Developer’s contract key items checklist
1. Scope of work
- Clearly define the scope of work, detailing the tasks, responsibilities, and deliverables expected from the property developer.
2. Start date of construction
- Specify the agreed-upon start date for construction activities to commence.
3. Construction scheduling
- Outline a comprehensive construction schedule, including milestones, phases, and anticipated timelines.
4. Construction completion date
- Clearly state the expected date of project completion.
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5. Rain days extension
- Define provisions for extending project timelines due to inclement weather conditions.
6. Bonus and penalty fee clause
- Outline any potential bonuses for early completion and penalties for delayed project delivery.
7. Cost saving split
- Determine the percentage or method by which any cost savings achieved will be shared between the developer and the contractor.
8. Change orders
- Specify the process for handling changes or additions to the original scope of work, including approval procedures and potential cost adjustments.
9. Guarantees
- Clearly state any warranties or guarantees the developer provided regarding the work’s quality and durability.
10. Draw schedule
- Define the Schedule for releasing payments to the developer based on project milestones or completion of specific tasks.
11. Reserve
- Outline any provisions for setting aside funds as a reserve for unexpected project costs or contingencies.
12. Lien waivers
- Include clauses related to obtaining lien waivers from subcontractors and suppliers upon payment to protect against potential liens on the property.
13. Backcharges
- Detail procedures for addressing any costs incurred due to the developer’s negligence or errors.
14. Punch out
- Define the process for addressing and rectifying any outstanding issues or incomplete work identified during a final inspection.
15. Warranty
- Specify the duration and coverage of warranties provided by the developer for materials and workmanship.
16. Broom clean condition
- Define the condition where the property should be left after the project, including cleanliness and debris removal.
17. Staging of phases
- If applicable, outline the sequence in which different phases of the project should be completed.
18. Arbitration or litigation clause
- Specify the method of dispute resolution, whether through arbitration or litigation, in case of conflicts between the parties.
19. Construction contract outline
- Provide a high-level outline of the overall construction contract, indicating key sections and their corresponding page numbers.
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Here’s a simple breakdown of the key sections you’ll find in construction contracts, giving developers an idea of what’s covered:
Section 1: The contract documents
- This section introduces all the papers that make up the contract and help guide the project.
Section 2: Work
- Explains the tasks and things that need to be done in the project.
Section 3: Contractor’s duties and status
- Talks about what the contractor is responsible for and their role.
Section 4: Time of starting and finishing
- Covers when the work will begin and when it’s expected to be mostly done.
Section 5: Cost of the work and maximum cost
- Deals with how much the project will cost and the most it should cost.
Section 6: Contractor’s payment
- Discusses how much the contractor will get paid for doing the work.
Section 7: Changes in the work
- Explains what happens if things need to change during the project.
Section 8: Costs to be paid back
- Talks about which costs the developer will need to pay the contractor back for.
Section 9: Costs not to be paid back
- Lists the costs that the developer won’t need to reimburse.
Section 10: Discounts, rebates, and refunds
- If there are any deals or money coming back, this part explains it.
Section 11: Subcontracts and agreements
- Deals with if the contractor hires others to help and other agreements they make.
Section 12: Accounting, cost control, and records
- Explains how the money will be handled, how the costs will be controlled, and what records will be kept.
Section 13: Applications for payment
- Talks about how the contractor asks to be paid.
Section 14: Paying the contractor
- Explains how and when the contractor will get paid.
Section 15: Stored materials
- If there are materials left over, this section says what can happen to them.
Section 16: Insurance
- Talks about the insurance needed to keep the project safe.
Section 17: Notices
- This part talks about how and when the people involved should communicate important information.
Section 18: Assignment, governing law, and subordination
- Explains if and how the contract can be passed to someone else, the rules that apply to the contract, and how it relates to other agreements.
Section 19: Termination
- Discusses when and how the contract can be ended before the project is finished.
Section 20: Indemnification
- Explains who’s responsible if there are damages, losses, or costs because of the project.
Section 21: Miscellaneous provisions
- Covers other important things that don’t fit in the earlier sections.