building has been approved, detailed civil, architectural, and structural plans must be submitted to the municipal building department (and sometimes the public works department) to determine compliance with the building code and sometimes for fit with existing infrastructure. Often, the municipal fire department will review the plans for compliance with fire-safety ordinances and regulations

Construction on a building in Kansas City

Before the foundation can be dug, contractors are typically required to notify utility companies, either directly or through a company such as Dig Safe to ensure that underground utility lines can be marked. This lessens the likelihood of damage to the existing electrical, water, sewage, phone, and cable facilities, which could cause outages and potentially hazardous situations. During the construction of a building, the municipal building inspector inspects the building periodically to ensure that the construction adheres to the approved plans and the local building code. Once construction is complete and a final inspection has been passed, an occupancy permit may be issued.

An operating building must remain in compliance with the fire code. The fire code is enforced by the local fire department.

Changes made to a building that affect safety, including its use, expansion, structural integrity, and fire protection items, usually require approval of the AHJ for review concerning the building code.