BESPOKE HOUSE BUILDERS IN THE UNITED KINGDOM

 Milestone Builders is a Luxury Project Management Company that aims to simply build and design dream living spaces, eliminating the stress of building for families and working professionals. We use our unique Milestone Method to ensure our projects are designed and built to perfection. 

 The purpose of these construction delivery methods is to define how the project owner, the general contractor and the licensed designer (architect or engineer) will interact throughout the project.

 Design-build: In the design-build method, the design and build phases are executed by the same party known as the design-builder.

 CM at risk: The CM at risk model empowers the construction manager, giving him more functions than he would normally have. In this project delivery method, the construction manager acts in two ways. On one hand, he is a consultant to the project owner during the design and development phases, and on the other hand, he monitors the contractor during the construction phase to control costs and guarantee that the project is delivered within the guaranteed maximum price.

 Once the project owner has the blueprints, material take-offs, a construction project manager and a general contractor, the project can begin.

 Construction project management requires a broad variety of skills, along with the ability to interface with a diverse range of agencies and people in order to lead the project from concept to build. It’s important that construction project managers follow the principles of project management during every phase of the project life cycle.

 You can’t start a project unless you know you’ll be able to finish it. First comes the due diligence to determine if the project is even feasible. How do you figure this out? You want to go through a feasibility study or what is often called a business case, in which you look at the goals, cost estimates and timeline to see if you have the resources to reach a successful project end within those constraints. You also want to define the reasoning behind the project and make sure it’s sound. If so, then you create your project charter to help initiate the project. You’ll also identify potential issues and risks in this phase.

 You have approval, now how are you going to achieve success? Outline the tasks within the timeline, noting project milestones, and the resources needed to do those tasks within the budget allotted. Be transparent in your project plan, so everyone is on the same page and understands what needs to be done over the life cycle of the project. That includes detailing the cost, scope, duration, quality and communications used in the project. This is also when you’ll be able to conceptualize the best project team for the project and begin the process of assembling them.

 The planning phase is probably the most important project management phase because you’ll create the documents that will guide the project execution. Here are some of them:

 The project schedule is a big part of the planning phase in construction project management. Here’s an example of a project schedule from ProjectManager’s free construction schedule template.

 Once you’ve completed the work breakdown structure, you’ll add your tasks to the left-hand side of the construction schedule template. You can add subtasks, add resources and costs, deadlines and more. Project phases can also be color-coded. To the right is a timeline that captures the entire project plan in one place.

 On the timeline side of the Gantt chart, you can link dependent tasks, set milestones and a baseline to capture the project plan to compare to your actual progress when the project is being executed. There are a lot more features to play with on the Gantt chart that will help you plan and control your project. Download the free template to practice making your own construction schedule.

 Once you have a construction plan that includes all the information you need to manage costs, scope, risks, time and other aspects of your project, it’s time to execute.

 At this stage, you’re executing the project and taking the project plan and implementing it while factoring in the changes and work management issues that can arise during such a process. Whatever deliverables you promised must come through in the timeframe you noted. Now, as a construction project manager, you must deal with the project owner, stakeholders and customers and teams. The latter have tasks that must be completed, which means workload management and resource allocation. You’ll be setting up meetings and reporting frequently throughout this stage. This is where your project management tool will really be tested, but more on that later.

 You can’t know the progress of your project if you don’t have a way to monitor it. You’ll be doing this during the previous stages of the project, but it’s important enough to demand its own separate stage in your management. You’ll want to have a way to note the progress, which is why you need to set up key performance indicators for cost control, time tracking and quality control. If you can stay on top of these figures, it’s less likely you’ll manage a failing project. Therefore, stay flexible and communicative throughout so you can adapt quickly to change when it occurs, and it always occurs.

 When you’re managing a construction job, there are certain objectives you should consider. Just like in any project, you accomplish overall project success by breaking it down into phases. The following are four steps you can take to organize a successful construction project management project.

