Considerations When Selecting a Project Delivery Method

Selecting a project delivery method is a foundational part of every building project. The delivery method defines the contractual relationship between the building owner, architect, and contractor and determines how the project will transition from design to construction. 

We have worked with various client types—from public institutions to private organizations—and understand the benefits and drawbacks of each delivery method. In our experience, the right choice depends on your organization, project, and goals. 

This article will help you select a project delivery method by discussing five factors to consider when making your choice. 

The 5 Common Project Delivery Methods 

Before discussing the factors to consider when choosing a project delivery method, let’s outline the most common methods and how they differ. These methods include: 

1. Design-bid-build 
2. Design-build 
3. Design-negotiate-build (negotiated contract) 
4. Construction Manager-Agent (CMA) 
5. Construction Manager-at-Risk (CMAR) 

Each method offers a different approach to bringing a project to life. Design-bid-build is the most traditional delivery method. With this approach, an owner hires an architect to complete design work, and after bidding, hires a contractor to complete construction. 

On a design-build project, the architect and contractor work under a single contract. Both team members work together from the project’s onset and collaborate on pricing and construction methods. 

With a negotiated contract, the client hires an architect and privately selects a contractor to complete construction. Like a design-bid-build, the owner has a separate agreement with each entity.

CMA and CMAR involve a construction manager joining as design work begins. With CMAR projects, the construction manager works on behalf of the owner and holds contracts with subcontractors, occasionally self-performing some construction work. The construction manager also sets a Guaranteed Maximum Price (GMP), putting them financially “at risk” for the project’s budget. 

On a CMA project, the construction manager holds no subcontractor contracts. Their role is more managerial, and throughout the design and construction process, they advise the owner, provide pricing information, and communicate with different parties. With both delivery methods, the owner has a separate contract with the architect. 

5 Factors to Consider When Choosing a Project Delivery Method 

1. Funding 

The first consideration when choosing a project delivery method is your organization’s funding. While private organizations can choose any delivery method, public institutions are limited to those specified in state law. 

In some states, publicly funded projects must use a design-bid-build method. This approach promotes competition, with the project awarded to the lowest responsible bidder, and is viewed as the best way to spend taxpayer dollars. Public entities may also hire a CMA in an advisory role. 

Some states allow alternative approaches. For example, a recent Iowa law change allows publicly funded organizations like schools to use the CMAR delivery method. 

Public projects face more regulations when hiring a CMAR than private projects. This additional complexity means the approach may not be the best fit for every project. For example, a school planning a small renovation may find a design-bid-build is more straightforward.   

Learn more by reading about the CMAR process for Iowa public schools.  

2. Timing and Scheduling 

Timing and scheduling will also factor into your choice of delivery method. Projects with fast schedules benefit from hiring a contractor early to provide cost estimates and start prep work. As such, schedule concerns may lead you down a negotiated contract or design-build path. 

A CMA or CMAR delivery method also works well for projects with faster schedules. With each method, the construction manager can break the scope into multiple bid packages, potentially allowing construction to start earlier. For example, the construction manager can solicit bids for the building’s foundations while the architect completes contract documents for other portions of the building. 

This approach can also benefit projects with unique phasing requirements. Schools and universities, for example, must carefully phase projects to minimize interference with education and athletic schedules. A construction manager can help plan a phased approach and solicit bids for subcontractor work. 

3. Project Complexity 

Your project’s complexity may also influence your delivery method choice. Typically, smaller, straightforward projects benefit from a traditional delivery method like a design-bid-build. This approach increases contractor competition and helps you achieve the best possible price for the work. 

CMAR, on the other hand, works best for larger, multi-phase projects. As mentioned, the construction manager can break the scope into multiple bid packages, making the work more manageable.  

It also allows more contractors to get bonded. A bid bond refers to a document signed by a third-party surety company ensuring compensation to the owner if the bidder fails to begin work. Some companies may not get bonded for a large-scale project, but smaller scopes of work allow them to participate.  

Similarly, projects with unique requirements benefit from earlier contractor involvement. For example, the Stanley Center for Peace and Security used a negotiated contractor to allow Graham Construction to participate in early design discussions. 

The project followed the Living Building Challenge, the most rigorous approach to design, and required an integrated project team from the project’s onset. This collaborative approach ensured everyone understood the project’s goals and requirements, creating a smoother construction process. 

4. Local Labor Availability 

Occasionally, local labor availability may determine which delivery method best suits your project. 

In areas with trusted general contractors and subcontractors, you are less likely to run into issues during construction. You can head into a public bidding environment with confidence, knowing the available bidders have the skills and professionalism to complete your project. 

Other times, you may desire more oversight. A CMA or CMAR delivery method can provide guidance and advocate for your needs. Although an architect can play a similar role, some owners feel more comfortable with an additional set of eyes during construction. 

5. Experience and Confidence 

Lastly, consider your organization’s experience with building projects. Some organizations—like universities and large corporations—have staff dedicated to managing construction projects and feel comfortable with public bidding. 

Those with less experience may desire a different approach. A private organization taking on its first project can benefit from a negotiated contract. Your architect can recommend contractors, guide you through interviews, and help you find someone who fits your goals and values. 

In other situations, owners feel more comfortable with a construction manager. While their services cost an additional fee, construction managers can provide further oversight. 

Their guidance may be helpful for clients taking on multiple projects at once. Schools, for example, may benefit from having one contact for projects with different contractors. 

Determine Which Project Delivery Method is Right for You 

Choosing a project delivery method is a critical decision that impacts your project’s budget, schedule, and how each party will work together. When choosing, consider your project goals, schedule, and your organization’s experience. 

The design-bid-build approach works well for straightforward projects, especially in areas with quality contractors and subcontractors. With a thorough set of contract documents, you are more likely to get the best price for construction work. 

CMA and CMAR for complex, multi-phased projects. If you have the funds to cover the construction manager’s fee, you may benefit from additional oversight during construction and the ability to break the project into smaller scopes. 

Negotiated contracts, on the other hand, work well when you know a contractor or your architect has a recommendation. Hiring a contractor directly can create a more collaborative relationship and construction-oriented mindset during the design process. The design-build delivery method can provide similar benefits, with the architect and contractor working as a single team.

Regardless of your delivery method, your organization will go through a seven-step process to bring your project to life. Your architect will start by setting goals and developing high-level concepts before moving on to more detailed design decisions. Prepare for the process ahead by reading our overview of the architectural process.