Avoid Costly Delays: Plan Utility Connections Early in Your Project!

If you’re a real estate investor, you already know that timing and budgeting can make or break a project. Whether you’re remodeling an existing structure or building from the ground up, one of the most overlooked – yet critical – aspects of project planning are utility connections. That includes electricity, gas, water, sewer, and sometimes even broadband service. Failing to plan ahead for utility hookups can delay your project, create unexpected costs, and turn a smooth renovation into a frustrating ordeal.

Here’s why you should take utility connections seriously from day one—and how to avoid common mistakes and pitfalls that catch even seasoned investors by surprise.

1. Permitting and Utility Coordination Can Be a Bureaucratic Maze

Connecting to municipal utilities usually requires coordinating with both your local permitting authority and one or more utility providers. These are often separate entities, and getting approvals from one doesn’t guarantee compliance with the other.

Example: The city permitting authority might approve your electrical meter-box and overhead connection setup, but your utility company may still reject your connection request for an issue relating to routing their service drops.

This kind of bureaucratic complexity can easily add weeks—or even months—to your project timeline if not you did not plan properly. Inspections, utility approvals and site visits can stretch into months.

2. Lead Times and Scheduling Delays Can Derail Your Timeline

One of the most common surprises for investors is just how long it can take to get utility service connected or reconnected. Electrical utility companies, for example, may require a multi-step process: application, engineering review, payment of fees, scheduling trench or service mast/weatherhead inspections, and finally sending out a crew to do the work. Each of these steps can be delayed by internal workloads, holidays, weather, locked gates or staffing shortages. In addition, the crew who comes out to do the work may not do the work, or can veto the work, if they see an issue that the city inspectors did not see or did not care about.

If you're in a more rural or developing area, providers might even have to upgrade infrastructure to serve your property, which could involve transformers, poles, or mains—each requiring additional time and approvals. Waiting until your project is nearly complete to initiate these conversations can leave you with a finished building and no way to turn on the lights.

Example: We had a project where we were adding a 2nd structure on a residential lot. The power line to the existing building hung over where we wanted to build the 2nd structure. The utility company needed to install a new pole so they could re-route the power line closer to the property line. Luckily, we had requested a utility consultation during our design phase, so we were able to get this done early, before we started construction.

3. Unexpected Costs Can Hit Your Budget Hard

Investors are often surprised by how expensive it can be to connect utilities, especially if upgrades are needed. Utility providers typically only cover a portion of connection costs. The rest, including trenching, water/sewer taps, conduit, backflow preventers, meters, or even moving existing poles or boxes, typically fall on the property owner.

Worse still, if a property has been disconnected for a long time or if prior work wasn’t up to the current codes, you may be required to bring everything up to modern standards—an unexpected cost that could run into the thousands.

Example: We were building a couple of townhomes close to the back property line. The architect did not realize the powerlines were on the back property line vs. on the street. After a meeting with the electric utility consultant it was determined that there was a transformer too close to the back of the townhome, and we had to pay to move it to a different pole.

4. Old Properties Bring Unique Challenges

If you’re remodeling an older home or building, utility reconnections can be especially tricky. You may encounter outdated wiring, illegal modifications, missing permits, or even lost service records. In some cases, the utility company may not recognize your address in their system if the property has been off the grid for too long.

You may also have to prove that service once existed at the location—or go through the same process as a brand-new construction. It’s not uncommon for investors to discover that what they thought would be a simple reconnection requires full redesign for basically brand-new service.

Example: We had a rental property that had always had gas. When a tenant moved out, we began a remodel on the unit. When we tried to reconnect the gas, we discovered that it had been “on”, but the gas utility did not have an active account for the apartment. Somehow our tenant had free gas for years. We, however, now had to pull a new permit and do upgrades and inspections in order to get the gas turned back on.

5. Early Planning Helps You Control the Timeline

Planning ahead allows you to align your construction milestones with the utility timeline, instead of being at the mercy of the utility providers. Contact your utilities and permitting offices as early as possible—even during the acquisition or design phase. Ask questions like:

• What is the typical lead time for new connections or upgrades?
• Are there any current moratoriums or backlogs?
• What documents and fees are required up front?
• Can you get utility consultants from the different disciplines (water/sewer, gas, electric) to visit your site and review your connection plans proactively.

By building these actions into your project schedule and budget from the start, you’re far less likely to experience costly surprises.

6. Pro Tips to Stay Ahead

Here are a few actionable tips to keep your utility connections on track:

• Create a Utility Checklist: Include tasks like applying for service, submitting plans, scheduling inspections, and confirming installation dates.
• Start Early: Start utility work as early as possible. Most utility infrastructure work happens outside so you can do a lot of this work outside while your remodel/building construction happens in parallel.
• Request Utility Consultations: Many utility providers have consultants who you can request to come out to your property and ensure your connection plan will work so you can move forward with confidence.
• Hire Experienced Contractors: General contractors or electricians with local experience often know the quirks of the system and can help you navigate it.
• Document Everything: Keep records of all communication, approvals, and payments. If disputes arise, documentation is your best defense.
• Build in Buffers: Always pad your timeline and budget for utilities. It’s better to come in under time and budget than have to scramble at the end.

Final Thoughts

Utility connections are not a glamorous part of real estate investing, but you can’t complete most projects without them. Failing to prepare can lead to frustrating delays, budget overruns, and even lost income if your project can’t go to market on time. By taking a proactive approach and treating utility coordination as a critical part of your overall project plan, you’ll save yourself time, money, and headaches—and keep your investment on track and on budget!