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Design-build delivery method crosses 50 percent threshold on major projects

Sources: Design-Build Institute of America (DBIA), Washington, D.C.; CP staff

Research indicates that more than half of construction projects above $10 million are being completed through design-build, the highest level yet for the delivery method offering an alternative to traditional competitive bid-build. A new DBIA report, “Design-Build Project Delivery Market Share and Market Size,” also finds that use of design-build had remained steady since a growth spike at the end of the last decade, and remains especially high in military projects.

“The growing use of design-build is not surprising,” says DBIA Executive Director Lisa Washington, CAE. “Throughout the last five years, and even through the recession, we’ve seen a large increase in demand for information and training on design-build best practices. Owners have been turning to design-build delivery because they recognize the inherent value it brings to any project in any sector of any size.”

The use of design-build in the nonresidential market spiked from 29 percent in 2005 to 36 percent in 2008. Throughout the recession, adoption of the delivery method continued to grow; with the economy stable and slowly recovering, use of design-build has held steady at around 40 percent the last three years.

Reed Construction Data/RSMeans Consulting analyzed detailed data on nearly one million construction projects state by state, noting design-build most prevalent on the West Coast. States where owners and contractors deploy the delivery method at the highest rate are Oregon (70 percent), California (59 percent) and Washington (56 percent). Military agencies use design-build on 81 percent of major projects. Even without such work factored, Oregon remains the top state for design-build due to multifamily residential and industrial sectors. Farther east, Michigan has especially shown widespread adoption of the project delivery method.

“[Our] segmentation analysis now includes nine complete years of actual history, statistically supporting observation of trends at the state and industry sector segment levels,” says Tim Duggan, director of Custom Solutions for Reed/RS Means, one of North America’s largest information providers to the design and construction industry. RSMeans’ proprietary database served as the basis for the study, coupled with other publicly and privately available data sources. Design-Build Project Delivery Market Share and Market Size Report is available for free download.