Most general contractors work on a cost based percentage. A cost-plus fee arrangement is the actual cost to build your home plus a fee to manage and coordinate the project. The fee is usually set as a percentage of the actual cost to build the home. Depending on the area, this percentage is usually set between 10% to 17% of the building cost.
One of the significant problems with this approach is--the higher the cost, the higher the fee to the contractor. Often times, this open-ended arrangement diminishes the incentive for the Contractor to save the client money. Without a genuine effort to competitively bid each phase of the project, many contractors tend to use the same sub-contractors, and may lose sight of competitive cost advantages that may exist in the labor/materials market.
ZRED actively bids sub-contracts. This process involves contact with at least three qualified sub-contractors and the evaluation of their bids with respect to costs, work to be performed and their ability to meet scheduling requirements and deadlines. Billing from sub-contractors is passed directly through to the owner with no "up charge" as is commonly practiced by some general contractors. Complete transparency is provided to the owner with regard to bids, invoices and accounting.
We have posted great returns for our clients in the spec market and in the re-sale of their homes. Unless a home is designed and built exclusively for the specific use and needs of an individual client, it’s always a good idea to think about the re-sale of the home. ZRED is able to provide a real estate market analysis of what type of home should be built. Factors such as size, number of bedrooms, specific amenities, and more, that will result in the highest likelihood of a sale of the property at the greatest profitability. We would welcome the opportunity to show you our approach to construction management.
Please contact us, so that we can detail the services we offer, as they relate to your project.
ZITTEL REAL ESTATE DEVELOPMENT