What Is CMAR in Construction in Construction?

In today’s fast-paced and increasingly complex building environment, project delivery methods must balance cost, quality, and schedule. One such approach that has become highly favored for its flexibility and risk-sharing framework is CMAR, short for Construction Manager at Risk.

But what exactly does CMAR in construction in construction mean? Why is this model gaining popularity in public and private sectors alike? This comprehensive article explores the CMAR method—how it works, its advantages and disadvantages, and when it’s most appropriate to use.

🏗️ Definition: What Is CMAR in Construction?

CMAR (Construction Manager at Risk) is a project delivery method in which a construction manager is hired early in the design phase to provide preconstruction services and later takes on the role of the general contractor—guaranteeing that the project will not exceed a predetermined price, known as the Guaranteed Maximum Price (GMP).

✅ The “at risk” part means that the construction manager bears the financial risk for delivering the project within the GMP. If the final cost exceeds the GMP and there are no scope changes, the CMAR is responsible for the extra cost.

This model enables a collaborative planning process, better cost control, and improved scheduling from the start of the project.

🔍 Key Characteristics of CMAR

• Early Involvement: CMAR is engaged during design to offer construction insights.
• GMP Contract: CMAR guarantees a maximum price to complete the project.
• Two Contracts: Owner holds separate agreements with the designer and CMAR.
• Open-Book Accounting: The CMAR provides transparent budgeting and cost tracking.
• Dual Role: CMAR acts as both a consultant (preconstruction) and contractor (during construction).

🔁 CMAR Process: Step-by-Step Breakdown

🛠️ 1. Preconstruction Phase

• CMAR reviews design documents
• Offers constructability suggestions
• Conducts cost estimating and value engineering
• Assists in scheduling and logistics planning
• Helps identify risks and long-lead items

💰 2. GMP Proposal

• Once designs are sufficiently advanced, the CMAR presents a Guaranteed Maximum Price that includes:
  • Labor, materials, equipment
  • Contractor fees
  • Contingency allowances

🚧 3. Construction Phase

• The CMAR becomes the general contractor
• Manages subcontractors and suppliers
• Oversees safety, quality, and schedule
• Delivers the project without exceeding the GMP (unless changes are authorized)

📊 CMAR vs Other Delivery Methods

👷‍♂️ Responsibilities of a CMAR

During Preconstruction:

• Provide cost estimates at each design phase
• Suggest alternate construction methods or materials
• Identify constructability issues early
• Create a preliminary project schedule
• Assist with early procurement planning

During Construction:

• Manage subcontractors through bidding and selection
• Administer construction and logistics
• Ensure safety compliance and quality control
• Track schedule and control costs
• Handle change orders and risk mitigation

💵 Understanding the Guaranteed Maximum Price (GMP)

The GMP is the CMAR’s financial commitment not to exceed a specified total project cost. It covers:

• Direct construction costs
• CMAR’s overhead and fee
• Contingency funds

🔒 If the final cost exceeds the GMP, the CMAR absorbs the loss, not the project owner—unless there’s a change in project scope or unforeseen conditions.

If the actual cost is less than the GMP, the owner may:

• Keep the savings
• Share savings with the CMAR (based on contract terms)
• Allow CMAR to retain the savings

✅ Benefits of Using CMAR in Construction

1. Improved Collaboration

The CMAR collaborates with the design team from the start, resulting in better-informed decisions and fewer costly errors.

2. Budget Security

The GMP provides financial predictability and protects the owner from cost overruns.

3. Schedule Optimization

Projects can be fast-tracked, with portions of construction starting before the full design is completed.

4. Quality and Risk Control

Early risk assessments and constructability reviews improve overall quality and reduce change orders.

5. Transparent Cost Tracking

Owners can monitor costs in real time through open-book accounting practices.

⚠️ Drawbacks of the CMAR Model

❌ Higher Preconstruction Costs

Engaging a CMAR early involves additional upfront services and fees.

❌ Dual Roles May Create Conflict

The CMAR may prioritize construction ease or profitability over owner’s interests unless monitored carefully.

❌ Complexity in GMP Scope Definition

If the scope isn’t clearly defined when GMP is set, disputes can arise.

❌ Requires Owner Oversight

The owner must manage relationships with both the designer and the CMAR, requiring more active participation.

📘 Legal and Contract Considerations

Key contract elements in CMAR projects include:

• GMP terms and breakdown
• Fee structures and contingency clauses
• Open-book accounting provisions
• Change order processes
• Risk and insurance responsibilities
• Shared savings clauses

Standard industry contracts include:

• AIA A133 – Owner/CMAR agreement
• AIA A201 – General conditions

🏫 When to Use CMAR in Construction

CMAR is well-suited for:

• Large-scale projects with complex logistics
• Projects requiring fast-tracking
• Public buildings like schools, airports, and hospitals
• Owners seeking early cost certainty but still wanting design flexibility
• Renovations in occupied or sensitive environments

🎯 Best Practices for CMAR Project Success

1. Hire an experienced CMAR with a proven record in similar projects.
2. Define the project scope clearly before GMP negotiations.
3. Maintain transparent communication between owner, designer, and CMAR.
4. Set expectations for collaboration and accountability early.
5. Monitor the use of contingencies and cost savings regularly.

📚 Conclusion

So, what is CMAR in construction in construction? Simply put, it’s a hybrid delivery method where a construction manager works alongside the design team during the planning phase and then executes the construction within a guaranteed budget. This dual role—consultant and contractor—adds value by improving coordination, cost control, and delivery speed.

For owners who want to retain design control while minimizing budget risks, CMAR provides a structured yet flexible pathway to successful project delivery. While it requires careful contract management and active oversight, the benefits of collaboration, transparency, and financial protection make it one of the most effective project delivery methods in modern construction.

❓ Frequently Asked Questions (FAQs)

Q1. What does CMAR stand for?

A: CMAR stands for Construction Manager at Risk, a project delivery method that blends preconstruction advisory services with a construction role under a Guaranteed Maximum Price (GMP).

Q2. How is CMAR different from a general contractor?

A: A general contractor is hired after design is complete and builds the project for a fixed price. A CMAR is involved early during design and provides a GMP before construction begins.

Q3. Who is responsible if the project cost exceeds the GMP?

A: The CMAR is responsible for cost overruns unless caused by a change in project scope or unforeseen site conditions.

Q4. Can CMAR be used in public sector projects?

A: Yes. CMAR is commonly used in government, healthcare, and educational projects due to its transparency and risk management benefits.

Q5. What happens if the project costs less than the GMP?

A: Depending on the contract, savings may be returned to the owner, shared between the owner and CMAR, or retained by the CMAR.

Q6. What’s the main risk in CMAR projects for owners?

A: If the scope is not clearly defined, disputes may occur regarding what is or isn’t covered under the GMP. Active owner oversight is essential.

Q7. Is CMAR more cost-effective than other methods?

A: While it may have higher upfront costs due to early involvement, CMAR can reduce overall project costs by improving efficiency, minimizing delays, and preventing rework.