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Types of Residential Buildings

Flat

Single

Storey

Terrace

2-3 Storey

Terrace

Single

Storey Semi

Detached

Low Cost

FlatLow Cost

House

Cluster

Detached

Town

House

Service

Apartment

Condominiums

/Apartment

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Commercial Building Sector

Can be privately funded e.g.shopping mall, office complex

Owner negotiate the price.

Government funded e.g.

Hospital, University Campuses

Price based on lowest bid or

design and built.

Large in nature, required

expertise.

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Industrial Sector

Most of these projects are

privately funded.

Quality and time are the critical

aspects in construction and

designing of this type of

projects.

Timely and smooth executionof a project is the main concern

in this industry.

Large/complex in nature,

required many expertise.

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Civil & Highway Sector

Driven by social/public benefits.Most of these projects are public funded.

The client are government agencies.

Quality and time are the critical aspects in

construction and designing of this type of

projects.

Principally, designers of these

projects are civil engineers. Builder

are normally the lowest bidcontractors. However, for some

projects, client will shortlist few

contractors based on their previous

project experience, expertise and

management and financial

capabilities to complete the project.

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Town

Planner

Owner

ContractorEngineers

Architect

Sub-

Contractor

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Clients Duties

To frequently consult the

consultant and contractorTo find a suitable designengineer for the project

To give approval if any changesare made to the design or

specification of the project

To state the specificationof the project To always monitor the progress and

state their level of satisfaction on work

done by the contractor

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Professional Players - Characteristics

Extensive period of training of an intellectual manner, in

technical/systematic/humanistic way

Knowledge and skills vital to the well-being of the larger society

Monopoly or near monopoly on provision of professional services

Degree of autonomy in the work place,

choice/judgment/creativity/skills/judgment - sophisticated work not

entirely routine

Regulated by ethical standards. Public good as indicated by a code of

ethics. Acting in ethical/responsible ways as individuals andinstitutions.

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Architect

To Produce designs by

referring to clients

requirementsTo produce constructionplan/drawing

To plan and overview

tenders

To monitor work

progress

Timely, to monitor the design to fulfill

the regulations requirements

building codes, zoning laws, fire

regulations, and other ordinances,

such as easy access by physically

challenged individuals

To apply certificate

of fitness from the

authority

To provide pre-design

services conducting

feasibility, selecting a

site, or specifying the

requirements the

design must meet

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Civil

Engineer

Supervise

infrastructure works

according to

specifications

Obtain permission for

machine works, during

work and guarding work

for contractors

Prepare civil and structural

construction drawing

Precede structural

works according to

specifications of the

structural drawings

Explain the flow of workbetween subcontractor and

main contractor

Supervise earthwork

according to

specifications

Detail report of work

progress, supervise

concrete work and

do the test report

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M & E

Engineer

Detail record of work

progress and new

construction work

progress

Prepare mechanical and

electrical construction

drawing

Explain the mechanical

and electrical problems

Supervise mechanical

and electrical works and

ensure it follows the

design specification

Get the solution on electricalproblems such as lack of power

supply

Explain flow of work

between subcontractor

and main contractor

Discuss with main contractor

and subcontractor about

costing building system e.g.

elevators, escalator, electrical

system, cooling system

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Builders construct a project according to theapproved drawings drawn by architect & engineer

SurveyorsLand SurveyorSite surveying

Site boundary

Quantity SurveyorFinancial Management

Bill of Quantities

Obtaining Tenders

Contract Administration

Account preparation

Cost monitoring

ConstructorsResponsible for

construction activities

e.g. construction,

extension, installation,

repair, maintenance,

renovation, demolition

Register with CIDB (Act

Part VI)

A person who undertake

to carry out & complete

any construction works

Manage the project &

subcontracts

Keep on schedule

Control costs

Coordinate project team

members

Specialty

Contractors

Largest portion of

construction industry

Skilled construction

workers (act 520)

Have their own specialty

Hired and work directly

for main contractor

Can be award contract

directly from client

Nominated subcontractor

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Specialty Contractors

Metal

Worker

Carpenter

Bricklayer/

Mason

Plasterer

Drain

Layer

Welder

Licensed

Electrician

Tiler

Plumber

Joiner

Painter

Concretor

Constructor

plant

operator

Bar-bender

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Other ParticipantsThere are two other bodies/agencies that play an important role in

construction project.

