Construction Management at Risk (CMAR) is a delivery method used in construction projects where the construction manager commits to completing the project within a guaranteed maximum price (GMP). Unlike traditional project management, where the construction manager acts only as an advisor, in CMAR, the manager takes on the additional role of a contractor, bearing the risk for any cost overruns that exceed the GMP based on the contract terms.

The CMAR model is designed to involve the construction manager early in the development and design phases, allowing them to provide input on pricing, scheduling, and constructability, which can significantly enhance the efficiency and effectiveness of the project. This approach fosters a collaborative environment where the manager works closely with the project owner and architects from the start, aiming to streamline the process and reduce any potential construction-related issues.

Construction Management at Risk (CMAR) Process

The CMAR process typically involves several key phases:

1. Selection of the CMAR: The construction manager is selected based on qualifications, experience, and sometimes a preliminary cost proposal.
2. Preconstruction Services: The CMAR provides input during the design phase, helping to analyze materials, equipment, and work sequences with an eye on optimizing costs and schedules.
3. Contract Negotiation: The project owner and the CMAR negotiate the details of the construction contract, including the GMP and the scope of work.
4. Construction Phase: The CMAR oversees the construction, working closely with subcontractors and vendors to ensure that the project adheres to the plans, budget, and timetable.
5. Project Completion and Review: Once the project is completed, the CMAR and project owner review the outcomes, addressing any changes or additional costs that occurred.

When Should You Avoid CMAR?

CMAR isn’t the ideal choice for every construction project. In markets characterized by high contractor competition, this method may not deliver the best value since competition can drive down costs more effectively. For simpler or smaller projects, the traditional design-bid-build approach might be more straightforward and cost-effective. Similarly, for projects where the scope isn’t well-defined or is likely to change, methods like design-build offer more flexibility. Additionally, owners who like to maintain direct oversight over every aspect of their projects may find the CMAR model too restrictive because it assigns significant responsibility and control to the construction manager.

Construction Management at Risk (CMAR) Pros & Cons

Pros:

1. Cost Control: One of the biggest advantages of CMAR is cost predictability. The GMP sets a cap on costs, which helps the project owner budget more effectively and reduces the risk of unexpected expenses.
2. Quality Assurance: With the construction manager involved from the beginning, there’s a greater emphasis on quality and performance. The manager’s reputation is directly tied to the project’s success, motivating them to maintain high standards throughout.
3. Time Efficiency: CMAR allows for phases of the project to overlap, meaning that construction can begin before the design is fully complete. This can lead to faster project completion compared to traditional methods.
4. Risk Management: The construction manager assumes the risk for cost overruns, which can provide peace of mind for the project owner and ensure a commitment to keeping the project within the agreed budget.

Cons:

1. Limited Contractor Competition: Since the construction manager is engaged early in the project and often assumes the role of the general contractor, this can limit competitive bidding for construction services, potentially leading to higher overall costs.
2. Complex Contract Negotiations: The CMAR method requires detailed contracts that clearly define the scope, responsibilities, and risk-sharing, which can complicate and prolong the negotiation phase.
3. Potential for Reduced Creativity: With a focus on staying within budget and schedule, there might be less flexibility for creative or innovative approaches to construction and design.

In conclusion, CMAR offers a collaborative, efficient, and risk-managed approach to construction projects but comes with its own set of challenges and limitations. Choosing this method depends heavily on the specific needs, scope, and context of the project.