(June 13, 2014) Salisbury-based construction firm Gillis Gilkerson is gearing up to oversee the construction of the new Ocean City Beach Patrol headquarters, after having won the city’s first-ever construction management bid for the project.
Earlier this year, the city decided to change its bidding process and, instead of hiring a general contractor directly, hire a management firm who would then oversee both the final design of the project and the hiring of subcontractors.
“It’s a much more seamless operation, where the people who have to build it are involved earlier on,” said Gillis Gilkerson President Dwight Miller.
Critically, Gillis Gilkerson is only receiving $25,000 up-front for pre-construction work on the project. The firm will then bid out to sub-contractors, and present the final schedule of costs to the city before construction begins.
“We would get all those sub-contractor packages together and si down with the city to make sure they’re competitive and a fair value for the work,” Miller said. “We’re still taking multiple bids for each part to get a fair dollar value.”
Whatever these costs turn out to be, Gillis Gilkerson will already have a pre-negotiated profit margin with the city, and will be responsible for any cost overages incurred by its contractors.
The city’s process for selecting a firm was largely qualification-based. Gillis Gilkerson was actually the second-lowest in price, but city staff found that their “local experience and long history building in Ocean City are a significant advantage for this project,” according to a city memo.
The firm is currently working on rebuilding the city’s 137th Street fire station, although this was a straight bid process and not a construction management job.
“We probably do equal amounts of construction management work and straight contracting,” Miller said. “It always keeps us in touch to make sure we’re getting the best deals.”
The impetus for the city to move to the construction management model was two-fold. First, the city has seen considerable construction success at the convention center, where the Maryland Stadium Authority takes construction management bids.
Secondly, the city is wary to be on the hook for any failings of a general contractor after the disastrous the Caroline Street restroom and stage facility.
The project, which began construction in the fall of 2012, was expected to be completed before the 2013 summer season. Instead, a myriad of delays saw the facility open the week after Christmas, seven month behind schedule. Parts of the facility are still experiencing leaks and premature wear.
Although the city borrowed $2 million in last year’s bond issuance for the OCBP project, the budget will be tight. The current layout of the building shows 9,477 square feet, a roughly 3,000 square foot reduction from what was originally pitched. However, in the first design revision, an increase in estimated costs ate up the 15 percent contingency the city had built into the price before construction even begins.