 There are four parts to designing a construction project. It’s the project manager’s responsibility to make sure your design meets with building codes and other regulations.

 The concept. What are the needs, goals and objectives of the project? You’ll be making decisions based on the size of the project, the site allocated for the build and the actual design of what you’re building. This is comprised of a list for each room or space under consideration, including all critical data.

 The schematic design. The schematic design is a sketch that identifies the various parts, materials, sizes, colors, textures, etc. It includes the floorplan, elevations, etc. and even a site plan.

 Design Development (DD). Design development requires research. What are the materials to use? What equipment will be needed? How much are the materials? What is the material take-off?

Self build in the United Kingdom

 Once you have a design, you’ll need to use information from construction drawings and documents from the previous stage to create a bill of quantities which will specify the materials and labor that’s required. Knowing local building codes and adhering to them will be important at this stage.

 Get the contract documents together. These are the final blueprints and construction specs. These will be used by outside contractors to bid on the job.

 The preconstruction phase starts once the general contractor bid is accepted, but before ground is broken. During that time, you’ll want to work on these three steps.

 Assign a project manager. If the project manager hasn’t already been determined, you’ll want to establish it now. Sometimes a project manager is on board early and participates in the first stages of a project, while other times they aren’t hired until the design is complete.

 Determine the rest of the personnel. Find a contract administrator or the person who helps the project manager. A superintendent is also needed to keep everything on schedule in terms of the materials, deliveries and equipment. Superintendents are also on-site to deal with construction activities. Finally, you want to have a field engineer, which is more of an entry-level position to deal with paperwork.

 Investigate the job site. Conduct a site analysis to understand the social, climatic and demographic variables that might affect your construction project.

 By this point, you’ve established your team and you’ve planned for the construction and materials necessary to complete it. Now you must purchase those materials and equipment. Depending on the organization, procurement might be the responsibility of the general contractor or subcontractors.

 By this point, you’ve established your team and you’ve planned for the construction and materials necessary to complete it. Now you must purchase those materials and equipment. Depending on the organization, procurement might be the responsibility of the general contractor or subcontractors.

 This is the stage you’ll be working with purchase orders, which are used as an agreement between the buyer and the seller.

 Finally, you’re ready for the build! But first, set a preconstruction meeting to deal with work hours, the storage of materials, quality control and site access. Then get everyone on the construction site and set up as needed.

 You’ll need to create a payment schedule and a process to deliver payments. This information needs to be transparent, not only to meet financial obligations but to maintain a happy and productive workforce and environment. Make sure your work orders are detailed enough to avoid misunderstandings between you and your contractors.

 The last part of the project is after the construction is complete and the occupants move into or take ownership of the site. You must make sure all their requirements have been met, and usually provide a warranty period to make that arrangement official and binding.

 Construction project management software organizes the planning, scheduling, building, resources and reporting associated with construction projects. It streamlines the process and improves productivity—all while keeping to a tight schedule and budget.

 Construction management software is designed to help managers control every phase of their projects by organizing its disparate parts and automating routines to add efficiencies. A construction project management tool also keeps stakeholders updated by sharing data-rich reports.

 Because of the many documents related to any construction project, file storage and management of those files are also one of the key features of construction project management software. Having real-time data to foster collaboration, plan, schedule and manage resources is also an essential feature. Microsoft Project is one of the most commonly used project management software, but it has major drawbacks that make ProjectManager a better alternative.

 Just as you need the right tools to build a structure, you need the right tools to manage that construction. ProjectManager provides construction project scheduling, construction project planning, construction vendor management, cost management in construction projects and other features that allow you to work more efficiently and productively.

 When you work with an interactive online construction management software like ProjectManager, project management becomes that much easier. You create a platform on which teams can collaborate and assigning them tasks and tracking progress becomes that simpler. You need a construction management solution that has the following features:

 Milestone Builders is a Luxury Project Management Company that aims to simply build and design dream living spaces, eliminating the stress of building for families and working professionals. We use our unique Milestone Method to ensure our projects are designed and built to perfection. 