Town Planner responsibility

Organised, control and plan for land

development and land acquisition includingbuildings within an area

Work, help and encourage the collection,

maintenance and publishing of statistics,

bulletin and monograph, related with town

and suburb planning & methodology

Carry out other task given by Pihak

Berkuasa NegeriorJawatankuasa

Perancang Negeri

Local Authorities

Bodies who represent the interests

of public safety

To ensure that the design of project

comply with the required standardsand guidelines

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List of Local Authority Involved in Construction Industry

No Local Authority Main Role

(i) BOMBA Fire hydrant approval

(ii) IWK Sewerage approval

(iii) DOE EIA, EMP

(iv) PWD Pilling, earthwork approval, TIA

(v) DID Drainage System, ESCP

(vi) Municipal Council Earthwork approval, Building

(vii) Pejabat Tanah Land acquisition

(viii) JBA Water reticulation

(ix) TNB Electrical approval

(x) TM Cable approval

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Flow of Technical Information

DEVELOPER/

OWNERCONSULTANTS CONTRACTOR

ARCHITECT

CIVIL &

STRUCTURAL

ENGINEER

MECHANICAL

ENGINEER

ELECTRICAL ENG

QUANTITY

SURVEYOR

BUILDING CODE &

SPECIFICATION

Needs

Solutions

Design

Drawings

Construct

Zoning Permit

Design &

Drawings

Inspection

Bills of

Quantity

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Types of Drawings

TENDER DRAWINGS

CONTRACT DRAWINGS

CONSTRUCTION

DRAWINGS

AS-BUILT DRAWINGS

Set of engineering drawings which

together with the other tender

documents, bills of quantities,specification, etc., will describe the

scheme to the contractor so that he can

workout the price to construct .

Are for working or building

purposes and must, therefore,

represent the engineers lastthough of construction.

A legally binding contract after

appointment of contractor. The

contracts drawings can be the

same as tender drawings. If

alternative proposals have been

accepted, new additional drawings

will have to be prepared.

A set of completion drawings.

Any changes from construction

drawings will be recorded in as-

built drawings and these

represent actual constructiondetails.

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Specification

Classes of specifications

i. Construction Specification

ii. Military or Federal Specification

iii. Engineering or Equipment Specification

Contract & Specifications

i) The connections between a contract and its engineering specifications arein the areas of meeting requirements for durability, safety and necessaryinformation, use of codes and standards and expert assistance.

ii) The connections between engineering and administrative specifications arein the areas of paperwork directly related to the building (that is, concerningdesign, testing, procedure, records, instructions and manuals).

iii) The connections between contracts and administrative specifications are inthe areas of contractual provisions related to management of the project and

terms of payment.

C i b C & S ifi i

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Connection between Contract & Specifications

Contracts

Engineering

Specification

Contractual Provisions

Related to Building

Design

Paperwork Directly

Related to the Building

Administrative

Contractual Provisions

Related to Management

of the Project

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Levels of Specifications in Construction Project

INDUSTRY & GOVERNMENT

Facility Requirements

CONTRACTORS

Construction Tooling Specifications

Assembly Specifications

Material Specifications

ARCHITECT/ENGINEER

Construction Specifications

Equipment Specification

Material Specifications

BUILDING MATERIALS SUPPLIERS

Process Specifications

Cleaning Specifications

Material Specifications

Packaging Specifications

PART MANUFACTURERS

Process Specifications

Cleaning Specifications

Material Specifications

Packaging Specifications

Examination & Shop Test Specifications

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Bills of Quantities

Nature of Bills

Comprise a list of items of work which are briefly described

Provide a measure of the extent of work and allows the work to be pricedThe work included in the item is defined in detail by the rules in the Method of Measurement

Item description is therefore brief to allow the relevant rules of the method to be identified

The measurement may be a single item or number, dimension (linear meter, square meter, cubic

meter), time (hours, weeks) or weight

Method of Measurement

BQ required to be prepared using rules in a specified Method of Measurement Standard Methods of

Measurement are now commonly available and used

The Method of Measurement will divide the work into categories for building industry, the division is

usually based on different trades

Practice in the Building Industry

The item description simply identifies the extent of the work priced, but the detailed requirements areto be found in the Specification and Drawings

In Contract Document the specification of the works is included in the Bills of Quantities in the form of

lengthy preambles

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Functions of BQ

BQ to serve a

number of

functions

An estimate measure of the

work for the tendered price, to

be used to achieve a revised

contract price once the actual

quantities of work carried out

are measured. It is the

remeasured form of contract.

A basis to measure the

value of work

completed for interim

payments.

A breakdown of the

tendered price, with no

contractual status, but

providing information for

the selection from

tenderers.

