Risk Analysis and Management Plan for Hudson Yards Construction Project

This assignment provides an in-depth analysis of the risk management plan for the Hudson Yards construction project, a large-scale development in New York with an estimated budget of $200 million. The report identifies various risks, including health and safety, environmental sustainability, timely completion, labor cost increase, material cost changes, and expenses going beyond the budgeted level. A risk matrix is prepared to visualize these risks, and a comprehensive risk management plan is presented to mitigate them. This assignment is ideal for students studying project management, construction engineering, or related fields.

Risk analysis and mitigation
project

Table of Contents
INTRODUCTION...........................................................................................................................1
PART A...........................................................................................................................................1
Project overview..........................................................................................................................1
PART B............................................................................................................................................6
Risk Analysis..............................................................................................................................6
PART C .........................................................................................................................................10
Risk Mitigation plan..................................................................................................................10
CONCLUSION..............................................................................................................................10

INTRODUCTION
For the construction companies one of curial essential element to ensure the success of
constructions project as well as company is to analyse the risk related with specific projects and
to develop plan to mitigate the same. This is very importance as without this on one can
guarantee the success of the project even with use of the best resource. In the present report
analysis of project over the Hudson Yard, New York is done. This includes preparation of
budget, key statistics, funding and stakeholder determination of the construction project.
Moreover, a risk analysis is done and plan is developed to mitigate those risk.
PART A
Project overview
1. Overall Budget:
The over cost of the Hudson yard project is estimated to be US$200 billion. So far
2. Social and economic rationale:
The social rationale of this project is to provide a modern and high tech township with
sky scrapheap ad all the facilities to the public of new york with latest technologism and
facilitates. This is a project with providing small high end city within New York (7 Steps to
Creating a Project Budget, 2018). The economic rationale is that this will definably prove
employment to many people and indirectly contributing the nation gross domestic product
(Dziadosz and Rejment, 2015). At the time of operation of this project many of the employees
from different sector will be employed. After its opening the shops, restaurants and mall within
the city will gain a new source of income.
3. Key statistics:
a. Project scope
Hudson Yards is a real estate development in Chelsea and Hudson neighbourhoods of
Manhattan of New York City. This is the largest private real estate development in US. It
includes buildings as 10, 15, 30, 35, 50 55 Hudson yards and The shed. The coverage of the
whole project is 26 to 28 acres. The project will commended in 2018 and will be completed by
2023.
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Illustration 1: Hudson yard master plan
Source: (Fang, Marle and Xie, 017)
b. Budge and estimated cost
The estimated cost of completion of the project is US$200 billion.
Estimate cost:
Particular Cost (in million)
Labour cost 37000
Material cost of the project 42000
Potential travelling cost 30000
Estimated the cost of the project office 15000
Cost of equipments 40000
Administration cost 33000
Software cost 3000
Total 200000 million (200 nillion)
c. Time line
2

Activities Duration
Planning to develop west side rail 15 days
Environmental impact study 28 days
Getting approval from City Council 15 days
Getting other necessary approvals 18 days
Submitting the bids 10 days
Starting the construction of 5 line extensions
and its completion
25 days
Development of skyscraper and its completion
(10, 15, 20, 30 Hudson yards)
60 days
Opening of Hudson yard towers 25 days
Unveiling the tallest building of the project 30 days
Opening of restaurant, vessels and shops for
public
18 days
3

