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Value Engineering
AGENDA:1) Overview2) Functional Analysis3) Keys to Success4) VE Approach5) VE Procedures6) Reporting
Procedures
© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
“ … an organized effort directed at analyzing the functions of systems, equipment, facilities, services, and supplies for the purpose of achieving the essential functions at the lowest life cycle cost consistent with the required performance, reliability, quality, and safety.”
Source: Office of Management and Budget
“Price is what you pay. Value is what you get.” ~ Warren Buffet
Evolved during World War II
General Electric took lead after WW II
Expanded to design & construction in 1960’s
Government and private sector by 1970’s
Numerous VE programs active today
History of Value Engineering© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Alignment
Projects need to start right to finish right
Expectations
Scope
Budget
Ongoing Effort
© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Item-Oriented Optimization• Item-oriented optimization involves
looking at item A and asking: “How can item A be made at a lower cost?” The result is item A1, a modified version of item A, as shown below:
AlA
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Function-Oriented Optimization
• VE involves looking at item A and asking the questions: “How can the basic functions of item A be provided at a lower cost?” The result is item B, which is sometimes a completely different item, as shown:
A BBasic
Functions of A
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Function Analysis
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Reasons for Unnecessary Costs• Lack of time• Lack of
information• Lack of key
ideas• Lack of budget• Temporary
circumstances
• Habits and attitudes
• Honest wrong beliefs
• Politics• Inadequate
definition of value
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Attitudes Toward VE
• General negative attitude toward VE
• Consensus to do VE earlier• Conflict over emphasis• Diversity of opinion on approach
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Industry Trends
• Emphasis on value• Timing of studies• A / E, owner, and user participation• “Zero-based” design
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Value Improvement
• To improve value:– Improve benefits, maintain cost– Maintain benefits, reduce cost– Improve benefits, reduce cost– Reduce benefits, reduce cost *– Increase benefits, increase cost *
* If benefits remain within needs and cost within limitations.
ValueValue = = Functional benefitsFunctional benefits
CostCost
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Functional Benefits: How are they measured?
• Esteem• Use• Reliability• Cost • Maintainability• Security• Expandability
• Aesthetics• Safety• Durability• Convenience• Accessibility• Flexibility• Perception
© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Key to Value Engineering Success
• What does “value” means to the owner
• Understand what is of “value” to the owner
• Understand how the owner measures “value”
• Understand how “value” is perceived• Define appropriate levels of “value”• Be precise in assessing “value”
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Relationship Between Quality and Cost
MAX
MIN
HIGH
COST QUALITY LIMITS
LOWLOW MIN MAX HIGH
QUALITY
INITIAL COSTS
FUTURE COSTS
TOTAL LIFE CYCLE COST
Too Cheap
Too Expensive
LOWEST LCC
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Pareto’s Law of Distribution
0
10
20
30
40
50
60
70
80
90
100
0 20 40 60 80 100
PERCENTAGE Of TOTAL FACILITY COMPONENTS
PE
RC
EN
TA
GE
OF
CO
ST
Best Value Focus
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Sensible Trade-OffsFacility Value Target
01 02 03 04 05 06 07 08 09 10 11
Found
ati
ons
Sub
stru
cture
Sup
ers
truct
ure
Exte
rior
Clo
sure
s
Roofing
Inte
rior
Const
ruct
ion
Conveyin
g
Mech
anic
al
Ele
ctri
cal
Genera
l C
ond
itio
ns
Sit
ew
ork
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Relationship of Time and Change
Cost of making changes
Best Opportunity for Improvement
Time
HighAbility to
make changes
Degree ofChange
Low
Planning Design Construction
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Civil & Structural
ArchitecturalMechanical
Electrical
Focus on Interdisciplinary Areas
Owner’s requirementsOwner’s requirements
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Sensitivity to Life Cycle Impact
Energy2%
Educational Staffing31%
Support Staffing11%
Furnishings/Fitout4%
Fees1%
Construction Contingency1%
Other Project Costs1%
School Allotment1%
Textbooks1%
Benefits/Overhead14%
Other Support Costs2%
Major Capital Replacements5%
Maintenance3%
Transportation5%
Construction18%
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Care with Major Risks in the Budget
“It’s worth a $100,000!”