A schedule of rates (SOR)

as the contract basis for

valuing variations in the

work

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Standard Forms

The standard Forms of contract normally used for civil engineering adopt the bills of

quantities for re-measurement. In the building industry, the price is normally a lump

sum and the bills are intended to be simply a guide to allow the price to be

determined. All forms use the rates and prices in the bills as a schedule of rates for

valuation of variations. In Contract Document, Bills of Quantity consists of :

Preamble to Bill of Quantities

Bill 1: Preliminary

Bill 2: Civil & External Works

Bill 3: Building Works

Bill 4: Mechanical & Electrical Works

Bill 5: Prime Cost and Provisional Sum

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Contract Overview

In construction, contract consists of written agreements signed by the contracting

parties (mainly an owner and a contractor) which bind them, and it defines

relationships and obligations. If any one party fails to fulfill their part of the

agreement, then the other party can seek compensation.

A contract must involve a consideration or payment. A consideration is defined as an

act, or promise by one party with another that constitutes the price for which they

buy the promise of the other. Consideration is governed by three main elements:

Valuable consideration The act, forbearance or promise must have some economic

value. Good consideration (such as moral duty) is not sufficient to render a promise

enforceable.

Sufficient consideration Consideration must be sufficient but need not be

adequate. This means that there must be some economic value, but it need not be

realistic.

Movement of consideration Consideration must move from the promise. For

example, if X promises to give Y RM10000 in return for Y placing a contract with Z, Z

cannot enforce Ys promise, as Z has supplied no consideration for it.

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Contract Overview (cont.)

A contract should fulfill three functions,

a) Normal performance A contract should define what is expected from each

party and how their performance may be allowed to vary under certain

circumstances within contract.

a) Sharing of risk As we have seen, contracts involve risk. The seller, especially, is

exposed to considerable risk. A contract should define how risk is to be shared

between parties.

a) Coping with problems We hope that our contracts will work perfectly, but they

often involve problems. The contract should define how the more predictableproblems are to be dealt with.

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Contract Overview (cont.)

For a contract to be valid,

There must be an intention to create legal relationships

The contract must be legal

It must not be contrary to public interest

It may be written or verbal

It may be signed or sealed

The parties must have the capacity to contract

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Types of ConstructionContract

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Types of Construction Contract

Lump Sum

Concession

Design &

BuiltCost Plus

Unit PriceConstruction

Contract

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Lump Sum Contracts

Suitable if the scope and schedule of the project are sufficiently defined to allow

the consulting engineer to estimate project costs e.g. building type projects.

Required detailed planning and design prepared complete plans and specification

for tender documents. Clearly define scope of work desired, the specification and

level of quality desired.

Need to appoint architect & consultants to prepare the drawing and specifications.

After plans have been finalized and approved by the client, then the tender will be

opened for bidding.

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Lump Sum Contracts (cont.)

Lump sum contract can be implemented in three different ways,

i. Lump Sum through Drawings This contract is normally for the project that requires

early completion. The drawings provided is not very detail for contractors to get an

accurate measurement for cost estimating. Thus, contractors are liable to a greater

risk.

ii. Lump Sum through Drawings and Bill of Quantity (BQ) - This contract is typically for

projects valued more than RM1 million. Contractors are able to estimate the project

cost accurately with the help of BQ provided together with the drawings. This

contract also facilitates the client in making progress payment and can clearly justify

any variation order or additional order placed by them.

iii. Lump Sum through Drawings and Price Rate Schedule This contract is normally for

projects which do not have enough time for document preparation. Price of the

project is quoted by the contractor. Sometimes, this contract is used for maintenancejobs of buildings. It can be categorized into two types of contract or Firm Price

Contract.

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Lump Sum Contracts (cont.)

Selection of contractor will be made by the owner.

A specific Lump Sum price is determined through competitive bidding by two ormore contractors.

The contractor with the lowest bid price would normally be awarded the contract.

If the lowest bid proposal received is within the construction budget then theLump Sum contract can begin.

However, if the lowest bid proposal is over the budget, then it may be necessary toconduct Value Engineering process calling the selected bidder and consultants to ameeting Tender Evaluation Meeting the price will be adjusted & recalculated until

the project cost within the budget.

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Unit Price Contracts

Unit price contracts are used for work where it is impossible to calculate the exact quantity ofmaterials that will be required. This kind of contract is based on estimated quantities of itemsincluded in the project and their unit prices. The final price of the project is dependent on thequantities needed to carry out the project.

For example, the consultant estimated that 1 million cubic meters of earth needs to be moved.However, both owner and contractor know that after the earthwork has been completed, the earththat has been moved will not exactly be 1 million cubic meters as estimated by consultant. The exactquantity will vary upon completion.

The owner needs to tell the contractor the estimated quantity before the work starts and paythem the exact measured quantity after the work is completed.

Generally, this is contract is suitable for construction and supplier projects where different types ofitems, but not their quantity, can be accurately identified in the contract documents.

