The Process: Specifically, this approach combines the design and construction process providing greater control of project cost and schedule to the owner. From programming, planning, and schematic design through the preparation of construction contract documents the owner/architect relationship remains basically the same as with traditional project management services. With the completion of the construction contract documents, however, direct bids are received by Hill Partnership for the major building components of the project on behalf of the owner, a workable construction schedule is established, and then the progress of the construction is monitored until its completion.

When the project is bid, each trade delivers their bid directly to the owner instead of the General Contractor. This gives the owner more control over the prime subcontractor’s for the project (all are pre- selected and sent invitations to bid). Bidding the project by invitation only provides an extra layer of protection to the owner. Contractor’s are selected from a database of several hundred subcontractors that have been prescreened. Selections for a particular project are based on contractors in the database that Hill Partnership has worked with on projects of a similar scope and nature. By pre-selecting all of the major contractors of the project, and by entering into direct contracts with each of them, the owner’s exposure is greatly reduced. This has eliminated the need for Bid Bonds and Performance Bonds - saving additional money for the owner.

So, how does it work? In the table below, there is a list of bids received for a project from three General contractors ‘A’, ‘B’, and ‘C’. Each submitted a number for each of the trade divisions of work (e.g. Carpentry, Masonry, etc.) with the total bid package listed at the bottom. It is easy to see that Contractor ‘A’ has submitted the lowest overall bid (shown highlighted). Under the traditional construction scenario, Contractor 'A' would be awarded the contract for the project.

Upon closer analysis, however, it becomes plain that while Contractor ‘A’ had the lowest overall bid, he did not have the lowest individual number within each Division of Work. Contractor ‘C’, for example, had the lowest Carpentry bid and Contractor 'B' had the lowest Masonry bid. In the traditional process however, there is no way for the owner to take advantage of these lower bids because he signs a contract for the project with Contractor ‘A’ for $678,084.00.

The Construction Administration process used by Hill Partnership gives the owner the opportunity to select the lowest bid in each Division of Work. A contract is established with each of the trades individually, thereby realizing substantial savings simply by engaging the lowest number for each trade.

Compare the subtotal numbers of the three General Contractors with the Construction Administration column. This process has allowed the owner the opportunity to select the lowest bid in each Division of Work.

Notice also that each of the General Contractors adds a minimum of 10% for overhead and profit in addition to the subtotal for the contractors in each division. There is no additional overhead and profit in the Construction Administration process. Hill Partnership receives a Construction Administration fee for their services but that fee is substantially less than the overhead and profit charged by each of the General Contractors. In this example, the Construction Administration process saved the owner approximately 20 percent over accepting the bid from General Contractor ‘A’. Hill Partnership clients consistently realize 20-23% savings in the cost of construction.

The Performance of the Process: Hill Partnership has worked with multiple banks and Title companies over the last twenty six years utilizing this process. The banks and Title companies have quickly seen the additional protection provided the owner through this process, and in the vast majority of cases, Hill Partnership has been able to have title disbursement fees waived for clients as the process of payment distribution eliminated the need for the additional expenditure to the owner. In literally hundreds of projects, there has never been a situation where a client was left unprotected. In the “handful” of situations over the years where a prime contractor had to be replaced, the retention and payment process requirements outlined in the specifications left more than sufficient funding for the client to replace the contractor without incurring additional costs. Hill Partnership clients have saved significant amounts of money on their construction projects by utilizing the direct process outlined herein (20-23% net savings of construction costs!). Additionally, in most cases, the savings of not having to pay for Title Disbursing Fees, Bid Bonds, and Performance and Payment Bonds has allowed them to redirect their limited funds back into the quality of the project.

Ranken Technical College was the first client to try the process. To date, we have completed over 135 projects for Ranken College in St. Louis. The President of Ranken College, Ben Ernst, wrote in a letter in March of 2000, “Rick has done outstanding work for us for many years and has saved us a LOT of money in the process. These savings were not the result of cutting corners, rather a construction management process that allowed us to divert more resources to the actual time and materials of the projects.” In May of 2011, Ben wrote, “Rick and his team are smart people who can see things most of us cannot see as we go about our day to day activities. They have some very good cost saving techniques that have saved Ranken Technical College millions of dollars over the years. If you decide to hire Rick and his team, be sure to have him show you how he can save you money.” It is worth noting, that Hill Partnership recently completed over $12 million worth of work for Ranken College utilizing this process, and saved the college over $4.5 million by Ranken’s own estimates.

The Construction Administration model used by Hill Partnership provides clients with greater involvement in the project, increased protection, and significant cost savings.

architects

a unique Construction Administration process...

Origins: In the mid-1980’s, Richard Hill, founder and President of Hill Partnership managed an architectural practice in Garmisch, West Germany. Project management in Germany was completely different than how it is practiced in this country. In Germany, architects were much more involved with the construction process. They worked directly with subcontractors in the field in overseeing the work and developing construction details on site. It was a very intriguing process for several reasons. Most significantly, the architect was more actively involved with the individual trades. This gave the architect a better understanding of which firms within the trade were conscientious, reputable, worked well with the other trades, and gave the client “that little something extra.” It also opened up a greater dialogue between the individual craftsmen of the trades and the architect. This led to better detailing and - drawing on the tradesman’s experience and expertise in his trade - a more efficient construction process for everyone involved. When Mr. Hill returned to the United States, this process had left a lasting impression.

In the 1990’s Mr. Hill saw multiple problems with sub-contractors arise due to the practice of General contractors having to use the lowest bid in order to remain competitive. General contractors would share with us that they had had problems with a particular subcontractor before, but since they knew that the other General Contractors competing for the work would use that particular low number in their bid, they felt forced to do the same.

Reflecting on his experience with project management in Germany, Richard developed a unique project delivery method that Hill Partnership uses exclusively today. The process combines the best practices and safeguards of both the project management systems in Germany and in the United States. The firm has completed hundreds of projects over the past twenty six years utilizing this process and has saved clients verifiably millions of dollars while providing them significant additional protection. The competitive bid nature of the process ensures that the owner receives the lowest possible bid from each of the subcontractors. Coupling that with the utilization of an invited list of pre-qualified bidders ensures the quality and reliability of those bids. This process consistently produces substantial savings in project costs (generally 20-23%), while adding additional protection to the owner due to multiple direct contracts (less overall exposure) with pre-selected subcontractors (reduced individual exposure).

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