The City of Newport Beach has been in need of a new city hall building for a number of years. During the past decade, the City even had a preliminary plan to rebuild at the site of the current city hall on the Newport Peninsula.
Then, in February 2008, Newport Beach voters narrowly approved local ballot Measure B which called for “City Hall in the Park.” The citizen-led measure wasn’t about whether or not to build a new city hall, rather, it focused on where to build a new city hall. Measure B said that Newport Beach City Hall should be located on a vacant, City-owned parcel located next to the Central Library in Newport Center. The City had been saving the site for a future park.
Measure B’s passage directly impacted the scope and the cost of the future city hall project:
- It meant locating a large City facility to an area of town where parking was already at a premium. With the Central Library being “underparked”, the solution was to add a large, 450-space parking structure costing about $7.5 million.
- It placed a significant building in or near a view corridor with protected views from MacArthur Boulevard to the ocean. This necessitated excavating the site and placing the building and parking structure well below the view plane, costing about $8 million for excavation and the construction of a large shoring wall near MacArthur.
- It took an open space area and developed it. New laws regarding construction on certain sites require that all rainwater be captured on site and naturally treated before the water is discharged into the bay or ocean. This stormwater protection program added about $2 million to site costs.
- Sitting one public building behind another without providing some link or second entrance between them made no sense. It was determined that a connection was needed between the Central Library to the City Hall and Park.
- Library patrons and library administration had long noted that the well-used Central Library needed more study areas and an expanded children’s programming area. The expansion of both, as well as the link to the rest of the civic center, added about $12 million in total construction costs to the project (more when soft costs are added).
- Community arts and cultural representatives asked for a large community room in the city hall building, one that would allow expansion of programs like the Distinguished Speakers Lecture Series, art shows and lectures, and more. This 150-person capacity room is now in the City Hall building, adjacent to and expandable with the City Council Chambers.
- Measure B was marketed as “City Hall in the Park.” The park itself is the community’s fifth largest park at over 12 acres. The construction cost of the park is over $15 million, counting grading, wetlands bridges, 1.5 miles of trails, an off-leash area for dogs, viewing areas, and more.
- Voter approval of Measure B set in place the pathway to the current project. More information about that pathway follows.
2008 & 2009: CITY HALL TO A CIVIC CENTER – DESIGN & DECISION PHASE
Following the vote, many in the community said, “If we’re going to build a city hall there, let’s make it a true civic center – a gathering place for all of the community, one that even the people who just wanted a park there will like.” After voting to indeed build a new city hall building and a community park on the Newport Center site, the City Council approved hosting an international design competition and formed a design committee of local architects to guide the competition.
What community needs should be addressed with the project? That was the question in 2008 and 2009. Many voiced their opinions – community members, library users, dog park supporters, and more. With the economy in recession, construction labor and materials prices were falling too. Central Library patrons didn’t have enough parking and the library itself had need for greater children’s programming, second floor restrooms, and more study areas. Another large community room could help accommodate more arts and cultural programs. The park envisioned by Measure B opponents and proponents needed to be built. With costs so low and an empty parcel, it was a great time to address all of those needs.
During the course of a dozen public meetings, the Design Committee set forth a new vision for the Civic Center – one with 12 acres of community park space, an expanded Central Library, a parking structure, and a modern, energy-efficient city hall office building. This expanded vision was set forth in Design Parameters, which the city adopted on May 13, 2008.
The Design Competition drew more than 50 submittals from architects based in the U.S. and around the world. The submittals were reviewed and gradually winnowed to five. Each of the five architectural finalists received $50,000 to develop concept plans for a civic center. The Design Committee held an all-day public meeting on September 27, 2008 to review each proposal.
In November 2008, the City Council approved the Committee’s final recommendation and selected Bohlin Cywinski Jackson (BCJ) to design the Civic Center. At about the same time, the City chose private-sector construction manager C.W. Driver after a qualifications-based selection process to build the project.
The City, BCJ, and C.W. Driver began going through the “Concept Design,” “Design Development” and “Construction Documents” phases of the project, keeping the City Council, Design Committee, and public advised on the project’s overall scope. Project cost estimates for the total project (“all-in” costs – soft, hard, everything) brought to the City Council in November 2009 showed a top end estimate of $139.2 million, depending on economic trends, use of contingencies, insurance losses/claims, and whether some elements (like the pedestrian bridge) were in or out at the end of the project.
Building each of these components individually would have been time consuming, costly (with separate design and management for each project), and inefficient in terms of keeping necessary facilities open and accessible. So, after more than two years of public meetings – with public input and media coverage - held about the scope of construction desired, the City Council agreed to build a community park, a parking structure, a library expansion, a new City Hall, and more.
