When Pre-Qualifying General Contractors, is anything off limits or is all fair game?
CM/GC’s are expected to be interviewed, researched and vetted and if done so in a professional manner nothing is off limits. You’re trying to gather as much information as possible to help make an intelligent decision.
Owner’s Reps have checklists that helps organize and profile the most qualified CM/GC to assist the owner in awarding the project. All this takes time especially if you’re interviewing multiple candidates. But also remember if this process is done professionally upfront, the owner hopefully will learn to appreciate the due diligence especially when the project starts having challenges.
For Prequal, the informal approach works efficiently for first cut. Invite a presentation with their marketing material including a Prequal form such as AIA Prequal Form. These meetings are to get acquainted with experience and capacity. Next cut is a formal Prequal format for the viable contractors. At this cut they are affirmed that it is worth their effort for the likelihood of making the short list.
Ask any and as many questions that are RELEVENT to the project. Relevancy is key and asking too much or irrelevant questions can raise concerns that affect responses. These all create a burden that may drive away potential good GCs that interpret this as the start of a difficult owner relationship or that the potential project isn’t worth the investment. On requesting financial statements, confidentiality is key and this may be best requested last after trust and relevancy is established.
Owner’s Representatives assist clients in determining the balance between protecting the owner and unreasonably burdening the GC.
Some typical questions asked:
1. How long have you been in business?
2. Have you or your partners worked under any other names?
3. Describe your experience in this type of construction?
4. Are you willing to negotiate this project on an “Open Book” basis?
5. Will you obtain at least 3 bids for each subcontractor category?
6. What construction work is typically performed by your company?
7. What are your rates for various employees? Superintendent, Carpenter, Laborer?
8. What is your anticipated OH& P?
9. How is OH &P calculated?
10. How do you calculate OH&P on additive and deductive change orders?
11. How do you control subcontractor markup on additive and deductive change orders?
12. On a typical Tenant Improvement Project do you usually end up within 5% of your estimate when the project ends?
13. How are your general conditions calculated?
14. How do you handle General Conditions and “Work Arounds,” when unexpected conditions arise that may impact schedule?
15. In your review of the plans have you identified any substantial “value engineering” items that might save the Owner money without negatively impacting project schedule and / or quality?
16. Do you have any questions about the bid documents at this time?
17. Who might be your project manager and superintendent?
18. Do you anticipate having a full-time superintendent on site for the project duration?
19. Does your project manager or superintendent have any vacation planned during our project’s timeframe? If so, do how will you cover the project during their absence?
20. What is the experience level of the superintendent that you anticipate assigning to this project?
21. How long has your superintendent worked for you?
22. Do you charge for estimates and pre-construction work?
23. On average how many jobs do you do per year?
24. On average how many jobs do you work concurrently?
25. How many jobs do you expect you will be working at the same time as ours? How will this affect your ability to staff our project?
26. How many employees do they employ?
27. Would you be willing provide a bank reference?
28. What is the level of insurance coverage you currently carry (per project and overall)?
29. If hired, are you willing to name the Owner as a co-insured party and provide a copy of your insurance certificate(s)?
30. Have you ever failed to complete any project?
31. Have you had any legal action brought against you as the result of work you have performed? If yes, why, and what was the outcome?
32. How many change orders would you consider average per job? Are their charges or fees for a change order (other than the obvious costs for the change)?
32.5. Do they have a CIP (Contractor Controlled Insurance Program) or will you be looking for them to sign an OCIP (Controlled Insurance Program).
There are unending ways to research and uncover every minutia of a GC, hence why the list doesn’t end at 33. The goal is finding CM/GCs that share your interest of working in the interest of the owner and the owner respecting that the GC needs to make a reasonable profit. The decision of who you award becomes straight forward, which is the result of good due diligence.
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