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Last edited 08 Oct 2020
Phased construction works
Construction works can be planned as a series of stages or phases, rather than as one continuous process.
This can be useful for clients where a complex sequence of events needs to be followed (such as on densely occupied or complex site), or where there are a number of distinct components to the works, particularly for clients who are seeking to maintain some level of business operation during construction and so wish to minimise disruption.
Phasing construction works can be beneficial in allowing a project to move forwards despite there being no guarantee of funding being available to complete it. Completing certain sections of work can make funding more attractive to potential lenders and investors than if the project has not begun at all. It can also enable the client to begin to generate income from the completed parts of the development.
Construction projects can be phased:
- By work category: Every part of a particular type of work is completed as part of one phase.
- By section: Dividing the project into different sections and completing them as separate projects.
- By partial completion: For example, the entire shell is built and the interior finished in separate phases.
Some of the advantages of phased construction include:
- Lower initial investment and so less initial risk.
- Construction costs can be spread over a longer time period.
- Income can be generated throughout the construction period.
- The ability to continue to occupy a site throughout the development.
- A smaller scope of works can result in a shorter construction schedule for key parts of the development.
- It can enable clients to continue to make changes based on response to the initial phases, market conditions and so on.
- Different parts of the works can be procured in the way most suited to them.
Some of the disadvantages of phased construction include:
- As different work phases will be spread out, the project overall will take longer.
- The costs overall may also be higher, as the works take longer, inflation is likely to have a greater impact, and it is not as possible to deliver economies of scale.
- The opportunity to make design changes may lead to scope creep.
- Maintaining business operations while construction is proceeding may be difficult.
- The possibility that delays in one part of the works will impact on other phases.
Particular care is required in relation to:
- Logistics on site when different sections are in the possession of different parties.
- The protection of completed sections from ongoing work.
- The provision of appropriate insurance at all times for parts of the site.
- The adoption of appropriate health and safety measures to deal with risks resulting from occupation of areas adjacent to, or only accessible through ongoing construction works.
- The provision of appropriate security measures.
- Continuity of systems such as building services.
Where all the works are procured under a single contract, phasing can be allowed for by sectional completion clauses. These allow different completion dates for different sections of the works. For more information see: Sectional completion.
If phasing was not agreed during procurement, it may be permitted to a certain extent by partial possession. This allows the client to take possession of part of a building or site, even if the works are ongoing or there are defects that have not been rectified. For more information see: Partial possession.
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