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10 Advantages of Architect-Led Design-Build

Ten Penny Construction teams with Gontram Architecture to deliver commercial projects via the Design-Build process.  Our unique process of architect-led design-build makes our Clients’ lives simpler by providing design and construction from a single source. The fact that we are architects and contractors gives our clients the distinct advantage of early budget confirmation, and the virtual elimination of surprises, delays, change orders, and cost overruns.

In the traditional Design-Bid-Build process, clients hire an Architect, who then designs the dream project for the Client.  It is then put out to bid to multiple general contractors, who provide a price, that may or may not be within the project budget, but is guaranteed to be ripe with potential change orders, surprises, and budget busters in the end.  It is a contentious process that puts the Owner between the design team and the construction team if a conflict arises, with multiple parties pointing fingers at each other.

In the Architect-led Design-Build process, everything is provided to the Owner thru a single-source, team approach.  The Architect and General Contractor work together from Day One to provide a successful project, within an initial budget, within the time allotted, and with no surprises.  And with a single source for design and construction, the owner doesn’t need to worry about playing referee.

At Ten Penny Construction, we make the complicated and stressful process of commercial design and construction predictable, economical, and enjoyable.  We’d like to help you with your project!  You can find out more about our process by downloading our FREE GUIDE.

Enthalpy Analytical Expansion Nearing Completion

In 2000, one of the very first projects Gontram Architecture and Ten Penny Construction delivered using the Architect-led Design-Build method was the Connor Properties Lab and Office Building in Durham, NC.  The anchor tenant for that 20,000 sq. ft. building was Enthalpy Analytical, a laboratory that specializes in analyzing for pollutants and other constituents in air, soil, water and tobacco products.

Since 2000, Enthalpy Analytical has grown several times.  Most recently in 2011, they added a 2nd location.  Each time, Enthalpy contacted Gontram Architecture and Ten Penny Construction to facilitate its growth.

Now, Enthalpy Analytical is consolidating its operations in one location, expanding into adjacent tenant space and adding laboratory space.  Once again, Gontram Architecture and Ten Penny Construction are coordinating the effort through Architect-led Design-Build for a streamlined approach to the design and construction process.

An interesting element of the project is the construction of a steel platform behind the laboratory space.  This platform will support a 3000-gallon liquid nitrogen tank, and hold it up 2 feet above the floodplain, as required by FEMA and Durham Floodplain Management. It will end up being 9’+ above the ground, weighing over 37,000 pounds when full!

…all in the name of science!

New Sales Tax rules in NC for Construction Projects

In North Carolina, the General Assembly has been actively pursuing ways to decrease personal income taxes.  In order to help pay for those reductions, they have boosted sales and use tax for personal services over the past year or two.  Service and maintenance businesses had been lumped in to that group, but this year, it has expanded even further.

Color_Seal_300dpiAs of January 1st, 2017, North Carolina made certain construction projects A LOT more complicated.  NC issued new rules for sales and use tax for projects that are classified as “Repair, Maintenance and Installation” (RMI) projects.  According to the NC Department of Revenue (NCDOR), a general contractor that performs “repair, maintenance, and installation services” on or after January 1, 2017 is liable for and should collect sales or use tax on the sales price of or the gross receipts derived from repair, maintenance, and installation services.

Prior to January 1st, a general contractor would pay sales tax on materials they purchase to do the work, and would then invoice the customer without charging sales tax.  Now, for projects such as minor building repairs and cosmetic upgrades, contractors may purchase materials tax free, but will have to charge sales tax (6.75% to 7.5%) on the entire project, materials and labor included.

ncdorFrom the NC Department of Revenue, examples of Repair, Maintenance and Installation (RMI) projects include:

  • HVAC repair for an air conditioning or heating unit that is not working properly.
  • Rekey locks for real property by a locksmith.
  • Repair of a water pump motor.
  • Repair to correct a jammed garage door.
  • Electrical repair due to a light switch or receptacle not working properly.
  • Plumbing services to unclog a drain.
  • Plumbing services to identify and repair a leak in a pipe.
  • Services by a roofing company to identify and repair a roof leak.Money
  • Replace damaged exterior bricks.
  • Replace or repair of a storm door or garage door.
  • Repair or replace countertops.
  • Replace or reface kitchen cabinet doors.
  • Repair or replace a water heater.
  • Repair of a liner for a swimming pool.
  • Repair or replace a single light fixture.
  • Carpet or linoleum install for a single room.
  • Repair or replace single plumbing fixture (i.e. toilet or sink).
  • Replacement of plate glass window.

So, for contractors that mostly do real property improvement projects (capital improvement), the state has issued a certification form (Form E‐589CI) that should be completed for every project, and signed by the Owner, that effectively certifies that the project is NOT and RMI type of project.  This signals to everyone that NO sales tax will be collected for the project.  This will help when NCDOR comes calling for sales tax.

