My construction project is taking forever / Now what?
I have been involved in construction for the last 40 years and can honestly state, the majority of the projects I have been involved in, did not meet the anticipated, original construction schedule, nor the budget. I laugh at the individuals, in the business, that claim all of their projects come in on schedule and under budget. If you ever hear that from a professional contractor or builder, consider that individual either delusional or simply not being accurate with the truth.
Construction projects in general are always over budget and take longer than anticipated. All builders and contractors are cringing when they see that in print!
It is easier to accept this realization, if you understand the basic fundamentals of the construction industry.
- The majority of contractors need to present a very positive representation of the project, if they expect the client to select them to perform the work. Unfortunately, there are many contractors that will simply say whatever it takes to secure the contract. There is a common attitude within the industry, that once the project is started, what is the client going to do regarding the schedule or the budget?
- This positive representation of the construction project includes both the schedule of the work as well as the price. What client wants to accept a real and truthful interpretation of the work? Especially if this is a naïve, excited residential client. There is no client in existence that will select the contractor that accurately presents, both the timing of the project, as well as the final value of the job. How can a contractor be accurate and truthful, if all their competitors are simply positioning themselves to be awarded the project? This realization within the marketplace, results in the majority of projects extending over budget and taking substantially more time.
- The construction industry realizes that the success of obtaining a project is by minimalizing both the price and the time. Most residential individuals do not have any clue what the actual timing for a project should be. Nor do they have any understanding what the cost should be. Contractors use this misinformation, as well as the naïve attitude of owners, to accentuate their ability to obtain the work.
I am currently involved with a multi-family project that will require an additional million dollars, and require at least twice the time being speculated, to actually complete the project. The contractor that I am involved with has established a value that is not realistic, in addition they have identified an inaccurate forecast for the time required to complete the project. Both the value and the schedule are severely understated; however, they have been awarded the project. In their opinion, this is all that counts.
By realistically understanding this situation, what should the owner of the delayed project do?
The following steps are based on a current project that is under contract, and is being delayed for various reasons. I will establish a separate webpage, explaining the steps that should be taken by the residential owner, prior to the acceptance and legal signing of a contractor to build the project, to prevent delays on a new construction project.
The following steps should be taken, if you are in the middle of a current construction project.
- Demand that your contractor provide current lien waivers from all of the subcontractors and material suppliers on the project. If the contractor refuses to supply these lien waivers, note the names of the vendors and the subcontractors on the project and call them direct. The reason for this action is to ensure that payments have been made in a timely fashion by the general contractor. In many cases, delays on the project are due to slow payment to vendors.
- Demand that the contractor provide an accurate, new schedule for the project. Once this schedule is received, demand that the contractor provide a two week look a-head schedule to clarify what activities will be occurring on the project within the following two weeks.
- Do not provide additional payment to the contractor, until the lien waivers and the updated schedule is received. Failure to receive these documents should stop any additional project payments.
- Start to investigate within your local area, for a construction lawyer or a construction professional, which you can hire on an hourly basis to interact with you on the project.
- Do not allow the contractor to convince you that they will expedite the work, they will have additional manpower on the project, they will work over the weekends, etc. This is simply more of the same contractor lingo that is extremely popular and used on a regular basis, in the construction industry.
- Remember, the contractor is not your friend! This is a business transaction that must be supported by facts and actual work activities.
- Do not accept any additional work tickets; do not accept any excuses for the delays and the budget overruns. The contractor will use all their skills to attempt to convince you that the documents were incorrect; the conditions of the project were not properly identified, etc.
Talk is not the answer, work is the answer!
If you are in the middle of a project that is delayed and probably, substantially over budget, you must act convincingly and quickly. The hiring of a construction professional or a construction lawyer is very important, to support your seriousness regarding the delay and the budget overruns. Do not allow the contractor to convince you otherwise, by smooth talk and over the top, verbose assurances. Talk is extremely cheap, only activity and schedule completion will convince you that the contractor is complying with the contract and the legal agreements.
Although I am a proponent of hiring a professional construction lawyer or construction professional to guide you in the completion of your delayed and over budget project, there is always social media. The ability, for an owner to identify the shortcomings of a local contractor, on social media is a powerful tool. Again I am not condoning it; however, many young and aggressive residential owners are extremely proficient at projecting their point of view, via social media. If this is your thing, by all means, use it!
Remember, this is your money, this is your home and the contractor is not a friend!