CON 4144

HONG KONG INSTITUTE OF VOCATIONAL EDUCATION

(TUEN MUN)

ENGINEERING DISCIPLINE

DEPARTMENT OF CONSTRUCTION

Higher Diploma in Building Studies

CON 4144

By

Choi Wai Lun 210388710

Lam Ho Yan 210259696

Lee Kwan Fan 210359530

Cheng Nga Yee 210268367

Lung Siu Fung 210280621

Project Supervisor: Mandy So

Jul 2024

Contents
1. Project Orientation 3

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1.1 Introduction 3

1.2 Site Information 3

3. Procurement Strategy 4

3.1 Good procurement strategy and approaches 5

3.2 Essential considerations for procurement strategy 6

3.3 Procurement options available in Hong Kong 7

3.4 Characteristics of the client 7

3.5 Characteristics of the project 7

(2) 5

(3) 6

4. Contracts Administration
1. Contractual Administration and Documents
2. Standard Form of Building Contract (General Conditions of Contract)
3. Amendments to the Standard Form of Building Contract (Special Conditions of
Contract)
4. Variations of design and instruction
5. Certificates and Payment
6. Contractor’s Claim (Extension of Time, Liquidated Damages, Loss and Expenses
etc.)
7. Final Account
8. Defects Liability Period
Reference

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1. Project Orientation

1.1 Introduction

Our company appointed to re-develop this old residential estate into a new building

development. The project site is 105 Austin Road & 1A Tak Shing Street, Tsim Sha

Tsui. The site is currently being used as a Pak On Building residential estate.

New Composite Development (Figure 1)

1.2 Site Information

Pak On Building is located at 105 Austin Road, Jordan, Kowloon. The Occupation date

starts from January 1963. It consists of 1 building with a total of 109 residential units.

There is good public transport, and it is about 2 minutes' walking distance to MTR.

The site area is 1379m². The land Registry is Lot No.11008.

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Land Leases (Figure 2)

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Zoning and Land Use - Outline Zoning Plan

OZP Plan (Figure 3)

Height

Most of the land in Tsim Sha Tsui East, i.e., the area bounded by Chatham Road
South, Cheong Wan Road/ Hong Chong Road, and Salisbury Road, has been
developed into hotels and purpose-designed commercial buildings for office and
retail shop uses. To allow penetration of prevailing wind from the east to the inner
area of Tsim Sha Tsui, which is poor in air ventilation, the maximum building height
restrictions for sites to the southeast and northwest of Mody Road in Tsim Sha Tsui
East are, in general, capped at 80mPD and 95mPD respectively to achieve a stepped
height profile descending towards the waterfront.

Class B Site

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(Figure 4)

Gross Floor Area (GFA) Concessions

Subject to the special circumstance of each case and compliance

with the pre-requisites (for all items except item (e)) and the overall
cap on GFA concessions (for items (a) to (b) only) stipulated in PNAP
APP-151, the Building Authority (BA) is in general prepared to
consider favourably application for modification of regulation 23(3)
(a) of the B(P)R in respect of:

a. Chimney shafts;

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b. Filtration plant rooms for swimming pools in hotels or for water

features in communal gardens/ landscape area;

c. A room of a size not exceeding 1.2m(W) x 1.2m(D), housing

satellite master antenna television equipment in accordance with
paragraph 33 of PNAP APP-42;

d. Genuine and properly designed pipe-ducts/ air ducts with

adequate access for inspection and maintenance which from part
of the distribution network for non-mandatory feature or non-
essential plant;

e. Genuine and properly designed pipe-ducts/ air ducts with

adequate access for inspection and maintenance which from part
of the distribution network for mandatory feature or essential
plant; and

f. Plant rooms for environmentally friendly systems and features

such as rainwater/ grey water recycling system and battery room
for solar panels.

RESIDENTIAL (GROUP A)

Site Survey

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(Figure 5)

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, Aerial, and Topography etc.

