Construction Mitigation Management

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1 Construction Mitigation Management Construction and the Community A formal construction mitigation effort is a fairly new approach to an old standing problem of proactively managing the Community concerns with on-going construction projects. PCM has managed construction mitigation efforts since We work with our clients to develop a proactive plan of construction mitigation that optimizes the competing concerns of the impact of construction on the daily workings of the surrounding community with an efficient and cost effective approach to the construction project. Some of the areas touched on in our construction mitigation management efforts include: Parking Control Business Disruption Planning Trash & Rodent Control Trucking & Pedestrian Routes Planning Communication Management Noise & Vibration Management Site Logistics Planning Complaint Management Lighting & Dust Control Construction Phasing Pre-Construction Surveys Enforcement Management Every construction project is unique and every community in which the project takes place is unique so there is no one size fits all approach to construction mitigation. There is however, a standard process we follow in developing a construction mitigation management plan. A good plan includes the following elements Early Planning, Regular Monitoring & Reporting, Communications and Problem Solving Process, and Enforcement Management. Early Planning We work with our clients to start the dialogue between the community and the project stakeholders early in the development process. This is an important first step to being successful in the construction mitigation efforts. Hours of work, pedestrian and vehicular traffic patterns, parking impacts, are just some of the issues that need to be discussed early so that all parties have an understanding of the impacts the construction will have on them. Both sides need to clearly understand the issues and priority concerns along with what can be done to mitigate those concerns. All resolutions should be addressed directly in a written plan and communicated widely to affected members of the community and all project stakeholders. This construction mitigation plan then needs to become part of the project documentation. Regular Monitoring & Reporting With the construction mitigation plan in place regular monitoring of compliance and reporting of findings needs to occur. On larger projects we establish a call center as an efficient way to centrally manage all of the communications, monitoring and reporting activity. Monitoring of the work involves a daily walk-thru of the site along with observation of monitoring instrumentation for environmental conditions such as vibration, dust and air pollution. A regular reporting mechanism with all affected parties is established, whether that be meetings, web-site updates or notifications. Additionally, reporting standards are developed to what is a reportable event. 1

2 Communication & Problem Solving Even with perfect planning, communication and problem solving in the field will need to be accomplished regularly. We bridge between the community and the contractors to develop effective communication protocols around the mitigation efforts. At times the mitigation staff will be working with the project contractors to suggest approaches to the work that will prevent complaints and at other times the mitigation staff will be responding to the community complaints. When a complaint is received it needs to be documented and responded to in a timely and effective way. Being conscientious in responding to complaints is essential to making the construction mitigation efforts a success. Enforcement The construction mitigation plan needs to include consequences for violating the terms of the agreement. We work with our clients to determine the best approach to enforcement of the plan. Typically the enforcement process goes through stages of notification, written warning, monetary fine and contract termination. 2

3 Lenders Controls Your Experienced Advocate on the Project As a lender, you have specific concerns regarding the construction projects for which you are provide financing. Our lender services are broken down into three areas of focus which identify and monitor the lender s risk at the various stages of the project. Pre-Financing Project Review Project Construction Oversight & Reporting Project Closeout Assistance We can provide all of these services or simply the ones which provide you with the most value in overseeing your project. Our services are primarily designed to assist lending institutions with monitoring cash outlays on a construction loan and minimizing their risks on the project. The following narrative provides a brief phaseby-phase description of the process that we follow in providing our services to a lending institution. Pre-Financing Project Review We prefer to be involved prior to the loan closing. There are a number of issues PCM Consulting can assist a lender with on a project that can dramatically affect the success or failure of the project. During the pre-financing project review, we look at all the plans and specifications for level of completeness, we review the contracts on the project to ensure that the appropriate performance controls are in-place, and we look at the project budget and schedule to ensure it is reasonable to the scope of the project intended. We investigate the permit and approval situation to ensure there is compliance. We investigate the licensing, experience and reputation of the proposed contractors. In short, our due diligence efforts at this stage are used to inform the lender of the possible risks to a successful outcome so that informed decisions on the loan can be made prior to the closing. Construction Oversight & Reporting We visit the construction site at least once a month to monitor the work in progress. During these visits, we accomplish a building and site inspection to ensure that the quality in the field meets the intent of the design documents. We review the work in progress to insure that it is in compliance with the construction contract. We analyze the project schedule to ensure the critical dates will be achieved. In reviewing the monthly pay requisitions, we look for the release of lien waivers, and we review the job progress paperwork being submitted by the contractor to ensure that it is in line with the work in place. We accomplish an analysis of pending or approved change orders to identify any potential risks to the budget or schedule. Following each site inspection we file a field report documenting our findings including digital photos illustrating conditions in the field. Project Close-Out The close out of a construction project is typically a very stressful and intense period. Our interest in this phase is to ensure that nothing of importance is neglected in the rush to complete the work. In many cases, there is a phased completion where a portion of the project will be occupied while the balance of the work is being completed. At this temporary occupancy stage, we ask for all warranty documentation, as-built drawings, occupancy permits, commissioning reports, and punch-lists. Many of these items should be in hand or close to completion prior to the temporary occupancy. Prior to any final payments, we see that all of the final documentation has been signed off and the work in progress in the early stages of occupancy has been completed. 3

