Title
Phoenix Sky Harbor International Airport Terminal 3 North Concourse 2 Processor Improvements - Construction Manager at Risk Services - AV13000004 (Ordinance S-52144) - District 8
Description
Request to authorize the City Manager, or his designee, to enter into an agreement with Hensel Phelps Construction Co. to provide Construction Manager at Risk Preconstruction and Construction Services for the Phoenix Sky Harbor International Airport Terminal 3 North Concourse 2 Processor Improvements project. Further request to authorize execution of amendments to the agreement as necessary within the Council-approved expenditure authority as provided below, and for the City Controller to disburse all funds related to this item. The fee for services will not exceed $125 million.
Report
Summary
The purpose of this project is to improve the Terminal Processor and Baggage Handling System (BHS) at Phoenix Sky Harbor International Airport Terminal 3. This project consists of modifications to the passenger check-in process, improvements to BHS operations, and providing additional passenger security screening checkpoint (SSCP) capacity.
Hensel Phelps Construction Co. will begin in an agency support role for Construction Manager At Risk Preconstruction Services. Hensel Phelps Construction Co. will assume the risk of delivering the project through a Guaranteed Maximum Price agreement.
Hensel Phelps Construction Co.’s Preconstruction Services include, but are not limited to: provide pre-construction services team to deliver a complete project; perform all preconstruction services for design phase to assure conformance with requirements; investigate and evaluate existing conditions and project constraints; protect the City’s sensitivity to quality, safety, and environmental factors; assist the design team with efforts to identify private and public utility easements; validate LEED goals and incorporate the Aviation department's sustainability initiatives; collaborate with the owner and design team during the design phase to validate and synchronize the scope, budget, and schedule to meet project requirements; provide detailed cost estimating, validate milestone deliverables, and reconcile with 3rd party construction cost estimates for each design phase milestone; provide project planning, scheduling, and assist in the permitting processes; provide construction phasing and scheduling that will minimize interruption to City operations; initiate procurement of long-lead items; identify Guaranteed Maximum Price (GMP) proposal package strategy and present alternate strategies to optimize sequence of construction; attend all project and team meetings as necessary to maintain the project objectives; prepare all reports for distribution to executives and stakeholders; perform design/constructability review of design documents at milestone review period; perform value engineering / cost reduction efforts to optimize project budget; and participating with the City in a process to establish a Small Business Enterprise (SBE) goal for the project.
Hensel Phelps Construction Co.’s initial Construction Services will include preparation of a Guaranteed Maximum Price proposal provided under the agreement. Hensel Phelps Construction Co. will be responsible for construction means and methods related to the project and fulfilling the SBE program requirements. Hensel Phelps Construction Co. will be required to solicit bids from prequalified subcontractors and to perform the work using the City’s subcontractor selection process. Hensel Phelps Construction Co. may also compete to self-perform limited amounts of work.
Hensel Phelps Construction Co.’s additional Construction Services include: construct the Phoenix Sky Harbor International Airport Terminal 3 North Concourse 2 Processor Improvements project; bond and insure the construction; provide quality controls and maintain site safety personnel from preconstruction through project closeout; notify the City of any unsafe conditions observed at the construction site; obtain required As-Built documentation to establish existing conditions; conduct field surveys/inspections and prepare reports to ensure compliance with the project plans and specifications; coordinate with various City of Phoenix departments, other agencies, and utility companies to meet all project requirements; prepare time-scaled logic construction schedule, and update throughout project duration; participate in Operational Readiness Activation and Transition meetings and provide any supporting documentation, as required; perform reviews and provide input on LEED and sustainability evaluation criteria relative to City standards and Aviation Department goals; provide itemized cost detail as required in support of proposed potential change notifications and change orders; provide coordination and resources to achieve Transportation Security Administration acceptance/approval for BHS Site Acceptance Testing, Pre-Integrated Site Acceptance Testing, Test Readiness Review, Integrated Site Acceptance Test, and all other BHS testing or commissioning by all agencies, departments, designers, and consultants; prepare and submit punch list and record documents for design team review/approval; prepare closeout submittal log with metrics; participate in the 11 ½ month warranty inspection; maintain all project records in electronic format; and provide construction services team to deliver a complete project.
Procurement Information
The selection was made using a qualifications-based selection process set forth in Section 34-603 of the Arizona Revised Statutes (A.R.S.). In accordance with A.R.S. Section 34-603(H), the City may not publicly release information on proposals received or the scoring results until an agreement is awarded. Seven firms submitted proposals and are listed below:
Selected Firm
- Rank 1: Hensel Phelps Construction Co.
Additional Proposers
- Rank 2: Hunt Construction Group, Inc. dba AECOM Hunt
- Rank 3: Hoffman Construction Company of Arizona
- Rank 4: The Weitz Company, LLC
- Rank 5: Chasse Building Team, Inc.
- Rank 6: Sundt Construction, Inc.
- Rank 7: Austin Commercial, LP
Contract Term
The term of the agreement is five years from issuance of the Notice to Proceed. Work scope identified and incorporated into the agreement prior to the end of the term may be agreed to by the parties, and work may extend past the termination of the agreement. No additional changes may be executed after the end of the term.
Financial Impact
The agreement value for Hensel Phelps Construction Co. will not exceed $125 million, including all subcontractor and reimbursable costs.
Funding is available in the Aviation Department's Capital Improvement Program budget. The Budget and Research Department will separately review and approve funding availability prior to execution of any amendments. Payments may be made up to agreement limits for all rendered agreement services, which may extend past the agreement termination.
Concurrence/Previous Council Action
The City Council approved Professional Services Agreement 162467 (Ordinance S-51627) on February 5, 2025.
Location
3400 E. Sky Harbor Boulevard
Council District: 8
Department
Responsible Department
This item is submitted by Assistant City Manager Inger Erickson, Deputy City Manager Mario Paniagua, the Aviation Department and the City Engineer.