Government Lease - General Conditions and Special

Conditions

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7. Condition

8. Adjacent Properties and Land Use

9. Site Constraint / Other related issue(s) to be considered

1. Professional Conduct
1.1. The architect`s practice in Hong Kong
Hong Kong is a city with few land and many people, so architects in Hong Kong
need to design buildings that use space efficiently, and most of the buildings are
high-rise or super-high-rise designs. The appearance is also a very important part of
the design, architects need to design visually attractive, because Hong Kong is an
international city, the design style will be a combination of Chinese and Western
style. In addition, due to the increasing problem of global warming, most recent
buildings will focus on sustainable design, so architects need to consider this part of
the design, such as: using solar energy, using energy efficient equipment or reducing
carbon emissions. As technology continues to evolve, architects also need to learn to
use different software to improve the efficiency and accuracy of design and
construction and enhance interaction with clients, such as BIM and VR/AR. Last but
not least, the problem of old houses in Hong Kong should be dealt with. Since Hong
Kong has a long history and many old low-rise buildings need to be rebuilt, the

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architect's needs to deal with more renewal and renovation or revitalization of old
buildings.

1.2. Role of Architect`s, Authorized Persons, Engineers, other parties associated

with the industry and types of practices
For the architect, he is primarily responsible for the design, planning and
supervision of buildings, ensuring that the design meets regulatory and functional
requirements. On the design side, it is necessary to provide innovative and beautiful
design with a focus on sustainability and user experience. In addition, they need to
coordinate various professional engineers and consultants and supervise the
construction process to ensure that the quality of the works meets the design
standards.
For the structural, electromechanical, civil and other professional engineers,
they are responsible for providing professional technical support and calculation and
design, construction and testing of various professional systems of buildings
according to the architect's design scheme.
For the Authorized Persons(AP), he is a professionally qualified person
recognized by the Government and is responsible for overseeing the entire
construction process to ensure that the building design and construction comply
with statutory building regulations and standards.
For other industry participants,
 Project management consultant: provides management services
throughout the project life cycle.
 Building Surveyor: responsible for project budgeting, contract management
and cost control.
 Urban Planner: formulating overall urban development plans and land use
policies.
 Property developers: develop real estate according to market demand.

For other industry participants,

 Architectural design company: specializing in architectural design and
consulting services.
 Engineering consulting company: Provide professional engineering
technical support.
 Building contractor: responsible for the construction and management of
building works.
 Property management companies: provide building operation and
maintenance services.
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 Government departments: develop regulations and standards and approve

construction projects.

1.3. Contract relationship between professional consultants

Contractual relationships among various professional consultants in the
construction industry in Hong Kong,
The first is the relationship between the architect and the engineer, the
architect as the main consultant of the project and responsible for the overall design,
while the engineer as the professional consultant, according to the architectural
design to provide professional technical support. They need to work closely together
in the design, construction and supervision process. In the process of cooperation,
the architect and the professional engineer usually sign a subcontract to clarify the
relationship between rights and responsibilities.
The second is the relationship between the architect and the project
management consultant, who provides professional services for the management of
the entire project, including drawing up the project plan, monitoring the progress
and cost, coordinating the parties, etc. Architects need to work closely with project
management consultants to promote the implementation of the project. In the
process of collaboration, the architect and the project management consultant
usually sign a subcontract.
The third is the relationship between the architect and the building surveyor,
who is responsible for the project budget, contract management and cost control,
while the architect needs to provide design information and collaborate with the
building surveyor for cost control. In the process of cooperation, the architect and
the building surveyor are usually signed by the owner of a separate contract.

