Alternative Delivery Methods: LeaseLeaseback and Integrated Project Delivery

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Alternative Delivery Methods Lease-Leaseback
and Integrated Project Delivery

• Society for Marketing Professional Services
  (SMPS)
• The Sacramento Grand Ballroom
• May 26, 2009
• Mark Rosson
• Michael Flores
• Capital Program Management, Inc.

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Agenda Key Points

• Current Delivery Method Options
• What is Lease-Leaseback?
• What is Integrated Project Delivery or IPD?
• The value / benefits to Owners, and Design
  Construction Teams of these delivery methods?
• Current Market Trends
• Business Development Opportunities

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Current Delivery Method Options

• Public

• Private

• Design-Bid-Build
• Design-Build
• Agency Construction Management (CM)
• CM At Risk
• CM Multiple Prime
• Lease-Leaseback

• Negotiated GMP
• Select List Bid
• Design-Build
• Click Here For
• Delivery Method Schedule

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What is Lease-Leaseback?

• Lease-Leaseback is a project delivery method
  authorized by Ed Code 17406 which allows a school
  district to select its entire construction team
  at the start of design
• Qualifications-Based Selection of Contractor (LLB
  Entity)
• Separate selection of Architect
• Contractually -- requires 3 contracts with the
  LLB Entity
• Preconstruction Services Contract
• Site Lease Agreement (VUSD for 10.00 to the
  District) upon DSA approval
• Facilities Lease Agreement upon DSA approval

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CONTRACTS
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What is Integrated Project Delivery (IPD)? How
does it Relate to Lease-Leaseback?

• Integrated Project Delivery is a term that has
  emerged from the Lean Project Management
  methodology that can only be fully implemented
  through delivery methods like Lease-Leaseback (or
  other non Design-Bid-Build methods)
• Relational Contracting
• Requires an involved owner
• Three party agreement

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The History of Lean

• In the 1990s, Toyota revolutionized the auto
  industry with Lean Production Management, a novel
  approach to getting the right things to the right
  place at the right time in the right quantity,
  all with the intent of minimizing waste and
  maximizing operational flexibility.

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Techniques and Tools of Lean or IPD

• Developed by Lean Construction Institute (LCI)
• Reliable Promises
• Pull Scheduling aka Reverse Phase Schedule
• Last Planner and the Weekly Work Plan
• Target Costing
• BIM Building Information Modeling

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Reverse-Phase Scheduling in construction trailer
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BIM
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BIM
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Whats So Special About IPD?

• The value / benefits to Owners, and Design
  Construction Teams.
• Change your mindset.

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Change Your Relationship
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Open Kimono
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No Plan-Hoarding Allowed
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Collaboration is the Key

• All parties agree to meet weekly starting with
  conceptual design.
• All parties send the representative who will be
  consistently there throughout the project.
• All parties agree to adhere to the Lean method of
  meetings and communication.
• Contractor will include Project Superintendent.
• IPD Team and Core Team responsibilities.

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Current Market Trends

• According to one local builder, over half the
  jobs they are proposing are being done with an
  IPD element.
• There is both existing and anticipated
  legislation on the horizon that will give other
  Public Entities more flexibility in delivery
  methods like L-LB is used for schools.
  
• Click here for P2SL Report
• Many developers are offering financing as part of
  the Lease-Leaseback contract, so theres little
  or no out-of-pocket expense for an owner. In the
  public sector, this is known as
  Public-Private-Partnerships (P3).

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Business Development Opportunities

• 90 of local school bond measures passed in
  November, 2009.
• Several school districts are starting Master Plan
  exercises this year.
• Additional local bonds will be on November, 2010
  ballots.

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Resource Information for Implementing IPD

• 2) P2SL
• University of California, Berkeley
• Dr. Glenn Ballard
• Http//p2sl.berkeley.edu/
• 4) Capital Program Management, Inc.
• 2150 Capitol Avenue
• Sacramento, CA 95816
• Michael Flores
• www.capitalpm.com

• 1) Lean Construction Institute
• Box 1003
• Ketchum, ID 83340
• Gregory Howell, P.E.
• www.leanconstruction.org
• 3) McDonough Holland Allen PC
• 500 Capitol Mall, 18th Floor
• Sacramento, CA 95814
• Will Lichtig
• www.mhalaw.com

• Books, Etc.
• The Toyota Way by Jeffrey Liker
• Lean Thinking by Womack/Jones
• What is Lean Construction by Gregory A.
  Howell Study Paper

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Special Thanks to our Host,DPR Construction, Inc.
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