The commercial terms
Five Things That Decide Whether the Deal Works
Contract structure, contingency, draws, schedule risk and escalation. None of them is about construction and all of them determine your return.
Bring the site, the unit count and the drawings at whatever stage. You get a range, the drivers, and an honest read on the pro forma.
Self-perform
Dewatering, SOE and deep foundations in house
Licensed
General contractor, licensed in the state of Florida
GMP
Open book, with the contingency visible to you
Draws
Documentation your lender can actually process
5 the commercial terms
Written for the person carrying the pro forma.
GMP & Contract Structure
A guaranteed maximum price is the standard structure for multifamily, and how it is assembled matters more than the number on the front.
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Lender Draws
Your lender is a stakeholder in the program whether or not anyone treats them as one. A draw that gets rejected costs you a month of carry.
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Contingency
Contingency is not padding and it is not free money. It is a bounded provision for things nobody could reasonably have known, and it should be governed as such.
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Schedule Risk
On a multifamily deal a month of delay costs carry plus a month of deferred lease-up, and that combination is usually larger than any construction saving anyone negotiated.
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Material Escalation
Between pricing and buying, materials move. Somebody carries that, and the contract should say who rather than leaving it to be argued.
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Next step
Find out what is actually wrong with it.
An inspection, photographs of what we found, and a written scope. If the honest answer is that it can wait another season, that is the answer you will get.