Sold-out crowd learns about key issues in project budget vs. final cost
at 2nd Annual Ontario RICS/CIQS Construction & Project Management Seminar
Construction professionals as well as aspirants packed a ballroom at Otello’s Convention Centre in Oakville, Ontario on November 20 for the Second Annual Construction and Project Management Seminar, cosponsored by the Ontario chapters of RICS and the Canadian Institution of Quantity Surveyors. With an unprecedented number of major construction and engineering projects underway in Canada and increasing scrutiny to achieve project construction budgets and track final costs, the event focused on “Project Construction Budget vs. Final Construction Cost: Expectations & Realities.”
“The RICS and CIQS Ontario chapters were very pleased to host another annual sold-out event, with more than 140 attendees,” said RICS Canada Board Member Arif Ghaffur, who chaired the event organizing committee. “The speakers were clearly passionate about the topic and the attendees were engaging, with the event culminating in thought-provoking presentations and a panel discussion hosted by moderator Glenn Ackerley, an accomplished construction lawyer,” Ghaffur said.
Here are some highlights and key issues raised during the seminar:
- Project Feasibility: Does the owner have the budget for the project?
- Design vs budget: You must design to a budget or budget to a design.
- Procurement route (risk allocation) has an impact on budget i.e. Design-Build will result in a Design-Build premium.
- Project budget consists of a number of components, including land, soft costs (consultant/municipal fees etc.), hard costs (construction) and taxes.
- Contractors’ Estimate is made up of a number of components, including direct costs, indirect costs, risk/contingency and overheads & profit
- Contract price can change for a number of reasons including change orders, additional work, disruption etc.
- There should be clear lines of communication so that the owner knows: a) how much to budget; b) when the budget changes; and c) why the budget has changed
- A recurring theme: the need for the owner, consultants and contractor to work together to achieve their individual objectives to the maximum extent possible.
“In addition to accomplished professionals, we were very pleased that event was attended by a number of students from local colleges, including Humber and George Brown – reinforcing both the CIQS and RICS’s focus on engaging aspiring professionals,” Ghaffur added. Finally, “we are very grateful to event chair Alan Hand (from A. W. Hooker) who, as always, was keen to not only participate but also continue to support an event focused on key issues for project management and construction professionals,” Ghaffur said.
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