4 Appraisal Controls Determining a Properties Real Value As a firm, PCM Consulting has been performing property appraisals since its inception in The appraisal staff which now numbers four employees has a diverse background in both the construction and appraisal business. Our focus most recently has been in providing valuation appraisals for the insurance industry, where we have represented a number of the major insurers internationally and have accomplished various valuation appraisals of all types of real estate, facilities and equipment. Reason for Appraisal? To ensure that insured properties are promptly and properly valued, in order that the Insurance Company and building owner is appropriately compensated for their actual exposure. To offer confidence in insured values when the insured has an agreed amount or co-insurance waiver. To offer confidence when purchasing re-insurance, by aligning the correct values. Appraisal Services REPLACEMENT COST APPRAISALS Know what your exposed property values are! We can provide a variety of real and personal property Replacement Costs, (New) and Actual Cash Value appraisal report formats for insurance purposes. Standard report set-ups range from very detailed to highly efficient walk through type value checks. Customized reports are available to meet specific format needs as in the case of matching a previous appraisal, meeting compatibility requirements of capital asset records or to satisfy Agreed Value Underwriting requirements. VALUATION CONSULTING Checks and Balances! We can also render an objective "second opinion" on in-house value reviews or previous appraisals, or provide low cost "desk appraisals", review asset records to estimate insurable value and provide other general valuation support as required. CLAIMS CONSULTING Know what you are paying for! We provide a variety of real and personal property claims consulting services. Having extensive experience with property appraisals, claims, construction costs and insurance policies allows us to augment your claims personnel with a unique perspective and range of skills. We offer detailed Repair and Replacement Estimates, Estimate Reviews, Negotiating Services, General Consulting Services, Project Monitoring Services and Appraisal/Reference Services. 4

5 Deferred Maintenance Assessment Penny wise and pound foolish This old adage is an apt description of the situation in deferred maintenance for many building owners. Routine maintenance often gets shortchanged as budgeted money for system repairs are allocated to higher priority items in the budget. When this happens on a recurring basis, the results can be overwhelming. What should be routine maintenance becomes deferred and what should be a simple repair results in an emergency situation at a higher cost. In many cases this occurs because building owners just do not know the extent of their deferred maintenance problem- how many facilities are in poor condition, is there a single building system at greater risk than others, what is the dollar value of the needed repairs. We can assist in answering these questions and provide you with the means to justify and methodically invest in your facilities by accomplishing a deferred maintenance assessment of your facilities. Similar to our other services, we customize our approach to the client in order to accomplish a deferred maintenance assessment. The basic steps we take in customizing each assessment are as follows: Initial Strategy, Assessment Design, Data Collection & Analysis, and Investment Plan & Implementation Strategy. Initial Strategy At this stage we work closely with our client to determine the appropriate criteria of the assessment. There are varying levels of assessment detail that need to be considered and many questions to be answered. Are all systems and building components to be assessed? Is every facility to be included in the assessment? What are the final reporting requirements? Are just deferred maintenance items to be collected or are adaptive reuse and capital improvement items also to be considered. What is the desired schedule for completing the assessment? What are the desired reporting requirements? Assessment Design Based on the criteria established with the client in the Initial Strategy phase, an audit team will be assembled and the assessment tool will be designed for the survey. The assessment tool is a set of goals, objectives, and methodologies to be followed in accomplishing the assessment. It is developed into forms used by the audit team to collect the building data. It is at this critical stage that the assessment team will standardize what they will look for, how they will collect the data, and how they will prioritize and report the building conditions. The criteria and format for cost estimating of the corrections is also established at this stage so that the inspectors will know what to look for in order to provide proper feedback to the cost estimators. Data Collection & Analysis This is the phase where the actual work in the field begins. The audit team will make their field observations, note the deficiencies, report any emergency situations they come across and complete their inspection reports on each building system, evaluating condition and functional suitability of each facility. Preliminary data will be reviewed for the cost estimating effort and the final data reporting requirements. Each day a quality assurance discussion is performed with the survey teams and a review of the data collected is accomplished. Once a good sampling of the facilities data is collected, we begin to accomplish some analysis of the findings and meet with the client to review the preliminary results. This preliminary analysis is used to calibrate the audit team, provide preliminary information for the cost estimate, and measure some findings against industry established benchmarks. 5

6 Results: Working a Plan The result of all the survey effort is to establish reliable information on the condition of facilities so that informed and supportable decisions on facilities investment can be made. The Facilities Condition Index (FCI) developed at the end of the assessment can be used to measure against industry benchmarks, and provide data back-up to support the level of funding needed to bring the facilities into an acceptable standard of repair. The facilities data collected in the assessment can establish a methodology for funding investment in facilities maintenance in the future. In a database format, management and manipulation of the information is easily accomplished. This allows for running the what if scenarios on the data to facilitate for proper planning of alternatives, the implementation of corrective action, and the development of financial models of investment. With the proper investment in facilities, which because of the assessment can now be supported by real data, operational disruption and high cost of emergency repair and the potential income lost due to poorly maintained and aesthetically unpleasing facilities can be avoided. All of these benefits truly provide a direct return on the investment in accomplishing the deferred maintenance assessment survey. 6