Cost Performance Comparison of Two Public Sector Project Procurement Techniques

Abstract

Increased industry discussion of the potential benefits of alternative forms of construction project delivery often presents little cost analysis of options. This work presents the results of a cost comparison study of completed public sector municipal facilities design and construction projects—a portion of which delivered using a traditional design-bid-build procurement approach and a portion of which delivered using the procurement technique of a negotiated lump sum construction contracts with in-house construction forces. The study compares costs for all phases of all the projects (design, bid and award, construction, and total project cost) across both methods of project procurement. Conclusions examine the cost trade-offs of using negotiated contracts with in-house forces, outline key success factors identified through this study in order to optimize the use of this form of project procurement, and identify areas for future research.