Are they the same?
$175,000$25,000
$100,000
$75,000 $125,000
“It’s worth a $100,000!”
© Construction Management Association of America. Do Not Duplicate or Reproduce. September, 2009
Project-Specific Issues
• Design approach
• Technical design
• Program• Flexibility• Reliability• Constructibility
• Expandability• Energy• Maintainability• Budget• Schedule• Procurement
approach
© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Value Engineering and Value Analysis
Planning & Design
Construction
Value Engineering
Value Analysis
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Approach to a VE Study
3 Phases of a VE Study:• Pre-Workshop: preparation &
organization • VE Workshop: intensive & focused
team during a 3-5 day dedicated effort
• Post-Workshop: Follow-up, assessment, report, meetings if needed, implementationPre-
WorkshopVE Workshop Post-
Workshop
Value Engineering Study
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Establishing a VE Team
• A most critical action! Good experienced team = successful VE
• Three choices:1. Select team from people involved in
project2. Select independent team not involved
in project3. Hybrid: i.e. some insiders/some
outsiders
© Construction Management Association of America. Do Not Duplicate or Reproduce. September, 2009
Advantages/disadvantages of the VE Team Composition
• A VE specialist facilitates the study using the existing design team, owner personnel, and other owner consultants
• Traditional outside, independent “cold team” which conducts the study, facilitated by a VE specialist
• A VE specialist facilitates the study using an independent “cold team” working with the design firm, owner personnel, and other owner consultants
© Construction Management Association of America. Do Not Duplicate or Reproduce.
VE Work Plan
• Information Objectives– Key issues & criteria– Function analysis
• Development– First cost– Life cycle cost– Non-economic
objectives• Speculation– Open-minded– Creative
• Report– Considerations– Implementation• Evaluation
– Performance against criteria
– Goals & objectives
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Defining Value ObjectivesList Criteria / Objectives
• First cost• O & M cost• Energy
consumption• Space
requirements• Performance
• Image (owner’s vision)
• Flexibility• Reliability• Expandability• Schedule
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Defining Value Objectives Determine minimum (or maximum) acceptable standards
• First cost NTE $150/sf
• O & M cost NTE $8/sf
• Energy consumption NTE 60,000 Btu/sf/p.a.
• Space requirements NLT 50,000 sf net program area
• Performance on scale of 1-10: 7 minimum
• Image on scale of 1-10: 5 minimum
• Flexibility 35% of space
• Reliability minimum toleration: 24 hours
• Expandability horizontal, one side
• Schedule September, 2003
Item Acceptable Standard
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Defining Scope
• Program– Functional Space
Program– Blocking & Stacking– Public Space– Efficiency
• Geometric Drivers– Wall Area Ratio– Degree of Articulation
• Volume Drivers– Clear Ceiling Height– Plenum Height– Interstitial Needs– Atria– Light Shelves
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Criteria and Standards
• Building systems standards• Energy standards• Codes -- local and national• Life safety considerations• Technical specifications• Document standards• Procurement standards
