What You Need to Know About Design and Construct Contracts
If you’ve ever had to navigate the complexities of a new clinic construction or renovating a dental fitout in Sydney, you know how many steps are involved. From initial concept and design to construction, approval, and final handover, it’s a lot to try and manage on top of running a business.
As experienced providers of medical fitouts in Sydney, we know that a successful design and construct contract offers specialist support, and lightens your load from end to end – but how can you know if it’s the right approach for your next project?
In this guide, we’ll cover the ins and outs of a design and construct approach with a healthcare fitout specialist, how it differs from a traditional contract, your changed responsibilities under one, and the overall benefits to your project’s outcome.
What Is Design and Construct?
Design and construct, otherwise known as D&C or design and build, is a popular procurement method in Australian construction, and it’s when a single entity coordinates a project from the initial design phase through to the build’s finishing touches.
It can be particularly beneficial when a project must adhere to strict industry regulations and requirements, and where the expertise of a specialist design and construction company – or one that offers end-to-end design and construct support like Akord Projects – is vital.
Who Is Responsible Under a Design and Construct Contract?
A single contractor assumes full responsibility for a project’s outcome and delivery under a design and construct contract.
However, while their obligations are more demanding than they would be under a traditional construction contract, this doesn’t mean that the project owner doesn’t still play a vital role, and these responsibilities can look like:
- Complete both design and build according to set project standards, goals, and requirements
- Absorb and monitor all project risk across design, construction, and coordination
- Prepare a clear and comprehensive project brief
- Providing appropriate documentation and site access
- Communicating approvals and feedback in a timely manner
Key Features of a Design and Construct Contract
In order to minimise risk, prevent dispute or additional costs, and promote a successful outcome, a design and construct contract must clearly define the contractor’s responsibilities, as well as several other key influencing factors.
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This should cover the contractor’s full scope of responsibilities from design to handover, and must include any relevant approval processes, design requirements, and clinical compliance needs.
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The contractor is responsible for every stage of the process. They ensure that every medical fitout project meets crucial DDA compliance and accessibility standards, so their contract must specify who is liable for any errors in design, and how long the contractor’s responsibilities continue after handover.
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A successful design and construct contract should also outline the rules and expectations for handling and approving any changes made, or problems found with the worksite, after work begins.
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In order for the contractor to deliver the completed build on time, target start and finish dates must be specified before any work commences, and the timeline must account for sufficient review and approval milestones.
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The contractor and their team must be paid to ensure that work continues on time, so it’s essential you first agree on how they will be paid, whether that’s under a lump sum or rate-based system.
This must be detailed in the contract, along with how, when, and where the payments will be made.
These factors are especially important in the healthcare field, where practices and clinics are held to higher regulatory standards than standard commercial builds.
However, exact requirements will vary depending on the specific type of Standards Australia contract form required for your project, as seen with:
AS 4300-1995 (General Conditions of Contract for Design and Construct)
AS 4902-2000 (General Conditions of Design and Construct)
Custom Design and Construct
This need is typically determined by the scale and complexity of the work, and a professional fitout specialist with experience in end-to-end design and construction can help walk you through what this could mean for your next project.
Design and Construct vs Traditional Construction Contracts
The key differences between design and construct contracts and traditional construction contracts (often called Managing Contractor models or lump sum models) lies in their process, and who assumes responsibility throughout.
A traditional construction contact separates the design and construction process into three key stages, and these are:
Design – an architect or designer is contracted to develop and create the project plan.
Tender – the project owner searches for a suitable contractor to bring the design to life.
Construction – a contract with a contractor is secured and construction begins.
When working with design and construct builders, the process is much simpler for the owner, with those core design and construction services bundled under one contractor:
Design & Construction – a single entity is responsible for every aspect of a project, all the way from design development to final handover, minimising the burden on the project owner or client.
Benefits of Design and Construct Contracts
Increased Cost Certainty
Many contractors have strong working relationships with suppliers, years of experience working on similar projects, and a firm grasp of market value and regulatory compliance in medical and dental fitouts, so they can navigate those complicated price conversations in pursuit of compliant, high-quality, and cost-effective project outcomes.
Faster Project Delivery
As a Design and construct contract means there is no third party to consult between the design and construction stages, the sign-off process is streamlined, and work can get underway more quickly than it would with a traditional contract.
This can be particularly beneficial in the healthcare space, where compliance is crucial to all professional fitout services.
Reduced Project Risk for Owners
Design and construct contracts offer a single point of accountability for owners, with the risks and responsibilities of design, construction, and coordination transferring to the contractor.
This means that, in the event something goes wrong with the project, you don’t have to chase your tail trying to find out who’s responsible.
Improved Communication
Design and construct contracts eliminate the need for multiple consultants or contractors – as well as the miscommunication that can arise from their conflicting or multi-stage processes – to streamline information to and from one clear, reliable point of contact instead.
Evolving with the Industry
The level of control given to contractors with a design and construct contract enables them to seek innovative solutions for optimal project outcomes.
From real-time digital models (BIM) to sustainable design and smart infrastructure, Akord Projects follows emerging trends in the healthcare and construction industries to ensure you’re getting a quality-driven build, delivered on time, every time.
Potential Challenges of Design and Construct
While a successful contract establishes essential project frameworks, an unsuccessful contract with unclear requirements can lead to delays, compliance disputes, and even cost blowouts as problems and revisions arise.
If you’re planning a project in the highly-regulated medical space, or just want to minimise your overall risk, you can engage specialist healthcare fitout services for professional support in navigating the complexities of a design and construct contract, all the way from concept to completion.
When to Choose a Design and Construct Contract
While design and construct builders are best used when your priority is delivery and not full design control, there are several other strategic reasons you may choose a D&C contract.
These include when:
Cost and delivery is more important than having full design control
The project has strict regulatory compliance or technical requirements to meet (such as in the healthcare industry)
Specialist structural or engineering input is required at every stage of the project (such as in the commercial, industrial, and infrastructure industries)
Minimal design or construction changes are anticipated
The project owner is experienced in their field and can provide a clear and comprehensive requirement brief
How Akord Projects Can Help
At Akord Projects, we understand that whether you’re building your first practice or elevating your current experience with a modern touch, you need something that’s not only functional and compliant, but also welcoming, comfortable, and visually pleasing.
We specialise in end-to-end medical centre fitouts and dental clinic fitouts in Sydney, bringing our deep knowledge of regulatory standards and effective healthcare design to every space.
If you’re ready to know more about our end-to-end project management, design and construct planning, or how we can help support your next healthcare fitout project, get in touch today.