 The acquisition of a constructed facility usually represents a major capital investment, whether its owner happens to be an individual, a private corporation or a public agency. Since the commitment of resources for such an investment is motivated by market demands or perceived needs, the facility is expected to satisfy certain objectives within the constraints specified by the owner and relevant regulations. With the exception of the speculative housing market, where the residential units may be sold as built by the real estate developer, most constructed facilities are custom made in consultation with the owners. A real estate developer may be regarded as the sponsor of building projects, as much as a government agency may be the sponsor of a public project and turns it over to another government unit upon its completion. From the viewpoint of project management, the terms "owner" and "sponsor" are synonymous because both have the ultimate authority to make all important decisions. Since an owner is essentially acquiring a facility on a promise in some form of agreement, it will be wise for any owner to have a clear understanding of the acquisition process in order to maintain firm control of the quality, timeliness and cost of the completed facility.

 From the perspective of an owner, the project life cycle for a constructed facility may be illustrated schematically in Figure 1-1. Essentially, a project is conceived to meet market demands or needs in a timely fashion. Various possibilities may be considered in the conceptual planning stage, and the technological and economic feasibility of each alternative will be assessed and compared in order to select the best possible project. The financing schemes for the proposed alternatives must also be examined, and the project will be programmed with respect to the timing for its completion and for available cash flows. After the scope of the project is clearly defined, detailed engineering design will provide the blueprint for construction, and the definitive cost estimate will serve as the baseline for cost control. In the procurement and construction stage, the delivery of materials and the erection of the project on site must be carefully planned and controlled. After the construction is completed, there is usually a brief period of start-up or shake-down of the constructed facility when it is first occupied. Finally, the management of the facility is turned over to the owner for full occupancy until the facility lives out its useful life and is designated for demolition or conversion.

 Of course, the stages of development in Figure 1-1 may not be strictly sequential. Some of the stages require iteration, and others may be carried out in parallel or with overlapping time frames, depending on the nature, size and urgency of the project. Furthermore, an owner may have in-house capacities to handle the work in every stage of the entire process, or it may seek professional advice and services for the work in all stages. Understandably, most owners choose to handle some of the work in-house and to contract outside professional services for other components of the work as needed. By examining the project life cycle from an owner's perspective we can focus on the proper roles of various activities and participants in all stages regardless of the contractual arrangements for different types of work.

 In the United States, for example, the U.S. Army Corps of Engineers has in-house capabilities to deal with planning, budgeting, design, construction and operation of waterway and flood control structures. Other public agencies, such as state transportation departments, are also deeply involved in all phases of a construction project. In the private sector, many large firms such as DuPont, Exxon, and IBM are adequately staffed to carry out most activities for plant expansion. All these owners, both public and private, use outside agents to a greater or lesser degree when it becomes more advantageous to do so.

 The project life cycle may be viewed as a process through which a project is implemented from cradle to grave. This process is often very complex; however, it can be decomposed into several stages as indicated by the general outline in Figure 1-1. The solutions at various stages are then integrated to obtain the final outcome. Although each stage requires different expertise, it usually includes both technical and managerial activities in the knowledge domain of the specialist. The owner may choose to decompose the entire process into more or less stages based on the size and nature of the project, and thus obtain the most efficient result in implementation. Very often, the owner retains direct control of work in the planning and programming stages, but increasingly outside planners and financial experts are used as consultants because of the complexities of projects. Since operation and maintenance of a facility will go on long after the completion and acceptance of a project, it is usually treated as a separate problem except in the consideration of the life cycle cost of a facility. All stages from conceptual planning and feasibility studies to the acceptance of a facility for occupancy may be broadly lumped together and referred to as the Design/Construct process, while the procurement and construction alone are traditionally regarded as the province of the construction industry.

