Monthly Archives: March 2016

yjjCommercial construction can feel overwhelming when you start to try to break down each of the steps that go into the process. You might wonder exactly where to start. Or, you might have questions about commercial construction in general. Read on to find the best commercial construction tips there are.

1. First, find a construction company that has a good reputation for being able to work with you, not just for you. This will also go a long ways towards making sure that future projects can have a solid start thanks to already knowing your contractor.

2. A good contractor will be a solid communicator as well. That communication can eliminate cost overruns and lead to a more smoothly run project. You will be better able to build up some trust along the way as well.

3. That also leads to you making sure you ask questions when you need an answer or you come across something that is not clear. Address concerns as they arise so the problem can be resolved and the project can stay on track instead of getting derailed, or the problem getting worse further down the road.

4. Dig into the past on the contractor you are planning to select. You will want one that is capable of doing the job you need and doing it well. Many states have the ability for you to check their construction contractor's license, which will tell you if the company has any liens against them as well as how long they have been in business.

5. Before looking at any subcontractors, hire a good general contractor. It can be easy to take bids in the order received, but unless you have a captain for your ship, you can't sail very far. The same is true of a construction project. You need that leader in place first.

6. Define your project's goals clearly so everyone involved understands their roles and what part they play in the project's success. It never hurts to have a meeting to clearly outline each subcontractor's role and responsibility.

7. Though you have your blueprints and project plan, it still is a good idea to brainstorm together. It helps everyone understand what the deliverables will be as the project goes along, and the subcontractors who deal with this type of work day in and day out will be best able to spot any potential issues before they become an actual problem. Their knowledge is one of your strongest assets.

8. Once you all have met and decided on the final plans and the construction timeline, break everything down into manageable stages with regular check in times. Mark down the milestones that are the highest priority and ensure everyone knows which ones they are. All of you will be working on your own aspects of the project and you don't want anything to get lost. You will all know which of the tasks are the most time consuming, too, so everyone will be able to keep them in mind and not panic trying to get them completed.

9. Use technology to your advantage by downloading some of the new construction project management apps. They are designed to help you keep in touch and on top of your project no matter where you are.
We hope these top tips will give you the advantage you need in order to be successful. Best wishes for a construction project well done!

seryOne of the main reasons that a commercial property transaction might fall through when it is near to closing is because one of the parties has forgotten an important aspect of the transaction that needs to be considered before the relevant documents can be signed.

With that in mind we have created a small checklist of things that you need to keep in mind when closing on a commercial real estate property, to make sure that you cover all of the bases.

Acquisition Documents

You need to ensure that all of the documents relating to the purchase are in place and ready. This includes all of the following:

• A signed letter of intent
• Any and all drafts of the purchase contract
• Any information relating to your legal counsel
• Access agreements
• Any client or portfolio manager authorisation that is required
• A fully completed purchase contract, that will be delivered into escrow
• Documentation for the initial cash deposits for the purchase
• Arranging for any bank accounts required to be set up

Title Matters

Title and zoning issues are also a high priority, so make sure you have the following:

• You have selected a title company whom you can send the seller's title commitment to
• Have an ALTA survey carried out and ensure you have the right documentation
• Verify that all relevant leases and assets are in the seller's name

Tenant Issues

If you are buying an apartment building or any form of commercial property where other businesses may become tenants and lease out space, you need to have all of the following:

• A current certified rent roll
• A review of all current leases and the related documentation for each.
• Your legal counsel should look over these leases and compare to the current review
• You need to look over all current tenant files
• Resolve any outstanding issues regarding lease
• Receive all reports relating to the tenants, including sales and receivables reports
• Transfer all tenant security deposits
• Review the tenant credit and payment history
• Prepare and sign the tenant Estoppel Certificates
• Final check on all documentation

Financial

The transfer of all relevant financial information is extremely important as well. This includes:

• Copies of any historical or proforma financial information
• Copies of utility bills
• Most recent tax statements
• An expense list for all expenses currently operating under the property

Litigation

You will need to consider the possibility that there is any current action against the property or the existing owners and take that into consideration.

Insurance

Getting insurance for the building is crucial, so it is important to get a quote as early into the proceedings as possible. Some of this may be covered by the Property Management Agreement.

Physical Property Inspection

Before any transaction is completed a physical property inspection must be carried out by the buyer to ensure that they are getting everything that they expect from the property.

