BACKGROUND

The Kansas City Aviation Department retained Paslay Group in 2018 to serve as Executive Program Manager for Build KCI. The ambitious capital development program replaced three 1972 Kansas City International Airport (MCI) terminals with a modern, 1.1 million-square-foot single terminal. PG’s EPM team served as an extension of the Aviation Department’s executive team, representing the interests of the owner in all contract negotiations and matters related to program scope, cost, schedule, and planning for future operations.

The $1.5 billion program included a new terminal with 40 gates expandable to 50, the largest all-glass boarding bridge installation in the U.S., a 6,220-space parking garage, and new central terminal roadways.  It also included an expansive check-in and ticketing hall, 16 security screening lanes, two concourses linked by a connector with moving walkways, 50-plus shops and restaurants, an eight-carousel baggage claim area, a new U.S. Customs and Border Patrol area, and many other amenities.

The new terminal opened on Feb. 28, 2023, three months earlier than the original contract completion date. Since its opening, MCI has been honored as one of the nation’s best airports and has served as an economic engine attracting world-class events such as the NFL Draft and FIFA World Cup to Kansas City.

Build KCI

  • 2019-2023
  • $1.5 billion program
  • 1M square feet
  • 40 gates, expandable to 50
  • 16 TSA security lanes, new CBP
  • 50 new concessions
  • 8 carousel baggage system
  • 6,220 space parking garage
  • $5.65M in public art installed throughout the terminal

 

OBJECTIVES

  • Ensure timely delivery of the Build KCI program that consolidated two 1970s terminals into a modern, single terminal with an adjacent parking garage and functional arrivals and departures roadways.
  • Meet an aggressive timeline and commitment to open to the public on Feb. 28, before the 2023 Big 12 Men’s Basketball Tournament and the April 2023 NFL Draft in Kansas City, Mo.
  • Serve as a bridge between the Aviation Department, the Design-Build Team, airlines, and various stakeholders to provide technical support and oversight during the new terminal’s design, construction, and initial operation.
  • Be responsible for overseeing the program and providing professional staffing necessary to complete the scope of services requirements, with the collaboration and direction of KCAD.
  • Provide effective leadership and management to ensure the successful completion and commissioning of the new single terminal.

 

APPROACH

Paslay Group’s Executive Program Management model provides airport owners with a small, core executive-level leadership team of experienced professionals in the primary areas of program development. The MCI team integrated with the Aviation Department’s senior executives, providing the experience and leadership necessary to achieve the owner’s objectives and protect the airport’s interests.

The Paslay Group EPM team collaborated with Aviation Department leaders to produce a comprehensive Implementation Plan that identified the processes and resources needed to deliver the program on time and within budget. The team also worked with Department leaders to procure resources, jointly ensuring optimal selections and controlling costs by contracting for services only as needed.

The five-member PG EPM team initially included an Executive Program Manager responsible for all program aspects, a Project Controls Manager, a Design Manager, an Implementation Manager, and an ORAT manager.

Paslay Group’s EPM team was based onsite full-time. The PG Executive Program Manager led regular, results-oriented meetings with each EPM team member, the senior Aviation Department leader responsible for the development program, and senior representatives of the developer, general contractor, architect, and other significant subcontractors. The PG Executive Program Manager representing the aviation department provided executive-level program briefings to city leadership and functioned as the city’s chief point-of-contact for all program information through close-out.

The EPM approach provided just-in-time staffing that helped control program costs and was uniquely aligned with the Kansas City Aviation Department’s objectives and interests. PG EPM provided no direct boots-on-the-ground staffing but managed staffing augmentation contracts for the owner, ensuring that the program could be delivered with additional scope items within the original budget.

 

CHALLENGES

The MCI Single Terminal Program was initially envisioned as a Public-Private Partnership, or P3, effort. In September 2017, a developer was hired to design, build, and finance the new terminal. More than 75 percent of Kansas City voters endorsed the airport terminal construction in a Nov. 7, 2017, ballot initiative.

Four months later, the Kansas City Aviation Department selected the Paslay Group, to serve as the Executive Program Manager and manage the previously hired developer. PG quickly began working with department leaders to develop a program management plan to drive the planning, design, and construction process.

The contracting order initially invited conflict about which entity – the developer or the EPM — had authority for program decision-making and recommendations to the Aviation Department. The city, however, had signed a Memorandum of Understanding with the developer rather than a contract. The need for a formal contract between the parties allowed Paslay Group’s Executive Program Manager to negotiate the developer’s fees, reducing them significantly from early proposals in order to align with industry norms and establish the governance structure necessary to move the program forward.

