German publications
AHO Booklet No. 9
Overview - Contents
1. Introduction
2. Code of Practice for CPM
3. Comments on the regular services of CPM
4. Comments on the compensation schemes / fee models for regular services of CPM
5. Guidelines to contracting (awarding contracts for) CPM services
6. Guidelines for contract procedures for CPM
Chapter 1: Introduction
Need for regulations
Chapter 2: Code of Practice for CPM
Specifications for services and fees for CPM
The fee for the regular services according to DVP/AHO can be derived from a fee table, or, alternatively, the DVP/AHO suggest a range for monthly billing rates for four categories of personnel.
Development of specifications for services for CPM and identifying a method for project specific fee determination derived from international fee investigations.
5 Project Stages
1 "pre-design"
2 "design"
3 "procurement"
4 "construction"
5 "post-construction"
4 Areas of Operation
1 "organisation, information, coordination and documentation"
2 "qualities and quantities"
3 "costs and financing"
4 "time schedule and capacities"
Fees according to time involved/required time
Absolutely new is a time-based model to determine the fee, thus enabling independency from project construction costs. Advantage: Added Value to clients since CPM do not benefit from unintended cost overruns. The fee schemes for multiple services, for instance if general constractors or gemeral designers are involved, has been detailed based on recent practical experince (§ 212).
Development of the Construction Market
Building index for residential buildings was e.g. 1995 = 100% and 2002 = 98,6%. In contrast, office cost of architects and engineers increased 3% per year in average. If considering productivity gains of ~1% per year, an average of around 2% remained to these parties.
Consequently, an overall fee gap of (1,02^8-1) x 100 + 1,4 = 18,6% has summed up from 1995to 2002. If project cost-related fee models were applied the situation was very beneficial to the owner.
Conclusion:
In the 6th edition of book No 9, the rates of fee for CPM have been increased by 12,5% (with conversion to €) thus taking into account the disparity of rising office cost and construction index prices since 1995.
Chapter 3: Comments on the regular services of CPM
The DVP has elaborated comments on the work backstages for the different services and has specified the expected deliverables. Various examples for each of the four areas of operation resemble valuable guidelines for graduates and junior engineers when managing projects in construction and real business (specifications for services/fees - Comments - Examples).
Basics of CPM in
A - Organisation, Information, Coordination, Documentation
B - Qualities, Quntities
C - Costs, Financing
D - Time Schedule, Capacities
Chapter 4: Comments on the compensation schemes
Following the extensionsof chapter 2, the "Comments on the compensation schemes/fee models for regular services of CPM" (DVP/AHO chapter 4) have been revised accordingly
Fee for conversion and new building in the respective project stages
EXAMPLE: The basic fee is: € 400.000,00
Work backages are foreseen for the conversion, whereas a general contractor should erect the new building. Accordingly, the fee within project stage 4 is reduced by 10% for the new building (from 26 to 23,4 per cent). As result of negotiations, an additional fee (25 per cent) for the conversion has been agreed (according to § 24 (1) HOAI).
Chapter 5 and 6: Guidelines to contracting CPM services and for contract procedures for CPM
1. Demand on CPM
2. Examples
Self-assessement about Expertise, Experience, Ability, Reliability
Value Benefit Analyses on general and specific professional aptitude of applicants for contract negotiations
3. Explanations about the CPM Contract
4. Extended contract procedures
5. General contract procedures, also for self employed PM
AHO Booklet No. 19
Overview - Contents
Apart from the traditional project management in staff function or in-line responsibility, various delivery models have been established in the market. These models either extend on traditional services or even set new standards in terms of risk and warranty allocation of the client.
In the summary (chapter 7) of the 6th Edition of booklet No. 9 of the series of publications of AHO from January 2004 (investigations to the scope of work, for remuneration and for the agency of project management services in the building industry and real estate economy) it was already pointed out that at the market apart from the classical steering of the project in staff function and the direction of the project in line function further scopes of work were established, which partly supplement the construction project management. In addition these substantially extend the assumption of risks and liability of the contractor.
As result of the consultation and elaboration of the members of the AHO commission for project management hereby new scopes of work are submitted, which are manual and working help to serve clients and contractors at the time of preparation and conclusion of achievement agreements:
Chapter 2: Implementation and application of project communication systems
Chapter 3: Project development
Chapter 4: Risk assessment for real estate objects (Real Estate Due Diligence)
Chapter 5: End-user project management
Chapter 6: Independent projektcontrolling commissioned by investors, banks or end-user
Chapter 7: Fulfilment of project legal advice and project management
Chapter 8: Construction management (at risk and at agency)
The scopes of work seized in these seven chapters are partially added on the achievements of the building project management defined in booklet No. 9 (chapter 2 - 6) or partially replace these (chapter 7 - 8).
All seven chapters are in principle uniformly arranged into three sections:
1. Introduction with explanations of kind and content of the respective topic
2. Scope of work, partly with comment as far as possible structured in project stages, areas of operation, basic and special services,
3. Remuneration, whereby often one suggests, in view of the individuality and complexity of each individual case a remuneration of time required suggested by number 9 of the AHO under § 203 (numbers. 2.3) and in the comment under numbers 4.1.
In chapter 1 recommendation for clients are given to make a selection from the new scope of services dependant on their own constellation.
Follow-up: Project management services in Public Private Partnerships documented in a respected AHO book
Chapter 2: Implementation and application of project communication systems
14 steps have been defined for Project Development in the initial phase:
(a) siting analysis (micro and macro)
(b) market analysis (customer and rival offers)
(c) acquisition and securing of estate/real property
(d) concept of use (requirements program of the users, program for functions, fixture, furniture and equipment) (e) concept of preplanning
(f) marketing (renting out, selling)
(g) funding of projects
(h) tax on real estate, companies, associates, acquisition of land, land/property, corporation, business tax, income tax, inheritance and capital transfer tax
(i) budget of investment and costs of use
(j) time schedule
(k) profitability calculation
(l) viability analysis and forecast with sensitivity analysis
(m) risk analysis and forecast with analysis of stakeholders involved
(n) Preparation of client's decision whether to continue or to terminate the project