When an architect provides complete documentation for the construction of a project, most areas of possible misunderstanding and confusion are removed.

Proper cost control is fundamental to the success of your project. This can only be achieved if attention is given to all matters relating to cost, from conception to completion, and extending into the maintenance and operation throughout the life of the building.

From the outset, your architect will discuss and determine a project budget with you. During these discussions you should be very specific as to whether this budget includes professional fees, for example for your architect and/or other specialist consultants, or is related only to the actual cost of the works.

During the design stages and the preparation of the construction documentation your architect will report regularly on project costs. Different cost options will be explored with you and the most economical ways to achieve your objectives will be considered. This will involve a consideration of the initialcost of construction and may include the life cycle costs of the project such as costs associated with energy consumption, maintenance and management during the building’s life cycle.

Different cost options wi ll be explored with you and the most economical ways to achieve your objectives will be considered

DURING CONSTRUCTION

During the construction phase your architect will manage project costs according to the requirements of your contract with the builder. Some of the provisions for this in most building contracts are:

PROGRESS PAYMENTS

Under most standard building contracts the builder is paid progressively throughout the project and is required to submit progress claimsto the architect on a regular basis. The architect assesses each claim, on the basis of work done, the labour and materials used, and any other construction costs, and then issues a progress certificate which states the amount calculated by the architect to be due to the builder at the time of issue.

Under this system, your architect is able to protect you from being charged for work not completed, or not in accordance with the requirements of the construction documents.

VARIATIONS TO THE CONTRACT SUM

When an architect provides complete documentation for the construction of a project, most areas of possible misunderstanding and confusion are removed and variations to the work are kept to a minimum; however, unforeseeable variations may be necessary due to the discovery of unexpected site conditions, authority requirements or simply if you change your mind during construction. Again, with their training and experience, your architect is equipped to advise on options which may minimise or even avoid any increases to building costs.

When variations are unavoidable, your architect will act on your behalf to negotiate an equitable contract adjustment.

PROVISIONAL AND PRIME COST SUMS

The total contract sum often includes sums of money which have been included in the contract documents to cover work which may not have been documented fully at the time of calling tenders. These allowances are known as ‘provisional sums’ and are used more particularly to cover the cost of work to be undertaken by specialist contractors selected by you and referred to as ‘nominated subcontractors’.

The total contract sum also may include similar sums for use in the purchase of materials and building components to be selected by you and which have not otherwise been provided for in the documents. Such allowances are known as ‘prime cost sums’ and are more specifically used to permit selection of such things as bathroom fittings, etc, during the construction period.

When the actual expenditure on works and materials differs from the provisional and/or prime cost sums, the balance is adjusted against the original contract sum. This adjustment is monitored and approved by your architect.

THE RETENTION FUND

Most contracts require the builder to provide a sum of money to be retained by the owner as a surety that the builder will remedy any defects which might arise during the contractual period. This is known as a security or retention fund and is usually in the amount of five per cent of the contract sum. It can be held as cash in a joint bank account in the names of the owner and the builder or in the form of a bank guarantee held by the owner. If in cash, deductions are made by the architect from each progress payment certificate, usually at the rate of 10 per cent until the required amount is reached.

It is normal for half of the amount to be retained to be released on practical completion and the remainder with the issue of the final certificate.

If the builder defaults or fails to rectify the work as instructed, your architect has the power within the contract to use part or all of the money retained to have the work completed by others.

LIQUIDATED AND ASCERTAINED DAMAGES

Liquidated damages is a financial recompense by the builder to which you may be entitled for financial loss if the building is not completed on time. The amount agreed to is usually stated in the contract as a daily rate and covers such items as:

• loss of rent
• additional financecosts and holdingcharges
• alternative accommodation

It is advisable to seek both architectural and legal advice when considering the application of liquidated damages against the builder.

Architects possess the most appropriate training and experience to totally coordinate and manage your building project.

Involvement in the initialdesign concept, early planning and determination of your needs for the building, puts your architect in the best position to effectively plan the work, brief the builder and provide the most cost effective solution.

