Subcontractor Engagement in the Two-Stage Early Contractor Involvement Paradigm for Commercial Construction

Abstract

Commercial construction projects (CCPs) in New Zealand contribute more to the economy than other project types. However, many face cost and time increases due to inadequate planning. Procurement pathways that involve contractors during design development provide more time to plan, collaboratively. Nevertheless, most projects are procured through traditional tender where contractors are only involved after detailed design. Through two-stage early contractor involvement (2S-ECI), contractors can provide design buildability advice for complex projects, contribute value management, carry out exploratory works, and order materials. The role of subcontractors in 2S-ECI can be significant. Six semi-structured interviews were conducted with clients, consultants, main contractors, and a subcontractor involved in large complex commercial construction projects. The findings build on the emerging body of knowledge about 2S-ECI by providing insight into subcontractor early involvement. Project complexity and market conditions were the main reasons for early subcontractor involvement. Common challenges include a lack of information sharing among the parties, non-competitive selection, and a lack of standard contract documentation. Opportunities for improvement include clarifying client expectations, educating stakeholders, and providing more equitable compensation for pre-construction services. Key drivers for subcontractor involvement include project complexity, market conditions, ordering long-lead-time systems, and performance specifications. Specialist early sub-trades include electrical, mechanical, structural steel, and façades. Subcontractors should typically be engaged as early as possible, often concurrently via main contractors to share performance risk. Pre-construction services provided by subcontractors include planning and sequencing; design buildability analysis; risk mitigation; value management; budget advice; systems procurement; design solutions; and document control systems. Advantages include obtaining specialist project knowledge and improving completion certainty. Producing a pre-construction services agreement (PCSA) for subcontractors may address challenges, as has been carried out for main contractors, but there is still a gap in the contractual framework for 2S-ECI for subcontractors.

Keywords

• two-stage early contractor involvement
• procurement
• subcontractor
• commercial construction projects
• practices
• New Zealand