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Functional and Operational Requirements
• Operating standards• Interface / support requirements• Redundancy• Security• Flexibility
© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Overview of VE Procedures
• Cost models• Energy / maintenance models• Function analysis• Issues analysis• Brainstorming and Group Dynamics• Economic Analysis/Life cycle
costing/Sustainability• Examples• Value Enhanced Design/Integrated VE• Standards
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Cost ModelCOST MODEL
Contingency Escalation Construction Project Belmont Learning Complex
Construction + @ 0.00% + @ 0.00% = @ Bid Date Location Los Angeles, Ca. Date Dec-97
$0.00 $0.00 $0.00 $0.00 Phase Design Development$141.45 $0.00 $0.00 $141.45
Bldg Type High School GSF 369,757
Const. Type Steel Frame/Masonry NSF 0
Use Units 3,550 Students Floors 312
Site Building Comparative Ratios:
$0.00 $0.00 Legend: Parameter Target ACT/EST
$0.00 $141.45 Target Cost per Student $14,733
Actual/Estimated SF per Student 104
Overhead 08 09 11 10
& Profit Structural Architectural Mechanical Electrical Equipment GC, OH & Profit
$0 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
$0 $29.74 $61.66 $18.17 $15.51 $1.47 $14.89
Site 01 04 Service & Fixed Mobilization
Preparation Foundation Ext. Closure HVAC Distribution Equipment Expenses (Bond)
$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
$0.00 $6.94 $27.04 $10.47 $4.14 $0.52 $0.00
Site Special 05 Lighting Job Site
Improvement Foundations Roofing Plumbing & Power Furnishings Overheads
$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
$0.00 $0.00 $5.24 $6.03 $6.76 $0.95 $10.79
02 06 Fire Spec. Elec. Special
Site Utilities Substructure Interior Const'n Protection Systems Construction Demobilization
$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
$0.00 $2.57 $28.08 $1.68 $4.61 $0.00 $0.00
03 07 Conveying Spec. Mech. Off Expense
Off-site Work Superstructure Systems Systems & Profit
$0.00 $0.00 $0.00 $0.00 $0.00
$0.00 $20.23 $1.30 $0.00 $4.10
3.4 COST MODEL
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Function Analysis - Assigning cost to functions
Item Function Cost
Acoustic Tile Ceiling Retard Fire $0.85
Hide Structure $0.35
Absorb Sound $0.30
Total $1.50 sf
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Facility Level Function AnalysisProject: High School System: Programming
Date: May-97 Item: Total Facility
Location: Metropolitan D.C. Function: House People & Equipment
Client: School Board Page: 1 of 1
ITEM NO. FUNCTION VALUE INDEX
DESCRIPTION VERB NOUN KIND COST WORTH C/W COMMENTS
1.0 SITE:Preparation Establish Elevation P $1,387,250 $1,250,000 1.11 Adjust Ballfields
Improvements Allow Access R/S $1,885,775 $1,600,000 1.18 Limit Parking
Creates AmbianceUtilities Convey Waste R/S $688,311 $500,000 1.38 Potential Simplified Drainage
WaterEnergy
2.0 STRUCTURAL:Foundation Support Loads P $344,792 $340,000 1.01 Minimum
Substructure Support Loads P $1,000,846 $800,000 1.25 Thinner Groundslab
Superstructure Support Loads P $1,987,380 $1,500,000 1.32 Bracing &/or Selected Load Beraing Walls
3.0 ARCHITECTURAL:Exterior Closure Control Environment P $2,602,348 $2,500,000 1.04 Limited Material Substitution
Roofing Control Environment P $548,737 $540,000 1.02 Minimum
Interior Construction Protect Surface P $4,168,402 $4,000,000 1.04 Material Substitution