Throughout the project, your architect will control the design, planningand quality of workmanship and materials to meet time and budgetary constraints.

Your architect will be your independent adviser, liaising on your behalf with builders, consultants and suppliers and ensuring compliance with the spirit and intent of the project.

CONTRACT ADMINISTRATION

Most standard contracts include provisions for the contract to be administered by an architect. Some allow for administration by a ‘superintendent’ and one, the ‘Administration By Proprietor (ABP)’ contract is written to allow the owner to administer it. Having been responsible for the design and documentation, your architect has an intimate understanding of what is required by the contract and is therefore in the best position to administer it on your behalf.

Contract administration calls on your architect’s skill and professional judgement in a variety of ways including:

• assessing and certify ing payments to bemade by you to the builder – ‘progress payments’
• issu ing, assessing, referri ng and authori s ing any contract variations
• assessing/determi ningcomplianceof materials and workmanship with the quality specified in the contract
• assessing and determi ning any extensions of time
• determining and formally notifying the date of practical completion
• notification of faults during the ‘maintenance period’
• determining completion and final certification

Your architect has three quite distinct roles during contract administration. They are:

1. to act as your professional adviser
2. to act as your agent
3. to value and certify payments, contract value and time extensions or contractions.

In the first two roles the architect is entitled to promote your interests. In the third, the architect must act absolutely impartially between you and the builder. Some building contracts describe the roles of agent and of certifier or valuer in some detail.

SITE VISITS

In the course of construction as part of their responsibility, your architect will visit the site at regular intervals to inspect the works, attend site meetings, advise the builder and issue instructions.

In the role of contract administrator, your architect will ensure as far as possible that all work is in accordance with the contract, however it is the builder’s duty to closely supervise the construction of the work and to ensure complete compliance with the requirements of the contract documents.

YOUR ARCHITECTS’ INSTRUCTIONS AND CERTIFICATION

For the duration of the contract, your architect must maintain effective communication with the builder to enable proper performance by the builder of the terms and conditions of the contract. Such communication will include instructions and directions given where necessary on any defect of the construction and may include explanatory sketches and drawings.

If any instruction should involve a variation in the cost of work, it is the builder’s responsibility to notify your architect of any change to the project cost before carrying out such instructions

Typical of such instructions is the issue of notices and directions as to the quality of materials and workmanship required by the specification, as well as the listing of outstanding work to be attended to by the builder before ‘practical and final completion’ is achieved. The builder is required to comply with instructions given by your architect.

In addition, your architect, in compliance with the terms of the contract, will issue ‘progress payment certificates’ at regular intervals, the ‘notice of practical completion’ and the ‘final certificate’ at the completion of your project.

YOUR ARCHITECT’S RECOMMENDATIONS FOR SUBCONTRACTORS

Your architect may nominate specialist subcontractors, especially when there are only a limited number of firms capable of satisfactorily undertaking a particular section of the work on your project. Similarly, your architect may nominate a particular supplier of materials.

If monetary allowances (‘provisional sums’) have been provided for in the contract documents it will be necessary for your architect with your approval to instruct the builder on the selection, purchase and/or installation of all items for which such allowances have been made.

Specialist subcontractors and materials suppliers can be engaged through negotiation or through calling tenders.

The tender process can be managed by your architect or the builder or a specialist consultant according to your requirements. (For example, a mechanical engineer may supervise the tender process for the supply and installation of airconditioning units.)

You should expect your architect to discuss these contractual arrangements with you and make recommendations; however, it is important that the supplier or subcontractor selected is acceptable to the builder as only the builder has a legal, contractual relationship with the supplier or subcontractor.

Subcontractors and suppliers may be selected at the same time as the builder or at a later stage as required.

Sections of the work are commonly handled in this way include electrical, mechanical and airconditioning, lifts and escalators, precast concrete, etc. Items to be provided by specialist suppliers will usually include sanitary fittings, door hardware, floor coverings, light fittings, kitchen equipment, ‘white goods’, etc.

