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In our design and construction industry, we are fortunate to work with some excellent general and sub-contractors who care about the final construction product and their craftsmanship. We have been fortunate to work with some quality contractors throughout the country, who take pride in their trade. Unfortunately, the active construction climate consumes many of the responsible, reputable contractors, and allows other less qualified contractors to price your projects. Many of the best contractors are too busy to even bid (estimate or price) my architectural projects nor unroll the drawings for new construction. In some cases, I can only talk to them between project site visits on the Nextel. In light of the times, I am sharing some advice to help protect you from the "nightmare" construction project.
First, Make a list of all the characteristics, elements, or items that you would like included your construction project. This goes for all projects; new construction, residential/ commercial renovations, additions, re-roofs, pools, kitchens, landscaping, and even repairs. Write down your budget and any critical dates or deadlines. This list you will typically share with your architect or give to all bidding contractors.
Second, Consider hiring a professional architect, or engineer to develop a "Statement of Work" (SOW) or "Scope of Services" for the complete project. The architect you choose shall be licensed in your state. Beware hiring a building designer, or CAD draftsman. Those people cannot sign and seal their drawings for building permits. These document will help communicate to the contractor the entire project, and establish in writing, clear agreement to detail the project, and expectations of the work. Any professional architect or engineer can produce a "Statement of Work" in a few hours depending on the complexity and scope of the project. Certainly, drawings can communicate any project more effectively, and will allow building permits to be issued as required. These simple documents and drawings may be the best investment in your entire project, and our office has many "standard" agreements and S.O.W. documents to help our clients with various projects. You will be shocked at the contractor's reaction to the educated home-owner, building-owner, or client who has done their homework and has professionally prepared agreements. "Would you go into a car dealership to buy a car without comparisons and documents?" Actually, the better contractors prefer to know in advance the expectations of the owner and the project to avoid conflicts, misunderstandings, deadlines, and payment concerns. This reduces change orders to stay near your budget, and helps avoid surprises. "A contractor may be a friend at the start of the project, but will rarely be your friend at the end of the project without clear agreements."
Third, Check the license and business history of your potential
contractor(s). We have utilized three agencies to perform back-ground checks
for potential contractors. You have every right to ask for a copy of a contractor's
license. Please note, a "Handyman's License" is not equal to a contractors
license. Handymen have restrictions on the size and nature of their project.
All agencies can tell you on the phone or via fax the status of the contractors
license, history, and the number of complaints, if any;
Fourth, Request a written Estimate, Quote, or Proposal,
on personal, company or business letterhead. The contractor should break-down
the construction activities and rough estimates on materials to be included
in the project. The contractor can show his/her overhead and profit as a separate
line item or load the prices based on each activity. All licensed contractors
are required by the State to have 300,000 liability, and 100,000 comprehensive
insurance. Workman's Compensation is required by the State, unless the licensed
contractor has a valid "Exempt Certificate from Workman's Comp." which
is a public record. Word of advise, "Do not let an uninsured contractor
on your property because you can be sued if someone is hurt during your project."
Fifth, Get the agreements or proposal in writing with his/her license number, including all attachments, "Statements of Work" or drawings, with deadlines. Also, make sure the individual has their license number on the agreement. A company or corporation name is not enough in tracing the contractor especially if the company is not qualified by the state unless the qualifier executes the agreement. The state and counties issue separate contractor licenses in the individual's actual name. The contractor's Florida license number is the "key." The business name, company, or corporation only has one or a few official qualifiers which are financially responsible for the company actions. If an employee is not authorized or has been fired you will have difficulty with any recourse. Some contractors have owned many companies, corporations, partnerships, and have ownership in fictitiously named businesses. The three agencies above can help to separate the "Men from the Boys."
Sixth, Never give a large initial deposit & Re-think
buying "Tract Houses." Never provide an large initial deposit
to start the work, or be requested to front money for purchasing initial construction
materials. A small deposit is standard to initiate the project. If the contractor
you have hired cannot afford the initial cost of the project, take notice immediately.
If you are interested in purchasing a "Cookie-Cutter House" or "Tract
House" from DiVosta, U.S. Homes, or Lennar, you may want to reconsider
and start designing and constructing a "real" home for less or equal
costs which truly meets your budget, quality, and personal tastes. Frequently,
the large, multi-family,( +100 massive, sub-division house) builders make nice
profits on you for their inexpensively constructed, identical or similar houses,
which are slammed into small, uneven lots, Furthermore, the builders make more
money on owner‘s upgrade of exterior/ interior finishes, and optional
changes when the owner attempts to personalize their standard unit. Good luck
in re-selling this "tract house" for a profit when you realize that
approximately fifty, identical houses within 3 miles of yours are also on the
market, too.
Seventh, Consider hiring an architect, engineer, or owner
representative to observe the construction. An experienced professional
can quickly advise you on quality, progress, and payment amounts to keep the
project in check. He or she can identify deficiencies, inferior work, resolve
change orders, develop punch-lists, and recommend and advise on the project
and any reasonable changes, and point out future safety, structural, and water
drainage concerns, as well as keep the project running smoothly.
Eighth, Always hold-back or retain money, and perform Punch-List(s).
The standard construction retainage is ten to fifteen percent of the total project
estimate. Of course, this translates roughly into most of the contractor's overhead
and profit. For each payment to the contractor, the owner shall request a partial
"Release of Liens" to prove payment to all parties in the project.
The owner should also request a complete list of all sub-contractors and material
suppliers for your project with contact information. The owner or owner's representative
should call each sub-contractor, and supplier to confirm payment from the general
contractor. A "Punch-List" should be developed by the owner and/or
architect to document outstanding or improper work and provided to the contractor.
The final payment shall be withheld until the owner is satisfied with the entire
project. Contractors will rarely come back to the project to finish outstanding
work unless money is due. All workmanship and labor shall be warranted for one
full year from completion. Other manufacturer's warrantees will vary for the
equipment only.
Ninth, Demand the "Release of , Sub-Contractor and Material/ Suppliers Liens, before all and especially before final payment. Some, or many of the material suppliers and sub-contractors will send the owner a "Notice to Owner" for public record that their company is owed money on your project within 45 days to be legal. The owner/buyer beware, you may be forced to pay double for the exact same project without proper release of liens..
Tenth, Enjoy a experience as you watch your design ideas come to life with licensed professionals in our industry. "To Build, is the Noblest Art of All." L.D/.S. Real estate investments and commercial building improvements prove each year to be a solid investment with good returns on your hard-earned money. So, go out and invest your money wisely in construction with good Architects and Contractors!"
Best of Luck,
David M. Hawke, RA
Hawke & Associates, Architects
Florida License AR # 0016510
(561) 740 - 4440
Watching Your Project Like a Hawke!
This is one of a series of articles written by David M. Hawke of Hawke & Associates, Architects in attempts to assist owners and contractors in the design and construction industry.