Separate AreaConveying Systems Move Vertical Loads R/S $40,000 $40,000
4.0 MECHANICAL:HVAC Control Environment P $3,424,093 $3,000,000 1.14 System Choices (LCC Impact?)
Plumbing Convey Water P $1,105,006 $1,000,000 1.11 Potential Simplification
WasteStorm
Fire Protection Protect Structure R/S $387,801 $380,000 1.02 Minimum
Special Systems Control Environment P $0 $0
5.0 ELECTRICAL:Service & Distribution Distribute Energy P $501,358 $500,000 1.00 Limited
Lighting & Power Illuminating Area P $1,241,734 $1,100,000 1.13 Altenate Systems Possible
Convey PowerSpecial Systems Convey Energy P $1,061,760 $800,000 1.33 Emergency Generator
EQUIPMENT:Fixed Support Program P $723,600 $650,000 1.11 Alternate Materials
Special Construction Support Program $0 $0
SUBTOTAL $23,099,193 $20,500,000 1.13
LEGEND Active Verb KIND P = Primary COST/WORTH RATIO Cost/Worth Ratio of Basic Function Only
Measurable Noun R/S = Required Secondary C/W Ratio: 1.13
S = Secondary 3.6 FUNCTION ANALYSIS
3.0 ARCHITECTURAL:Exterior Closure Control Environment P $2,602,348 $2,500,000 1.04
Roofing Control Environment P $548,737 $540,000 1.02
Interior Construction Protect Surface P $4,168,402 $4,000,000 1.04
Separate AreaConveying Systems Move Vertical Loads R/S $40,000 $40,000
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Fast DiagramCapital Program Management
Notify Tenants
HOW WHY
ModernizeElevators
ManageCapital
Program
Plan/ProgramProjects
AccessConditions
ProcureContractors
ManageProjects
BidProjects
ProcureDesigner
DefineRequirements
DevelopCapital
Program
DesignProjects
BudgetProjects
CoordinateContractors
ImproveReliability
ReduceLife Cycle
Cost
ImproveMaintainability
MeetCodes
ImproveAppearance
PrioritizeProjects
MinimizeDisruptions
NotifyTenants
ImproveCommunication
BetweenContractors
ClarifyContractor
Responsibilities
PrequalifyContractors
DevelopProject
Schedule
AssessProject
Conditions
ProcureD/B/O
FAST - Technical - Example
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Issues Analysis
• Define key issues• Tie functions to key issues• Identify benefits / costs• Identify priority• Define trade-offs
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Unlocking CreativityTwo Kinds of Thinking• Analytical
– Logic based– Limited/unique
ideas– Convergent
thinking– Vertical
thinking– Works well
inside the envelope
• Creative– Imagination
based– Many & varied
ideas– Divergent
thinking– Lateral thinking– Tests the edges
of the envelope
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Brainstorming Techniques
• Defer judgment• Focus on the key issues identified• Start with most general & work to
specific• One individual records ideas• Maintain one discussion at a time• Everyone is equal• Keep a good sense of humor
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Barriers to Creative Thinking• Unwillingness/inability to focus on
critical issues• Conformity• Not challenging the obvious• Extreme focus on details• Evaluating too quickly• Fear of looking like a fool• Self-imposed barriers
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Checklist for Generating Ideas• Inordinately
expensive items• Complex &
complicated items• Construction
difficulties• High maintenance
items• Potential operational
difficulties• Non-standard
products
• Multiple use & repetitive items
• Critical materials• Obsolete materials• Restrictive criteria• Extreme safety
factors• Restrictive
tolerances• Proprietary
specifications
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Group Dynamics & Partnering• Recognize the importance of group
dynamics• Avoid unnecessary conflicts• Base VE process on common goals &
objectives• Address the issues not the individuals• Understand that the whole is larger than
the sum of the parts• Use VE process to develop partner
relationships
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Economic Analysis Techniques
• Present Value Analysis• Annualized Cost• Rate of Return• Break Even/Payback Period• Savings/Investment Ratio
© Construction Management Association of America. Do Not Duplicate or Reproduce.