EXTENSIONS OF TIME

Situations may arise in which the builder is unable to complete all contractual obligations by the stipulated date for practical completion. In such cases, your architect is required to consider the builder’s claimand if appropriate grant an extension of time, adjusting the practical completion date accordingly. Delays may be caused by:

• local authorities
• variations to the original contract
• industrial disputes
• disputes with neighbours
• bad weather
• delays in issuing instructions
• other matters beyond the control of the control of the Builder

In cases where a delay is beyond the builder’s control, the contract usually will require that the builder be paid adequate compensation for costs incurred by the delay. The possibility of delays occurring can be minimised by:

• properly prepared contract documents bei ng used
• establ i shing that the contract price i s fair
• establ i shing trust andcooperation between the parties
• adequate timeallowed for construction of the works
• prompt decision making
• maintaining effective communication between all parties throughout the project.

 PRACTICAL COMPLETION

The date for practical completion is the date nominated in the contract for the works to be completed and available for use. This may be subject to change. Your architect is required to issue a notice of practical completion after being satisfied that all the work has been completed in  accordance with the contract, that all equipment and services are fully operational and that the project is fit for occupation.

Before issuing the notice, the architect will undertake a comprehensive inspection and list any items which require further attention by the builder.

Once the notice of practical completion is issued, you can occupy the building and you must take responsibility for its insurance from the date of that notice.

DEFECTS LIABILITY

Under the terms of the contract, the builder remains liable to remedy defects in workmanship and materials which become apparent during the ‘defects liability period’ specified in the contract. The builder is required to rectify such defects during the period and/or at the end of the period as instructed by your architect.

Prior to the completion of the defects liability period, your architect will undertake a ‘final certificate’ inspection and list any unsatisfactory items for the builder’s attention. All items listed must be rectified to your architect’s satisfaction before a final certificate is issued. This gives you protection against faults developing after occupation for the length of the defects liability period (which can be as long as 12 months depending on your requirements).

ISSUING THE FINAL CERTIFICATE

At the satisfactory completion of any required rectification work, your architect will issue the final certificate. This signifies the successful completion of the defects liability period and formally completes the contract between you and the builder.

It also certifies the release of any security or retention sum which may have been provided by the builder under the terms of the contract.

ADVISING ON MAINTENANCE AND WARRANTIES

Even after the defects liability period, many materials, services and specific items will remain under guarantee or warrantywhen such have been provided for within the contract documentation. Your architect will advise you on maintenance contracts which may be necessary for the

on-going operation of machinery and equipment. In entering into such a contract it is essential to ensure that neither the warrantor’s nor the builder’s responsibilities are interfered with or voided.

What can you do as the client to assist realisation of your project?

• Be as clear as possible about what you want to achieve, what you need and what you can afford.
• Don’t hesitate to ask about the client/architect agreement before you sign the contract to clarify what will be done for what cost
• Changes are best made early so make sure your architect explains early sketch designs. The later in the process that changes are made, the more likely it will have a cost implication.
• Be clear about the responsibilities of the architect, builder and sub-contractors.
• If your architect is administering the building contract, avoid three-way confusion by dealing with all queries through your architect who will deal with the builder. This ensures your early discussions on what you wanted from the project are built-in all the way through.
• Keep your own notes of meetings, either in the office or on site. When decisions are flying, it can be useful to record them.
• Talk about timetables; be aware that many factors can affect these including delays in Council approval, unseasonal weather, disruption in the supply of materials and delays in construction due to matters outside the control of the architect.
• Don’t hesitate to ask questions, be involved, but allow your architect to do their job.
• Be aware of your rights as a consumer of architectural services. Professional conduct of architects is governed by the NSW Architects Code of Professional Conduct. Familiarise yourself with the Code which is available in our downloads section.

If you have a problem, firstly talk to your architect and try to resolve these problems. Be open. But if you have a complaint or need advice about the professional conduct of an architect, contact the NSW Architects’ Registration Board.

