Owner and Design Builder Agreement (Cost of Work Plus Fee with GMP)
Construction Contracts: Deliver Better Project Outcomes
In today’s construction market, choosing the proper delivery method is fundamental for success on any project. A variety of delivery choices are available to owners and widely used across the design and construction industry.
But before deciding on a project delivery method, owners must properly evaluate their budget, schedule, design process, risk assessment, and level of expertise. Then they can tailor a delivery method that best meets the unique needs and challenges of each project.
Owners interested in a single point of delivery, certainty that they can meet their budget, and no surprises at the end of the project often choose the design-build method.
The design-build delivery method:
- Allow owners to start construction sooner, even before the design plans are complete, and set the GMP as the design develops.
- Provides design-builders’ expertise when choosing materials and meeting overall requirements of the project, which optimizes speed and cost.
- Offers implied fitness of design plans because the design team and build team are under the same contract.
- Limits finger pointing between designer and builder and solves the liability gap that the owner faces.
- Doesn’t require 100% finished design before selecting the build team.
- Reduces paper shuffling, removes approval process, and streamlines the submittals while still safeguarding the owner.
ConsensusDoc 410: The Right Choice for Design-Build Projects
ConsensusDocs’ 410 Owner and Builder Agreement (Cost of Work Plus Fee with GMP) is a popular design-build agreement between an owner of a construction project and the design-builder that integrates one contract for the design and build services.
This construction document is a cost of work plus a fee agreement with a Guaranteed Maximum Price (GMP) and assumes the Design-Builder will hire a Design Professional (architect or engineer) to provide design services. This agreement requires the ConsensusDocs 400 Preliminary Agreement Between Owner and Design-Builder in order to develop the Owner’s program and some schematic design documents. The parties set the GMP through an amendment using the ConsensusDocs 410.1 – Guaranteed Maximum Price (GMP) and Completion Dates document at a mutually agreed-upon development in the project.
The ConsensusDocs 410 Owner and Design Builder Agreement also addresses critical construction law contract issues, including but not limited to:
- Parties relationship and responsibilities to each other
- Scope of work and execution obligations
- Design delegation
- Worksite conditions
- Contract price
- Permits and taxes
- Schedule changes
- Payment schedule
- Insurance and bond
- Claims and notice
- Waiver of consequential damages
- Dispute resolution and mitigation
- Construction defects
Every construction project is unique, and for each project, there is an ideal project delivery method that offers the best opportunity for success. For owners who want a simplified construction process and to realize cost and time savings by streamlining responsibilities, the 410 Owner and Builder Agreement is the right choice. See sample and purchase options below.Purchase Options