50
LEED© Checklist taken from LEED® Green Building LEED® Green Building Rating System™Rating System™
Yes ? No ChecklistSustainable Sites 14 Points
Y Prereq 1 Erosion & Sedimentation Control Required
Credit 1 Site Selection 1
Credit 2 Urban Redevelopment 1
Credit 3 Brownfield Redevelopment 1
Credit 4.1Alternative Transportation, Public Transportation Access 1
Credit 4.2Alternative Transportation, Bicycle Storage & Changing Rooms 1
Credit 4.3Alternative Transportation, Alternative Fuel Refueling Stations 1
Credit 4.4Alternative Transportation, Parking Capacity 1
Credit 5.1Reduced Site Disturbance, Protect or Restore Open Space 1
Credit 5.2Reduced Site Disturbance, Development Footprint 1
Credit 6.1Stormwater Management, Rate or Quantity 1
Credit 6.2Stormwater Management, Treatment 1
Credit 7.1Landscape & Exterior Design to Reduce Heat Islands, Non-Roof 1
Credit 7.2Landscape & Exterior Design to Reduce Heat Islands, Roof 1
Credit 8 Light Pollution Reduction 1
Yes ? No
Water Efficiency 5 Points
Credit 1.1Water Efficient Landscaping, Reduce by 50% 1
Credit 1.2Water Efficient Landscaping, No Potable Use or No Irrigation 1
Credit 2 Innovative Wastewater Technologies 1
Credit 3.1Water Use Reduction, 20% Reduction 1
Credit 3.2Water Use Reduction, 30% Reduction 1
Yes ? No
Energy & Atmosphere 17 Points
Y Prereq 1 Fundamental Building Systems Commissioning Required
Y Prereq 2 Minimum Energy Performance Required
Y Prereq 3 CFC Reduction in HVAC&R Equipment Required
Credit 1.1Optimize Energy Performance, 20% New / 10% Existing 2
Credit 1.2Optimize Energy Performance, 30% New / 20% Existing 2
Credit 1.3Optimize Energy Performance, 40% New / 30% Existing 2
Credit 1.4Optimize Energy Performance, 50% New / 40% Existing 2
Credit 1.5Optimize Energy Performance, 60% New / 50% Existing 2
Credit 2.1Renewable Energy, 5% 1
Credit 2.2Renewable Energy, 10% 1
Credit 2.3Renewable Energy, 20% 1
Credit 3 Additional Commissioning 1
Credit 4 Ozone Depletion 1
Credit 5 Measurement & Verification 1
Credit 6 Green Power 1
Yes ? No
Materials & Resources 13 Points
Y Prereq 1 Storage & Collection of Recyclables Required
Credit 1.1Building Reuse, Maintain 75% of Existing Shell 1
Credit 1.2Building Reuse, Maintain 100% of Shell 1
Credit 1.3Building Reuse, Maintain 100% Shell & 50% Non-Shell 1
Credit 2.1Construction Waste Management, Divert 50% 1
Credit 2.2Construction Waste Management, Divert 75% 1
Credit 3.1Resource Reuse, Specify 5% 1
Credit 3.2Resource Reuse, Specify 10% 1
Credit 4.1Recycled Content, Specify 25% 1
Credit 4.2Recycled Content, Specify 50% 1
Credit 5.1Local/Regional Materials, 20% Manufactured Locally 1
Credit 5.2Local/Regional Materials, of 20% Above, 50% Harvested Locally 1
Credit 6 Rapidly Renewable Materials 1
Credit 7 Certified Wood 1
Yes ? No
Indoor Environmental Quality 15 Points
Y Prereq 1 Minimum IAQ Performance Required
Y Prereq 2 Environmental Tobacco Smoke (ETS) Control RequiredCredit 1 Carbon Dioxide (CO2 ) Monitoring 1Credit 2 Increase Ventilation Effectiveness 1Credit 3.1Construction IAQ Management Plan, During Construction 1Credit 3.2Construction IAQ Management Plan, Before Occupancy 1Credit 4.1Low-Emitting Materials, Adhesives & Sealants 1Credit 4.2Low-Emitting Materials, Paints 1Credit 4.3Low-Emitting Materials, Carpet 1Credit 4.4Low-Emitting Materials, Composite Wood 1Credit 5 Indoor Chemical & Pollutant Source Control 1Credit 6.1Controllability of Systems, Perimeter 1Credit 6.2Controllability of Systems, Non-Perimeter 1Credit 7.1Thermal Comfort, Comply with ASHRAE 55-1992 1Credit 7.2Thermal Comfort, Permanent Monitoring System 1Credit 8.1Daylight & Views, Daylight 75% of Spaces 1Credit 8.2Daylight & Views, Views for 90% of Spaces 1
