All Forum Posts by: Patrick Philip

@Patrick Philip   The whole tone of this thread is that you don't trust contractors, you're smarter than they think, you know how much everything costs and you want to shave every nickel .  In every response you circle back to one of these.  You're setting yourself up for major disappointment.  

To address your last comment how do you know the "good" contractors haven't already weeded out the $14k guy because he never shows up and does shoddy work?  If someone isn't "the phone is off the hook" busy in this economy then they suck!!   I'll go out on that limb.....  If you think it's difficult finding quality help now wait until you have a sub that you either fired or walked off the job and you have to get someone to replace them.   No one wants to do that especially when they hear the tone you've been setting in this whole thread.....

In another of your responses you said that GC's get "mad" when they find out you're not a "sucker"???  Dude you are so - fishing in the wrong pond....with the wrong bait I might add.  You've got a long, rough, bumpy road ahead of you.  You need a legitimate mentor not a contractor(s). When you find that mentor make sure you're not attracted to them because they think like you.  That's not a mentor.......  I do applaud your interest in learning but you are off to a very, very bad start.  Take a breath, reread this thread and treat people like you want to be treated not like they're there solely to rip you off.

"And this is not even to mention the fact that if I hire a GC, a lot of what he will do is just sub out much of the work, in which case I'm basically paying him a "finders fee" for a sub that for all I know I could have found a better/cheaper one myself"......

If you think that GC's make all of their profit by "accumulating" a list of sub-contractors and sitting at the coffee shop doing nothing you're so far over your head you're looking up at the Marianis Trench......

I would say typical owner provided items are at a low risk of injury liability. My contracts allow me to provide materials with contractors consent. 

I would have to see precident on what liability owner provided, contractor installed items would have. Can't imagine alot so long as the materials meet applicable requirements. 

Most liability comes from improper installation, not the actual product. At least in my experience. 

Can you sit for the Residential Basic exam (or whatever FL calls their equivalent contractors license)? Other wise you are going to need some serious volume to get anywhere close to that price per foot, at least in my area.

Ways to get a contractors Fee down:

1. Owner provided, contractor installed items: supply plumbing fixtures, appliances, and other specialty items. This will avoid the sub's retail market up on these items. make a list of what you will supply, and let it be known that you will pay for delays caused by the items you supply. Warranty is on you for these items. 

2. Split on-site CM time with the contractor. If you background is suitable for it (which it sounds like it is) try splitting on-site managment time with the contractor. Certain crews you could get rolling in the morning, saving the contractor a trip to the site.

3. Detailed spec sheet. Residential architecture plans are generally garbage. You need to substitute a long spec sheet with how you want everything done, materials used, etc. Mine is maybe 20 pages long, and doubles as my proforma. Its organized by section, where section summary is the relevant information for a contractor and everything else is essentially breaking the price down. Sections by order of construction is how mine is setup. This will provide info on everything from the subfloor I want, types of joists, plumbing rough in requirements, HVAC minimum specs I want, etc etc etc. This will cut out hours of questions/meetings with the contractor, and eliminate any delays because he doesn't have the info he needs to order and move forward. In return his management time will be less, and theoretically can afford to reduce fee a little. This also serves as quality control measure.

4. Getting a contractor to understand you are NOT a homeowner. You will get decisions to them immediately, pay for rightful change orders without delay, that you have secured financing and have the required amount of cash on hand to cover any discrepancies in the draw schedule, and will provide X number of units a year. Remember the interview process goes both ways. Contractors (and every business for that matter) will slap on a PITA profit factor if you are not careful, especially in this market where work is plentiful. You want to be the easiest customer the contractor will ever have.

Using take offs to get fee down probably is not going to help. Lumber yards provide material take offs for wood, each sub does their own, everything else is fairly simple. This wont really decrease the contractors overhead substantially, but will increase your exposure a fair amount.

Jump on Greg's offer as soon as you can. There are few people on this board that I read and absorb their posts, he is one of them.

@Patrick Philip do you have the land already? Are you essentially ready to go or just in the beginning concept stage? I would be happy to discuss and help you vet GCs establish budgets and schedules etc. shoot me a message and let’s chat about it. 

 Patrick,

What are you trying to accomplish? I guess I am missing your end goal here.

You could provide take offs if you wanted. I am not sure what it would gain you. But I personally avoid doing this both from the owner perspective and architect. If you are off by one unit of whatever it is, you are going to get killed in fees from when the GC has to order the missing unit, or from delays you cause, from having to re-roll crews, etc. The line may become blurry as to actual costs and delays caused by your oversight, and things that you may not be at fault for. Point is you waste time and money. Let the contractor do take offs IMO.

The penality you are looking for to avoid delays is called liquidated damages. I only see this in commerical, and in hundreds of projects the only time I saw a client ALMOST use it was on a $20mm project where the GC was 1.5years late, even then the client didn't do it because of the difficulty. 

Your arrangement with a contractor is a realtionship that builds trust over time. Have a contract written to let you out Incase of non-performance, but to expect reperations isn't realistic, especially on small residential projects.

And yes you should care if you annoy the contractor. It goes against the realtionship building aspect. 

@Patrick Philip  you can alleviate all of your concerns by hiring a professional general contractor. It’s in their best interest to get the job done quickly and efficiently that’s how they make money. A real pro will not drag it out. 

 If you want to control the subs and supply materials you’re going to have a hard time finding a GC to help you. Also you will not have any warranties from a general contractor if you’re making all the decisions and supplying materials.

Yes some GCs will open the books and line item everything when doing cost plus. 

@Patrick Philip I don't think you will find a GC to agree to all of your terms. Especially the penalty clause. Thats very unusual for residential construction. Also it is a violation of contractor law in most if not all state for a GC to pull a permit for you without otherwise being involved in the project. A GC can act as a CM and pull permits and oversee the project with you in control and you paying all bills directly but you will need a CM contract with them.

Best thing to do if you want to use a GC turn key is to find one that does the type of homes you are looking to build. Make sure they have been in business for 5 years or more, check with current and past customers and make sure to check some of their current job sites. You can tell a lot about a GC by the way his sites look and how many subs are on the job.

For contracts you can check out NAHB, AIA and DBIA for example contracts as well as local attorneys who specializes in real estate and construction law.

If you want that much control expect to take on the risk and liability exposure in return. No decent GC is going to let an owner run the show AND accept the liability for the owners potential shenanigans. 

A good contract will impose performance standards that will protect you in that regard. Schedules are tricky. Generally you hold a substantial portion of the Fee for after CO is received.

I have heard some GCs will pull permits for owners as a flat fee, the owner then does all the management. Have never gone this route personally. This route aligns with your last sentence in your post.