D. Brown Management - Project Delivery - CM Agency or Multi-Prime

Project Delivery - CM Agency or Multi-Prime

Project Owners can minimize the markups for overhead and profit (OH&P) by contracting directly with the specialty contractors and hiring a Construction Management (CM) firm to work as their agent.

D. Brown Management

January 13, 2019 2 minute read

This project delivery method is called CM Agency or CM Multi-Prime.

CM at Risk: Project Delivery Methods - Definition of CM Agency and pros and cons.

The role of the CM is expected to be the same as the CM at Risk method but without direct ties to the contractors. This eliminates conflicts of interest for the CM with the intention of allowing the CM to act 100% for the benefit of the project owner.

While the OH&P savings can be substantial and the conflict of interest concern for the CM role is minimized, there are downsides that must be weighed to ensure this delivery method is best for the project.

The CM does not have the financial or other risks of construction, which are all passed directly to the Project Owner. This makes the selection process for the right CM firm very critical.
Between no early involvement of key specialty contractors and the CM not having the financial risk of financial overruns against a Guaranteed Maximum Price (GMP) can lead to change orders and schedule delays similar to the Design-Bid-Build method.

CM at Risk

The preferred project delivery method. There is a reason 100 of ENR's Top 400 General Contractors use CMAR as the project delivery method for over 75% of their work. Leverage CMAR as part of your growth strategy....

Previous Next Go To Series

Related Insights Series

CM at Risk

Previous Next Go To Series

Related Insights Series

Definition of Sustainability

How sustainable is your construction business? Not your ability to build sustainable buildings, but the true sustainability of your business.

Jack Welch - Any Jerk Short-Term Earnings

The ultimate measure of a leader is how well their business unit performs AFTER they are gone. With the construction industry talent shortages leaders must focus on building other leaders at an accelerated rate just to maintain market position.

Lean Principle - Value Stream

A contractor’s value stream is every step required to take raw materials and information then deliver a completed project to the waiting hands of a customer. Deep understanding of this value stream is the foundation for major productivity improvements.