Cummings Properties and Massachusetts Trial Courts used the design/build/lease delivery method to complete the 150,000-square-foot Middlesex County Superior Court at TradeCenter128 in Woburn. The first foundation pile was driven in January 2007. The building and 900-car garage were substantially complete a year later.
Time and money are critical elements of any building project. The necessary significant investment in both continues to increase dramatically in order to acquire permits and approvals and then develop and build quality real estate. Our local, state and federal governments are not immune from this challenge. By implementing a design/build method of building delivery, however, government agencies can save their valuable resources and accelerate many building projects.
One major factor impacting public sector projects is the lengthy bid process, a multistep progression where each critical component is bid out separately and sequentially. This is often a protracted process, which does not always result in the desired completion date, particularly in construction projects. On the other hand, adopting the design/build/lease delivery method can almost entirely eliminate this drawn-out and complex process. This integrated method provides an efficient and cost effective way for public agencies to quickly obtain modern facilities from which to serve the public.
This method appears to be gaining more acceptance in the public sector. The Massachusetts Trial Courts, through the Commonwealth’s Division of Capital Asset Management and Maintenance, is one state agency that appears to have embraced this method, as evidenced by the many high-quality leased court facilities around the state. According to Massachusetts Trial Courts’ administrative attorney and lease-property manager Christopher McQuade, “Of the more than 130 court locations across the Commonwealth, nearly half are leased facilities, designed, built and maintained by private firms.”
A near-textbook example of the successful application of the design/build/lease delivery method is the brand-new, recently opened, 150,000-square-foot Middlesex County Superior Courthouse at TradeCenter 128 in Woburn. Cummings Properties, also of Woburn, built the structure. Cummings has been effectively implementing this delivery method for nearly 40 years to design, build and lease more than 9 million square feet of office, lab and research space in cities and towns north and west of Boston.
According to McQuade, “this custom-built courthouse, complete with holding cells and 15 courtrooms, is the Trial Court’s largest leased facility in the Commonwealth.” From lease signing to completion, Cummings Properties finished the first-class building in one year, utilizing virtually all the key design/build/lease attributes.
Modern Approach
The distinctive features of the design/build/lease method stand in stark contrast to the traditional design/bid/build/own approach. In the latter approach, the end-user hires different firms to provide architectural, engineering, financing, permitting, legal, construction and maintenance services. In the design/build/lease method, however, the end-user contracts with one firm to single-handedly manage all of those separate services. That one firm provides a cohesive, streamlined package encompassing nearly all the development, construction and property management services.
Establishing a working relationship with one firm creates one obvious and dramatic advantage – single-source accountability. Instead of having to coordinate several different consultants and contractors, the end-user only has to work through one firm, which has centralized knowledge and full responsibility to perform. Questions or concerns regarding any aspect of the project can all be directed to this single source. In the case of the Middlesex County Superior Courthouse, Massachusetts Trial Court officials worked directly with the project management staff, all of whom were Cummings Properties employees.
Single-source accountability significantly reduces miscommunications, change orders or delays, which are commonplace in traditional multiparty bid projects. The cornerstone of a design/build relationship is excellent written and verbal communications. During the contract, design and construction phases, Cummings Properties’ team members and Massachusetts Trial Court officials were in constant contact, often many times a day, in order to accelerate the decision-making process.
The true success of a project, however, depends on the design/build/lease firm’s ability to meet the criteria established by the user or owner, including staying on budget, conforming to the user’s expectations and remaining on schedule.
Those are areas where a design/build/lease firm tends to prove that its methodologies offer a vast improvement over the traditional public sector bid process. One noteworthy example of this superior approach occurred during the recent construction of the Middlesex County Superior Courthouse, when, due to another large project, the original lead electrical subcontractor unexpectedly went bankrupt and had to be replaced.
In a standard bid process, the electrical work would have to be sent out to bid again, which would have been problematic since the work had been partially completed. Adjusting the bid specifications alone would have delayed the project. Instead, the Trial Court relied on its project manager, who replaced the electrical subcontractor within two days and the project continued as scheduled.
The most effective design/build firms can meet these types of challenges, and they also have a long history of successful projects. Additionally, accomplished firms possess both of the following key attributes:
• No financing contingencies with the ability to take some amount of risk. In order to expedite delivery, a successful design/build/lease firm needs to move forward before every aspect of the project is finalized and sometimes even before the client has committed to the project. For example, by self-financing the project, Cummings Properties initiated the permitting process, created construction drawings, and even started some site work before the contract was signed with the Commonwealth. Typically, a developer would have to wait for financing before committing such major resources.
• Superior in-house expertise. In order to succeed, a firm must have significant in-house resources in all the critical areas including architectural, engineering, legal, purchasing, construction and property management. A firm that is nimble enough to deploy these teams can successfully streamline the typical project schedule and expedite final delivery. While the individual tasks involved may not take less time to complete, bringing these teams of professionals together in a collaborative environment means that much of this work can be completed concurrently, instead of sequentially.
One critical approach to creating a streamlined project schedule is through careful purchasing efforts. Project management teams must maintain strong, worry-free relationships with their suppliers and subcontractors, works closely with them to establish mutually agreed upon pricing, and pay them promptly. As a result, precious time is saved when materials can be ordered and subcontractors can begin work immediately, without working through a time-consuming bid process.
Finally, when the building is complete and the lease begins, the design/build/lease firm continues to lead the project by taking over the building’s maintenance. This continuity is important to the end-user because there is an existing, established relationship with the builder, so any typical concerns such as warranty issues or liability for defects can be quickly addressed and resolved. Also, knowing that the property management company is also the builder, the end-user can be assured that they won’t be stuck with an inferior product.
Another benefit to leasing is that when the lease is over, the agency can choose to renew or simply walk away. The agency does not have to deal with an aging asset, like the former Middlesex County Superior Court in East Cambridge. Renovating and updating this antiquated, state-owned property will require untold millions of dollars of public funds and many years of construction.
In sum, if the public sector can take advantage of the design/build/lease model, it can markedly slash the time and expense that is ordinarily put forth to design, deliver and manage buildings occupied by agencies of the Commonwealth.