3. Procurement Strategy
3.1. Good procurement strategy and approaches

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RISK OPERATIONAL
COST QUALITY DURATION
MANAGEMENT EFFICIENCY

A good procurement strategy and method is very important for this project,
because it will affect the cost, quality, time limit for construction, risk management
and the operational efficiency of the building.
For cost control, according to the different stages and needs of the project, it is
very important to develop a better procurement plan, a good procurement plan can
not only achieve batch and centralized procurement, but also control the effect of
the appropriate amount of material inventory.
For the quality of the project, the purchase of high-quality building materials,
equipment and professional subcontractors can ensure the quality of the project.
The selection of suppliers requires careful evaluation, including the formulation of
supplier admission criteria, consideration of their production capacity and product
quality, and reference to their work references and integrity records. After
screening, a small number of suppliers are left, and then site visits and sample tests
are conducted on them to select more suitable suppliers. Good building materials
and after-sales service can greatly improve the quality of the project.
In a good procurement strategy, in order to reduce the construction period, it is
necessary to identify the key materials and equipment that affect the construction
period, such as prefabricated components, mechanical and electrical equipment, etc.
In addition, purchase as early as possible, confirm the arrival time in advance and
appropriately increase the buffer inventory to reduce the delay in the construction
progress due to material shortage.
A good procurement strategy should include a risk management mechanism,
because there are many uncertainties in the procurement process, such as price
fluctuations, supply disruptions or material quality decline, the procurement strategy
should take these factors into account and develop solutions in advance, so as to
maximize the project schedule and cost control within or better than expected
There are many equipment and systems that need to be used for a long time in
the building, such as public lighting systems, elevators, HAVC, etc. When purchasing
the above equipment, you can choose equipment and systems with high energy
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efficiency, low carbon emissions and high durability, thus saving energy and
maintenance costs.

3.2. Essential considerations for procurement strategy (Client resources, project

characteristics, possibility to make changes, risk management, cost and quality
issues, construction time, certainty of cost)
There are many aspects to consider when developing a procurement strategy,
the first thing to consider is customer resources, and it is necessary to fully
understand the customer's financial status and budget, so as to develop a
procurement plan that matches customer resources. At the same time, it is also
necessary to understand the needs and preferences of customers for equipment,
whether customers are willing to accept innovative technologies or processes,
because it is not ruled out that some customers do not accept innovative technical
products, such as sweeping robots, energy-saving lamps or energy-saving elevators,
so it is necessary to fully communicate with customers when formulating
procurement strategies.
The second point to be considered is the characteristics of the project, which
consists mainly of low-rise shopping malls and clubs and multi-storey residential
buildings with parking lots. Although the complexity of the project is not high, it also
has its own project characteristics, such as the high repeatability of building
materials for residential buildings, so it can adopt the general contracting or joint
procurement mode, while shopping malls and clubs adopt the flexible mode of
subcontracting or self-sourcing.
The third thing to consider is the change in the design of the project, the
design of the project may change, so before making the procurement plan, it is
necessary to communicate the details of the project as deeply as possible to
minimize the situation of design change. However, it is also necessary to discuss with
the customer that if the design does change, it should be notified immediately.
When planning a purchase, contingency funds should also be set aside to deal with
unexpected design changes.
The fourth is risk management. In the procurement strategy, most of the risk is
caused by the supplier, because the supplier may have default or non-delivery,
quality problems of the goods, late delivery, etc. Therefore, the most basic is to
carefully select suppliers, and then add risk management programs into the
procurement strategy, for example, in the contract signed with the supplier, clearly
specify the delivery conditions, acceptance standards, liability for breach of contract,
etc., in addition, it is necessary to develop emergency plans for key risks

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The fifth is the need to consider the cost and quality of the purchased goods, in
the basic case of meeting customer requirements, choose the best cost-effective
products, including reference products to meet specific standards or service life
The last thing to consider is the certainty of the cost, because building materials
will fluctuate due to market conditions, so in order to ensure the certainty of the
cost, you can set a fixed price with the supplier for the building materials that need
to be ordered in large quantities, and sign a contract to ensure that the cost of the
project is not too different from the expected. This project needs a lot of building
materials, steel bars, concrete, interior decoration materials and home appliances....
And the signing of the above contract, there is a chance to order a large number of
building materials, and be able to obtain a more favourable price in the hands of
suppliers.
According to the above detailed analysis, a procurement strategy needs
multiple considerations, and the more consideration, the greater the gain for the
project, the more able to avoid the project faced with procurement risks.

