August 22, 2024 - News

Understanding General Contracting

Completing a commercial building project on time and within budget requires a skilled general contractor (GC) that can overcome unforeseen challenges on the job site. Cost overruns, schedule delays, labor shortages and subcontractor management are just a few of the obstacles faced by general contractors.

GCs manage every aspect of the commercial construction process, while mitigating risk for clients. Before working with a general contractor, it is essential to understand their role and responsibilities in the commercial construction process.

What is a commercial general contractor?

A commercial general contractor (GC) is a company responsible for overseeing the construction or renovation of commercial properties to ensure a timely and cost-effective project for the property owner.

A general contracting services company may work on the following types of projects:

• Industrial: warehouses, distribution centers, heavy & light manufacturing, self-storage, cold storage, data centers, showrooms and flex space.
• Retail: shopping centers, community centers, power centers, convenience stores, restaurants and freestanding buildings.
• Multifamily: residential buildings including apartments, townhomes, condominiums, student housing, senior housing as well as mixed-use developments.
• Office: traditional, creative, coworking and medical office buildings.

Each property type requires the general contracting team to have project-specific knowledge. Jobs come in all shapes and sizes so it is important to consider the type of construction before working with a general contractor.

Who hires a general contracting company?

1. Real estate developers: developers who build commercial projects from the ground up hire a GC to manage construction work from start to finish
2. Property owners/investors: individuals or companies that own commercial properties hire a general contracting firm for new construction, redevelopment and tenant fit-outs.
3. Businesses/corporations: companies or corporations hire a GC to build projects such as office, retail and warehouse spaces.
4. Architects/design firms: it is common for architects and design teams to hire a GC on behalf of a client to ensure the new build meets design specifications.
5. Government agencies: city, state or federal government governments work with a licensed general contracting firm to complete schools, hospitals and infrastructure.

Understanding the role of a general contractor

A general contracting company plays a key role in the construction process. While a property owner might be tempted to work on a project alone, a skilled GC ensures a quality result and timely delivery. As the primary point of contact, the general contractor manages all aspects of the project from start to finish.

The property owner hires a GC to do the following:

• Project Management and Coordination: general contractors create a detailed project plan, schedule tasks, and ensure that every phase of the project aligns with the timeline. As a result, subcontractors, suppliers, and vendors collaborate seamlessly.
• Budget Management and Cost Control: a commercial general contractor is responsible for estimating project costs accurately and keeping the project within budget. This includes negotiating contracts with suppliers and subcontractors, monitoring expenses, and making adjustments to prevent cost overruns.
• Compliance and Quality Assurance: a GC ensures compliance with local building codes, regulations, and safety standards. They oversee inspections, obtain necessary permits, and guarantee that the development meets all legal requirements.
• Risk Management and Problem Solving: a commercial general contractor anticipates potential risks, such as delays, unforeseen site conditions, or supply chain issues, and develops strategies to mitigate them. Their ability to solve problems swiftly and efficiently is vital to keeping the project on track and avoiding costly disruptions.

What are the advantages of working with a general contractor?

Property owners partner with general contractors with a proven track record to reduce cost, shorten the construction timeline and mitigate risk. Working with a GC allows the developer to streamline the entire project, from start to finish.

Here are some of the benefits of working with a commercial contractor on your next job:

1. Established network of subcontractors and vendors: commercial construction projects involve a wide range of subcontractors. Site preparation, concrete, plumbing, electrical, HVAC, structural and framing are just a few of the types of subcontractors that work under a general contractor’s direction. Subcontractors and vendors often respond favorably to general contractors, as they have likely collaborated before or have been recommended by former clients.
2. Detailed project planning and reporting: a commercial general contractor creates and manages the project timeline as efficiently as possible. They ensure that the proper materials, equipment, permits and subcontractors are obtained and implemented. GCs also manage all necessary reporting such as progress, financial, quality and safety reports.
3. Risk management and compliance: a proficient general contracting company manages various types of risk on and off the job site. Some of the common threats to construction work include legal disputes over contracts and risks related to resource management. Furthermore, GCs are well-versed in local building codes and the permitting process.

Now that we know the key roles of a commercial general contractor, let’s take a closer look at the different phases in the construction process and how a GC fits into each stage of a project.

Pre-Construction Phase

The pre-construction phase is a critical period where foundational elements of the project are planned and secured. The duties of general contractors include:

• Planning
• Budgeting
• Recruiting subcontractors
• Securing permits and licenses

This phase involves creating a comprehensive team effort, including architects, engineers, construction managers, and general contractors working together to ensure a smooth start to the project.

Planning and Budgeting

General contractors collaborate with estimators to develop accurate construction budgets by:

• Analyzing the project scope, specifications, and building codes
• Providing crucial oversight to spot potential extra costs in project plans
• Suggesting affordable adjustments

This collaboration ensures that the construction project, also known as the building project, is completed, stays within budget and meets all necessary requirements, thanks to the dedicated team.

An accurate construction budget includes direct costs like labor, materials, and equipment, as well as indirect costs such as administrative expenses and utility costs.

Hiring Subcontractors

To hire subcontractors for specialized tasks is necessary in a construction project. General contractors ensure that subcontractors are selected based on their specialization and the specific needs of the project. This involves reviewing qualifications, past performance, and ensuring they meet project timelines.

All agreements and project details are documented in comprehensive contracts before work begins.