CONSTRUCTION MANAGER AT RISK
The City contract with private-sector C.W. Driver is a “Construction Manager at Risk” (CMAR) agreement. CMARs are commonly used in project construction. A qualified firm, like C.W. Driver, sits at the table with the project owner and architect during the design process, offering ideas to improve constructability and save resources. Then, as construction documents are completed and plans issued, the Construction Manager competitively bids each trade – steel, glass, concrete, landscaping, plant material, utilities, more. The bids are opened in a public setting, with low qualifying bids selected. Then each selected bid is wrapped into the Construction Manager’s overall contract with the project owner.
The “at risk” part of the CMAR means that the construction manager pledges to bring the project in at the cost of its contract – no more. Cost overruns become the contractor’s responsibility (unless due to a delay or scope change not under the contractor’s control).
2010 & 2011 – EARLY CONSTRUCTION
Excavation and the shoring wall started before the final plans were complete in May 2010 and was an $8 million expense assigned to C.W. Driver. September 2010 saw the start of the parking structure’s construction - a design build contract (with Bomel Construction) at $7.5 million. At the conclusion of the city hall, park, and library expansion design process and after opening all bids in public in December 2010, C.W. Driver was set to begin construction of the remainder of the project.
By February 2011, the City-C.W. Driver total construction cost contract amount was about $106.5 million and included all construction activities (parks, parking structure, city office building, library expansion, excavation), a construction contingency, 3.25% profit for C.W. Driver, and some insurance. Total construction costs exclude “soft costs” like the design fees to architects, the EIR, other insurance, fees, inspection, furnishings, and the “owner’s contingency.” Because a cost is called “soft” doesn’t mean it’s inexpensive – most estimators say that soft costs can be up to 25% of a project’s total costs.
|Total Construction Costs (TCC) Construction with C.W. Driver|
|Mass Excavation and Shoring Wall||$||
|Parking Structure (450 spaces)||$||7,500,000|
|Park (both parcels, dog park)||$||15,000,000|
|Library Addition and Repair||$||12,000,000|
|City Hall, Council Chambers, EOC||$||62,000,000|
|Pedestrian Bridge over San Miguel||$||2,000,000|
|Total Construction Costs||$||106,500,000|
ABOUT THE PROJECT: A MODERN, CUSTOMER-CENTERED CITY HALL
The old city hall complex on Newport Boulevard, with elements dating back to 1947, is a maze of four buildings and three office trailers. Persons visiting City Hall to get a building permit often go to two or three different buildings, each with a different queue. Parts of the complex are not ADA compliant. Other parts are seismically unsafe. The various buildings and trailers each have individual heating and air conditioning units, increasing energy and maintenance costs. Parking for customers is limited to a limited number of free spaces in the small parking lot or to metered on-street parking.
The new city hall building has plenty of free parking. It also has a Permit Center, with all customer permit needs in one place. Technology will help reduce wait times, walk distances, and allow more to be done online. The new City Hall also has the community’s first disaster preparedness room, safely built in the bottom floor in one of the building’s five bays.
The building may secure a LEED Gold rating, with advanced climate controls, advanced lighting, raised floor HVAC systems, and takes advantage of the local climate to use shading, openable windows, and venting to cut utility costs between 13 and 24 percent (per US Green Building Council studies). The LEED certification also provides environmental and sustainability benefits such as reduced greenhouse gas emissions, conservation of water and energy, and a healthier building environment which results in less sick days and improved productivity.
The exterior of the building looks expensive – and it is more expensive than a “tilt up” or stucco concrete building. The steel and glass, the exterior surfaces, and the wave patterned roof all were more expensive than stucco.
The exterior utilizes quality building materials that will provide a design life that is superior to standard construction. The design appears to be elaborate, but is very functional in nature. The north facing clerestory windows work with the wave form roof that channels the natural westerly wind to cool the building. The oversize overhangs shield the interior spaces from solar heat gain while the glass permits maximum usage of natural light. These exterior design features work together to minimize energy use and maximize energy savings.
But the exterior shell hides a functional yet inexpensive interior. Standard materials were used inside the building. The work stations are finished plywood. The furnishings are standard-sized, “off the shelf” file cabinets, chairs, plan holders, and more from common vendors (Hayworth, the winning bidder). The restrooms are of ceramic tiles and regular water-efficient fixtures. While the technology cabling and data center is new and modern, the “old” city hall’s computers and phone system gets moved over across town to the new workstations. The raised flooring added to the interior cost, but has an energy-efficient payback. Energy savings is projected to be $85,000 per year over a traditional new building.
