Defense Advanced Research Projects Agency, Headquarters
Arlington, Virginia, United States
Next Century Partners LLC, Century Plaza
Los Angeles, California, United States
Project Summary
MGAC worked directly for Next Century Partners, LLC on their mixed-use restoration and redevelopment of the hotel, a 17-story historic landmark, into the Fairmont Century Plaza Hotel and the ground-up construction of two 46-story high-rise residential towers, retail shops, and restaurants. It represents approximately 2,000,000 SF of development. The project had multiple funding sources, two distinct loans, five GMP packages, multiple bid packages, and a fast-track schedule for the design and negotiation of trade contracts with the construction manager.
MGAC's Role
MGAC was enlisted to conduct an independent cost review of the concrete package executed by the general contract. MGAC worked on this project for over five years, where we meticulously analyzed all costs, recommending competitive bidding strategies that yielded substantial savings. Subsequently, MGAC undertook a comprehensive cost estimate for the entire project, validating the initial guaranteed maximum price (IGMP) while identifying potential cost discrepancies. Transitioning from impartial advisors to proactive partners, we collaborated closely with stakeholders to realign budgets, mitigate risks, and safeguard against further cost escalations.
Challenges
Understanding the complexity of the project and the need to minimize cost exposure from claims for additional costs after the GMP was signed, MGAC developed a flexible cost management system that supported timely data analysis and financial reporting, allowing our client to make strategic decisions about the project’s scope of work, design quality, and revenue projections. This was achieved in a series of structured steps for each change order which included reviewing change orders for entitlement based on review of GMP contract documents, trade level signed agreements, and other relevant documents; assuming entitlement was justified, reviewing the scope and value of the change order, including assessment of all labor, material, and equipment costs; providing recommendations to NCP; assisting in presenting our recommendations to the subcontractor and negotiating a fair and reasonable settlement; and tracking all negotiated change orders by trade.