Task Mode Task Name Duration Start Finish Predecessors Early
Finish Early Start Total
Slack
Auto
Schedule
d
Planning to
develop west side
rail
15 days Tue 23-
04-19
Mon
13-05-
19
Mon 13-
05-19
Tue 23-
04-19 0 days
Auto
Schedule
d
Environmental
impact study 28 days Tue 14-
05-19
Thu 20-
06-19 1 Thu 20-
06-19
Tue 14-
05-19 0 days
Auto
Schedule
d
Getting approval
from City Council 15 days Fri 21-
06-19
Thu 11-
07-19 1,2 Thu 11-
07-19
Fri 21-
06-19 3 days
Auto
Schedule
d
Getting other
necessary
approvals
18 days Fri 21-
06-19
Tue 16-
07-19 2 Tue 16-
07-19
Fri 21-
06-19 0 days
Auto
Schedule
d
Submitting the
bids 10 days
Wed
17-07-
19
Tue 30-
07-19 3,4 Tue 30-
07-19
Wed 17-
07-19 0 days
Auto
Schedule
d
Starting the
construction of 5
line extensions
and its completion
25 days
Wed
31-07-
19
Tue 03-
09-19 5 Tue 03-
09-19
Wed 31-
07-19 0 days
Auto
Schedule
d
Development of
skyscraper and its
completion (10,
15, 20, 30 Hudson
yards)
60 days
Wed
04-09-
19
Tue 26-
11-19 6 Tue 26-
11-19
Wed 04-
09-19 0 days
Auto
Schedule
d
Opening of
Hudson yard
towers
25 days
Wed
27-11-
19
Tue 31-
12-19 7 Tue 31-
12-19
Wed 27-
11-19 23 days
Auto
Schedule
d
Unveiling the
tallest building of
the project
30 days
Wed
27-11-
19
Tue 07-
01-20 7 Tue 07-
01-20
Wed 27-
11-19 0 days
Auto
Schedule
d
Opening of
restaurant, vessels
and shops for
public
18 days
Wed
08-01-
20
Fri 31-
01-20 9 Fri 31-
01-20
Wed 08-
01-20 0 days
4

d. Key construction elements:
The launcher: A machine specially build for providing assistance in development of sky
scrapers. The cost of which is $600 million.
Subway extension: $2.4 spent on the subway extension project for construction and
providing access to the current project.
Hudson park and Boulevard:$1.2 billion are spent over the development of Hudson park
and Boulevears as a part of the project.
4. Funding mechanism:
Off this project of Hudson Yard, 60% of the stake are retained by Oxford. The ownership
of the rental building is retained by the owners themselves. $600 million have been invested by
the foreign investors EB-5 (Mignan and et.al, 2015). The other lender in this project are The
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Children's Investment Fund Foundation, Deutsche Bank, and Allianz who invested approx $18
million in the project. $6 millions are benefited from the investment and tax breaks from city in
conjunction with Hudson Yard's construction. $1.6 million are given by Empire state
development.
5. Key stakeholders:
The primary developer, Oxfrod properties, foreign investors, Mitsui Fudosan, Kohn
prdersonFox are the key equitholders of this project. The master paln is designed by Skidmore
Owing and Merrill, Thomas heatherwick, Roche Dinekeloo and Diller Scofidio. Another
stakholderso of the project are the tenants which includes fashion company Tapestry, consulting
firm BCG and Alphabet subsidiary pavement Labs.
PART B
Risk Analysis
Risk analysis is essential for this project to identify the existing potential threat and
vulnerabilities and other hazards that can compromise the performance of the project. Potential
Risk of the construction project of the Hudson Yard in New york are:
Qualitative risk: the qualitative risks are related with delving into resources of the
project. This includes risk related with management, team members and all personnels of
working on the project.
 Health and Safety risk
 Environmental sustainability
 Risk related with timely completion of the project
Quantitative risk: is related with the determination of the risk of the project into
numeric terms (Qualitative Risk Analysis and Assessment, 2018). The numeric information is
used frequently to determine the cost and time contingencies of the project.
 Increase in the cost of labour
 Chang in the material cost
 Risk related with expenses going beyond the budgeted level:
Risk matrix:
6

Risk Likelih
ood
Impact Severity on
schedule
Description Mitigation
plan
Contingent
plan
Health and
Safety risk
Modera
te
High No change in
schedule
Due to accident
happen to any
worker at the
construction
site, failure of
any machinery
or equipment
Intact
maintenanc
e of all the
machine.
Proper and
effective
training to
all the
machine
operators.
In situation
of
emergency
and high
risk stop the
use of
machine
immaterialit
y and sent it
for repair. If
ant accident
has occurred
to take care
of the
person
Environment
al
sustainability
Low Low 1 week delay to
schedule
Occurs in
frequently dan
due to any lack
in meeting any
statutory or
voluntary
obligation to
protect the
environment.
To adhere
with all the
requisite
legal
requirement
s.
To follow
the path
and
direction of
the
environmen
tal
To change
the policy of
applications
and meet the
immediate
requirement
to avoid
legal
prosecutions
and pay off
any legal
fines and
penalties.
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sustainabilit
y.
Risk related
with timely
completion
of the project
Very
High
High 10 week delay
in schedule
This is long
term risk and
can occur with
constant delay in
various factors
and risk related
with project.
To see for
completion
of each
consecutive
activities of
the project.
To take
immediate
action be
taken to
avoid the
time gap.
To stop any
activity and
and
incurring
intent
planing to
complete
the
immediate
activity
completion
in order to
reduce the
time gap.
Increase in
the cost of
labour
High 2-4 week delay
in the schedule
This can occur
over time as
construction
project runs for
a long time that
is 2-3 years.
To keep
the record
of changing
trends in
labour
market and
increase the
labour cost.
To
estimates
the labour
cost with
keeping the
budgets in
To
immaterialit
y effectively
changing
the budgets
to avoid the
future
contingency
related with
financial
constrains
over the
project.
8

