The industry’s latest performance research predicts that design-build will deliver nearly half of all non-residential design and construction in the United States by 2026. Because design-build isn’t a one-size-fits-all approach, it allows Owners to choose the variation that best suits their goals, project and team. In addition to cost and schedule savings, the flexibility to select the best method for each project and team is among the factors that have driven design-build’s incredible growth nationwide.
So, many in the industry wonder, “Which procurement approach is best suited to my project needs?” According to design-build professionals, the answer is, “It depends on the Owner and the project.”
Diving deeper into that answer, we first need to appreciate that Progressive Design-Build (PDB) and Best Value are both design-build, just variations on the procurement approach. In a well-managed two-step Best Value Design-Build selection process, the Owner establishes qualitative non-price and quantitative cost/price criteria by which proposals will be evaluated and a selection made, with qualifications and past performance heavily weighted in the selection. PDB also uses primarily a qualifications-based selection, followed by a process whereby the Owner then “progresses” toward a design and contract price with the team (thus the term “Progressive”).
Some Key Differences
According to former DBIA National Board Chair Marty Hedlund, “While the two approaches aren’t wildly variant, ultimately, using design-build, the Owner will pick the most highly qualified team and let them use their ingenuity and experience to develop the best solutions possible. That is the essence of design-build. Give teams the freedom to collaborate and innovate.”
DBIA’s Position Statement: The Flexibility of Design-Build and updated Design-Build Done Right® Universal Best Practices offer a few key differences between Best Value and PDB:
(Two-Phase) Best-Value Design-Build |
Progressive Design Build |
||
Team Selection |
Qualifications are the sole evaluation factor in phase one of the two-phase Best-Value process with past performance being the single most important factor. In phase two, design and price are evaluated for the short-listed firms. | The design-builder is retained by the Owner early in the life of the project and, in most cases, before the design has been developed at all.
The design-builder is selected primarily, if not exclusively, on qualifications and the design-builder’s plan for managing the project. |
|
Design |
The Owner focuses on describing the project goals, criteria, challenges and constraints, allowing the competing design-build teams to present design concepts during the pre-award proprietary meetings, and during the post-award design management phase of the project. | The Owner “progresses” toward a design and contract price with the team (thus the term “Progressive”). | |
Price |
Provides the Owner with a firm-fixed-price (lump sum) or GMP at time of contract award, with the price and scope being established through a competitive procurement process. | The Owner does not seek nor does the design-builder commit to a final contract price at the time of the selection of the design-builder. Rather, the price commitment comes after the parties have agreed upon scope, schedule and other commercial terms. | |
Setting Contract Price
Craig Unger, former DBIA President and long-time DBIA instructor and design-build consultant, noted when the contract price is set is an essential difference between Best Value and PDB. “In Best Value, we are going to select the three most highly qualified teams,” he explained. “Then those three teams submit a technical proposal within budget, and the best team with the best proposal within budget will be chosen. There are both qualitative (skills) and quantitative (price) measures in the team selection.”
But in PDB, Hedlund described how price comes later, “In PDB, the design-build team is typically selected largely on qualifications. The entire team then progresses from there to collaborate on design, pricing and budget,” said Hedlund. “That is the biggest leap Owners have to take because there is no contract price at the point of award. There may be a cost element covering design, pre-construction work and an overall budget but no agreed-upon contract price. Some Owners will struggle with the idea of selecting a team without that price.”
Questions for Owners to Consider
Design-build’s growth over recent years has many Owners considering which procurement approach is right for them. But Hedlund noted there are some critical questions for Owners to consider first, including:
- What are the specific goals for the project?
- What is the Owner’s internal capacity to appropriately manage each procurement approach?
“If an Owner can put out an excellent non-prescriptive RFP, or at least a very good idea of what they want, then Best Value might be the way to go. But if an Owner would rather progress that design and price together with their design-build team, then PDB is a good option,” he said.
Unger added, “Owners have to ask themselves, ‘How far do we really need to advance the design to put out an RFP? (And let’s also note that developing detailed Bridging Documents is not a DBIA Best Practice.) Do we have the capability, capacity and expertise to do that? Can Owners get internal buy-in with procurement, technical and legal on the same page? Is there anyone else who can derail the project? There needs to be internal alignment.”
Case Studies: A Tale of Two Projects
Best Value Design-Build: North Torrey Pines Living and Learning Neighborhood
The University of California at San Diego (UCSD) is an experienced design-build Owner that recently chose Best Value and PDB to deliver two large half-a-billion dollar mixed-use, live, learn and play neighborhood projects. The North Torrey Pines Living and Learning Neighborhood was in construction when COVID hit and was delivered using Best Value Design-Build. Design-build collaboration allowed the team to pivot to address the pandemic’s unexpected challenges. According to Eric M. Lindebak with Safdie Rabines Architects, “It really allowed us to partner with all the trades and have an open dialogue as we worked through the design process. I also know those in the room really enjoyed that collaborative process better.”
PDB: Theatre District Living and Learning Neighborhood
The second project, the Theatre District Living and Learning Neighborhood, began construction in 2021 and is a PDB project scheduled for Fall 2023 delivery. Walt Kanzler, Senior Director of Resource Management and Planning at UCSD, told attendees at DBIA’s Design-Build Conference & Expo that UCSD selected PDB on the second project to reduce the cost of competition for design-build teams hoping to work with the university. “I think everyone who competes for these projects, especially in the bigger ones, understands how much work has to go into it. It’s an incredible effort,” he explained. “So, we got a lot of feedback after North Torrey Pines from some teams that didn’t get the project. We thought, ‘Okay, what is our next best approach, or how can we do this a little bit differently?’”
Ultimately, UCSD considers both design-build procurement approaches a success. According to Kanzler, collaboration is vital no matter which design-build method you choose, “From UC San Diego’s point of view, it’s all about culture, leadership and teamwork. In the design-build environment, it’s all about teamwork and collaboration. It’s important to know that you can trust your partners all the way up and down the scale.”
Doing It Right – No Matter Which Procurement Approach You Choose
So, which is the correct design-build procurement choice? It truly does depend. It depends on the Owner. It depends on the project. It depends on the team’s skill and commitment to collaboration at every level. Unger advised Owners, “Best Value or PDB, if projects are done correctly using Design-Build Done Right® best practices, both are incredible options to consider.”
Note: DBIA does not endorse one methodology over the other. DBIA endorses both procurement approaches when done according to best practices and not on a low-bid basis (e.g., lowest price technically acceptable). Consistent with Design-Build Done Right® principles, the Owner needs to make an informed decision based on, among other things, goals, internal capacity, resources, statutory authority and comfort level.
DBIA Resources
- Design-Build Done Right® Universal Best Practices (2023)
- Progressive Design-Build Deeper Dive
- Position Statement: The Flexibility of Design-Build
- Position Statement: Best Value Selection
- 2023 DBIA Progressive Design-Build Courses
- DBIA Progressive Design-Build Recordings and Webinars (on demand)
