Development of a Proposed Commercial Building

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BACKGROUND OF THE PROJECT......................................................

OBJECTIVES OF THE PROJECT........................................................


IDENTIFICATION OF PROBLEMS......................................................


Responsibilities of parties........................................................


Public work department...........................................................

EVALUATION OF PROCUREMENT METHODS.............................................


SELECTIONS PROCEDURES..........................................................



Proposed commercial building


The objectives of the said project i.e. building of commercial center is a government own project. When completed, it is expected to provide a conducive environment for commercial activities. Therefore, to achieve the underline target, certain criteria have to be met in term of conduciveness for the activities to be carried out. The building is to be constructed for commercial purpose and so the reasons for construction have to be in place.

Therefore, the procurement to be use for construction and methods is very important as it affect the cost, quality and time of delivery of the project. As given, the time for project completion is 2 years under certain conditions. It is crucial to understand what type of procurement to attain certain work quality, within the demarcated time and at an affordable cost.

Perhaps, it is important to understand the reason for construction (economic activities) to make the building functional. Most public buildings failed because a clear target is not identify for the building performance. To achieve these, a sequential work frame should be arranged with a clear target construction.


Facilities in commercial buildings are so many and are provided according to the functions/ performance of the commercial building. Such buildings include office buildings, industrial, retail/restaurant, multifamily, land and miscellaneous. Therefore, the facilities provided for each of the above mention commercial buildings varies depending on the type of building requirement.

Below are some of the facilities in commercial buildings:

  • Recreational facilities
  • Restaurant
  • Ticket counter
  • Worship area such as surau
  • Super market
  • Merchandise displace area
  • Rest room/changing room
  • Shops
  • Bank facilities/ ATM machine
  • Sitting facilities for wheel chair users
  • Inquiry offices
  • Custom area
  • Waiting area etc


In most instances, the government undertakes large scale projects and public facilities such as, highways, learning institutions, hospitals and sport facilities. They are non profit oriented but crucial in terms of delivery, quality of works and safety. Unfortunately a number of government funded project in the country suffered. They failed to achieve the said quality and schedule.

  • The lack of scope for improving construction efficiency and derived relevant quality and efficiency target and performance measures for construction works.
  • Failure to examine current practice and the scope for improvement by innovation in product and processes.
  • Failure to identify specific actions and good practice which would help achieves more efficient construction in terms of quality and customer satisfaction, timeliness in delivery and value for money.


Responsibilities of parties

Basically there are three parties involved in this project, to which if any fault arises will be held responsible. These parties include:

  1. The government who happens to be the client and to which gives the contract under a certain ministry.
  2. The main contractor of the project
  3. The health and safety legislation and enforcement agency, which is responsible for the effectiveness implementation of the so called safety and health policies.


The Government as the client and as the client and as the owner of the project has a diverse responsibilities. The government is supposed to appoint a competent architect or supervisor who will monitor the project from the start until finishing stage. The planning supervisor to the building is specifically referred to in the SBC (standard building contract) as being appointed by the employer, and to which the planning supervisor is stated to be the architect unless some other individual is identified. The planning supervisor is required to:

Ensure that the design avoid foreseeable risk.

  • Ensure co-operation between designers.
  • Be able to advice the client as the employer is termed in CDM94 (construction design management) on the competence of appointed designers.
  • Be able to advice the client on competence of the contractor.
  • Ensure preparation of draft health and safety plan for the contractors at tenders stage.
  • Give notice of the project to the health and safety executive.
  • Review and amend the health and safety files as work proceeds.
  • Deliver the health and safety files to the client on completion of the project.

The main contractor

The principle contractor is stated to be the contractor or such offer contractor as the employer shall appoint as the principal contractor pursuant to regulation 6 (5) of CDM 94. The employer must be reasonably satisfied that such principle contractor is competent and can allocate sufficient resources to ensure appliance with regulations. The principal contractor is required to:

  • Ensure that other contractors comply with their obligations on health and safety matters.
  • Co-ordinate co-operate between sub-contractors
  • Ensure compliance with health and safety plans.
  • Ensure that all relevant persons comply with all the health and safety plans.
  • Ensure that only authorized person are allowed on site.
  • Display a copy of noticed submitted the health and safety executive.
  • Provide the planning supervision with the information required for the health and safety files.
  • Instruct other contractors so that the principle contractors duties are comply with.
Health and safety regulation bodies

The department of occupational safety and health (DOSH) and other agencies has regulations that lay down the legal requirement to ensure that the safety and health of not only the workers at place of work but also the public as well. These guidelines applied to all work in building operation and work of engineering construction activities in Malaysia. Covered by the occupational safety and health act 1994 (ACT 514) the factory and machine act 1967 (ACT 139) and all the regulations made there under. It is designated to serve as a handy reference and to read together with above mentioned legislation and other industry code of practices.