3.3. Procurement options available in Hong Kong

Common procurement options in Hong Kong include;

Open Tendering
Selective Tendering
Negotiated Contracts
Term Contracts
Design-Build Contracts
Public-Private Partnerships
Open tender is one of the most commonly used procurement methods in Hong
Kong. Tenders are invited by means of public tender announcements, and owners
are allowed to evaluate and select tenders in accordance with established tender
evaluation criteria, so as to identify the successful contractors and enter into
contracts. Therefore, it is a highly transparent procurement method that effectively
ensures competitive prices and reliable quality. In addition, it is the most regulated
procurement method, so it is fully compliant with the relevant government
regulations.
Selective tendering a form of invitation to tender in which the client/owner
invites a certain number of pre-selected contractors to participate in a bidding
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competition, then evaluates the bids according to established bid evaluation criteria,
identifies the winning contractor, and signs the contract. It is more suitable for
professional or complex projects, because the pre-selected contractors are screened,
and the professionalism of the project will be higher. On the other hand, due to the
small number of contractors participating in the tender, this helps to improve the
quality and efficiency of the tender.
Negotiated contract is a contract negotiated directly between a client/owner
and a specific contractor. Such purchases are usually used for special or emergency
situations. While this avoids time-consuming and complicated bidding procedures,
prices are determined without competition.
Term contracts are long-term cooperation agreements between
customers/owners and contractors, mostly for maintenance, minor engineering
projects or repetitive works.
Design-build contracts are procurement methods that combine Design and
construction work into a single contract. First, the owner/client will determine the
needs and objectives of the project, and then select the contractor through bidding.
Finally, the owner/client is mainly responsible for the supervision and acceptance of
the project. This is usually used in projects with high engineering complexity.
Public-private partnerships are partnerships between the Public and Private
sectors, typically for public infrastructure and public services.
At the procurement level, the project is mainly divided into three parts, the first
part is the demolition works, the second part is the underground B1/F and B2/F car
parks with a total height of about 7 metres, while the third part is the above-ground
shopping mall, residential and public areas, etc.
It is considered that design-build contracts and open tenders will be used for
the project. First, a design-build contract is adopted for the second-floor
underground car park, considering:
1) The geographical environment of the project is relatively complex. Close to
the subway and residential buildings, the noise and dust generated by excavation are
easy to affect nearby residents.
2) In addition, the station can only rely on the narrow lanes in front and back of
the station to enter, which will make it easier to accept complaints during traffic
jams.
3) The Hong Kong government has strict control over the development of
underground Spaces and various regulations and standards need to be met before
construction can begin. However, the pre-construction approval process is complex
and requires multi-departmental coordination.

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4) The geographical environment of the project is in a busy city, and the

relocation of underground pipelines may be involved in the process, and the
arrangement of ventilation and drainage needs to be handled, which is a big
technical challenge
Therefore, using a design-build contract for the construction of part of the
underground car park allows for the integration of design and construction
responsibilities into the same team, reducing the risk for the owner. On the other
hand, since the design and construction are the responsibility of the same team, it
can be better coordinated and optimized to achieve better results.
Another part is used for demolition works, shopping centres and residential
buildings. Since this part of the construction process is more common and the risk is
low, the method of open tendering is adopted. Because the proposed construction
of the upper level is relatively simple, more contractors can be attracted to
participate in the bidding, so that the most suitable contractor can be selected. This
ensures competitive prices and reliable quality.

3.4. Characteristics of the client

The client choice of Pak On Building in Tak Shing Street, Tsim Sha Tsui as the site
for the C&D project was a enterprising choice as the adjacent environment was very
restrictive. However, after careful evaluation, the client still chose this site as a
development project, showing that the client has a certain level of experience and
confidence in the project.
First of all, if the customer has relevant experience or professional knowledge of
the project, it is very helpful for the construction process of the project, because the
more clear the requirements or purposes of the customer, the more smooth the
design or construction of the site will be. In addition, when it comes to design or
construction decisions, clients can make decisions faster, increasing project fluency
and reducing the chance of repeated modifications.
The second question is whether the customers of this project can accept
innovative practices, such as the use of new materials, the increase of renewable
energy, the use of building information modelling (BIM) technology, because it
cannot be ruled out that there are some customers in the market who only accept
traditional buildings and are not willing to adopt new technologies.
The third item is about the client's budget, because all the design and
construction of the project are based on this cost to formulate construction methods
and materials. If the budget is sufficient, the design space will be larger, and the
quality of the building will be improved.

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Finally, the active participation of the client in the project can create a good
communication bridge with the contractor, thus improving the coordination of the
project, which can better enable the building to meet or exceed the client's expected
standards.

