Owner’s Involvement in Preliminary Stage of Real Estate Development Project Case Study in Vietnam

What is the main involvement of owner in managing real estate projects while hiring outside consultants during the preliminary stage and how they can manage and monitor these design consultants effectively to achieve the best quality for their projects. It is important to explore the roles and the responsibilities of owner involving decision making in every stage of project development with outsourcing strategy.

Mr. Truong Thai Binh made a case study to design a guideline for owners who do not have enough experience and in-house resource to develop property. His study was carried out to increase a better understanding of owners’ roles and responsibility in developing construction projects.

The objectives of his study were: (1) identify project life cycle and real estate project development procedure, particularly for real estate projects in Vietnam; (2) based on project life cycle, investigating the involvement of owner in every stage of project development, especially in Design phase; and propose recommendation for improvement of project management guideline for managing, controlling and monitoring.

Conclusion

Role and Responsibilities of Owners

A successful project begins with the owner. In general, the broad responsibilities of the owner on construction projects include two major factors that contribute to a quality project. The first is the development of complete and realistic requirement and objectives for the project. By communication and coordination, the second factor is to provide a thorough understanding to other team members of the role and responsibilities of the owner. Besides that, the owner is also responsible for providing adequate financing for the entire project and making prompt payment to team members.

Owner also plays an important role of making a decision in every step of the projects development, particularly in preliminary phase. The key indicators for the owner to consider before making any decision in every step of preliminary phase are given in the table below:

Recommendation

Recommendations are suggested based on the case study and the literature review.

a) The most common causes of the construction problems were the lack of coordination and insufficient drawings. Solution for these problems is the involvement of the Owner and Design Professional at the design and development phase. Their participation will reduce the risks as they help all parties to understand the actual requirements and minimize conflicts between parties to achieve better designs.
In order to reduce the conflicts in the construction project, it is recommended to have a good communication channels among the Owner and other parties to establish a good coordination.

b) To assure the quality management in the design phase of construction projects, the Owner should have a good training program for his/her employees. Training on the job is a good method to help employees become more professional.

Reasonable investment in the design staff will have good effects on the creativity in the Owner project management. The most appropriate skilled, experienced staff should be selected for each project.

c) The Owner should ask for the help of Architect or Designer in formulating the final brief. By working closely with them, the Owners should also help to establish a valuable dialogue and ensure that the Owners have a clear understanding about creative references, functional needs, roles and responsibilities.

The Owners should never be afraid to change their minds at this formative stage of the project. Design briefs often evolve so that the final brief is quite different to the original brief. The important thing is to get it right at this stage because design changes later in the project have the potential to undermine the integrity of the overall design, delay the project and add to the cost.

The Owners empower the Architect or Designer to do what they do best with the potential to deliver a project quite literally beyond the Owners’ comprehension. This can be considered as the pre design phase.

d) It is important to integrate design quality in the overall quality of the project – procurement process, leadership, project team and continuous improvement. Good design will:

- Make a positive addition to the location, the environment and the community;
- Add value and reduce whole-life costs;
- Create built environments that are safe to construct and safe to use;
- Create flexible, durable, sustainable and ecologically sound environments for the community;
- Minimize waste of materials, energy and pollution both in construction and in use;
- Be attractive and healthy for users and the public;
- Contribute to construction that is quick, safe and efficient;
- Produce facilities that are easy and cost effective to manage, clean and maintain.
[Source: Better Public Buildings]

His thesis abstract is copied and posted.

ABSTRACT

Today, with more than 86 million people, Vietnam is one of the potential real estate markets in Southeast Asia. For such reason, there is a great need for professional project management skill, particularly for owners and investors in Vietnam. Therefore the subject of this study is to identify the owner’s roles in managing his projects. This owner organization is established in 2002 and has been working as property investor for almost 7 years. The organization is located in Ho Chi Minh City. The managers are those who do not have enough experience and acknowledgment in real estate and, particularly in construction industry. Important part of this study is to develop a brief guideline to identify the roles and responsibilities of the owner in project investment and management.