Yes ? No
Innovation & Design Process 5 Points
Credit 1.1Innovation in Design: Specific Title 1
Credit 1.2Innovation in Design: Specific Title 1
Credit 1.3Innovation in Design: Specific Title 1
Credit 1.4Innovation in Design: Specific Title 1
Credit 2 LEED™ Accredited Professional 1
Yes ? No
Project Totals 69 Points
Certified 26-32 points Silver 33-38 points Gold 39-51 points Platinum 52-69 points
Yes ? No ChecklistSustainable Sites 14 Points
Y Prereq 1 Erosion & Sedimentation Control Required
Credit 1 Site Selection 1
Credit 2 Urban Redevelopment 1
Credit 3 Brownfield Redevelopment 1
Credit 4.1Alternative Transportation, Public Transportation Access 1
Credit 4.2Alternative Transportation, Bicycle Storage & Changing Rooms 1
Credit 4.3Alternative Transportation, Alternative Fuel Refueling Stations 1
Credit 4.4Alternative Transportation, Parking Capacity 1
Credit 5.1Reduced Site Disturbance, Protect or Restore Open Space 1
Credit 5.2Reduced Site Disturbance, Development Footprint 1
Credit 6.1Stormwater Management, Rate or Quantity 1
Credit 6.2Stormwater Management, Treatment 1
Credit 7.1Landscape & Exterior Design to Reduce Heat Islands, Non-Roof 1
Credit 7.2Landscape & Exterior Design to Reduce Heat Islands, Roof 1
Credit 8 Light Pollution Reduction 1
Yes ? No
Water Efficiency 5 Points
Credit 1.1Water Efficient Landscaping, Reduce by 50% 1
Credit 1.2Water Efficient Landscaping, No Potable Use or No Irrigation 1
Credit 2 Innovative Wastewater Technologies 1
Credit 3.1Water Use Reduction, 20% Reduction 1
Credit 3.2Water Use Reduction, 30% Reduction 1
Yes ? No
Energy & Atmosphere 17 Points
Y Prereq 1 Fundamental Building Systems Commissioning Required
Y Prereq 2 Minimum Energy Performance Required
Y Prereq 3 CFC Reduction in HVAC&R Equipment Required
Credit 1.1Optimize Energy Performance, 20% New / 10% Existing 2
Credit 1.2Optimize Energy Performance, 30% New / 20% Existing 2
Credit 1.3Optimize Energy Performance, 40% New / 30% Existing 2
Credit 1.4Optimize Energy Performance, 50% New / 40% Existing 2
Credit 1.5Optimize Energy Performance, 60% New / 50% Existing 2
Credit 2.1Renewable Energy, 5% 1
Credit 2.2Renewable Energy, 10% 1
Credit 2.3Renewable Energy, 20% 1
Credit 3 Additional Commissioning 1
Credit 4 Ozone Depletion 1
Credit 5 Measurement & Verification 1
Credit 6 Green Power 1
Yes ? No
Materials & Resources 13 Points
Y Prereq 1 Storage & Collection of Recyclables Required
Credit 1.1Building Reuse, Maintain 75% of Existing Shell 1
Credit 1.2Building Reuse, Maintain 100% of Shell 1
Credit 1.3Building Reuse, Maintain 100% Shell & 50% Non-Shell 1
Credit 2.1Construction Waste Management, Divert 50% 1
Credit 2.2Construction Waste Management, Divert 75% 1
Credit 3.1Resource Reuse, Specify 5% 1
Credit 3.2Resource Reuse, Specify 10% 1
Credit 4.1Recycled Content, Specify 25% 1
Credit 4.2Recycled Content, Specify 50% 1
Credit 5.1Local/Regional Materials, 20% Manufactured Locally 1
Credit 5.2Local/Regional Materials, of 20% Above, 50% Harvested Locally 1
Credit 6 Rapidly Renewable Materials 1
Credit 7 Certified Wood 1
Yes ? No
Indoor Environmental Quality 15 Points
Y Prereq 1 Minimum IAQ Performance Required