Final Closing Documentation

To complete the transaction all of the relevant financial and legal documentation must be completed and handed in on time and be completely accurate.

34Commercial construction is often an arbiter of changing economic conditions. Construction projects mean both an improving economy and a way to improve the economy of a given area. Read on to learn more interesting facts about it.

This type of construction helps public sector agencies as well as private firms. Big new schools in areas where people are moving give students a chance to learn in state of the art facilities. New office buildings bring jobs to the area, and the upward spiral continues. Not only do the buildings benefit the users, but the building process itself gives workers a solid job for several months, and the expenditures from the construction project go directly into the local economy.

The United States is second in the world in terms of this construction, regardless of where the company doing the building is headquartered. As much as 10% of all commercial construction takes place in the US, and New York is the city with the most commercial construction going on - $8.5 billion (that's billion with a B) in 2013. A lot of the construction was for residential buildings. Following New York were Houston and Dallas. Those two cities spent $10 billion in 2013 on commercial projects.
One of the biggest trends in commercial construction is green building. Experts from the Environmental Protection Agency expect that by 2017 as much as 48% of new building will be done with green building materials. To put that in financial terms, it could mean as much as $145 billion dollars.

By 2018, 84% of residential construction companies plan to have at least some of their construction projects classified as green. To get an idea of just what kind of impact this has on the overall economy, consider that residential projects total as much as 5% of the current gross domestic product of the US. As more and more firms add green building to their plans, it might mean that as much as 18% of GDP will be based around green construction.

Big commercial office buildings are going green, too. LEED certification is becoming the main standard, and builders are up to 41% green as of 2012. Just how rapidly is this growing? Consider that only 2% of commercial construction, non-residential, projects were green in 2005. It's no surprise that states like Hawaii and California are leading the way in LEED projects.

It's not just the US that is interested in green construction, though. LEED certifications around the world are becoming more common. A study released earlier this year showed that as many as 69,000 LEED projects are going on globally in 150 different countries.

This construction is as important to the global economy as it has ever been, and the increases in such projects over the last few years signal a positive change after the worldwide recession of 2008-09 and the soft recovery that followed. With even more green projects being planned than ever before, commercial construction projects will also be kinder to the planet, meaning everyone will benefit for years to come.

wtCommercial construction is a vastly different process than residential construction is. The scale is completely different, and the bidding/permitting process is unique. There are more factors to consider and more environmental impacts to account for at each step along the way. There are some special components to contemplate when it comes to commercial construction - let's take a look at some of them.

First, make sure a professional architect or estimating engineer does your blueprints. It might be OK to build a home off of sketches, but a commercial project can't run that way. You will need to submit your prints for approval from the local authorities and you will have to present these to your contractors. Professional plans will ensure that everyone is all on the same page and that you will get the project you want in the end.

Make sure that all of the permits you need are taken out and that necessary inspections are taking place on the right schedule. It can be financially devastating to have your construction project shut down because an inspector is not satisfied with an aspect of your progress, or worse, that he or she sees something dangerous.

Take the time to make sure that your plans are complete and that your specs are all-encompassing. This bit of time spent at the beginning can pay big dividends, sometimes literally, down the road. Conversely, making changes late in the project's progress can be more costly than if they had been incorporated at the beginning.

Line up your financing before a single shovel is picked up, or else things will be delayed mid-project. Those delays can end up costing more than the project would have originally, even though the actual number of work days is the same. Having full financing sources to keep you going all the way to the end of the project will also help you be successful. That financing needs to pay for all of the project's costs, plus it should include a bit of a cushion to handle the unexpected.

Once your project is prepped and ready, send out for a number of bids and read each one over carefully. Look for a successful track record by any of the contractors and subcontractors, and check their bids to ensure that they have accounted for everything in your project. Just because a company is the low bidder doesn't make them the right choice.

After you have selected your contractor, read over the contract carefully to ensure that everything is accurate and that all the points you want covered are indeed covered. Then, inspect what you expect - stop by and check in with your project manager regularly to make sure that everything is progressing on the right schedule.

Any changes that need to be made should be done in writing and agreed to by both the contractor(s) and you so everyone is in accord and that all of the details have been worked out.

Lastly, be sure everyone knows what the timeline is. Each phase of the project should have a deadline, and a cushion should be built into each phase so if there is one delay at an early stage, it won't negatively impact the entire project and make it run past the completion date.