Early Steel Release on a Schedule-Critical Medical Office Addition
A 9,600 m² four-story steel-framed medical office building must be substantially complete by week 62 to meet the owner's lease commencement. The critical chain is: 100% construction documents and building permit at week 8; steel released to the mill at permit (22-week delivery); erection 8 weeks; deck and elevated slabs 8 weeks; MEP rough-in 12 weeks; finishes 8 weeks. Steel therefore arrives at week 30 and occupancy falls at week 66. The fabricator can secure a guaranteed mill slot three weeks after release instead of the standard eight if the order is placed at week 2 on 90% documents. Total framing is 520 tons, of which the mechanical penthouse and screenwall framing is about 60 tons; the gravity grid is essentially frozen. Assumed change exposure is 10% of released tonnage at $3,000/ton fabricated and erected. The mill premium is $95,000, and owner delay cost is $38,000 per week.
1. Build the critical path, confirm the delay against the week-62 milestone, and state how much relief the early steel release actually buys.
Read the worked answer
Critical path (finish-to-start, weeks): permit/CDs 8 → steel delivery 30 (8 + 22) → erection 30–38 → deck/slabs 38–46 → MEP 46–58 → finishes 58–66 → occupancy 66.
- Gap to milestone: 66 − 62 = 4 weeks late.
- Steel delivery carries zero float; every week of mill delay is a week of occupancy delay.
- Early release at week 2: delivery = 2 + 22 = week 24, i.e. 6 weeks earlier than week 30. The whole downstream chain shifts: erection 24–32, deck 32–40, MEP 40–52, finishes 52–60 → occupancy week 60.
Relief purchased = 6 weeks, which covers the 4-week deficit and leaves 2 weeks of recovered float. Note that relief only materializes if the follow-on trades (erectors, deck crew, MEP) can be resequenced to the earlier date; confirm crew availability before committing, because a floating start would erase the gain.
2. Compare a full early release with a phased release, quantify each, and recommend a course of action.
Read the worked answer
Option A - full 520-ton release at week 2
- Mill premium: $95,000
- Change exposure: 10% × 520 t = 52 t × $3,000/t = $156,000
- Total exposure ≈ $251,000
- Value of the avoided delay: 4 weeks × $38,000 = $152,000
- Exposure exceeds the delay cost by roughly $99,000; the extra 2 weeks of early delivery carry no contractual reward. Reject as proposed.
Option B - phased release (recommended)
- Release the design-frozen gravity framing (≈460 t) at week 2. Mill premium still $95,000, but the tonnage at risk of change is essentially zero because the bay spacing, column lines and beam sizes are locked.
- Hold the ~60 t penthouse/screenwall package to week 8 with the 100% CDs. It delivers at week 30 and is needed only at the top of the erection sequence (≈week 31), so it does not gate topping-out.
- Total exposure ≈ $95,000 against $152,000 of avoided delay cost → net benefit ≈ $57,000, plus 2 weeks of recovered float.
Decision: phased release. The judgment is to buy schedule only with the portion of the work whose design is genuinely frozen, and to keep the geometry-sensitive penthouse on the normal documentation path where change exposure is zero.
3. What contractual and monitoring mechanisms should protect the owner if the phased early release proceeds?
Read the worked answer
- Owner-directed change order authorizing the early procurement, with the $95,000 premium as a lump sum and a not-to-exceed for subsequent re-fabrication.
- Design-freeze log naming the drawing set and date for each released package; no changes to the released scope without a written change order priced at pre-agreed unit rates ($/ton fabricate, $/ton erect).
- Mill order language: fabrication hold points (detail → cut → fit → weld) so that material can still be redirected if a change lands before cutting; require the fabricator to absorb changes within a stated tonnage tolerance (e.g., 2%).
- Weekly drawing-issue tracking against the freeze dates; a slip in the week-8 set is reported the same week, not at delivery.
- Schedule contingency: hold the 2 recovered weeks as buffer, not as a new milestone date. Report earned schedule weekly so the owner sees whether the 6-week gain is being consumed by downstream trades.