Y Prereq 2 Environmental Tobacco Smoke (ETS) Control RequiredCredit 1 Carbon Dioxide (CO2 ) Monitoring 1Credit 2 Increase Ventilation Effectiveness 1Credit 3.1Construction IAQ Management Plan, During Construction 1Credit 3.2Construction IAQ Management Plan, Before Occupancy 1Credit 4.1Low-Emitting Materials, Adhesives & Sealants 1Credit 4.2Low-Emitting Materials, Paints 1Credit 4.3Low-Emitting Materials, Carpet 1Credit 4.4Low-Emitting Materials, Composite Wood 1Credit 5 Indoor Chemical & Pollutant Source Control 1Credit 6.1Controllability of Systems, Perimeter 1Credit 6.2Controllability of Systems, Non-Perimeter 1Credit 7.1Thermal Comfort, Comply with ASHRAE 55-1992 1Credit 7.2Thermal Comfort, Permanent Monitoring System 1Credit 8.1Daylight & Views, Daylight 75% of Spaces 1Credit 8.2Daylight & Views, Views for 90% of Spaces 1
Yes ? No
Innovation & Design Process 5 Points
Credit 1.1Innovation in Design: Specific Title 1
Credit 1.2Innovation in Design: Specific Title 1
Credit 1.3Innovation in Design: Specific Title 1
Credit 1.4Innovation in Design: Specific Title 1
Credit 2 LEED™ Accredited Professional 1
Yes ? No
Project Totals 69 Points
Certified 26-32 points Silver 33-38 points Gold 39-51 points Platinum 52-69 points
© Construction Management Association of America. Do Not Duplicate or Reproduce.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Value Engineering Reporting Procedures
• Summary of Results / Implementation matrix
• Executive summaries• Proposals• Cost estimates• Appendix materials
– Cost models– Function analysis– Idea listings– Agenda– Miscellaneous
© Construction Management Association of America. Do Not Duplicate or Reproduce.
53
Value Engineering Proposal For U.S. Embassy Project
DEVELOPMENT PHASE VALUE ENGINEERING PROPOSAL
Proposal No. AS-18
PROJECT: New Office Building SYSTEM: Architectural
LOCATION: Overseas Location
CLIENT: US Department of State
DATE: April 18-21, 2000
ITEM: Consider alternate finishmaterial on the north, east and westwalls of the NOB.
ORIGINAL DESIGN:The entire north elevation of the NOB (59 m wide x 23 m high) is finished with painted plaster (excluding stonewater course).Parts of the east and west elevations (each 17 m wide x 23 m high) are painted plaster (excluding stone watercourse).
PROPOSED DESIGN: Stone veneer panels in lieu of painted plaster finish on the major building elevations.
[Alternate: architectural finished concrete if the appropriate concrete skills are locally available]
ADVANTAGES: Provides an exterior finish material that is in keeping with the representational image of a U.S. Embassy. Low maintenance material; does not require periodic patching and painting that is required by painted
plaster.DISADVANTAGES:
Higher initial cost; possible impact on project delivery schedule.
DISCUSSION/VERIFICATION:ISSUES: Representational Image; Maintainability; Life-cycle Costs.The goal of FBO is to provide buildings that are representational in nature. Although it is understood that paintedplaster is a frequently used material in the vicinity of Overseas Location, there is a question if this material is themost appropriate to be used so extensively on the highest profile building in the compound.
There is also a question of the maintainability (life-cycle costs) of plaster veneer in a climate of frequent freeze/thawcycles. Although plaster veneers is used frequently in the vicinity of Overseas Location, it will require periodicpainting and repair. While this may be an acceptable maintenance issue in the private sector in Overseas Location,this periodic maintenance may be disruptive to the activities at the NOB.
Attached are two life cycle cost analyses presenting a seven-year replacement cycle and a ten-year replacementcycle for the stucco. The seven-year cycle indicates a 5.8-year payback and the 10-year cycle indicates a 10.6-yearpayback cycle. A precise determination of component life is very difficult but the LCC analyses are presented toassist in FBO’s value judgment.