consideratio
n.
Chang in the
material cost
Very
high
High 7 week delay in
the schedule
This can occur
frequently as the
cost of mate rail
changes with
change in
economic and
other
environmental
factors at
national as well
as international
level.
To keep in
stock of
material
with
frequent
changing
price.
To
Maintain
therecord of
the
changing
prices.
To purchase
the material
with
available
funds at the
which are
necessaries
to keep the
work
running and
hen ot take
measure to
meet the
increased
cost.
Risk related
with
expenses
going beyond
the budgeted
level
Very
High
Very
high
20 week delay
in the schedule
This is long
term effect and
can delay the
project beyond
the stipulated
completion date.
To analyse
all activities
of the
project.
to identify
the lag and
then to take
corrective
measures
Reducing
the funding
of all the
department.
The
activities
with high
increment
will ask for
mire funds
and in this
way
activities
9

with more
expenses
can be
identifies in
lesser time
to take
control over
them.
PART C
Risk Mitigation plan
 Health and Safety risk: To keep intact maintenance of all the machine and equipment at
the project site. Also, give proper training to personnels on instructions of the machines.
 Environmental sustainability: To adhere with all the requisite legal requirement as well
keeping a record of the path and direction of the environmental sustainability by the
organisation.
 Risk related with timely completion of the project: To keep a strict eye on the
completion of each consecutive activities of the project as all are related to each other.
Any lag if seen, immediate action be taken to avoid the time gap in long run.
 Increase in the cost of labour: To keep an record of changing trends in labour market
and increase the labour cost timely to reduce the risk of disputes with labour (A Study on
Risk Analysis in Construction Project,2018). To estimates the cost with keeping in mind
the changing cost of labour.
 Chang in the material cost: To keep in a stock of material with frequent changing
prices and to keep record of the changing prices in order to make the budges
accordingly.
 Risk related with expenses going beyond the budgeted level: To analyse all activities
of the project and identifying those which are incurring the cost over the budgeted funds
and then to take corrective measures.
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CONCLUSION
From the above report it can be concluded that the construction project of Hudson Yards
is a large construction project with developing a small city with in New york. The over all
budgets of this project is estimated to be $200 million. The risk qualitative and quantitative risks
are identifies and for this a risk matrix have also been prepared. For all the risks an overall risk
management plan has been presented.
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REFERENCES
Books and journals
Dziadosz, A. and Rejment, M., 2015. Risk analysis in construction project-chosen
methods. Procedia Engineering. 122. pp.258-265.
Fang, C., Marle, F. and Xie, M., 2017. Applying importance measures to risk analysis in
engineering project using a risk network model. IEEE Systems Journal.11(3). pp.1548-
1556.
Mignan, A and et.al, 2015. Induced seismicity risk analysis of the 2006 Basel, Switzerland,
Enhanced Geothermal System project: Influence of uncertainties on risk
mitigation. Geothermics. 53. pp.133-146.
Online
7 Steps to Creating a Project Budget. 2018. [Online]. Available through :<https://www.ims-
web.com/blog/7-steps-to-creating-a-project-budget>.
Qualitative Risk Analysis and Assessment. 2018. [Online]. Available through
:<https://www.project-management-skills.com/qualitative-risk-analysis.html>.
A Study on Risk Analysis in Construction Project. 2018. [Online]. Available through
:<https://www.irjet.net/archives/V5/i5/IRJET-V5I5920.pdf>.
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