3.5. Characteristics of the project

This project is a large-scale demolition and reconstruction project: a
professional demolition company is required, and demolition and reconstruction
work is handled by different companies. And the original building is an ordinary old
building, so it can be completely demolished and rebuilt, but the site is small and the
surrounding environment is sensitive: more stringent safety and environmental
protection measures are needed in the process of demolition and reconstruction.
The functional positioning of the buildings to be demolished is roughly the same as
that of the new buildings to be constructed, except that there are two more storeys
of underground car parks and shopping malls, and there is no functional change, so
the required preliminary research work can be reduced.

4. Contracts Administration
4.1. Contractual Administration and Documents
In this project we will chose Design & Build Contracts for the contractual
administration. A design-build contract, sometimes called a design/build, D-B, or D/B
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contract, is a project delivery system often used in construction. While the

traditional approach to construction requires contracts with two separate entities, a
designer and a contractor, a design-build contract combines these two entities, so
only one company is responsible for the designing and building contract for a
project.

Design-build contracts save time and money and can prevent situations where an
owner may be caught in the middle of a dispute between a contractor and a
designer. With this kind of contract, the designer and the contractor work together
from the beginning of the project as a team.

Some advantages that owners enjoy from a design-build contract include:

Unified project recommendations
Collaborative problem solving
No blame-shifting between designer and contractor
One point of responsibility
Savings in time and money
Design-build contracts are becoming more popular to tackle home building and
remodel projects while saving time and money.

4.2. Standard Form of Building Contract (General Conditions of Contract)

4.3. Amendments to the Standard Form of Building Contract (Special Conditions of

Contract)

4.4. Variations of design and instruction

4.5. Certificates and Payment

Stage A - Preliminary and Inspection Stage

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1. Review and on-site survey of the existing site. Investigate available data of
information relating to the project and are relevant to the planning and structural
engineering works including retrieval of record plans form Building’s Department,
Site measurement, etc.
2. To provide and submit the Inspection Report which includes the findings.
3. To provide master project program for review and approval of the Employer.
4. To provide estimated budget in accordance with the inspection result and
Employer’s consideration.
5. To provide professionals’ advices and recommendations to the Employer on
issues raised during the feasibility stage.

Stage B – Design and Tender Stage

1. To provide develop the design, requirements and sets of drawings showing all
works.
2. Work with the Employer for establishing all necessary tender information and
specifications including but not limited to all tender drawings and specifications,
construction / installation methods, materials specification and requirements,
schedule of rates (SOR), etc. so that the Employer is capable to prepare for the
whole set of tender documents and complete the whole tendering process.
3. Depend on the Employer’s requirements, prepare different sets of tender
documents for various trades of works such as builder, or others.
4. To attend the Employer’s meetings and site visits for presentation of the tender
documents.
5. To carry out pre-qualification exercise of tenderers, and recommend list of
competent tenderers for Employer’s approval.
6. To invite tenderers for the works and reply the queries from the tenderers.

Stage C – Comprehensive Project Management Stage

1. Co-ordination and liaison with contractors / consultant of other trades as
appropriate; and / or other departments of the Employer; government
departments / public utilities to facilitate work progress at site during the whole
course of the project.
2. Arranging and minute site progress meeting as well as meeting at the premises
of the Employer and preparing progress report to be made available to the Employer
upon request.
3. Prepare and monitor the overall project program with the awarded vendors and
their submission schedule.

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4. To prepare, provide all necessary detailed information and construction