LIFE CYCLE COST SUMMARYCOSTS & SAVINGS (PRESENT VALUE)
Initial Cost O&M Total LCC
Original Design 530,000
Proposed Design 1,327,000
Savings (796,000)
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54
LCC Analysis for VE Proposal For U.S. Embassy Project
Life Cycle Costing - General Purpose WorksheetNOB Overseas Location, Overseas Location Stucco Veneer Stone Veneer
Exterior Wall Exterior Wall Study Title: Comparison Stucco to Stone Cladding (AS-18)
Discount Rate : 6.0% Date: Estimated Present Estimated PresentLife Cycle (Yrs.) 30 Costs Worth Costs Worth
Initial/Collateral CostsA. North Elevation Stucco 224$ 1350 m2 302,400 302,400
B. East Elevation Stucco 224$ 480 m2 107,520 107,520
C. West Elevation Stucco 224$ 540 m2 120,960 120,960
D. North Elevation Stone 560$ 1350 m2 756,000 756,000
E. East Elevation Stone 560$ 480 m2 268,800 268,800
F. West Elevation Stone 560$ 540 m2 302,400 302,400
G.
H. Total Wall Area = 2370 m2I.
J.
Total Initial/Collateral Costs $530,880 $530,880 $1,327,200 $1,327,200Difference ($796,320)
Replacement/Salvage Inflation/ PW
(Single Expenditures) Escal. Rate Factor
A. Stucco Replacement 7 2% 2.134 743,232 1,586,047
B. Stucco Repaint/Refinish 4 2% 3.964 51,002 202,191
C. Stone Cleaning 10 2% 1.144 30,601 35,008
D.
E.
F.
G.
H.
I.
J.
Total Replacement/Salvage Costs $1,788,238 $35,008Annual Costs Inflation/ PW
Escal. Rate Factor
A. Annual Maintenance 2% 17.458 6,120 106,847 2,040 35,616
B.
C.
D.
E.
F.
G.
H.
I.
J.Total Annual Costs $6,120 $106,847 $2,040 $35,616
Sub-Total Replacement/Salvage + Annual Costs (Present Worth) $1,895,085 $70,624Difference
Total Life Cycle Costs (Present Worth) $2,425,965 $1,397,824Life Cycle Cost PW Difference $1,028,141
Payback - Simple Discounted (Added Cost / Annualized Savings) 6.0 Yrs.Payback - Fully Discounted (Added Cost+Interest / Annualized Savings) 7.7 Yrs.
Total Life Cycle Costs - Annualized Per Year: $176,244 Per Year: $101,550
April 24, 2000
OccuranceYear -or- Cycle
(7 Year Cycle)
INIT
IAL
/ C
OLL
AT
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AL
CO
ST
SR
EP
LAC
EM
EN
T /
SA
LVA
GE
CO
ST
SA
NN
UA
L C
OS
TS
LIF
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YC
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S
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Sample Implementation Matrix
HANSCOMB INC.SUMMARY OF VALUE ENGINEERING STUDY RESULTS
POTENTIAL IMPLEMENTATION MATRIX
Project: Child Development Center System: ArchitecturalLocation: Andrews AFB, Camp Springs , Md.Date: February 12 - 13, 1998Client: EFA Chesapeake Page: 1 of 1
COST ANALYSIS IMPLEMENTATION
Proposal Initial Future Total ActionNo. Type Description Cost Cost LCC Action Action Accept or Comments
Savings Savings Savings By Date Reject
0 ProposalsPotential Total
Cost Savings $0 $0 $0
Legend:
P = Proposal (approximate value of suggestion is identified)
DS = Design Suggestion (value of suggestion is not quantifiable)
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Value Enhanced Design
• Integration of value management, cost management into design process
• Utilizes design team of record• Emphasizes owner & user
participation• Must start at outset of project• Objective is to assure alignment of
scope, expectations & budget
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Value Enhanced Design Delivery
Cost Management
Design
Value Management
Internal workshops to improve value and to enhance
constructibility
On-going, interactive cost management supplementing
milestone estimates$ $ $
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Value Enhanced Design DeliveryAdvantages
• Improved team communications• Better control over cost• Improved clarity of value
expectations• Faster feedback on cost impact of
decisions• Reduced chances of redesign• Improved relationship with owner
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Standards
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Questions?