A construction project has three phases: the pre-construction phase, construction phase, and the post-construction phase. All of these phases involve a lot of activities. Moreover, each of them needs individual contractors to increase the chances of having a high-quality construction. In the pre-construction phase, the very first task you have to do is to get into a business settlement or partnership with a pre-construction services contractor. To do this, both the contractor and client must produce a legal document that delineates the planning process, construction management responsibilities, pricing development, and more. Learn more by browsing through our article and examples below.
A pre-construction services agreement (PCSA) is a process document that spells out the business arrangement between a pre-construction service contractor and a particular customer. According to the Designing Buildings Wiki, it should clearly describe the contractor’s scope of work, the involved parties’ accountabilities, procedures of unfulfilled responsibilities, payment methods, payment schedules, and stipulations on late payments. Another set of its usual content includes the pre-construction plan, feasibility analysis or buildability, technical specifications, as well as the financial proposal. Through the documentation of these pieces of information, the participants have proof to protect them if they carry out a dispute to the other.
Pre-construction is the construction project phase that details a series of tasks before the actual construction begins. In the past, most construction firms did not consider the undertaking as part of the construction project. However, the perception started to change as modern construction takes place. The following is the list of activities for pre-construction.
– Appoint the project manager
– Develop the strategic plan
– Create the construction project’s design
– Secure construction permits and other authorizations
– Picking and integrating general contractors and subcontractors
– Procurement of construction materials, equipment, and labor force
Writing contracts and agreements, such as PCSA, adopts technical writing. This means that you have to make your document as simple as possible without compromising its technicality. And since such an agreement involves business matters, it follows certain standards, especially in its sections. Through these facts, it’s clear to see how hassle it is to create one. Fortunately for you, we have set out our standardized outline of such an agreement’s document flow. Not only that, each of the outline’s items includes easy to understand descriptions.
Start your PCSA with the statement of purpose. It should include descriptions of the pre-construction phase and the general business agreement between you and the client. Besides that, you should also incorporate your construction firm’s complete and legal name, as well as that of your client.
Pre-construction service providers differ from one another in terms of their service offers. So to make things clearer for the client, you should thoroughly set your firm’s pre-construction service coverage. You can make the pre-construction activities mentioned above as your reference.
One of the pre-construction activities is the development of project design. Both you and the client have tasks to fulfill during the activity. You must elaborate on what these tasks are to constantly make both of you well-informed of what to do throughout the development of the construction project plan. For this section, you also have to seek guidance from architects and engineers.
Permits and entitlements are some of the documents that are necessary for the pre-construction phase to push through. They ensure that the service complies with the state and local regulations. As participants of the PCSA, both you and your client must share duties and accountabilities in creating these documents.
Every detail of your PCSA is confidential. For this reason, you have to include a clause that discusses the non-disclosure agreement (NDA) or the data confidentiality agreement. Aside from that, you have to settle who will have the rights over all of the documents, from the building design to the permits.
Rates per hour, flat rates, cash deposits, recurring payment agreements, and payment schedules are a few things that you must never forget to take into account. Obviously, this section is necessary to acquire the appropriate exchange for your firm’s efforts, just like how business transactions should be done.
There are many reasons why disputes happen in construction services. According to Gregory Brown of Brown & Charbonneau, LLP, the said reasons usually consist of the following:
– Poor construction quality
– Unutilized construction materials
– Abandonment of construction project
Step 1: Visit your local building office
Step 2: Prepare permit application
Step 3: Submit the permit application
Step 4: Post building certificate
Step 5: Get Your Site Audited
Pulling up permits, finalizing your plan, and securing the construction funds will usually take at least two months to complete, depending on how big the project is.
Properties that do not have building permits will prevent owners from selling the house. Moreover, their property insurance policy will refuse to cover damages caused by fires, plumbing issues, and other mishaps.
Abraham Lincoln once said, “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.”. Every business undertaking needs proper preparation. Doing so lets you see your goals and objectives in a bigger picture, giving you the chance to strategize your approach to reach your targets without any problems. Because of its importance, it has become a standard practice in the construction industry. Not only that, but some construction firms also start to specialize in that aspect. And since you have mastered the art of preparations, you know very well how to prepare a pre-construction services agreement for your potential clients. Then again, you can’t afford to make mistakes. Therefore, a little guidance like our article and examples is necessary.