The new city-developer contract reduced fees by over $100 million from initial program cost estimates. PG EPM also helped the Aviation Department reduce fees for the Design-Builder selected by the developer by 3.5%, trimming another $45 million in costs. The contracts brought the program costs in alignment with what MCI’s airline partners were willing to spend.

Simultaneously, Paslay Group engaged Kansas City Aviation leaders in an extensive value engineering process to determine the right elements for the new terminal that both met the owner’s objectives and fit within what the airlines were willing to spend. The team agreed to alter some design guidelines to be more flexible and to encourage more competitive pricing. They set some design items aside, pledging to put the “wish list” back into the program if possible.

The PG EPM team reduced estimated costs enough that about $40 million worth of “wish list” items were added back to the program. Among those items was a parking guidance system that allows passengers to quickly identify available spaces through digital signs and red and green indicator lights.

 

IMPLEMENTATION

When Paslay Group joined the program, Kansas City had already selected a developer and its preferred Design-Build team. Paslay Group, working with KCAD, developed the broad Program Delivery Document and day-to-day management strategy in a formal Implementation Plan that considered the department’s goals, constraints, and capabilities – then aligned all parties and contractors to work within the framework.

The PDD included schematic design and 10% to 15% design, providing a high-level perspective on the overall size and look of the facility and specifics such as the number of escalators and elevators in the building and how many passengers could move through the building at a time. The well-designed PDD allowed the PG EPM team to procure goods and services accurately and avoid cost escalation.

PG EPM also introduced Procore as the owner’s project management software. PG EPM used Procore to manage requested changes and administer 30 professional specialty and on-call contracts. Procore gave the team a common view of program budgets, forecasting, and true costs to date, and results were reported to the Aviation Department monthly. The system also allowed PG EPM to upload invoices, assign a team member to validate that work was performed, and assess scope items as they were completed – keeping a tight grip on dollars and avoiding paying for work that could not be confirmed. At close-out, the system helped all parties track punch list items toward final acceptance of the work.

Communication across the team – from the General Contractor and architects to multiple subcontractors – was essential to the program’s success. The PG EPM team, developer, and design firm were housed in a common office building on airport property alongside the Aviation Department’s Deputy Director for Planning and Engineering, who oversaw the program for the city. The PG EPM team met three times a week with the Aviation Department’s executive team, fully integrating into the leadership group for the duration of the program.

The benefits of these collaborations were evidenced when the Paslay Group Construction Manager saw an early opportunity to clear the terminal site and develop a fully coordinated plan for new utility installation and relocation of existing utilities. All parties came together to develop this solution that ultimately saved the project time, avoided complex utility coordination on-site, and earned goodwill for and between the various development teams. Finalizing the Implementation Plan and design for the new terminal, updating cost estimates, and demolishing an old terminal to prep the construction site took 15 months. Construction of the new, consolidated terminal began in late July 2019.

Airport Development Essentials

  1. When the owner’s executive or development team is limited in size or experience, hire an Executive Program Manager to expand the owner’s ability to execute the program. Hire the EPM early, ideally following a Master Plan adoption, to ensure that program design, delivery method, and other essential elements are aligned with the owner’s objectives, capabilities, and constraints.
  2. Develop a broad Program Definition Document (PDD) to provide a high-level perspective on the facility’s overall size, look, and specifics, such as the number of escalators and projected passenger traffic. A well-designed PDD allows the owner to procure goods and services at projected pricing and avoid cost escalation.
  3. Develop a detailed Implementation Plan in tandem with the PDD before you determine the program delivery method. The Implementation Planning process will help the owner determine which delivery method is the best fit for the program and customize the method as needed. The Implementation Plan should establish how airport leaders and their Executive Program Manager will interact with the designer, manage project controls, and monitor program progress.
  4. Plan for low-voltage systems during the program’s concept phase to ensure the systems’ timely start-up with the facility’s opening.
  5. Develop the Operational Readiness and Training plan early to ensure that all parties know the roles, responsibilities, and timing of the transition from construction site to operating airport.

 

RESULTS

MCI’s New Single Terminal opened to the public as scheduled on Feb. 28, 2023. It features 1.1 million square feet of glistening concourses, an efficient and central security checkpoint, high-tech restrooms, Kansas City-flavored and branded concessions, and a $5.65 million public art program with installations throughout the terminal and concourses.

