APC competencies: Design economics and cost planning

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22 November 2017

Ewan Craig, a speaker at RICS’ annual It’s Your APC conference, explains how you can demonstrate the optional competency of Design economics and cost planning

Design economics and cost planning is one of the optional competencies of the Building surveying APC. It is associated with the core competency of Design and specification, and covers the impact of design and other factors on cost throughout a building’s lifecycle, as well as the control of cost during the pre-contract stage.

The levels  

At Level 1

Demonstrate knowledge and understanding of the main factors that affect design economics over the whole life of a building. Demonstrate knowledge and understanding of how cost planning assists in the financial control of projects during the design development stage.

At Level 2

Apply your knowledge to the cost management of design development on a project from feasibility to design completion. Prepare and submit cost data to in-house and/or external data collection agencies.

At Level 3

Give strategic and reasoned advice, including the preparation and presentation of reports with reference to cost, time, quality and buildability. Advise on various market factors and trends in construction costs. Comment on accuracy and risk.

You should be familiar with issues relating to design economics and cost planning in your submission documents and be ready to address questions on them and related matters.

Questions

Actual questions are based on the candidate’s experience, which should be at Level 2 but could exceed this. Two examples are given in this article.

You prepared cost estimates for a new 2-storey commercial building as part of project A. Could you please explain how you prepared the initial order of cost estimate?

This question is aimed at Level 2. It could, however, be extended to Level 3 if you provided advice by reporting on the estimates. The answer would explain pertinent issues to support your application of knowledge.

I prepared the initial order of cost estimate for capital works at an early stage of the project. These were used to guide the client initially on the extent of the works and capital budgets. I used the known information on the project, such as proposed floor areas, together with basic data from the client. I developed this with client-specific data that affected costs such as office furniture, which the client wished to include in the project.

I used my practice’s pro forma of interlinked spreadsheets to calculate the order of cost estimate, and followed RICS’ New Rules of Measurement (NRM) to prepare this. I sourced appropriate benchmarked cost rates from previous office projects in a nearby town, which were similar in scope and size, for the approximate quantities of the project.

Where the benchmark data was unsuitable, such as a difference in quality, I used rates from cost analyses conducted by the BCIS Online service. As project A took place 2 years after the previous projects, I uplifted these rates using BCIS indices to reflect the construction market’s increased costs. A percentage allowance for professional fees and a project contingency were also applied. A partner then checked the estimate for the purposes of our quality assurance procedure.

Could you please explain the sources of reference service life and how you adjusted these to prepare lifecycle costing for the building in project C?

This question is aimed at Level 2.
However, it could be extended to Level 3 if you provided advice for the project.

I used a number of reference sources for service life. I found both the Building Maintenance Information Life Expectancy of Building Components and the Chartered Institution of Building Services Engineers’ Guide M, Maintenance Engineering & Management, very useful, as they covered a range of relevant components. I also used data sheets for components that were likely to be used in the building as these gave more accurate information on service life. Following RICS NRM 3, life factors, such as the component quality and maintenance provision over its life, were used to adjust the reference service life and account for the predicted conditions that the components would endure.

Be brief but comprehensive

Given the time constraints of the APC, your answer should be brief but comprehensive. Those given above are not exhaustive; care should be taken to demonstrate your own skills, abilities and knowledge to the assessors.

Ewan Craig is an APC assessor and Associate with Ridge and Partners LLP

Further information

Download a complete “APC competencies: Design economics and cost planning” PDF