M&E PORTFOLIO TENDER
PAS were appointed to undertake the tender of a property portfolio in excess of 1.5 million sq. ft. of commercial offices. For this appointment we adopted a different approach as the client was quite vocal that the current contract was not operating well.
Based on this discussion we conducted a number of workshops with the Client’s property management team. During these workshops we noted the concerns and developed an understanding of the expectations of the management team and the portfolio tenants. This lead PAS to incorporate a bespoke maintenance scope for assets that were frequently failing ensuring they received more intrusive maintenance on a frequent basis.
Following completion of this first stage, we produced a portfolio specific contract addendum document to accompany the Managing Agent’s standard specification.
Our observations during our review of the existing contract was that the salaries of the engineering team were well below industry standards. In addition, there was minimal interaction between the management team and engineering teams. We often inherit contracts where salaries are low but client expectations are high and firmly believe that we must benchmark salaries to ensure they are adequate to both attract and retain the correct calibre of engineers. In consideration of this, PAS set the salaries for the engineering team and implemented six monthly team meetings between the engineering and property management teams to discuss the portfolio and improvements that could be made. In addition to providing a forum to discuss the challenges the engineering team were facing.
We undertook a strategic review when compiling the tender document, opting to utilise the incumbent subcontractors across the portfolio to provide a better service at a more competitive cost. Our view was as the portfolio grows the contract could benefit from dedicated subcontractor resources.
We reviewed the tender returns with a focus on the ITT financials, project mark up and hourly charge rates. This was due to the age of some of the buildings and plant equipment/assets. With regards to the chargeable out of hours rate, savings were secured, coupled with a reduction on project work percentage mark up. The final contract was negotiated with a £1000 semi comprehensive limit per individual occurrence and life cycle expired assets not being excluded from the comprehensive allowance if found in good working order at time of contract commencement.
We also introduced an annual contract review with the client and contractor in attendance, to ensure that the contract was operating as intended for both parties.