According to KCAD, the program generated over 6,000 construction-related jobs over five years, and more than 240 Kansas City-area subcontractors contributed to it. The project also involved more than 130 minority- and women-owned business partners, achieving 34% participation – far exceeding its MWBE goal of 21%.

As of April 2024, total passengers were 2.6 million, up 7.4 percent over 2023 levels. Airport Business magazine named the Build KCI Single Terminal Program its 2024 Project of the Year. TravelAwaits.com named the new MCI the Best Airport in the United States in June 2023. Soccer fans will flood the new terminal in June 2026 for the FIFA World Cup.

 

LESSONS LEARNED

Build KCI would have benefited from a timeline that introduced the Executive Program Manager, earlier in the process and leveraged that executive-level leadership to drive Implementation Plan development before procuring the Developer/Design-Build team. The program also would have benefited from developing a detailed Program Definition Document before procurement and awarding the Design-Build team’s proposal with the owner’s goals and objectives. When the project changed direction, the team spent about a year redesigning and updating the budget.

Additionally, the owner’s resistance to the early adoption of the ORAT and commissioning process should have been considered with contract clarity around when the owner would take over the maintenance and operation of the new building. The lack of early engagement in ORAT planning created conflicts and unforeseen outcomes that decreased the efficiency of terminal start-up operations.

Finally, insufficient attention was spent on planning low-voltage systems early in the program, including during the early procurement of the LV subcontractor. An earlier LV Design-Builder procurement would have allowed more time for close coordination with the lead program design firm to carefully consider phasing, safety, and necessary energy loads. Bringing in the low-voltage Design-Builder subcontractor later in the program led to challenges, including not planning for enough power to support specialty systems and their heating, cooling, and technology infrastructure capacity requirements in clubs, hold rooms, and the Customs and Border Protection areas.

“I tell everyone, we don’t build buildings; we build high-tech systems,” says Terry Cassidy, Paslay Group’s Executive Program Manager for Build KCI and the current EPM for Cleveland-Hopkins International Airport’s terminal modernization program. “The fiber optic communications systems run security, baggage systems, flight information, building management systems, and everything else. To achieve the best outcomes, these systems must be considered during concept design development.”

Other recommendations:

  • Ensure that the Owner and EPM are included in key design decisions that affect cost when serviceability or design life are involved. This is also true for items that may impact end-user operations. This is good governance and provides the Owner control over spending on elements important to them.
  • This practice would also help to ensure that contractors that may have been debarred from site work are not awarded subcontracts.
  • Include in the Design-Build agreement a level of accountability for missteps or design deficiencies that may arise. If the Design-Builder is making decisions that affect costs or operational aspects of the building, the firm must get the owner’s approval in advance.
  • Ensure that project management system software can manage the overall program’s numerous projects. Align the use of a single project management software platform across the program team to establish a common data set and enable document sharing and collaboration.
  • Begin adoption of the ORAT process early. Clarify roles, responsibilities, and the timeline for transition.
  • When introducing new arrivals and departures roadways and management practices, airport owners must educate and train the public well in advance of opening day – especially if terminal curbside access is more limited. Start by enforcing parking and standing rules at existing terminals. Ensure drivers know where cell phone waiting lots are located and their purpose.
  • Establish a governance structure with the owner early on to control spending, approvals, and contingencies. Specify spending authority for senior program leaders and when governing bodies need to approve adjustments to contract authority. To control costs, contractors must justify cost increases before billing for or using contingency.

Conclusion

Paslay Group counts the 2023 Build KCI Single Terminal Program among our clients’ most transformational airport development programs. Our firm was honored to collaborate with Kansas City’s visionary and proactive leaders to assist in delivering a state-of-the-art airport terminal complex that will foster economic growth across Missouri for decades.

The program is a prime example of the value of Paslay Group’s Executive Program Management model to complex airport development programs, particularly when the owner has a limited internal capital development team.

The Build KCI program gained momentum once the Aviation Department and PG EPM adopted a clear Program Definition Document and a detailed Implementation Plan. Early planning that detailed and documented roles, responsibilities, and governance before hiring major contractors saves time and money in the design and construction phases. Implementing a single project management software system across the program aligned with the owner’s financial system optimizes the EPM team’s ability to track a common data set, respond appropriately to requested changes, validate invoices against work performed, and control costs.

Careful planning for low voltage systems and Operational Readiness and Training will set the program for long-term success.

 

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