“Owner representation should have project controls as its impetus

The terms “construction manager” and “owner’s rep(resentative)” generally pertain to large and complex projects, where multiple-primes, or general contractors build a job, under the direction of a construction manager. Although the construction manager is expected to act as the owner’s agent, or provide owner representation, more and more owners are implementing their own owner representation programs – in-house, or out-sourced, if for nothing else, to monitor their general contractor or construction manager’s performance.

I believe that owner representation was a natural  result of chronic under-performance by general contractors and construction managers who failed to deliver their promise of representing their own and the owner’s best interests. This trend seems to have started in earnest during the overbuilding of the 1980’s, when construction management contracts came into full swing. However; owners are realizing some of the less heralded downsides of construction management contracts, which may range from delays, overcharging, collusion, and outright fraud. For one-such, read this article.

Constant builders, or owners who are always building; such as retailers, public schools, or developers, are slowly waking up, and more and more are establishing in-house owner representation. In my experience, in-house owner representation often is delegated to individuals or teams with some general skills, but few of the practical or technical skills required to efficiently drive a construction project. I suspect these constant builders embrace the limited perspective that if an individual has some basic management skills, then they are fit to spearhead any endeavor. It must be said that an inexperienced owner’s rep may often be better than no owner’s rep at all – sort of like comparing blind in one eye, with legally blind.

Surprisingly, the B101 Owner/Architect contract does little to reify the architect’s role as owner advocate. The project architect has his own responsibilities to the owner, as stipulated in the AIA 101 Owner/Builder contract, wherein it is stated that the project Architect shall act as the Agent of the Owner regarding liaisons with the contractor. Thus does this brief and under-defined reference to an architect’s role as owner’s advocate serve to mislead owners in any number of ways they might want to believe, but will soon enough come to realize, one of which is that this clause is seldom bound or binding to any fast and hard responsibility.

Owners should be wary of architects who dissuade them from hiring an outside representative, as they don’t appreciate -or resent – the value of third-party oversight. They may even  reassure an owner that oversight is superfluous, as they have that covered. Perhaps they fear the facility of exposure, which would be very small without proper oversight.

However merely wishing does not make it so: architects have their own contractual responsibilities with the owner, and these seldom dovetail all the owner’s needs in the way an owner’s representative does. Moreover, project administration during construction takes a back-seat to all other architect responsibilities. Not infrequently does an architect expend his budgets in the preconstruction and design phases, well before a project is shovel ready, thereby giving project administration short-shrift. In contrast, an owner’s rep does his best work when he is advocating from the inception through the conclusion of a project.

In lieu of what I term tacit owner representation, proper owner representation can be readily outsourced to consulting firms who have seasoned construction professionals on staff. The most obvious advantage to the owner is that he can generally rest assured that his rep has “all the bases covered,” and that there is less occasion for conflict of interest, or even collusion. Of course, such firms come in every stripe and color. Many are specialized in a particular building sector, whereas others offer owner representation in several sectors. An owner must be especially selective in choosing his representative, as there are leaders and laggards, much like any industry. The best owner representation is offered by firms with people who have both field and administrative experience.

Given the extraordinary degree of project mismanagement in the construction sector, I believe that just about any project could stand to benefit from owner representation, or third-party oversight, even if just for contract or change order negotiation. This means home -buyers, retailers, and small businesses, who either shun, or are unaware of the benefits of proper owner representation. Of course, engaging an owner’s rep requires a leap of faith – much like hiring a construction manager on a fee or percentage based contract. However; in the event of conflict, it is much easier to swap owner representation, than it is to change construction managers.