Some more detailed examples:

  • Example 1:  A homeowner hires a handyman service to repair an area of damaged bathroom tiles. The handyman service purchases replacement tile, grout, and sealant exempt from tax by issuing an exemption certificate to the retailer as these items are for resale and will be
    transferred to the customer’s property. The handyman is a retailer and is liable for and should collect sales tax on the total sales price of the repair, maintenance, and installation service.
  • Example 2: A homeowner hires a home improvement business to reface outdated kitchen cabinets. The project requires the home improvement business to replace the exterior cabinet doors, drawer fronts, and cabinet handles. The charge by the home improvement business to the homeowner is $2,500.00. Based on the scope of work, permits are not required to be obtained by either the homeowner or the contractor. This transaction is not a capital improvement nor considered remodeling and is, therefore, not taxed as a real property contract. Rather, the transaction is subject to sales tax as repair, maintenance, and installation services and the contractor is liable for and should collect the general State, applicable local, and applicable transit rates of sales and use tax on the sales price of $2,500.00.
  • Example 3: A homeowner hires a general contractor to convert an attic space into an additional living space. The conversion will involve the reconfiguration of the house’s truss system, the installation of a dormer window, additional plumbing, electrical wiring, framing, and new insulation. The general contractor will secure the applicable permits required by the State Building Code and all work will be inspected by the appropriate local government inspections department. The transaction is a real property contract for new construction with respect to a capital improvement and subject to sales and use tax as a real property contract. The general contractor, as real property contractor, is liable for sales and use tax on the purchase price of all tangible personal property (building materials, etc.) to fulfill the real property contract. The general contractor must issue Form E‐589CI, Affidavit of Capital Improvement, to any subcontractor that is hired to perform any portion of the real property contract, provided a “blanket” Affidavit of Capital Improvement is not already on file with the subcontractor issued from the general contractor. If a subcontractor is not hired to perform any portion of the conversion, no Form E‐589CI is required to be issued or completed by the general contractor.
  • Example 4: A homeowner decides to update the homeowner’s kitchen. The activities include the following: installation of new kitchen cabinets including cabinet boxes, tile, flooring, interior walls painted, and a new sink. Upon completion, the appearance of the room is substantially different. The transaction is remodeling.

As always, there will be some gray areas.  It will take some time for general contractors and customers alike to get used to the new rules.

In North Carolina’s continuing effort to shift the tax burden, they have tried to simplify the rules, but have introduced many levels of complexity to businesses and customers that are not accustomed to dealing with sales tax.  Granted, the majority of typical design-build projects will not be affected.  However, the process of determining compliance is placed squarely on the contractor.

For some more information, check out the following:

http://www.dornc.com/practitioner/sales/directives/SD-16-4.pdf

http://www.wral.com/sales-tax-changes-taxing-for-consumers-contractors/16403517/

NC School Boards Association Assembly Hall gets facelift

The North Carolina School Boards Association building in Raleigh is home to numerous office tenants along with the Association that represents public school personnel.  On the ground floor of the building is a large Assembly Hall that is used for group meetings and conferences.

Assembly Hall

Assembly Hall – Before

The room was in desperate need of an upgrade, and Ten Penny Construction came equipped to propose material options, discuss pricing alternatives, and perform the work in less than 2 weeks time.

The project involved various sheetrock repairs, new carpet tiles, new wallcovering, new ceiling tiles, new LED lighting with a lighting control system, new ceramic tile, new paint, and re-installation of their photo display millwork.

The entire room and two common corridors were upgraded as part of this project.

ncsba_assembly_after1

Assembly Hall – After

GEM&J Coatings gets a new Spray Booth

Business is booming in the truck bedliner business!  The owners of the car wash and truck bedliner application building in Raleigh, NC needed more application bay space and contacted Gontram Architecture and Ten Penny Construction to design and build their upgrades.  Their existing spray area was not keeping up with demand, and was further limited by the way it was constructed.  Larger trucks had to be turned away.

So, in stepped Gontram Architecture and Ten Penny Construction.  In a few short months, the project was designed, permitted, and constructed under a turn-key design-build arrangement so popular with our clients nowadays.

gemj-demo

Demo underway as the existing door opening is enlarged

An existing storage bay was converted for use as a spray booth.  An existing overhead door opening had to be enlarged substantially to accommodate the larger vehicles.  A new non-combustible spray booth and chemical storage room were constructed within the existing building.  New ventilation, lighting and power were also required.

The seemingly simple project was made much more complicated by the NC Building Code, the NC Fire Code, existing conditions within the building, and the interpretation of hazardous chemical requirements by the local jurisdiction.  But, permits were successfully obtained on the first try and construction was completed in a timely manner, with only minor delays (thanks to Hurricane Matthew).

gemj-beam

New beam for enlarged door opening is welded in place.