Permits and Licensing

Acquiring the required permits and licenses is a key duty of general contractors. They are tasked with navigating local zoning laws and building codes to ensure compliance with all regulations. By applying for necessary permits early in the pre-construction phase, general contractors can expedite the permitting process and avoid potential delays.

Construction Phase

During the construction phase, the construction manager, also known as the general contractor, plays an increasingly vital role. They:

• Manage project tasks
• Ensure quality control
• Maintain project timelines
• Coordinate with subcontractors on a daily basis
• Manage on-site activities
• Ensure timely arrival of materials and equipment

This phase requires effective coordination and management to ensure the successful completion of the project.

Project Management

Effective project management by general contractors involves day-to-day oversight and:

• Overseeing daily activities
• Coordinating subcontractors
• Keeping clients informed about progress
• Managing on-site personnel, ensuring proper task delegation and coordination of day-to-day activities
• Maintaining agreed deadlines and budgets
• Tracking job progress with work-in-progress reports
• Managing cash flow

Quality Control

Quality control is a critical aspect of a general contractor’s responsibilities. They ensure that construction work adheres to safety practices and meets specified standards. Regular inspections are conducted to verify that the construction meets client expectations and all prerequisite inspections are passed before the final inspection.

Timeline and Scheduling

Establishing and upholding project schedules is necessary for the prompt completion of construction projects. General contractors are responsible for schedule monitoring to ensure that project deadlines are met and costly delays are avoided. This streamlined process helps keep the project on track and minimizes disruptions.

Post-Construction Phase

The post-construction phase is the final stretch where the project is polished and handed over to the client. It includes final inspections, client handover, and addressing any remaining deficiencies.

This phase verifies that all work aligns with the contract documents and local regulations prior to the official project completion.

Final Inspections

Final inspections are conducted to ensure that all work complies with contract specifications and local regulations. The general contractor schedules these inspections and must be present during them to address any discrepancies. Documentation, including photos taken during the construction process, is crucial for addressing inspector queries.

Client Handover

Client handover involves transferring blueprints, operation manuals, and providing support during the transition to ensure customer satisfaction. The general contractor remains available to assist the client with understanding and operating the new systems and equipment, ensuring a smooth transition.

Addressing Deficiencies

Addressing deficiencies is a key step in the post-construction phase. A punch list is used to document any remaining work or damage that needs immediate attention before final payment is made. This ensures that all issues are resolved to the client’s satisfaction, completing the project in its entirety.

Licensing and Qualifications

The various licensing requirements and qualifications for general contractors differ by state, involving potential requirements such as exams, background checks, and ongoing education. These regulations ensure that general contractors possess the necessary expertise and adhere to industry standards.

State Requirements

State requirements for general contractor licenses often include submitting a license application, proof of insurance, and passing exams. Some states require general contractors to pass both business management and trade exams, and background checks might be necessary to obtain the license.

States may also have reciprocal agreements to simplify the licensing process for out-of-state contractors.

Educational Background

Many general contractors pursue degrees in construction science, building science, or related disciplines to solidify their educational foundations for their career. These academic backgrounds provide them with the necessary knowledge and skills to excel in their field.

These qualifications help ensure that contractors have the technical knowledge required to manage complex construction projects effectively.

What to look for when hiring a general contractor?

• Extensive Experience: it’s crucial for property owners to choose a general contracting company with a proven track record of successfully completing a range of commercial construction projects within their specific project type.
• Innovative Solutions: many GCs use outdated methods and lack the necessary technology. It is important to find a general contractor that uses industry-leading technology and innovative construction methods to deliver efficient, sustainable, and reliable building solutions.
• Comprehensive Services: it is essential to work with a GC that is involved in every aspect of the construction process. A company that offers pre-construction planning, design-build, general contracting, construction management, and renovation/retrofit, ensures a seamless process from start to finish.

Summary

In summary, general contractors play an indispensable role in the construction industry, overseeing every phase from pre-construction planning and budgeting to final inspections and client handover. They ensure that construction projects are completed safely, on time, and within budget, while maintaining quality and compliance with local regulations.

By understanding the responsibilities and qualifications of general contractors, property owners can make informed decisions when embarking on a building project. Choosing the right general contractor, backed by thorough research and evaluation, can significantly impact the success of your project.

As you venture into your next construction endeavor, remember that a skilled general contractor is not just a manager, but a partner in bringing your vision to reality.

Frequently Asked Questions

What is the role of a general contractor in a construction project?

The role of a general contractor in a construction project is to oversee the entire process from start to finish, including planning, budgeting, hiring subcontractors, obtaining permits, ensuring quality control, and maintaining project timelines.

Why is hiring specialized subcontractors important in construction projects?

Hiring specialized subcontractors in construction projects is important because they have expertise in specific trades, such as carpentry or roofing, which is essential for completing specific tasks within the project. General contractors ensure that these subcontractors are qualified and meet project timelines.

What are the key elements involved in the pre-construction phase?

The key elements in the pre-construction phase include planning, budgeting, subcontractor hiring, and obtaining permits and licenses, which are essential for laying the foundation of the project.

How do general contractors ensure quality control during the construction phase?

General contractors ensure quality control during the construction phase by conducting regular inspections to ensure safety practices and specified standards are met. They are responsible for delivering quality work to the client and ensuring all necessary inspections are passed before the final inspection.

What are the typical payment processes in a construction project?

In a construction project, the typical payment processes include an initial deposit, progress payments linked to project milestones, and a final payment upon completion. Retainage, where a percentage of each payment is held until project completion, is also common.