I came across a Lotus 123 spreadsheet that I had prepared on a PC back in the mid 1980’s carefully detailing how I might purchase, in thirds with my girlfriend and her sister, a modest property in what was then, truth be told, a hovel, in a suburb known as Newtown. We were proposing to borrow at investment property rates which were then 16%. At the end of the 1980’s investment property rates exceeded 18% and it seemed reasonable at the time to lock in a fixed rate loan for five years at a ridiculously high 15.5%.

The Sydney property market is an investment market like all others. There are winners and there are losers. More than a few baby boomers like me struggled to purchase a home or an investment when the big banks were offering low interest rates of over 18% per annum. We knew then, just as it is today, that it is very difficult to buy into Sydney and should you sell and move to another city, it is next to impossible to buy back in if you have to.

Nothing has changed really. I know my parents really struggled to build their first home in the western districts of NSW back in the fifties. The two of them were making the concrete blocks on site with little more than grunt, a larry, a wheelbarrow and a formwork mould that they had made for themselves.

I wonder how different it would have been for Baby Boomers if interest rates were at today’s record lows below 5%? If the fifties are any guide, probably no different to today, I guess. If I had bothered to research it, I’d probably find that home ownership has always been a struggle.

Now, Architects are not economists. I apply the kiss principle to stuff outside my area of expertise for my own sake, so bare with me. For all the economists and other punters with a point of view… bring it on.

Record low interest rates simply mean that people can, for the time being, service a loan of significantly higher value using their income cash flow. I think a competitive and limited property market that is Sydney, reacts to this by rapid price increases. These circumstances lead to higher risk.

One obvious risk is that interest rates will rise leaving many punters in the situation that they cannot service their loans.

Perhaps equally obvious, but directly connected is that the lenders won’t like that situation at all because their share of the equity in your investment will be put at higher risk in those circumstances. What lenders will do to protect themselves is that they will limit their exposure by increasing the security required to obtain such loans. The banks will do this by requiring more equity from you, regardless of your cashflow capabilities.

To compete, however, the Banks are likely to assign a market value to your prospective property at a figure which is lower than the amount you have to pay to obtain it.

Essentially, it’s the banks who control the rate of growth of the Sydney property market, unless of course, everybody is so cashed up that they don’t need to borrow… which is the case when people downsize from their baby boomer home to a smaller property to live out their retirement.

What is the current situation so far as that is concerned? Well, there’s tonnes of cashed up prospective retirees downsizing, competing against tonnes of cashed up private super funds investing. It’s hell out there.

If you’re one of those people who is thinking of borrowing at record low interest rates and is also thinking how clever it is to be negatively geared, why not try a humble renovation project on your existing home instead. Just sit it out and let the punters fight it out in the trenches until the cashflow settles down.

If you’re in the unfortunate situation of having to purchase into the Sydney market for the first time, then I suggest that you be prepared for the Bank’s valuation to be lower than what you have to pay to buy in.

Back in the day, before capital gains tax and you could see INXS play in pubs we used a PC that had no hard drive. It had 640k of RAM if you were flash, and you put the program disk in one 5″ floppy drive slot and your files disk into another floppy drive slot. It was still pretty good for figuring stuff out.

Gary Finn

Charles Correa (1930 – 2015)

Charles Correa was perhaps India’s foremost Modernist. However, he did not simply adapt Western practices to a subcontinental version: he transformed Modernism and owned it.

As a student in the 1980’s I had the benefit of hearing his guest lecture at the UTS International Series. Mr Correa must have been around my age at the time. I was inspired by concepts of community empowerment by involvement and his self determination to make designs local, and paradoxically in the one moment, internationally relevant. I saw India’s struggle to embrace a modern art movement similar to Australia’s struggle to find an artistic expression that is peculiarly Australian, at a time when Glenn Murcutt’s tin roof pavilions were leading the way.

As a student at UTS, our job was to serve the red and white wine which we had especially labelled for each guest speaker. I lament not retaining just one bottle of the Charles Correa labelled Mudgee Shiraz and the fact that those international series talks are rare events.

