In its simplest form, a construction manager is contracted to provide pre-construction expertise including cost estimating, value engineering, scheduling, bidding, and coordination of construction activities during the construction phase. The owner still contracts separately with a designer to develop construction documents (as in the Design-Bid-Build method). The construction manager recommends award of either a single "General Contractor" contract or multiple "Specialty Contractor" contracts. However, the owner holds the contracts with the contractors. Under this arrangement, the construction manager is paid a set percentage of the total project cost whether the project cost escalates or not. There are variations termed Construction Management “At-Risk” whereby some, or all, of the burden to control the project cost is placed on the construction manager. This is a somewhat riskier but potentially more cost-effective option for the owner, and a decent compromise between the first two delivery options.
- Owner gains design and construction input free of bias
- All subcontracts are competitively bid
- Cost and schedule control throughout the project