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Once you've signed the final copy of your commercial lease, it means you have negotiated terms for a build out of your office, industrial or retail space. One of the best ways to save time and money, and ensure your build out is done in a timely manner is to hire a general contractor who will serve as your project manager. He or she will help you through the design and planning process, pull necessary permits, and complete your build out so you can focus on other aspects of getting ready to open your doors.
Beware that some commercial contractors are better than others (calling Captain Obvious!), so you need to choose carefully. Below we provide tips on the how to choose a commercial contractor for your office, industrial or retail build out.
Reach out to friends, family members, and other trusted business owners for referrals. Your closest friends and peers are not going to refer a contractor, unless they are sure the contractor is qualified and reputable.
Any of the professionals you have dealt with during the leasing process might also have referrals for commercial contractors.
This can include commercial real estate brokers, property management companies, and even you landlord (who will have a list of contractors that are already approved for the building).
A referral, however, should not replace references, which we will cover later on.
Also, don't underestimate the power of the internet. You can read Google and Yelp reviews about all kinds of businesses, including contractors. The Better Business Bureau might also provide information about commercial contractors, especially if previous projects didn't go well and clients filed complaints.
Finally, check Angie's List, a website which offers reviews on service providers.
Angie's List collects ratings and reviews on more than 700 services, including commercial contractors.
Unlike other review sites, people cannot submit anonymous reviews to Angie's List, which keeps their ratings honest.
When you check out reviews, you can learn project details such as cost and how well a contractor performed in terms of response time, price, professionalism, and quality.
Your search for a commercial contractor will typically include accepting at least two competing bids for the work you need done. The contractor will review your project and provide you plans accompanied by a cost estimate.
Make sure that all contractors you invite to bid on your project understand your needs the same way and approach them similarly, so you compare apples to apples when you compare bids.
Contractors who want to have a lot of financial cushion so they can hide things do not offer detailed bids.
You need to look for a contractor who itemizes as much as possible in the beginning stages.
More details suggest he or she has a good handle on the cost and won't come to you later asking for more money to complete your project.
You should keep in mind that unforeseen complications can increase the budget of a build out, but consistently overshooting estimated costs for every aspect of a project is a good sign you might have made a poor choice in contractors. If you ask a potential commercial contractor to offer a more detailed bid and he or she refuses, it's in your best interest to accept another bid.
Most states and/or counties require contractors to obtain a license. You are entrusting one person to oversee your entire business project, which is likely at least tens of thousands of dollars in materials and labor, perhaps much more.
Although plenty of unlicensed people are competent at performing some or all of the tasks associated with a build out, you aren't protected if they make a mistake or completely botch the job.
Most states require licensed contractors to be bonded and insured. If a worker gets injured on your property during construction or the contractor doesn't follow your plan or complete the job, you have a higher likelihood of recovering associated losses.
Qualified and reputable commercial contractors will have not problem providing you with a list of at least three or four references from previous projects they have completed.
Don't just assume the references are okay. Instead, make sure to call and learn about your potential contractor. Some questions you should ask include:
As mentioned above, a referral shouldn't replace checking a contractor's references.
You should expect if someone close to you gave you a referral for a contractor that you should get positive feedback when you check references. This might not always be the case, so take the time to make a few calls just in case and make a careful decision based on the information you gather from speaking to references.
Getting ready to open or relocate your business can be a nerve-wracking experience. You want and need to know that everything in your build out is going as planned. And, in some cases, you might find things aren't exactly as you hoped. It's in these situations that some contractors fall off the face of the earth or never have time to speak with you, answer your questions, or address any issues you might have. For your own sanity, find a general contractor who will offer you regular updates and communicates with you when questions arise, instead of making crucial decisions without your input.
Ask what method of communication your contractor uses - phone calls and emails are most common, but I have seen contractors do regular video updates to visually showcase the status of the space, and others use project management software products like Trello and Monday.com to keep the tenant in loop.
When you check references, you will learn about a commercial contractor's success or failures on past jobs, but you also need to review a commercial contractor's past experience (in your industry and track record with your landlord) to make sure you have the right contractor for the job.
If you are doing a build out for a restaurant lease, a commercial contractor who does build outs in medical offices or warehouse facilities will likely not be the best fit for your project.
Depending on your exact location and business you might not find an exact industry fit, but you should be able to at least find a contractor who is industry adjacent. For example, a general contractor who has done build outs on several bars will probably do a good job in a coffee shop or cafe.