The punch list consists mostly of incomplete or deficient items found on the substantial completion walkthrough. The contractor and the owner or owner’s representative will usually conduct a walk-through together where they compile a list of items that still need to be done, aren’t working as expected, or deviate from approved building plans. That’s up to the local building authority which issues certificates of occupancy.ĭetermining what counts as being “substantially complete” can be complex, and is very project-specific. While owners and contractors might agree the building is ready, they don’t have the authority to determine whether a building is up to code and safe. Get the AIA G-704 Certificate of Substantial Completion Many projects, especially those using contract documents from the American Institute of Architects (AIA), require a certificate of substantial completion. Substantial completion is the point in construction when the owner and contractor agree a building is ready for its intended use, even if minor work still needs to be done. Below are eight activities generally required to close out a project. The closeout process involves several steps. Eight Steps to a Successful Project Closeout In worst-case scenarios, contractors who cause closeouts to go long can be responsible for paying liquidated damages. Final payments are also often connected to completing closeout. For owners, prolonged closeout can result in losing money, as they pay for additional work while not have access to using or selling their building.įor contractors, an unexpectedly long closeout can drain their capacity to work on anything else. However, the longer closeout goes, the more resources are lost. Request a Demo What Happens When Closeout Goes Poorly Owners should understand what to expect, when to expect it, and someone should update them on delays to help maintain positive relationships that can turn into repeat business. Subcontractors should understand the required documentation before saying work is complete, and have an idea of a project’s timeline, so they know where they fit in and when they will likely get paid. Fostering effective communication makes the process easier to navigate and helps avoid stressful situations turning into heated interactions. CommunicationĬloseout requires an immense amount of problem-solving, negotiation, and coordination. Tracking change orders as they are submitted and completed helps many parts of closeout, including keeping as-is drawings up to date, making document submission easier, and helping people get paid sooner. A great example is change orders, which can happen many times on each project and can alter the project’s scope, schedule, and payment. Closeout becomes much more manageable when it's clear what documents have already been collected and where they are. Planning ahead only works if a general contractor has an organization system that ensures documentation collected throughout construction is thorough and accessible. A general contractor who has planned ahead will be able to collect these items while the subcontractor is still on the job, as opposed to tracking them down months later when they’ve moved on to other projects. For example, a general contractor must collect a number of documents from each subcontractor, such as manuals, warranties, or lien waivers. Many requirements for closeout - such as warranties or documents for obtaining a certificate of occupancy - are easier to collect while work is ongoing. Contractors who wait to begin thinking about closeout until the last few months of construction usually find themselves trying to complete an impossibly large number of tasks in an impossibly small amount of time. One of the best ways to ensure closeout is as smooth as possible is to start planning for it as soon as the project begins. There are a few things that always improve the process. In general, the larger the project, the longer and more demanding wrapping it up will be. However, a well-managed closeout is possible and is one of the biggest factors determining if a project finishes on time and on budget - and how likely a client is to come back for repeat business.Ĭloseouts vary in how complicated they are, based on the project and its intended use. Just based on the sheer number of variables involved, closeout has the potential to be very stressful and to go longer or require more work than expected. Contractors want to collect final payment and set themselves up for success on future projects. Project owners want to move into their building, open it for business, or sell it. Eight Steps to a Successful Project Closeout.
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