Michael Jordan Collision – 20

Lots of hard work coming together in the last few weeks of the Michael Jordan Collision Center project in Durham, NC.

Work recently completed includes VCT flooring, ceramic tile, cabinetry, ceiling tile installation, and more.  On the exterior, the front driveway entrance and concrete tie-ins  were poured, and the fire line and domestic water line work was completed.

This coming week, we will install doors, toilet partitions/accessories, plumbing fixtures, and other last minute touches in preparation for final inspections.

On the exterior, the front driveway entrance and fire line will be inspected, fencing work completed, and landscaping may be installed.

This project is being provided to the Owner through the Architect-led Design-Build project delivery method with Gontram Architecture, Inc.

Michael Jordan Collision – 19

Coming down to the last few weeks of the Michael Jordan Collision Center project in Durham, NC.

Work recently completed includes prime paint, ceiling grid, lighting, ductwork, above ceiling inspections, and more.  On the exterior, the rear drive was poured, and the fire line and domestic water line work was cleaned up.

Finishing touches underway include ceramic floor and wall tile, painting in Body Shop area, ceiling tile installation, and others.

Next week, we will see VCT flooring installed, cabinetry, and plumbing fixtures. The last bit of fire sprinkler work should be completed next week as well.

On the exterior, the front driveway entrance will be repaired, fencing work completed, and landscaping may be installed.

This project is being provided to the Owner through the Architect-led Design-Build project delivery method with Gontram Architecture, Inc.

Michael Jordan Collision – 18

Another busy week just ended at the Michael Jordan Collision Center project in Durham, NC.

Interior finishes are well under way.  Walls have been finished and sanded, so prime paint is going on.  Wall angle and hanger wire for the suspended ceiling grid is also installed.  And, ceramic tile work has begun in the restrooms.

On the exterior, the fire line work finished.  As-built drawings are being completed and should be ready for submittal to Durham Public Works for final review shortly.

The stone base is complete for the rear access drive. Formwork has been installed, and over 200 cubic yards of concrete will be poured by the end of the weekend.

This project is being delivered to the Owner via the Architect-led Design-Build process with Gontram Architecture, Inc.

Michael Jordan Collision – 17

We are coming down to the wire at the Micheal Jordan Collision Center project in Durham, NC. With a month to go, work is at a fever pitch.

After a week or so of bad weather, work has picked up again on the rear drive installation.  geotechnical reinforcing fabric and stone base has been placed, and will be prepped for concrete and poured next week.

The fire line installation is also nearing completion.  The tap was made last week, and there has been much flushing and testing of the line happening this week before the final connections can be made.

Sprinkler work on the inside is nearing completion on the Lower Level.  Upper Level work will start next week.

Sheetrock finishing is complete and we are readying for ceiling grid, lights, painting and floor finishes to start next week.

This project is being provided to the Owner thru the Architect-led Design-Build process with Gontram Architecture, Inc.

Michael Jordan Collision – 16

Work on the inside of the building progressed now that the fire protection permit was released.  Work on the outside, however, was stymied by wet weather, again.

Installation of the high sprinkler pipe is well underway and away from the office area.  Sheetrock installation was complete by the end of the week, with sheetrock finishing activities due to start on Monday.

Permanent power was also installed late in the week, so we were able to turn on the new CREE LED high bay light fixtures in the Body Shop area.  Emergency light fixtures were also installed.

On the outside, even with the wet weather, we were finally able to make the fire line tap into the public water main.  This was delayed because it required shutoff of several valves given the existing condition of the main.

Next week, work will hopefully continue on the rear driveway once the rain clears.

This project is being provided to the Owner thru the Architect-led Design-Build process with Gontram Architecture, Inc.

Michael Jordan Collision – 15

Progress picked back up this week after substantial weather and jurisdictional delays attempted to delay the Michael Jordan Collision project in Durham, NC.  Several inches of rain have fallen in the last week and a half hampering fire line and rear driveway construction.  Also, the fire sprinkler permits had been in some sort of weird computer limbo at the City of Durham, but we finally have that straightened out.


This past week, the subgrade of the new rear service drive was proof-rolled, and unsuitable soils were discovered.  Several feet of undercut was required in several areas.  A strategy of geotech fabric and compacted stone base will provide a stable base upon which to pour our new concrete service drive.

In the front of the building, installation of the fire line continued.  Due to existing conditions of the actual water main, it was determined that the tap couldn’t be installed with the water main live.  So, a temporary shutdown of the local water service is scheduled for next week.  In the meantime, the new fire line is installed from the building to the road, and has been pressurized and flushed.

Perforated metal panels were installed on the face of the new canopy.  This will provide the background for the new signage.

This project is being provided to the Owner thru the Architect-led Design-Build process with Gontram Architecture, Inc.

 

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