In this, the department health safety and health work in collaboration with other regulation bodies to compliment their policies. These are:

  1. National Institute of Safety and Health (NAOSH).
  2. Construction Industry Development Board (CIDB).

All these bodies mentioned above are to ensure zero accident is obtained both at place of work after the main construction and also during construction’s process.

  • To secure the safety, health and welfare of person at work against risks of safety and health arising out of activities of persons at work.
  • To protect persons at place of work other than person at work against risks to safety and health arising out of person at work.
  • To promote an occupational environment for person at work which is adapted to their physiological and physiological needs?
  • To provide means where by the associated occupational safety and health regulations maybe progressively by a system of regulations and provide industry code of practice operating in combination with the provision of this act designed to maintain or improved the standard of safety and health.

Public work department

The public work department is the government official which is under a certain ministry of Housing Urban and Rural development. The responsibility of this authority is to execute and work with master city plan. The masses in turn must work with the local authority so as to achieve the city master plan. Therefore, every individual or company willing to erect any structure must submit their building’s propose plan to local authority for approval.

Perhaps, this authority already set up plans for the general public usage (ie: Areas set out for industrial, commercial and residential areas). Generally, when there is disapproval from the local authority, the aggrieved person/s can always appeal for approval until a certain agreement is reach by both parties. Therefore, the local authority is responsible for giving out building’s plans and specification.


The definition of procurement is ‘the obtaining of goods and services’. But in construction, it is to obtaining the whole spectrum of good, materials, plant and services in order to design, build and commissions a building that delivers the best possible value for the money for the client over its life cycles. In traditionally, criteria for the selection for good, materials, plant and services has been the cheapest or lowest price bid. However, for nowadays, the emphasis has changed from cheapest cost to best value. The process of obtaining a range of construction services and suppliers in order to deliver a construction solution to identified needs.

The procurement needs of the project is

  1. Time
  2. Cost
  3. Quality or specification

Types of Procurement

There are many types of procurement which design based on the requirement of the project and the needs of the client in the project. The different types of procurement represent different advantages and disadvantages. Therefore, the client should choose accordingly to their budget and needs in the project. Although that have many types of procurement but in Malaysia are just focus .

Traditional procurement

This procurement method is client appointed a design team by his own and completed the drawing of project accordingly. After that, the client will appoint a main contractor to carry out the construction according to the drawing and specification drawn up by the design team. At the same time, the construction work will be advice by the leader of the design team, which is architect or civil engineering.

Direct relationship

Indirect relationship


  1. The unit rates allow ease of valuation for the stage payments of work carried out and for any variation to the original design.
  2. All parties have a clear image and responsible as to the extent of their obligations.
  3. It gives a clear analysis of the cost of all aspects of the project.


  1. Changes may lead to disputes or claim.
  2. Take time in design stage.
  3. Design does not benefit to construction experience.

Design and Build Procurement

This procurement is client just appointed a contractor. The contractor will have his own design team to design accordingly the need of the owner then he will build accordingly.


  1. Less technical risk because the contractor is responsible to design and build based on their experiences.
  2. Save time due to no tendering is needed.


1. Cost will notice by end of design.

2. The contractor may reduce the quality to maximum their profits.


The turnkey is a type of project that is constructed so that it could be sold to any buyer as a completed product. This is contrasted with build to order, where the constructor builds an item to the buyer’s exact specifications, or when an incomplete product is sold with the assumption that the buyer would complete it. Main contractor responsible for design. Main contractor responsible for constructing. main contractor installed the furnishing


1. A turnkey contract is one in which an independent agent agrees to furnish materials and labor to finish a project and then turn it over to the owner for a fixed price.