Heavy or highway works are the best projects to use this kind of contract.

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Cost Plus Contracts

Used in situations that make it difficult or impossible for either owner or contractor

to predict their costs during the negotiation, tender and award process. Technically, it is

favored where the scope of the work is indeterminate or highly uncertain and kinds of

labor, material and equipment needed are also uncertain

The most common form of cost plus contract is Cost Plus a Fixed Fee and Cost Plus a

Percentage. However, between the common two forms, most owners prefer to choose

Cost Plus Fixed Fee because it limits the profit amount for the contractor, thereby

removing any incentive for the contractor to produce poor quality work

Cost Plus a Percentage contracts are suitable for a very difficult situation such as

when the time to complete the work is uncertain, but some incentive to maintain

productivity are needed. Under this arrangement complete records of all time and

materials spent by contractor on the work must be maintained for future reference.

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Cost Plus Contracts (cont.)

The Cost Plus Contract may be specified as,

Cost + Fixed Percentage Contract

Cost + Fixed Fee Contract

Cost + Fixed Fee with Guaranteed Maximum Price Contract Compensation is

based on a fixed sum of money. The total project cost will not exceed an agreedupper limit.

Cost + Fixed Fee with Bonus Contract Compensation is based on a fixed sumof money. A bonus is given if the project finish below budget, ahead of schedule,etc.

Cost + Fixed Fee with Guaranteed Maximum Price and Bonus Contract Compensation is based on a fixed sum of money. The total project cost will notexceed an agreed upper limit and a bonus is given if the project is finished below

budget, ahead of schedule etc.

Cost + Fixed Fee with Agreement for Sharing Any Cost Savings Contract Compensation is based on a fixed sum of money. Any cost savings are shared withthe buyer and the contractor.

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Design and Build Contracts

In the design and build contracts a contractor is responsible for both the design and

construction of the project. This is the latest method being used in construction project.

It is also the fastest method for designing and building a project.

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Design and Build Contracts

Design & Build

Contracts

Advantages Disadvantages

Single point responsibility

easier to manage

Client/Design and Build Contractor are

in direct contract

Clients financial commitment

known from the outset

Greater integration between design and

construction and improved build ability

The Design and Build Contractor has more

control over the project delivery process

Reduce variance

Competition remains

There is little scope for the client to

make changes without substantial

costs to the client

The clients agent has to

ensure the specification is met

Performance standards are left

to the contractor

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Concession Contracts

The definition of the concession contract:

A project based on the granting of a concession by a Principal, usually by a

government to the Promoter, sometimes known as the Concessionaire, who

is responsible for the construction, financing , operation and maintenance ofa facility over the period of the concession before finally transferring the

facility at no cost to the Principal, a fully operational facility. During

concession period the promoter owns and operates the facility and collects

revenues in order to repay the financing and investment costs, maintain and

operate the facility and make a margin of profit.

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Concession Contracts

Concession

Contracts

BTO build,

transfer, operate

DBOT design, built,

operate, transfer

BOL build, operate,

lease

BOO build,

own, operate

FBOOT finance, build,

own, operate, transfer

BOT build,

operate, transfer

BOT build, operate,

transfer

BRT built,

rent, transfer

BOOST built, own,

operate, subsidies,

transfer

BOD build,

operate, deliver

DBOM design, build,operate, maintain

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Concession Contracts

Supply

Contract

Promoter

Operators

Users

Investors

Lender

Suppliers

Loan

Agreement

Shareholder

Agreement

Operation

Contract

Off-take

Contract

Concession

Agreement

Construction

Contract

Principal

Constructors

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Summary of Contract Types

No Contract Application Advantage Disadvantage1 Lump Sum Most widely used. Suitable for

project that have sufficient

information on scope and

schedule.

Fair and secure to all

parties

Consume a lot of time

during the design and

pricing stage.

2 Unit Price For a project that is impossible to

calculate the exact quantity of

materials or works.

Flexible contractual

arrangement.

Project may go over

budget after job

completed.

3 Cost Plus Used in situations that make it

difficult or impossible for either

the owner or contractor to predict

their costs during the negotiation,

tender and award process.

Contractors may gain

more profits because it

does not provide cost

control

High risk because a lot of

variable are uncertain.

4 Design & Build The fastest method for designing

and building a project

Faster and single point

responsibility easier

to manage by owner.

Performance standards

are left to the contractor.

5 Concession For a project based on the

granting of a concession by a

Principal to Promoter, who is

responsible for most of the work.

Single point

responsible. Facilitate

government in building

and maintaining

facilities.

Complicated, time

consuming and

expensive.