RIP Mr Correa.

Gary Finn
Architect Partner
Sydney Access Consultants
http://www.fs-architecture.com.au

Shop 7/438 Forest Road, Hurstville NSW 2220
Phone (02) 95863111 Mobile 0414 414101 info@SydneyAccessConsultants.com.au
Member of Master Builder’s Association Associate of the Australian Institute of Architects
Accredited member of the Association of Consultants in Access, Australia

You may live in the perfect spot for your lifestyle, friends, neighbours and family, so there is no “right” answer to this question. You’ll need to weigh up all your options and FS Architects recommend that you get good advice, perhaps even exploring each feasibility without committing too much, so that you can make a learned decision that assists you to generate wealth and well being. We understand that wise decisions can take time.

The article below sets it out in principle for you, though seems to be weighted on the side of renovating. In our opinion, some homes have done a good job and are at the end of their lifecycle, and really ought be replaced by you, or the next person. Whatever your choices, we are here to assist.

Gary Finn

*Article below is copyright to Archicentre

It is a question all homeowners have to face at some point and there’s no easy answer as every situation is unique.

Families who live in the right place, but in the wrong house have found a solution in renovating.

“Prior to finding the right house, home buyers seek out neighbourhoods for qualities they can check off like items on a wish list. They consciously select areas close to work, near schools, public transport services, shopping facilities, parks, restaurants and intend to have a long involvement in the community. If special needs are required, they renovate.

“Building has been expensive over the last few years however, with the current economic climate now and relatively low interest rates, renovation or building a new home is an attractive financial proposition.”

Of those people who do move, they don’t move far, often remaining in the community or a neighbouring area. “Moving is an expensive exercise with moving costs up to $50,000 including loan fees, agent fees, removalist fees, and stamp duty costs. These are expensive fees and charges where the funds could be put to better use paying for renovating your home to improve your lifestyle.”

The Three Big Questions

Relocate?
The easiest option to consider, but potentially the most costly. This may require a further extension on a mortgage thus loan approval needs to be sought from the financial institution.

Knock Down and re-build?
Knock it down provided you’ve received council approval. Pay a visit to display home villages or peruse standard house plans, but keep in mind, it’s rare to find a house that totally suits your needs and taste (and alterations to standard plans can be disproportionately costly).

Renovate?
If you want to maximise your property’s potential and you are not sure if it can be modified, whether it’s feasible or within reach of your budget, Renovation has a threefold advantage. Investment in the family home does not attract capital gains tax when it is sold; people get to enjoy a better lifestyle; and they could turn part of their home into a future revenue stream by creating a self contained living area for rent.

Sitting here looking at a 3d model this morning I was contemplating how much things have changed since I commenced my first job. I realise that younger architects will have had no experience of earlier practices as many of our processes have completely disappeared from the industry.

My first day in an architect’s office was interesting. I had only ever prepared technical drawings using a clutch pencil on bond paper so everything was new to me. First job for any junior was nearly always “print boy” and the architect’s text book was a copy of Sir Bannister Fletcher’s “A History of Architecture”.

Week 1: Printing Processes
Plan copying was laborious. Architect’s either used an ammonia machine or a dyeline machine. Our office had a dyeline machine. These large machines had two roller feeds, one for reproduction and the other for developing. The process involved taking plans drawn on transparency, overlaying that sheet carefully on canary yellow chemically treated matching size paper (up to A0 size) and running them through an ultra violet light to produce a photographic reproduction. Then the “print” had to be developed through a bath of chemicals and hung on a line to dry. Managing the print machine meant topping up and mixing various chemicals.

A large print run was quite a process with paper draped on every available space to dry, and this process could take days to complete. For the inexperienced, it was easy to mess things up and on one occasion I accidently ran a negative through the developer… but as luck would have it, the lines didn’t bleed and weeks of drafting time was not ruined, and even though I feared it, I did not lose my job.