 Owners must recognize that there is no single best approach in organizing project management throughout a project's life cycle. All organizational approaches have advantages and disadvantages, depending on the knowledge of the owner in construction management as well as the type, size and location of the project. It is important for the owner to be aware of the approach which is most appropriate and beneficial for a particular project. In making choices, owners should be concerned with the life cycle costs of constructed facilities rather than simply the initial construction costs. Saving small amounts of money during construction may not be worthwhile if the result is much larger operating costs or not meeting the functional requirements for the new facility satisfactorily. Thus, owners must be very concerned with the quality of the finished product as well as the cost of construction itself. Since facility operation and maintenance is a part of the project life cycle, the owners' expectation to satisfy investment objectives during the project life cycle will require consideration of the cost of operation and maintenance. Therefore, the facility's operating management should also be considered as early as possible, just as the construction process should be kept in mind at the early stages of planning and programming.

 Since most owners are generally interested in acquiring only a specific type of constructed facility, they should be aware of the common industrial practices for the type of construction pertinent to them. Likewise, the construction industry is a conglomeration of quite diverse segments and products. Some owners may procure a constructed facility only once in a long while and tend to look for short term advantages. However, many owners require periodic acquisition of new facilities and/or rehabilitation of existing facilities. It is to their advantage to keep the construction industry healthy and productive. Collectively, the owners have more power to influence the construction industry than they realize because, by their individual actions, they can provide incentives or disincentives for innovation, efficiency and quality in construction. It is to the interest of all parties that the owners take an active interest in the construction and exercise beneficial influence on the performance of the industry.

 In planning for various types of construction, the methods of procuring professional services, awarding construction contracts, and financing the constructed facility can be quite different. For the purpose of discussion, the broad spectrum of constructed facilities may be classified into four major categories, each with its own characteristics.

 Residential housing construction includes single-family houses, multi-family dwellings, and high-rise apartments. During the development and construction of such projects, the developers or sponsors who are familiar with the construction industry usually serve as surrogate owners and take charge, making necessary contractual agreements for design and construction, and arranging the financing and sale of the completed structures. Residential housing designs are usually performed by architects and engineers, and the construction executed by builders who hire subcontractors for the structural, mechanical, electrical and other specialty work. An exception to this pattern is for single-family houses which may be designed by the builders as well.

 The residential housing market is heavily affected by general economic conditions, tax laws, and the monetary and fiscal policies of the government. Often, a slight increase in total demand will cause a substantial investment in construction, since many housing projects can be started at different locations by different individuals and developers at the same time. Because of the relative ease of entry, at least at the lower end of the market, many new builders are attracted to the residential housing construction. Hence, this market is highly competitive, with potentially high risks as well as high rewards.

 Institutional and commercial building construction encompasses a great variety of project types and sizes, such as schools and universities, medical clinics and hospitals, recreational facilities and sports stadiums, retail chain stores and large shopping centers, warehouses and light manufacturing plants, and skyscrapers for offices and hotels. The owners of such buildings may or may not be familiar with construction industry practices, but they usually are able to select competent professional consultants and arrange the financing of the constructed facilities themselves. Specialty architects and engineers are often engaged for designing a specific type of building, while the builders or general contractors undertaking such projects may also be specialized in only that type of building.

 Because of the higher costs and greater sophistication of institutional and commercial buildings in comparison with residential housing, this market segment is shared by fewer competitors. Since the construction of some of these buildings is a long process which once started will take some time to proceed until completion, the demand is less sensitive to general economic conditions than that for speculative housing. Consequently, the owners may confront an oligopoly of general contractors who compete in the same market. In an oligopoly situation, only a limited number of competitors exist, and a firm's price for services may be based in part on its competitive strategies in the local market.

