There exist five Types of Construction Contracts: fixed price (or lump sum), time and materials (T&M), unit price, guaranteed maximum price (GMP), and cost-plus. Each of these contract variations is appropriate for certain projects but not universally applicable. Additionally, each type presents both advantages and disadvantages for the diverse stakeholders participating in a construction endeavor. […]
A contract with a guaranteed maximum price (GMP Contracts in Construction) establishes the highest cost for a construction project, and any additional expenses beyond that limit are the responsibility of the contractor. Also known as a construction manager at risk contract, this form of construction agreement reduces financial risk for the owner by defining a […]
Time and Materials Contracts are construction arrangements in which the project owner compensates the contractor for all material and labor expenses, along with a markup. In contrast to lump sum contracts, a T&M contract relies on the actual time and materials invested in a project, rather than a predetermined fee. This construction agreement is frequently […]
The construction process consists of several phases, starting from predevelopment to closeout. In the preconstruction stage, the drawings are finalized and a general contractor is chosen. However, before the project can begin, subcontractors and suppliers need to be selected through a process called “buyout.” – “Construction Buyout” This article provides a comprehensive overview of the […]
When embarking on a new construction project, the choice of project delivery method is crucial as it determines the roles and responsibilities of project stakeholders throughout the design and construction process. Two popular project delivery structures are CMAR vs Design-Build (design-build and construction manager) at risk, each offering benefits and challenges to stakeholders. Owners must […]
Change management in construction encompasses any modifications made to the initial scope of work once a project is underway. These changes, whether they are minor or significant, have the potential to impact the project’s budget, costs, and schedule. Therefore, it is crucial to approach change management diligently to mitigate risks and prevent delays. The Significance […]
Construction Manager at Risk (CMAR) is a project delivery method where the owner contracts a construction manager to take on a construction project from its design phase through project closeout. This approach is favored by owners as the CMAR contract shifts a significant portion of the risk and responsibility associated with the construction project to […]