Most of our documents are not printed at all these days because they’re issued electronically as PDF files. You’d think we are paperless, but I think we use more paper now than ever before.

Week 2-3: Colour rendering
Nobody had a colour printer that I knew of. If the project was say, an alteration and addition.. all of the proposed work on a plan was highlighted by a particular colour coded to denote the materials to be used. After printing, my role was therefore to prepare coloured sets of the plans. Coloured sets were prepared for Council applications and for tender process as well as for the client and for the file archive. I was required to mix enough water colour of the same colour to paint every print so that the finished sets were consistent. In my first days of employment, I remember spending two weeks preparing water colour washes over 15 sets of A0 plans, elevations and the sections. A task I did many times over in the ensuing years until well after the advent of the Mac or PC.

The drafting board had to be at the right angle so that the water colour would flow evenly down the page. The brush had to be flooded just right so that the finish was evenly distributed. Each set had to be completed exactly the same, in exactly the same blend of colours. A beautiful set of brushes and high quality water colour paint was essential, as was the mixing process and these wet prints were strewn all over the office to dry before collating.

My practice today uses the same colour coding in our CAD drawings but sadly the process of preparing a drawing to be issued in colour is not as therapeutic as it was with a brush in hand.

Week 4: Architect’s tools
Does anyone prepare technical drawings by hand these days? An architect’s kit consisted of a set square, an adjustable square, a scale rule, a razor blade, a soft rubber, a hard rubber, a clutch pencil, an eraser guard, some lettering stencils, some blotting paper, masking tape, a strong light, a cedar drawing board laminated with green vinyl, an adjustable chair with footrest, an assortment of Rotring pens of various sizes and the all important pen holder with damp foam in the bottom of it. These essential items were used just about every day to prepare drawings on transparency film or velum tracing paper.

The pens have to be held just so to get a consistent line and can never be pushed up the page, you had to use blotting paper to avoid getting any oil from your skin on the paper or else the line would be inconsistent and your sheet grubby. Mistakes were undone and changes made using a razor blade following which the surface of the paper had to be repaired. For beginners, scratching holes in your work was common, at which point the drawing would have to be re-traced. However I once saw a guy spill a bottle of ink over a perspective he had spent 2 weeks working on, so he went home early and spent the next day picking out the spilled ink with a razor blade, good as new. That was impressive!

Rotring pens have a colour band representing the thickness of the line that they produce. In our CAD practice today, we use line colours to code the resulting line thickness, matching the colour code to those old rotring pens. This helps us to ensure consistent documentation and backwards compatibility with our archived CAD files and I guess it’s a bit nostalgic and ritualistic!

Week 5: Documentation coding

Because some of our documents were to be archived on microfilm it was prudent to complete text on a drawing using a lettering stencil matched to the rotring pen line thickness. This ensured consistent readable lettering and fonts, but it was a cumbersome process, one letter at a time, sometimes taking days to complete the text for one drawing alone.

to speed up the process some offices employed a code system, for instance, using two letters to denote a finish or material (e.g. NF) and those two letters were referenced back to a table where you would find that NF actually meant “New 1800 high colorbond metal fence …. etc”. I still see drawings produced today in CAD using similar documentation methods although it beggars belief that they do so, as it is a simple matter of typing it once using a keyboard and then you can copy and paste that same note in a matter of seconds across numerous drawings. These documentation methods should have become one of the curiosities of past practices but still seem to hang around. I suppose people who do that have their reasons.

Week 6: Plan Drawers

Remember them? We used to put our drawings away every night so that the humidity didn’t distort them. In a large office it was a logistic nightmare keeping everything important safely filed away and protected should there be a fire…. and just about everybody smoked cigarettes.

Workstations and office space requirements for Architects have become significantly reduced, than was previously necessary and now we have staff who telecommute and work interactively on BIM models across the web from the comfort of their own homes. I guess at one stage staff wore slippers and dressing gowns to their home offices, although iChat has put an end to that little perk, although they obviously have to buy their own coffee.

How things have changed.