 Specialized industrial construction usually involves very large scale projects with a high degree of technological complexity, such as oil refineries, steel mills, chemical processing plants and coal-fired or nuclear power plants. The owners usually are deeply involved in the development of a project, and prefer to work with designers-builders such that the total time for the completion of the project can be shortened. They also want to pick a team of designers and builders with whom the owner has developed good working relations over the years.

 Although the initiation of such projects is also affected by the state of the economy, long range demand forecasting is the most important factor since such projects are capital intensive and require considerable amount of planning and construction time. Governmental regulation such as the rulings of the Environmental Protection Agency and the Nuclear Regulatory Commission in the United States can also profoundly influence decisions on these projects.

 Infrastructure and heavy construction includes projects such as highways, mass transit systems, tunnels, bridges, pipelines, drainage systems and sewage treatment plants. Most of these projects are publicly owned and therefore financed either through bonds or taxes. This category of construction is characterized by a high degree of mechanization, which has gradually replaced some labor intensive operations.

 The engineers and builders engaged in infrastructure construction are usually highly specialized since each segment of the market requires different types of skills. However, demands for different segments of infrastructure and heavy construction may shift with saturation in some segments. For example, as the available highway construction projects are declining, some heavy construction contractors quickly move their work force and equipment into the field of mining where jobs are available.

 When an owner decides to seek professional services for the design and construction of a facility, he is confronted with a broad variety of choices. The type of services selected depends to a large degree on the type of construction and the experience of the owner in dealing with various professionals in the previous projects undertaken by the firm. Generally, several common types of professional services may be engaged either separately or in some combination by the owners.

 At the early stage of strategic planning for a capital project, an owner often seeks the services of financial planning consultants such as certified public accounting (CPA) firms to evaluate the economic and financial feasibility of the constructed facility, particularly with respect to various provisions of federal, state and local tax laws which may affect the investment decision. Investment banks may also be consulted on various options for financing the facility in order to analyze their long-term effects on the financial health of the owner organization.

 Traditionally, the owner engages an architectural and engineering (A/E) firm or consortium as technical consultant in developing a preliminary design. After the engineering design and financing arrangements for the project are completed, the owner will enter into a construction contract with a general contractor either through competitive bidding or negotiation. The general contractor will act as a constructor and/or a coordinator of a large number of subcontractors who perform various specialties for the completion of the project. The A/E firm completes the design and may also provide on site quality inspection during construction. Thus, the A/E firm acts as the prime professional on behalf of the owner and supervises the construction to insure satisfactory results. This practice is most common in building construction.

Turnkey developments in the United Kingdom

 In the past two decades, this traditional approach has become less popular for a number of reasons, particularly for large scale projects. The A/E firms, which are engaged by the owner as the prime professionals for design and inspection, have become more isolated from the construction process. This has occurred because of pressures to reduce fees to A/E firms, the threat of litigation regarding construction defects, and lack of knowledge of new construction techniques on the part of architect and engineering professionals. Instead of preparing a construction plan along with the design, many A/E firms are no longer responsible for the details of construction nor do they provide periodic field inspection in many cases. As a matter of fact, such firms will place a prominent disclaimer of responsibilities on any shop drawings they may check, and they will often regard their representatives in the field as observers instead of inspectors. Thus, the A/E firm and the general contractor on a project often become antagonists who are looking after their own competing interests. As a result, even the constructibility of some engineering designs may become an issue of contention. To carry this protective attitude to the extreme, the specifications prepared by an A/E firm for the general contractor often protects the interest of the A/E firm at the expense of the interests of the owner and the contractor.

 In order to reduce the cost of construction, some owners introduce value engineering, which seeks to reduce the cost of construction by soliciting a second design that might cost less than the original design produced by the A/E firm. In practice, the second design is submitted by the contractor after receiving a construction contract at a stipulated sum, and the saving in cost resulting from the redesign is shared by the contractor and the owner. The contractor is able to absorb the cost of redesign from the profit in construction or to reduce the construction cost as a result of the re-design. If the owner had been willing to pay a higher fee to the A/E firm or to better direct the design process, the A/E firm might have produced an improved design which would cost less in the first place. Regardless of the merit of value engineering, this practice has undermined the role of the A/E firm as the prime professional acting on behalf of the owner to supervise the contractor.