ABOUT THE PROJECT: COMMUNITY AMENITIES
Just as the Council and the Design Committee discussed in 2008 and 2009, the Civic Center is a place for the community to gather, use, and serve. A two-acre “civic green” centers the library expansion, the city hall, and the parking structure as a place for art shows, town celebrations, plays, and more. The 12 acres of park space includes 1.5 miles of trails with bridges across an existing wetlands, children’s elements, picnic and view areas, and the community’s first dog park.
The Community Room accommodates 150 people, with room for another 150 in the Council Chambers. The rooms combine to be a lecture hall, a display area for art, a place for community and neighborhood meetings, and for family celebrations by reservation. The parking structure has 450 spaces – enough to accommodate employees and visitors. A small “grab and go” cafe space between the library and the Civic Green meets the needs of library patrons and visitors to City Hall or the parks for breakfast, lunch, coffee, or an afternoon snack.
The library expansion adds 17,000 square feet of space to the highly-used library, adding more room for study groups and a greatly expanded children’s area. Second floor restrooms, a new media lab, and an art storage area fill out the new library space.
ABOUT THE PROJECT: BRIDGE OVER SAN MIGUEL DRIVE
As the project was under construction, in November 2011, the City Council added a pedestrian bridge over San Miguel Drive to the project, adding $2 million to the total cost of the Civic Center project. The bridge has three key benefits: It links the parks together to encourage users to utilize the entire site; it prevents users from having to cross San Miguel at an intersection (and slow down traffic at already busy intersections); and it provides one of the best view sites of the entire park.
HOW WAS THE PROJECT FUNDED?
As noted, by November 10, 2009, when the Council was nearing its decisions regarding all project elements, estimators gave an upper end estimate of the entire project – start to finish, all costs (including the design competition, the EIR, more) at about $139.2 million (estimate).
The City issued Certificates of Participation (COPs) of $123 million in November 2010 to fund a majority of that amount, intending to cash-fund the remainder using reserve funds saved for that purpose. About $1.5 million had been reserved in an Information Technology fund for the buildings’ IT needs. The COPs took advantage of a federal Build America Bonds subsidy, saving about $21.6 million over time. The COPs are paid for using a combination of reserve funds saved for construction purposes, a percentage of the City’s General Fund, and contributions from developers. This is described in the City’s Facilities Financing Plan (FFP), a public document that describes the city’s facilities replacement needs over the next 30-plus years.
Was this the best time to complete a project this big? Today’s market indicators say yes. An economic downturn often sees low bond rates, low labor and material prices, even low transportation costs.
Based upon the industry building indexes since 2010, our project could cost 15 to 20% more ($8-21 million) if we bid the project today. The change in the ENR Building Cost Index from May 2010 to now is 7.5% ($8 million). The California Construction cost index has risen 7.36% ($7.8 million).
During the nearly three-year construction phase starting in May 2010, hundreds of change orders were studied, with 66 approved to date. Total change orders as of this date are $1.33 million, or 1.25% of total construction costs. While the project is not yet done, our goal has been to stay at or below about 2.75%, which is the same level of change orders as the OASIS Senior Center. The below chart highlights some of the larger single change orders, with smaller ones categorized together – many have been at or below $5-7K each.
|Change Order Item||Amount|
|Window and Lighting Controls (CCO #4)||$||134,618|
|AV Modifications, Shelving (CCO #3)||$||35,001|
|Revised Surface for Dog Park (CCO #2)||$||10,964|
|ADA Ramp Modifications (CCO #1)||$||12,269|
|Electrical and Lighting (multiple items)||$||250,493|
|Landscaping and Site (multiple items)||$||271,666|
|Architectural (multiple items)||$||611,842|
|Current Total Change Orders (est)||$||1,326,853|
|Change Orders as a % of TCC||$||1.25%|
How does this compare with other projects? Industry-wide, a typical change order percentage is about 5%. The following chart shows change orders as a percentage of construction costs for some other projects:
|Civic Center Project (NB) - Goal||2.75%|
|OASIS Senior Center (NB)||2.75%|
|City Hall - City of Laguna Niguel||4.74%|
|Victoria Gardens Cultrual Center, Rancho Cucamonga||6.00%|
|Roger Rowe School, Rancho Santa Fe||3.90%|
|Bass Pro Store, Rancho Cucamonga||24.00%|
Please note that some change orders are pending as of the time of this writing. Again, the City’s goal has been to stay at or below 2.75%.
