commercial building inspections three options

Selection Process

All condo or HOA boards face the task of hiring a service provider or construction contractor periodically. The final success of this effort often depends on establishing the initial selection process and following it to its conclusion. Most service contracts are routine and do not require significant planning or project management oversight. This article will consider the more complex capital asset or infrastructure repair type of projects with a recommendation of 10 elements leading to a successful project.

These projects typically arise from long term planning such as reserve fund studies or an unexpected failure of a community component such as roof surfaces or roadway. Assuming available funds and the community’s support for commencement of the project, the first decision by the Board is how the project is to be managed. As most board members do not have the skill set or time to actively act as project manager, this role typically falls to the property manager or engineering firm who recommended the repairs.

What to Consider

The search for the Right Contractor begins with the development of the Request for Proposal (RFP) with a detailed scope of work and bidding documents to ensure all responses have a similar understanding of the project’s objectives. The project manager needs to obtain clear direction from the Board on contractor selection criteria; issues to be addressed; and management responsibilities. The following matters are important to consider:

  • Obtain multiple estimates: Review several contractor candidates and select three to provide proposals addressing cost; work methods; building materials; scheduling; and other matters important to the community. Beware of the low bidder and do not lose sight of the importance of quality assurance and confidence in the contractor’s management and technical skills. 
  • Check references: Research contractor’s history with similar projects; depth of experience; prior customers’ view of quality and service. Does the scope of work match their typical work. 
  • Hire local: Local contractors are easier to contact and work with. They are more concerned about their local reputation. They are familiar with local building codes and resources. Selecting a contractor from those featured in Condo Media directories or ads provides some assurance of the contractor has applicable experience on not only technical issues but also the world of condos and HOAs and their special needs. 
  • Make sound decisions: Don’t be pressured into making bad decisions. A common complaint in today’s business climate is the lack of available quality contractors. None the less, do your research and due diligence to find the right fit for your community. 
  • Minimize project risk: Obtain the contractor’s certificate of insurance and ensure available bonds. Use your own insurance company to vet the contractor’s history and review policy limits and coverage. Do not take on unnecessary project liability. 
  • Good documentation: The contract should be comprehensive. Terms and conditions should be well written with a clear description of the scope of work; schedule of payments; estimated dates of project milestones; an understanding of responsibilities and guarantees; detailed procedures for handling change orders and contract cancelation. and signed by all parties. 
  • Payment methods: The timing and method of payment should be well understood. Protocols for documenting contractual changes to cost or schedule should be delineated. 
  • Chain of authority: The lines of decision making need to be well understood. Decision makers should be named with all significant changes to be a written form. Emergency contact information including text, phone; and addresses should be kept current. 
  • Document control: Protocols must be in place to ensure the correct documents and the current revisions are recognized by all parties including contracts; change orders; drawings and specifications. Also, payment submission schedules, warranties; and approved material submissions and approvals need to be kept current. 
  • Avoid the appearance of conflicts of interest: Ensure the contractor’s past or present relationships with board members; unit owners; or property manager is well understood and accepted by the Board.

One issue bears repeating. This is a difficult time to find the Right Contractor due to the risks arising from the lack of skilled labor; escalating costs; and uncertain supply schedules. It means you may need to get creative requiring some deviation from these suggestions. Ask your preferred contractor what he needs to submit a proposal. Perhaps instead of a fixed-price contract the Board can negotiate a fixed fee + cost type of contract. Your property manager or engineer may be a valuable source of ideas to attract the Right Contractor.

Of all these issues, the underlying item to assure a successful project is communication between the parties. This element should be established early during the initial interview process. Are both the Board and project manager comfortable with the prospective contractor? Are trust and rapport expected to continue to grow? If there is doubt, this might not be the Right Contractor.

Written by Jack Carr, P.E., R.S., LEED-AP, Senior Consultant Criterium Engineers
Published in Condo Media