 A common trend in industrial construction, particularly for large projects, is to engage the services of a design/construct firm. By integrating design and construction management in a single organization, many of the conflicts between designers and constructors might be avoided. In particular, designs will be closely scrutinized for their constructibility. However, an owner engaging a design/construct firm must insure that the quality of the constructed facility is not sacrificed by the desire to reduce the time or the cost for completing the project. Also, it is difficult to make use of competitive bidding in this type of design/construct process. As a result, owners must be relatively sophisticated in negotiating realistic and cost-effective construction contracts.

 One of the most obvious advantages of the integrated design/construct process is the use of phased construction for a large project. In this process, the project is divided up into several phases, each of which can be designed and constructed in a staggered manner. After the completion of the design of the first phase, construction can begin without waiting for the completion of the design of the second phase, etc. If proper coordination is exercised. the total project duration can be greatly reduced. Another advantage is to exploit the possibility of using the turnkey approach whereby an owner can delegate all responsibility to the design/construct firm which will deliver to the owner a completed facility that meets the performance specifications at the specified price.

 In recent years, a new breed of construction managers (CM) offers professional services from the inception to the completion of a construction project. These construction managers mostly come from the ranks of A/E firms or general contractors who may or may not retain dual roles in the service of the owners. In any case, the owner can rely on the service of a single prime professional to manage the entire process of a construction project. However, like the A/E firms of several decades ago, the construction managers are appreciated by some owners but not by others. Before long, some owners find that the construction managers too may try to protect their own interest instead of that of the owners when the stakes are high.

 It should be obvious to all involved in the construction process that the party which is required to take higher risk demands larger rewards. If an owner wants to engage an A/E firm on the basis of low fees instead of established qualifications, it often gets what it deserves; or if the owner wants the general contractor to bear the cost of uncertainties in construction such as foundation conditions, the contract price will be higher even if competitive bidding is used in reaching a contractual agreement. Without mutual respect and trust, an owner cannot expect that construction managers can produce better results than other professionals. Hence, an owner must understand its own responsibility and the risk it wishes to assign to itself and to other participants in the process.

 Although many owners keep a permanent staff for the operation and maintenance of constructed facilities, others may prefer to contract such tasks to professional managers. Understandably, it is common to find in-house staff for operation and maintenance in specialized industrial plants and infrastructure facilities, and the use of outside managers under contracts for the operation and maintenance of rental properties such as apartments and office buildings. However, there are exceptions to these common practices. For example, maintenance of public roadways can be contracted to private firms. In any case, managers can provide a spectrum of operation and maintenance services for a specified time period in accordance to the terms of contractual agreements. Thus, the owners can be spared the provision of in-house expertise to operate and maintain the facilities.

 Although many owners keep a permanent staff for the operation and maintenance of constructed facilities, others may prefer to contract such tasks to professional managers. Understandably, it is common to find in-house staff for operation and maintenance in specialized industrial plants and infrastructure facilities, and the use of outside managers under contracts for the operation and maintenance of rental properties such as apartments and office buildings. However, there are exceptions to these common practices. For example, maintenance of public roadways can be contracted to private firms. In any case, managers can provide a spectrum of operation and maintenance services for a specified time period in accordance to the terms of contractual agreements. Thus, the owners can be spared the provision of in-house expertise to operate and maintain the facilities.

