A handbook for improving real estate project delivery in Malaysia : analysis, comparison and selecting the best method

Abstract

The real estate and construction sectors are very important and integral part of the Malaysian economy. At a macro-level, governmental development plans in Malaysia are based on successive five year plans since 1956. For each of the five year plans, the real estate and construction sectors feature prominently in terms of value and policy implementation. The budget for the five year plans is in relation to public sector expenditure and does not include private sector initiatives. As regards real estate project delivery methods in Malaysia, the most common form is the traditional design-bid-build method. The design-build method is getting some acceptance of late, whereas infrastructure projects do adopt the build-operate-transfer method. This thesis seeks to classify, analyze and compare the various types of delivery methods and thereafter examine whether there is a methodology for selecting the best delivery method in Malaysia. Each delivery method, apart from actual project delivery itself, entails different apportionment of project risks between the owner and contractor. Choosing the right delivery method can lead to project success, whereas selecting the wrong delivery method invariably leads to project failure.

(cont.) For the private sector in Malaysia, the owner can pretty much choose the most commercially viable project delivery method. However, for the public sector, there are political and policy considerations, and rules and regulations which may affect the choice of project delivery method. As a developing country, there is much that Malaysia can learn from the US and other developed countries which are more advanced and experienced in terms of project delivery methods, construction and engineering.