The Central Government Real Estate Agency contracts commercial enterprises to develop, manage and maintain buildings and systems. We make use of various types of contract in such cases, depending on the nature and scope of the agreement concerned.
Traditionally, many contracts cover a single aspect of property, for example maintaining the electrical system or the lifts in a building. That is gradually changing, with a growing trend towards integrated contracts. Such contracts cover multiple disciplines, for example lifts, electricity and climate control, and structural matters. Contracts can also cover multiple phases of a building or site project, for example development, construction, maintenance and management.
The Central Government Real Estate Agency assesses and monitors the performance of contractors in accordance with the contracts. We review the results of assignments as well as the contractor’s working methods and client focus, for example by means of the Past Performance tool.
Traditional contract types
Many of the contracts awarded by the Central Government Real Estate Agency cover a single aspect of property. For example, there may be separate contracts for maintaining the electrical and climate control system or the lifts, or for property development, construction and management.
Increasingly, the Central Government Real Estate Agency has been working with integrated contracts. An integrated contract covers multiple disciplines, for example lifts, electricity and climate control, and structural matters. It may also cover multiple phases of a building’s or site’s life cycle. For example, there may be a single contract covering development, construction, maintenance and management. There are different types of integrated contract, including DBM, DBFMO, and main contracting.
DB and DBM contracts
A DB or DBM contract encompasses multiple phases of a building’s life cycle: the ‘Design, Build’ phases (DB) or the ‘Design, Build, Maintain’ phases (DBM). The Central Government Real Estate Agency is exploring options for awarding DB and DBM contracts.
The most common integrated contract awarded by the Central Government Real Estate Agency is the DBFMO contract type. DBFMO stands for ‘Design, Build, Finance, Maintain and Operate’. In other words, we contract out all of these tasks to a single private party.
In a DBFMO contract, the client and the contractor can cut costs by ensuring better coordination between the various project phases. Coordination of this kind is also conducive to good quality accommodation and long-term use.
The Central Government Real Estate Agency is running a trial with main contracting in property management and maintenance. In main contracting, we conclude an agreement with a single contractor, known as the main contractor. The main contractor manages and maintains one or more buildings. The contract is usually valid for a period of eight to eighteen years.
Public-Private Partnerships (PPP)
In the case of large-scale projects, the Central Government Real Estate Agency generally works on the basis of public-private partnerships (PPP). In a PPP, the various project phases are clustered into a single request for tender and a single contract. We work with the contractor for a longer period of time, for example on the design, construction, management and maintenance of an office building. The client is paid on the basis of completed performance.
PPP contract types
There are various types of PPP contracts, including DBFM, DBFMO and alliance contracts. In the latter case, the Central Government Real Estate Agency participates in a project with other parties (e.g. architects and building firms). In other words, we are simply one of the project participants.