 As a logical extension for obtaining the best services throughout the project life cycle of a constructed facility, some owners and developers are receptive to adding strategic planning at the beginning and facility maintenance as a follow-up to reduce space-related costs in their real estate holdings. Consequently, some architectural/engineering firms and construction management firms with computer-based expertise, together with interior design firms, are offering such front-end and follow-up services in addition to the more traditional services in design and construction. This spectrum of services is described in Engineering News-Record (now ENR) as follows: [2]

 Facilities management is the discipline of planning, designing, constructing and managing space -- in every type of structure from office buildings to process plants. It involves developing corporate facilities policy, long-range forecasts, real estate, space inventories, projects (through design, construction and renovation), building operation and maintenance plans and furniture and equipment inventories.

 A common denominator of all firms entering into these new services is that they all have strong computer capabilities and heavy computer investments. In addition to the use of computers for aiding design and monitoring construction, the service includes the compilation of a computer record of building plans that can be turned over at the end of construction to the facilities management group of the owner. A computer data base of facilities information makes it possible for planners in the owner's organization to obtain overview information for long range space forecasts, while the line managers can use as-built information such as lease/tenant records, utility costs, etc. for day-to-day operations.

 Builders who supervise the execution of construction projects are traditionally referred to as contractors, or more appropriately called constructors. The general contractor coordinates various tasks for a project while the specialty contractors such as mechanical or electrical contractors perform the work in their specialties. Material and equipment suppliers often act as installation contractors; they play a significant role in a construction project since the conditions of delivery of materials and equipment affect the quality, cost, and timely completion of the project. It is essential to understand the operation of these contractors in order to deal with them effectively.

 The function of a general contractor is to coordinate all tasks in a construction project. Unless the owner performs this function or engages a professional construction manager to do so, a good general contractor who has worked with a team of superintendents, specialty contractors or subcontractors together for a number of projects in the past can be most effective in inspiring loyalty and cooperation. The general contractor is also knowledgeable about the labor force employed in construction. The labor force may or may not be unionized depending on the size and location of the projects. In some projects, no member of the work force belongs to a labor union; in other cases, both union and non-union craftsmen work together in what is called an open shop, or all craftsmen must be affiliated with labor unions in a closed shop. Since labor unions provide hiring halls staffed with skilled journeyman who have gone through apprentice programs for the projects as well as serving as collective bargain units, an experienced general contractor will make good use of the benefits and avoid the pitfalls in dealing with organized labor.

 Specialty contractors include mechanical, electrical, foundation, excavation, and demolition contractors among others. They usually serve as subcontractors to the general contractor of a project. In some cases, legal statutes may require an owner to deal with various specialty contractors directly. In the State of New York, for example, specialty contractors, such as mechanical and electrical contractors, are not subjected to the supervision of the general contractor of a construction project and must be given separate prime contracts on public works. With the exception of such special cases, an owner will hold the general contractor responsible for negotiating and fulfilling the contractual agreements with the subcontractors.

 Major material suppliers include specialty contractors in structural steel fabrication and erection, sheet metal, ready mixed concrete delivery, reinforcing steel bar detailers, roofing, glazing etc. Major equipment suppliers for industrial construction include manufacturers of generators, boilers and piping and other equipment. Many suppliers handle on-site installation to insure that the requirements and contractual specifications are met. As more and larger structural units are prefabricated off-site, the distribution between specialty contractors and material suppliers becomes even less obvious.

 A major construction project requires an enormous amount of capital that is often supplied by lenders who want to be assured that the project will offer a fair return on the investment. The direct costs associated with a major construction project may be broadly classified into two categories: (1) the construction expenses paid to the general contractor for erecting the facility on site and (2) the expenses for land acquisition, legal fees, architect/engineer fees, construction management fees, interest on construction loans and the opportunity cost of carrying empty space in the facility until it is fully occupied. The direct construction costs in the first category represent approximately 60 to 80 percent of the total costs in most construction projects. Since the costs of construction are ultimately borne by the owner, careful financial planning for the facility must be made prior to construction.

 Construction loans to contractors are usually provided by banks or savings and loan associations for construction financing. Upon the completion of the facility, construction loans will be terminated and the post-construction facility financing will be arranged by the owner.