2. No outlay of cash until the project is done.


  1. Not easy method and involve high capability of promoters.
  2. Transaction cost is high

Procurement based on Case Study

Based on the scenario, the suitable procurement is using Novated turnkey Procurement. The theory of this procurement is the client. Because the new oil company entering Malaysian market willing to fund a new community center, when organizations or individuals wish to have a new facility, or carry out refurbishment or maintenance of an existing facility, they will be involved in some from of procument. There are a variety of different methods for procuring this new facility, not all of which involve construction as a solution.


I would recomment the use of construction management for this project with carefully selected manager who will in person handle the project and manage it well. This is because construction management is flexible, efficient and cost effective.

There should be a Study Committee to consulted and ensure the Final report addressed client concerns.Information and Material Obtained in Interviews. The consultants and clients appreciate the time and effort of individuals and organizations who supplied information, financial records, comments, and observations with regard to construction of commercial building for this Study.

It is important to use some raw material so as to make reference data in the report, with attribution to the source. It also to provide a strategic approach to the commercial building provision within the district required. It is recommended that before any significant next steps are taken with regards to the construction progress, the commercial and political discussions that are required relating to the potential funding of the new centre.

Such committee should be able to provide additional information which relate to the project life cycle, so cost benefit analysis to the proposed project is expected to positively contribute towards the local economy through increased investment in sport/recreational facility and subsequent commercial/economic activities. On the other hand, associated project activities may cause some negative environmental impacts. The main goal of the committee is to provide an evaluation as to whether the project will bring a net overall gain or loss to society from the environmental stand point.

This study adopts the impact pathway approach (IPA) where the physical environmental impacts are linked to an economic valuation process.


The selection procedure for the most acceptable method for construction of the commercial building is base on cost, quality and time. It was to follow with the said importance of the project priority. These selection procedures are:

  1. Identifying which of the above construction procurement method would provide the required need for time reduction i.e to complete project with the given stipulated time.
  2. Cost reduction or management is of essence, so which of the methods would be cost effective.
  3. Identify the best method with construction efficiency and derived relevant quality and efficiency target and performance measures for construction works.
  • Traditional method

The traditional form of procurement is where the designer does not have direct link with the specialist and all communication is via the main contractor who in many cases will not accept design liability.

  • Design and Build Method

Design and Build procurement method is one in which a design-build contractor is given the responsibility of carrying out both the design and construction of the project for the client.

  • Management Contracting Method

This strategy involves the owner/ developer entering into an agreement with Management Contractor who in turn contracts with individual trade contractors.

The owner pays the cost of the work contracts as well as the management fee for the management services.

Fig 2.0 showing the different procurement methods and their effectiveness in relation to cost, quality, and time.

Traditional Method

Design and Build Method

Management Contracting

Time: this is considered as the most time consuming type of procurement method

Time: It is known as fast tract method because of its nature of build ability.

Time: It is the fastest method compare to the others

Cost: Cost or price certainty is fairly good. Client can be sure in regards to amount spend.

Cost: This method provides a better package and value for money spends on the project.

Cost: It is the least in comparison with the others.

Quality: This method provides a high degree of quality and certain standard.

Quality: It is often found out that the quality under this contracting system tends to be questionable.

Quality: The certainty in relation to the quality of work is dependent on the package contractors. But it is better than D&B in comparison.

The table above contains vital information on the different procurement methods. Each method has its own peculiarity and advantages, considering the different factors i.e. cost quality and time. It is important to know that one method could not be use as best practice for all construction type. To recommend the most effective method for certain project, the objective and purpose for the said construction must be understood.


Each project procurement system has its own peculiarity in terms of the pretender and post tender activities and processes, division of risks between client and contractors, and the effectiveness of project monitoring and control.

It is very important at the very outset of a project to carefully consider all factors when selecting the most appropriate procurement approach for a construction project. This is because each system has its own feature and peculiarity that will have effect on the cost, time and quality of the project i.e. the project performance. Aiming to overcome typical problems of separation of execution from planning and after the-fact variance detection currently experienced in the real practices, a vision for the this generation of construction planning and control is proposed to overcome life project execution problem. It is important to use current construction practice for effective results.