ST : Er, what is a two-envelope system?

Aug 29, 2010

FINANCIAL QUOTIENT

Er, what is a two-envelope system?

Where do you see this?

In media reports and the Government's tender annnouncements.

What does it mean?

It is a tender system in which developers submit their design proposals and tender prices in two separate envelopes.

The Government will first evaluate the concept proposals against a set of pre-stated criteria, including the overall design and the adaptive reuse of conservation buildings.

At the second stage, the tender price envelopes of these shortlisted bidders will be opened.

The site will be awarded to the highest of these bidders, provided this top bid meets the Government's reserve price.

Why is it important?

This system is used for selected major development sites, such as the historical Capitol Theatre site, to ensure that developers come up with distinctive developments commensurate with the site's strategic location.

For instance, world-renowned British architect Norman Foster's firm Foster and Partners presented a design that incorporated comprehensive, cutting-edge green features without compromising on aesthetics for the landmark South Beach project in Beach Road.

So you want to use the term. Just say...

'The Government is using the two-envelope system for the Capitol Theatre site. I am sure whoever wins the tender will have a design that's guaranteed to bring more life to the City Hall area.'

Lorna Tan