The project was intended to be completed in December 2012. The April 2013 move-in date means that the project’s construction has taken 34 months, not 31 months.
As noted, the Civic Center project has some expenses that are unique:
- Protecting the View. Starting in May 2011, the site underwent a massive $7 million excavation with another $1 million in shoring to keep the City Hall and parking structure from blocking public views from MacArthur Boulevard.
- Investment in Energy Efficiency. The raised-floor system, and other green building improvements in the City office building is a nearly $1 million expenditure in itself, but helping with long-term energy savings, up to $85,000 per year starting in 2013-14 and growing each year for the life of the building.
- Water Quality Protection. Updated laws from the State of California required an advanced rainwater capture system - adding about $2 million in expenses, with pipes and special drainage across the site, ending with a capture and treatment system in front of the Central Library.
- Inspections and Plan Check. We decided not to use City plan checkers and inspectors to inspect this one-of-a-kind building. Doing so could have distracted from the City plan checkers’ daily duties – and that would have delayed residents’ home remodeling projects. Given the buildings’ construction materials and the groundwater history of the site, we also added extra inspection protocols for steel and for waterproofing. These special services added about $3 million to the “soft” costs.
- Quality Insurance. Before construction, the City made a purposeful decision to enact a $3 million “Owner-Controlled Insurance Program” (OCIP) to supplement C.W. Driver’s insurance. We did so because of this project’s complex scope and construction style. The project has been remarkably accident-free.
OTHER OFFSETTING COSTS
Several more categories of costs now applied to the Civic Center Project were investments that the City would likely have had to make regardless of the project. These amount to about $3 million and include:
- Some of the Furnishings. In the mid-2000s, the City made a purposeful decision to stop purchasing most new furnishings and to stop improving or investing in significant maintenance at the old city hall site. As a result, many furnishings in the old city hall site date back to the 1970s and 1980s. A portion of the $2.5 million that furnishes and equips the new City Hall building was due for expenditure in the old building, but foregone.
- Surprises at the Library. When the contractor opened the back of the Central Library building to work on the expansion, three construction defects were discovered dating back to 1992, the year the Central Library was built:
- The clerestory windows facing north, which leaked for years, had been installed incorrectly ($700K).
- The stairway to the second story was built in a different place than the original plans showed, which required its complete reconstruction rather than a simple modification ($250K).
The flooring was poured unevenly, leading to variances of more than 2 inches in some places ($50K).
- Information Technology. The City has recently ramped up its investment in technology to allow us to provide better, easier, more transparent services. About $829,000 of the IT amount attributed to the project is hardware or software or audio-visual equipment that would have been installed at the old or new City Hall.
|Offsetting Costs - Costs Incurred whether or not Civic|
|Fixing the Library Clerestory Windows||$||700,000|
|Other Central Library Repairs (stairs, floor)||$||300,000|
|IT Upgrades and Replacements||$||829,000|
|Replacement of Old City Hall Furnishings||$||1,500,000|
|Total Offsetting Costs||$||3,329,000|
THE PROJECT TODAY
The project was completed in April 2013. The final cost of the Civic Center and Park total about 140.2 million, if costs (hard construction costs, soft costs, environmental review costs, insurance and inspections, and more) from 2008 through 2013 are taken into account. When completed, the Civic Center and Park:
• Was the result of over 100 public meetings and Council actions, as well as a public vote on Measure B, the action that in effect moved City Hall’s operations from the Peninsula to the current site.
• Was communicated to our residents via meetings with service clubs, HOAs, business associations, and mailed community newsletters 13 different times between 2008 and 2013, newsletters that went to every residence and business in the City (about 54,000 separate addresses).
• Took advantage of a large downturn in the economy to build five needed different projects in one, saving millions had the five been built separately. These projects were:
o An expansion of the Central Library
o A City Hall, with a community room, Council chambers, a “one-stop” permit counter and disaster preparedness center.
o A 15-acre park, including a Civic Green, a dog park, and new landscaping around the Library.
o A pedestrian bridge to easily link two sides of the park.
o A 450-space parking structure, 100 of which are for the Library.
• Took over four years – from planning to completion – to build and occupy.
• Was privately managed by a well-known construction manager (CW Driver), and had all elements of construction go out to public bid, where the lowest qualified bidder got the job.
• Excavated 200,000 cubic yards of material, all to sink the buildings below a view plane.
• Had over 700 change orders, most small in magnitude, but resulting in 6.1% of the total project cost (about in line with industry norms).
• Has been used and enjoyed by residents, visitors, and the city employees who work here.