Schack Institute of Real Estate

Construction Budgets and Financial Management

SU20_COPM1-CE9118001, 19 Credit Hours

Instructor

Allison Robin, Adjunct Professor

Email: adr304@nyu.edu, allison@levienco.com, 646-820-5469

Course Times & Location

Summer 2020: June 1, 2020 – July 6, 2020

This course is asynchronous (AS) which means that it is conducted entirely online through

NYU Classes and you can view the recorded Lessons, Assignments and Forum discussions

at any time each week. However, the course is not self-paced; weekly coursework

must be completed before the next Lesson is released. The Lessons for each week will

be posted by the following dates:

• Class 1 – June 1, 2020

• Class 2 – June 8, 2020

• Class 3 – June 15, 2020

• Class 4 – June 22, 2020

• Class 5 – June 29, 2020

• Class 6 – July 6, 2020

Course Overview

This Construction Management course examines the concepts and techniques of project and

program cost management. Topics include project budget development and management,

cost estimating, procurement strategies, direct and indirect costs, risk and contingency,

billing and payment cycles, change orders, dispute resolution, cash flow management, and

financial evaluation techniques.

The goal of this course is to provide students with the knowledge and confidence necessary

to examine and manage construction project budgets, cost and finances. Upon successful
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completion, students will be armed with a set of fundamental management skills that are

essential to managing construction risk and delivering a successful project.

Effective financial and cost management begins at the very conception of a project and

continues throughout the project life cycle. This course aims to teach students how to keep

costs on track through the project in a proactive way. Discussion will be focused primarily on

the perspectives of the contractor and owner, but will also touch upon cost management of

other project team members and stakeholders. Students will be given the opportunity to

practice using some of the cost management tools, providing hands-on experiences with

industry best practices in financial control.

Course Objectives

This course is designed to provide:

• Thorough understanding of best practice construction cost control methods.

• Understanding of the different phases of the project life cycle and when and how cost

control tools can be applied.

• Understanding of procurement strategies.

• Skills in creating and/or evaluating claims.

• Understanding of how to develop and present financial reports.

• Introduction to current software tools and their use.

• Understanding of performance measurement techniques and reporting formats.

Required Textbooks

This course does not require the use of a textbook. Recommended reading will be provided

throughout the course.

Course Requirements

• Lessons: There will be multiple recordings for each Lesson posted on NYU

Classes. All of the recordings will comprise one Lesson. Each recording will be
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approximately 10-30 min. The sum of recording for each Lesson will not exceed 2

hours.

• Course Material: In addition to the Lessons, other useful resources and

recommended readings will be posted on NYU Classes under the Resources tab.

• Forums: Students are required to participate in Forums on NYU Classes on a weekly

basis. New discussion topics will be posted each week in order to enhance your

understanding of the material taught and to provide an opportunity to interact with

your classmates.

• Assignments: There will be (6) assignments that will supplement the material taught

from each Lesson. These deliverables will reinforce key concepts introduced in the

Lessons and will become valuable resources for future application. Instructions for

each assignment will be included in the final Lesson recording of that week and

posted under the Assignments tab on NYU Classes. Assignments should be

completed before the next Lesson is posted and will be graded on a “check” system

(“checked” for completed, “not checked” for not submitted). A sample response will

be posted in the following Lesson.

Grading Policy

Forum Participation 20%

Assignments (6) 80%

Lesson Schedule – Topics, Assignments & Exams

Lesson 1 (June 1, 2020): Course Overview; Project Team and Lifecycle; Budgeting
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Topics Discussed:

• Introductions

• Course Overview, Goals & Objectives

• Project Team and Organization

• Ability to affect cost through project lifecycle

• Budget vs. Estimate

• “Hard” and “Soft” costs

• Contract Direct cost, General Conditions, Fee and Insurance

Forum Topic: Introductions

Assignment 1: Preparing a project budget (directions posted on the Assignments tab at

NYU Classes)

Lesson 2 (June 8, 2020): Cost Estimating, Procurement and Contracting

Topics Discussed:

• Cost Estimate Evolution

• Contingencies

• Value Engineering

• Consultant Agreements

• Types of Construction Contracts

• Subcontractor Bid List Development and Qualification

• Bid process and leveling

• Allowances, Alternates, Unit pricing

Forum Topic: Exclusions during bidding

Assignment 2: Preparing a bid leveling sheet (directions posted on the Assignments tab

at NYU Classes)

Lesson 3 (June 15, 2020): Cost Control During Construction

Topics Discussed:
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• Project Cost Report

• Schedule of Values

• Billing and Payment Cycles

• Imprest Accounts and deposits

• Retainage

• Stored Materials

• Taxes

• Reporting Requirements for Lenders and Other Funding Sources

• Cashflow projections

Forum Topic: Project management software

Assignment 3 – Prepare an Application for Payment on the AIA G702/G703 (directions

posted on the Assignments tab at NYU Classes)

Lesson 4 (June 22, 2020): Change Management

Topics Discussed:

• Sources of change orders

• Calculating change order costs

• Dispute Resolution

• Backcharges

• Damages

Forum Topic: TBD

Assignment 4: Change order evaluation (directions posted on the Assignments tab at

NYU Classes)

Lesson 5 (June 29, 2020): Risk Management

Topics Discussed:

• Risk Mitigation, Avoidance & Transference

• Insurance, Bonding & Letter of Credit

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• Contingencies

Forum Topic: Risk Management During Bidding

Assignment 5: Preparing a Cost Report – Part 1 (directions posted on

the Assignments tab at NYU Classes)

Lesson 6 (July 6, 2020): Final Project Accounting and Close-out

• Punchlist and Hold-backs

• Backcharges

• Final negotiations

• Retainage release

• Final lien waivers

• Measuring job profitability

• Incentives, Shared savings

• Lessons learned; project debriefing

Forum Topic: Project close-out Strategies

Assignment 6: Preparing a Cost Report – Part 2 (directions posted on

the Assignments tab at NYU Classes)

Academic Integrity and Plagiarism Policy

NYU Schack Institute of Real Estate of New York University strives to promote an ethical

learning environment and wants to ensure that all students understand the concepts of

academic integrity. We see this as an extremely important issue for the students’ time at the

Institute, but also for after graduation. Hence we require that all students familiarize

themselves with the Academic Integrity and Plagiarism Policy as found on the following link:
https://www.sps.nyu.edu/homepage/student-experience/policies-and-
procedures.html
Please read the Academic Integrity and Plagiarism Policy carefully and make sure that you

follow it whenever you submit any work for this course. Also realize that there are a number
 Schack Institute of Real Estate

of penalties associated with violating the Academic Integrity and Plagiarism Policy: they

range from failure for a paper or a course to dismissal from the University.

Technical Requirements & Support

Technical requirements: http://www.scps.nyu.edu/academics/online-offerings/system-

requirements.html

Technical Support: submit your question via the Ask ITS Contact

Form(https://www.nyu.edu/its/askits/contactus/) or call the IT Service Desk at 212-998-

3333, open 24x7 with your technical questions.