What to Consider before Starting a Commercial Construction Project
Whether you are building out a new space, doing tenant improvements, or remodeling an existing location, it’s important to understand the process and partner with a commercial contractor you can trust to do a great job and stay on budget.
Finding a Commercial Space
If you are still looking for a space, the first step is to find a commercial real estate broker. It doesn’t matter if you are looking to lease or buy, a commercial real estate broker will help you find the perfect location and provide you with valuable insights. They will speed up the process and help you avoid major mistakes and pitfalls. If you already have a contractor in mind, ask them if they can recommend a commercial real estate broker. A good general contractor will refer you to a local broker who they have worked with before.
If you are looking to purchase a property that needs updates in order to be usable for your business, be sure to consult with your broker prior to making an offer. It may even be wise to get a quote from a general contractor before making an offer, so you can consider the impact of future improvements on your budget. Then your broker can build an offer around your “all in” budget or can help you find better options.
Finding a Commercial General Contractor
If you are already working with a broker, they will likely refer you to a general contractor. But don’t jump into anything too fast. Be sure to get bids from at least two contractors to get a feel for their strengths and compare their prices. It may be a bit more legwork, but thorough comparison you will help you to find the best fit for the job at the right price. Research what types of businesses possible general contractors have worked with in the past; reach out to those businesses. Check online reviews on Google, Angie’s List, Better Business Bureau, and other review websites. When you find a general contractor who comes highly recommend and has great reviews, dig a little deeper and look at past projects. Does this company have experience in projects similar to yours? Do you like their aesthetic?
When making the final decision, go with your gut. It’s important to connect on a personal level with the construction company you choose. You should feel like they understand and listen to you. Most of all, you should trust your general contractor. Seek a company that makes all their decisions based on your best interest.
Last but not least, double check that your chosen contractor is fully licensed and insured. This is more of a box to check, rather than a conversation that needs to be had. Nevertheless, be sure to check with your prospective general contractor to ensure that they meet all local, state and national requirements.
If your existing business is relocating or opening a new location, it’s important to consider how construction will impact your budget, employee schedules, hours of operation, and more.
It is important to discuss a realistic timeline with your possible contractors. Understanding their schedule and its effect on your budget and timeline is especially important if your business can’t be open during construction. Things like noise, level, parking, storage, and daily clean up are critical to the safety and comfort of your staff and customers during construction.
Scope and Budget of the Project
When you begin looking for a contractor for your commercial construction project you should have a clear idea of your budget. But remember that each contractor will have different timelines, ideas, and prices. These all affect your budget, either directly with price changes or indirectly in how business revenue is affected.
The scope of the project is another key thing to consider while budgeting. Are you planning on rooting your business in this location for the foreseeable future or do you have a growth plan that will require you to relocate in a couple of years? Your project scope should match future plans for your business.
Commercial Construction Project Timeline
Your desired timeline could be a deciding factor when choosing a general contractor. There are three things that should be considered when determining a realistic timeline for a commercial construction project.
- Funding: If you are working with a bank for a loan to fund a project, but sure to loop in your broker. They will help you understand a realistic timeline based on the information provided by your bank.
- Permitting: Permits vary by City and County. Your General Contractor should provide insight on permitting requirements and wait periods, in your area.
- General Contractor’s Availability: When pricing out options for a contractor, be sure to ask about when they are available to start the project and their projected date of completion. Their project pipeline could impact where your project fits on the schedule.
Maintaining Communication with Your Contractor
By following the above recommendations, you will have the tools you need to have your project go smoothly. But, especially in commercial projects with existing buildings, delays and complications can occur. It is extremely important to always maintain clear communication. Communicate your expectations and needs. If you have any questions, or need something clarified, make sure and ask.