Real Estate Development – Finding the Right Builders
It is the wish of investors in the world to have a breakthrough in the real estate development industry. They find the real estate industry to be very lucrative. Real estate developers do however need the services of builders who will do the actual construction. There is therefore need for real estate developers to secure only the best builders for the projects. There are many parameters that determine whether a builder is good for the job or not.
Securing the right builder for an initial real estate development project is very important. Before the builder gets to work, the developer must prepare adequately for the project. The first thing is for the developer to get the necessary documentation. You can view documentation as the foundation of the construction project.
You need to have a bulletproof documentation for the builder to use as a foundation for the project. The details of how construction will be done are contained in the documentation. There is no room for assumption during quotation if the developer came up with a bulletproof documentation. The documentation should include drawings for the work, engineering plans, landscaping, soil and energy reports among others.
Inflation of the cost of building can be done by the builder if the documentation is not bulletproof. The loser then becomes the developer who incurs loses. If something is missed in the tender process, it will still have to be included but the cost will be significantly higher. Extra costs will definitely be footed by the developer. It is therefore important not to sign the contract with a builder without proper documentation.
The best builder can be found if custom liquidated damages contracts are signed beforehand. Liquidated damages in any contract usually dictate an amount of money that is payable as damages to the developer if the project is not completed within the stipulated timeline. You should not use plain faith that the builder will complete the project on time. Cover yourself against damages occasioned by prolonged construction by signing the custom liquidated damages contract.
As you tie down the builder with a liquidated damages contract, provide sufficient time in the contract for the builder to finish the project well. Less time allocated means that the work done could fail to be impressive due to the rush to beat the deadline. Of importance also is the concept that in real estate development, time equals money. This concept suggests that there must be a balance between the timelines for the completion of the project and the financial implicaitons. Have a plan that balances the financial implications and the timelines. If you consider all the above factors, you will be in the right position to get the best builder under the right deal for your real estate development work.