drawings for the whole rectification work to all involved parties.
5. To be responsible for verifying the drawings, materials, method statements,
materials delivery schedule, testing and all other measures, etc. submitted by the
vendors and provide corresponding advice to the Employer.
6. Carrying out regular site inspection (at least weekly), site safety walks sand
supervision of the construction work to monitor / report the site progress, overall
program, materials quality, workmanship, record and follow up defects to be found
and provide all necessary information or resolution for site related matter.
7. Monitoring and controlling of the contractor’s work progress to ensure that the
works are completed within the specified period and budget.
8. Checking and evaluating any variation requests from contractor.
9. Attending the testing and commissioning, and factory tests of the installation /
equipment and endorsing and compiling results in clear written format.
10. Checking and certification of the interim and stage payment applications
submitted by the contractor.
11. Collecting as-fitted drawings, Operating & Maintenance manuals, statutory
certificates for the installation (if any) and other relevant documents from contractor
and / or other organizations, government departments in connection with this
project prior to handover inspection to the Employer.
12. Checking against & endorsement on the as-fitted drawings and Operating &
Maintenance manuals submitted by the contractor before arranging handover
inspection to the Employer.
13. Issuing Practical Completion certificate to the contractor when the installation,
testing & commissioning, as-fitted drawings, and Operating & Maintenance manuals
are in order.
14. Preparation of defect list upon practical completion of the project.
15. Monitoring of the defects rectification work and ensuring the defects are
rectified within the Defect Liability Period.
16. Monitoring and ensuring the satisfactory final handover of the installation to
the Employer.
17. Checking and certification of the final account submitted by contractor.
18. Provide package of project close-out report and finalizing all required
documentary works including but not limited to as-fitted drawing, manuals, testing
results and all other relevant documents mentioned above to the Employer.
19. After 1-year DLP, the Consultant had to carry out final site inspection with
vendors. The Consultant is responsible to follow with vendors for clearing all defects
and outstanding items.
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Programme of Assigned Services

The Assigned Services divided into three independent stages. Consultant may be
appointed for any one stage of the services. Each stage of Assigned Services will not
be considered as complete until the occurrence of the corresponding events listed
below:

Ite Description Amount (HK$)

m
1 Service Fee for completing Stage A:

2 Service Fee for completing Stage B:

3 Service Fee for completing Stage C:

Total Sum for the above Item 1-3:

Moreover, the Employer has the right to award any one or more stage(s) of three of
the Assigned Services separately to the Consultant.

Payment Terms
Payment is to be made upon completion of each work stage with following breakdowns:

Payment Stage % of Total Fee Amount (HK$)

Preliminary Stage: Upon Completion of the Preliminary
1
and Inspection Report
Design and Tender Stage: Upon Completion of analysis and
2 Report of the site information, the Detailed Design and
upon the issuance of Tender
Comprehensive Project Management Stage: Upon
3a
Completion of Site Work Practical Completion
Comprehensive Project Management Stage: After 12
3 months DLP (incl. final site inspection with vendors and
b complete the follow-up on ALL defects rectification and
outstanding items)
Total Sum for the above Items:

4.6. Contractor’s Claim (Extension of Time, Liquidated Damages, Loss and Expenses
etc.)

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Liquidated Damage

No extension of time except for inclement weather or the subsequent effects of such
inclement weather or additional works incurred by the Client by issuing of written
notice that are not specified in this contract executed, is allowed in this tender and
the liquidated damage shall be 0.25% of the Contract Sum or HK$20000 per working
day whichever is higher will be imposed should there be any delay in the completion
of the installation work. For the purpose of this clause, inclement weather is defined
as rainfall in excess of twenty mini-metres in a twenty-four hour period (midnight to
midnight) as recorded in the Hong Kong Observatory or the hoisting of Typhoon
Signal No. 8 or above and critical works have been physically hindered. The
Contractor is required to submit in writing the request of extension of time within 7
calendar days after the inclement weather or the receipt of written instruction, to
the Client for consideration and approval. After the specified period, any claim for
the extension of time shall not be entertained.

4.7. Final Account

4.8. Defects Liability Period

12 months defects liability period from the date of issue of Practical Completion
Certificate by the Client shall be allowed. In the event that defects are arisen due to
the poor workmanship and material during the defect liability period, the Contractor
shall remedy and rectify the said defects to the satisfaction of the Client. The
Contractor shall include all relevant costs incurred for satisfactory completion of the
defect rectification.

Defect liability for any substantial part(s) requiring replacement, renewal or repair
shall be counted from the date of acceptance of such replacement, renewal or repair.

In case of latent defects, provision of Limitation Ordinance CAP 347 applied.

Reference

Midland Realty

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https://www.midland.com.hk/en/estate/Kowloon-Jordan-Pak-On-Building-E06866

Integrated Registration Information System (IRIS)

https://www2.iris.gov.hk/eservices/searchlandregister/result.jsp?
__fbsID=1715965874809

CAP123F

https://www.elegislation.gov.hk/hk/cap123F!en

Outline Zoning Plan

https://www.ozp.tpb.gov.hk/

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